Congressional Record, Volume 144 Issue 151 (Wednesday, October 21, 1998)

[Congressional Record Volume 144, Number 151 (Wednesday, October 21, 1998)]
[Senate]
[Pages S12741-S12810]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

OMNIBUS CONSOLIDATED AND EMERGENCY SUPPLEMENTAL APPROPRIATIONS FOR
FISCAL YEAR 1999--CONFERENCE REPORT

The PRESIDENT pro tempore. Under the previous order, the clerk will
report the conference report.
The assistant legislative clerk read as follows:

The committee of conference on the disagreeing votes of the
two Houses on the amendment of the Senate to the bill (H.R.
4328), have agreed to recommend and do recommend to their
respective Houses this report, signed by a majority of the
conferees.

N O T I C E
When the 105th Congress adjourns sine die on or before October 22, 1998, a final issue of the Congressional
Record for the 105th Congress will be published on November 12, 1998, in order to permit Members to revise and
extend their remarks.
All material for insertion must be signed by the Member and delivered to the respective offices of the
Official Reporters of Debates (Room HT-60 or S-123 of the Capitol), Monday through Friday, between the hours of
10:00 a.m. and 3:00 p.m. through November 10. The final issue will be dated November 12, 1998, and will be
delivered on Friday, November 13.
None of the material printed in the final issue of the Congressional Record may contain subject matter, or
relate to any event that occurred after the sine die date.
Senators' statements should also be submitted electronically, either on a disk to accompany the signed
statement, or by e-mail to the Official Reporters of Debates at ``Record@Reporters''.
Members of the House of Representatives' statements may also be submitted electronically on a disk to
accompany the signed statement and delivered to the Official Reporter's office in room HT-60.
Members of Congress desiring to purchase reprints of material submitted for inclusion in the Congressional
Record may do so by contacting the Congressional Printing Management Division, at the Government Printing
Office, on 512-0224, between the hours of 8:00 a.m. and 4:00 p.m. daily.
By order of the Joint Committee on Printing.
JOHN W. WARNER, Chairman.
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[[Page S12742]]

The Senate proceeded to consider the conference report.
(The conference report is printed in the House proceedings of the
Record of October 19, 1998.)
Mr. LOTT. Mr. President, if there is no objection, I would like to
engage in a colloquy with the distinguished Chairman of the
Appropriations Committee, the senior Senator from Alaska.
Mr. STEVENS. I would be happy to.
Mr. LOTT. I understand that this bill contains a provision which
prohibits the FBI from charging a user fee or gun tax on all firearms
purchases that take place once the national instant criminal background
check system takes effect on November 30 of this year--Is that correct?
Mr. STEVENS. Yes. The Brady Act did not intend, nor did it authorize
the Department of Justice to charge a tax or fee to law abiding
citizens to exercise their Second Amendment right. The National Instant
Check System (NICS) is a national criminal justice program which was
designed to quickly screen prospective firearms purchasers--weeding out
prohibited gun pruchases while ensuring that the sale of a firearm to a
law-abiding citizen could go forth without significant delay. The NICS
is a federal program of benefit to all citizens and therefore the cost
should be and will be borne by the federal government in view of the
absence of any enabling provision relating to assessment of a user fee
to gun owners.
Mr. LOTT. I am pleased to hear that, since I supported the
establishment and the creation of a national instant check program. It
was certainly my understanding that this program was meant to
facilitate gun purchases by law abiding Americans and not cause a
chilling effect on our rights. We have provided millions of dollars--
including $42 million in this bill--for the FBI to implement NICS
pursuant to the law. As I also remember, NICS is specifically
prohibited from becoming a repository of approved firearms transfer
records and firearms owners? Is that correct?
Mr. STEVENS. Again the Senator is correct. The establishment of NICS
contained important elements in the law designed to protect the privacy
of individual law-abiding gun owners. One of the greatest concerns and
legitimate fears of law abiding gun owners is that the federal
government will create a federal gun owner registration system where
law abiding gun owners exercise of their constitutional rights will be
carefully monitored. This is why there are a number of provisions in
law which prohibit such action by the government. One such law is the
Firearms Owners Protection Act, passed in 1986, which specifically
prohibits any record of firearms owners and firearms purchases from
being maintained or recorded, for any period of time, in a facility
owned, managed, or controlled by the United States government.
Mr. LOTT. I thank the Senator for making that point clear. Is it not
also the case that the Brady law itself includes a prohibition on the
centralization and creation of a federal gun registration system?
Mr. STEVENS. Yes, the Brady Act clearly states that upon approval of
a firearm transaction, the instant check system shall ``destroy all
records of the system with respect to the call (other than the
identifying number and the date the number was assigned) and all
records of the system relating to the transfer.'' 18 U.S.C.
Sec. 922(t)(2). Additionally, Section 103 of the Brady Act prohibits
the establishment of a firearms registration system to prevent any
records generated by the instant check system from being transferred to
a facility owned, managed or controlled by the United States
government.

Mr. LOTT. Well, let me understand something. Does that mean that the
FBI or the Department of Justice would be able to collect and maintain
all personally identifying information on transactions relating to
approved firearms transfers for one and one half years, or for any
period of time?
Mr. STEVENS. The national instant criminal background check system
clearly prohibits such action by the FBI. The centralization and
retention of firearms transaction information and records on firearm
owners would create a de facto system of firearms registration which
has clearly not intended by the Brady Act or any other provision of
federal law. In fact it was specifically prohibited.
Mr. LOTT. Specifically, though, is the NICS statute clear on this
prohibition of maintaining an audit log or other repository of approved
firearms transaction and personal information on firearms owners? Is
there any doubt as to Congress' intent in this regard?
Mr. STEVENS. I do not believe the law could be any clearer. The NICS
statute is transparent and unambiguous on the point that the instant
check system ``shall destroy'' such records. Subsection (t)(2) of 18
United States Code, Section 922, is clearly drafted so that destruction
of an approved firearms transaction and personal identifying records
shall occur contemporaneously upon the system's approval of the
firearms transfer, the assignment of a unique identifying number, and
upon the immediate voice or electronic conveyance of such approval and
unique identifying number to the federal firearms dealer making the
NICS inquiry.
Mr. LOTT. Is there any information that the FBI is permitted to
maintain from an approved firearms transaction that goes through NICS?
Mr. STEVENS. The only information or records on approved firearms
transfers that the FBI is permitted to maintain in a central registry
is the ``NICS Transaction Number'' (NTN) and the date the transaction
was requested. See, 18 U.S.C. Sec. 922(t)(2)(C).
Mr. LOTT. I would like to be sure that the rights of law abiding gun
owners are not violated by FBI's operation of NICS. Do you have any
suggestions in this regard, to ensure that the laws are being followed?
Mr. STEVENS. I suggest that a General Accounting Office (GAO) audit
be conducted periodically to ensure Americans that the retention of
information and records run through the NICS is not being maintained,
for any purpose, unlawfully.
Mr. LOTT. I certainly would second that recommendation. This matter
is too important to the American people to allow any opportunity for
abuse.
____

Mr. DASCHLE. Mr. President, the statement of managers contains
language concerning the proposed HCFA rule that would defer to state
law on the issue of physician supervision of nurse anesthetists. As I
understand it, this is non-statutory language, and nothing in the bill
would prohibit HCFA from moving forward with the publication of the
final rule on this issue. I would like to ask my colleague from North
Dakota, who is a member of the Committee on Appropriations, is that his
understanding of the language as well?
Mr. DORGAN. Mr. President, the language to which my colleague refers
is only included in the statement of managers and does not have a
binding effect on HCFA. As a matter of law, nothing in the bill or the
report language would prohibit HCFA from moving forward with the final
rule.
Mr. DASCHLE. Mr. President, then it would be correct that HCFA could
base its final decision on data or information that is already
available, rather than conducting any new studies. My concern here is
to ensure that HCFA is neither discouraged from nor delayed in moving
forward in publishing a final rule. It is my understanding that nothing
in the report language of this year's Labor/HHS Appropriations bill
would prevent HCFA from moving ahead and that any further review of
data could follow HCFA's publication of a final rule.
Mr. DORGAN. Mr. President, the Senator is correct. The statement of
managers does not mandate, as a matter of law, any further studies by
HCFA on this issue. Nor would HCFA be impeded from moving forward with
issuing a final rule regarding the physician supervision issue. In
fact, the language clearly states it is not intended to discourage or
delay HCFA from moving forward.
I know this issue is particularly important to some of us because
nurse anesthetists are the sole anesthesia providers in 70% of rural
hospitals. Finalizing this proposed rule is critical to rural America.
Mr. CONRAD. Mr. President, I appreciate the responses from my
colleague from North Dakota, and I wish to briefly comment on this
matter. As the

[[Page S12743]]

sponsor in previous congresses of legislation that would require HCFA
to defer to state law on this issue, I am pleased that HCFA has finally
issued a proposed rule that would in fact defer to state law. This
issue has been hanging over us for many years, and it seems that the
only way to finally resolve it is for HCFA to publish its final rule
based upon the proposed rule and let the states decide. As a member of
the Senate Finance Committee, I would add that we included a provision
in our Medicare package in 1995 that would defer to state law on the
issue of physician supervision of nurse anesthetists. That provision
was not included in the final package as a result of an agreement
between the two associations to focus on a reimbursement issue instead.
However, I want to emphasize earlier comments that HCFA should neither
be discouraged nor delayed in moving forward in publishing a final
rule.
Mr. DORGAN. Mr. President, I share my colleague from North Dakota's
position on the nurse anesthetist issue and thank him for his comments.
I believe that HCFA should move forward and issue a final rule removing
the physician supervision requirement and defer to state law.
Mr. DASCHLE. Mr. President, I thank my colleagues for their comments
regarding the statement of managers' language on nurse anesthetists, an
issue important to all of us, and know we all will follow the issue
closely in the months to come.
Mr. STEVENS. Mr. President, I would like to engage the distinguished
Senator form New Mexico, the chairman of the Energy and Water
Development Subcommittee, on the subject of funding which is provided
in P.L. 105-245 for the existing joint U.S.--Russian program, for the
development of gas reactor technology to dispose of excess weapons-
derived plutonium.
As the chairman of the subcommittee knows, the purpose of this
program is to develop a new reactor technology which is not only more
efficient in burning weapons plutonium but is melt-down proof and more
thermally efficient than existing reactors. Because of the promise of
this technology, the Russians are very enthusiastic about it and the
French nuclear company Framatome and the Japanese company Fuji Electric
have been active participants. Further, because most of the technical
work on this program is being performed by Russian nuclear scientists
and engineers, program costs are reduced considerably the those same
Russian scientist and engineers are engaged in stimulating non-nuclear
weapons work.
It is my understanding that this unique and innovative U.S.--Russian
program to destroy weapons plutonium is the result of the very
considerable expense and efforts of a particular U.S. company over
several years. Is this also the Subcommittee Chairman's understanding?
Mr. DOMENICI. Yes, it is.
Mr. STEVENS. Is it also the Senator's understanding that from all
indications, this program has been well run and has an existing and
effective management structure with both U.S. and Russian
representation?
Mr. DOMENICI. Yes it certainly is. I would note that Secretary of
Energy Pena noted and has appreciated the cooperation that has occurred
in this area under the current partnership program. In a joint
statement signed on March 11 of this year, Secretary Pena and Deputy
Minister of Minatom Mr. Ryabev specified those areas in which further
scientific research will be necessary; plutonium fuel, neutron physics,
and materials. That joint statement was an important indicator of the
success and purpose of the gas reactor partnership and future efforts
should be consistent with that statement.
Mr. STEVENS. Then I would like to ask the Senator from New Mexico his
understanding of language in the report that states that of the $5
million made available for this program in Fiscal Year 1999, $2 million
is for ``work to be performed in the United States by the Department of
Energy and other U.S. contractors.'' Specifically, is it the Senator's
understanding or intent that the Department of Energy should receive
most of this money or impose a new management structure over this
program that is working so well and is so well accepted by the
Russians?
Mr. DOMENICI. I thank the Senator from Alaska for raising this key
issue. I can assure the Senator it is my wish that the Department of
Energy utilize the already established partnership that created this
important program and has management it so well.
Mr. STEVENS. I thank the distinguished Senator from New Mexico for
this clarification.
Mr. GRASSLEY. Mr. President, Otto von Bismarck, former Chancellor of
Germany, once said, ``Laws are like sausages. It is better not to see
them being made.'' Yet even Bismarck would have gagged over how this
bill evolved.
Several times in recent years, I have disparaged the process of
eleventh-hour budgeting because it inevitably leads to one thing: a
rising tide that lifts all spending. All the Republican programs get
higher funding, all the Democrat programs get more funding. The budget
busts apart at the seams. The taxpayers are the losers.
And it's not just the budget process. Bismarck would have croaked had
he seen how the normal legislative process--bad as it is--was bypassed,
becoming a free-for-all. It's as if the Clinton Administration and the
Congress had a power outage, and the looters came from everywhere and
picked the taxpayers' pockets clean. The legislative process was
stripped of its integrity.
This isn't an ``omnibus'' bill; it's an ``ominous'' bill.
Many of us in this body have brought the good news home to our
constituents. We have delivered the first balanced budget in a
generation. We created surpluses as far as the eye can see. The debt is
finally being paid down. Our children have a brighter future because of
it. And Social Security will be saved for the Baby Boomer generation.
This is the vision we had when we passed the bipartisan Balanced Budget
Act of 1997.
I intend to vote against this bill. The reason is because it
threatens that vision. A vision we committed to just one year ago.
Specifically, there are three reasons I oppose it. First, it threatens
what we accomplished last year. It compromises the Balanced Budget Act.
This bill proves that the Clinton White House and Congress can never
resist the temptation to spend money, even though we've promised to
save the money for Social Security and to pay down the debt. That
signifies a total lack of fiscal discipline.
Second, it squanders the surplus. It would soak up $21 billion of it
in the coming year alone. This is just one month after the announcement
of the nation's first surplus in 29 years. Both sides were patting each
other on the back. Meanwhile, we couldn't wait to spend it. We could
have and should have found offsets for this money. I predict that in
coming years, this will be Congress' way around the budget agreement--
Call any program an emergency and the budget agreement is by-passed.
Third, the bill, is a budget-buster. Maybe not technically, maybe not
now. But in pushing $4.1 billion of spending decisions into next year,
it's the first die cast in ensuring another rising tide of spending
next year. In addition, it's not really clear what the budgetary impact
is of all the legislative mushrooms we're passing in this budget. The
funding for these programs is like fertilizer. And next year these
mushrooms become BIG mushrooms. And that creates further budgetary
pressures for more spending.
In short, Mr. President, this process shows we have reverted to the
same attitude, the same mindset, the same practice, that brought us
monumental debt levels in the first place.
Moreover, I deplore the intellectual dishonesty of the President of
the United States. For nine months, I have been applauding his stated
commitment to save the surplus to ensure the viability of Social
Security. Then he pushes for a budget that spends $21 billion of that
surplus in just one year. The following day, the President appears in
the Rose Garden and announces we've agreed to a budget deal, and saved
Social Security in the process.
Mr. President, this cynical statement by the President, and the
precedent it sets, hasn't saved Social Security. It has threatened
Social Security. It has opened up the flood gates. It ensures future
raids on future surpluses. And the President now has no moral authority
to use those surpluses exclusively for Social Security. He squandered
that moral authority.

[[Page S12744]]

It is also intellectually dishonest of the President to oppose tax
cuts, using the argument that tax cuts would jeopardize Social
Security, yet assume that spending the surplus would not.
These reasons, Mr. President, constitute why I am seriously
disappointed in this process, and in this budget. I regret my vote
against it because there are many provisions in this bill that I fully
support. Some of them I am even responsible for.
For instance, there is approximately $300 million for Iowa farmers in
additional relief. The relief package includes AMTA payments, disaster
assistance and new operating loans. In addition, there is tax relief
for farmers, including Permanent Income Averaging, accelerated health
insurance premium deductibility, and a 5-year net operating loss carry-
back.
There are other provisions I fought for and support. Chief among them
are:
Home health care funding; Education funding for new teachers; Head
Start funding; IMF reforms and funding; Extension of Chapter 12
bankruptcy provisions for family farmers; LIHEAP funding at levels
beyond the administration's request; Anti-drug funding; and, Roads and
highways funding, at the highest levels in history.
These are all provisions that I worked hard for, supported and that I
believe are essential. However, they could have been paid for without
this revival of the practice of incrementally mortgaging the future.
The easy thing for me to do would be to vote for this bill. But when
the process of governing breaks down and puts our commitments and our
future at risk; when Congress's recent fiscal discipline falls apart;
and, when our elected leadership abdicates its responsibilities of
governing, it's time, in my view, to say ``no.''

district of columbia appropriations

Mr. FAIRCLOTH. Mr. President, I rise to make a few remarks concerning
the conference report on the Columbia appropriations, fiscal year 1999.
This conference report is the product of a productive debate between
the Senate and House subcommittees. This is a good bill, a bipartisan
bill, and I urge my colleagues to support it.
I want to thank my subcommittee members, Senator Boxer, the ranking
member, and Senator Hutchison for their hard work and assistance in
putting the Senate bill together. I would also like to thank the
chairman of the Senate Appropriations Committee, Senator Stevens, and
the distinguished ranking member, Senator Byrd, for their guidance and
support.
Mr. President, the conference report largely ratifies the consensus
budget for local funds adopted by the Mayor, the Council, and the
Financial Authority. The Congress created that budget process, and it
has imposed some much needed fiscal discipline on the District's
budget. Instead of drowning in red ink, the budget of the Nation's
Capital is now solidly in the black, with a surplus of over
$300,000,000 for fiscal year 1998.
The conference report appropriates over $372,000,000 for
implementation of the National Capital Revitalization and Self-
Government Improvement Act of 1997. With the exception of the capital
budget for the District court system, the conference report supports
the President's budget request for implementation of the act.
The conferees did not provide the $50,000,000 requested by the
President to capitalize the National Capital Revitalization Corporation
[NCRC]. The Congress has not been consulted as to either the
composition of the Board of the NCRC, its duties, the scope of its
activities, the relationship between the NCRC and other Federal or
local agencies, the relationship between the NCRC and Congress, or the
extent to which actions taken by the NCRC may conflict with previous
economic incentives adopted by the Congress on behalf of the District.
Despite these concerns, the President's nonemergency supplemental
request included $25,000,000 to capitalize the NCRC.
The District of Columbia was recently named the worst city in the
country to raise children. The children of our Nation's Capital deserve
better. Our conference report provides $7,000,000 to pay for new
facilities at the Boys Town operations in the District; over
$15,000,000 for public charter schools; and $200,000 for mentoring
services for at-risk children.
The conference report also provides funding for several nonprofit
organizations located in the District of Columbia. These projects have
broad bipartisan support and will bolster the District's downtown
revitalization efforts.
The conference report provides over $75,000,000 in Federal funds to
improve public safety and repair a crumbling infrastructure in the
Nation's Capital. Included in this amount is over $18,000,000 for
repairs to the District's public safety facilities, including badly
needed capital improvements to Metropolitan Police Department [MPD]
facilities. In addition, the conference report provides the United
States Park Police with $8,500,000 for a new helicopter, which will
assist the MPD in meeting the District's public safety needs. In
addition, the conference report appropriates $25,000 to expand the
subway station next to the planned Washington Convention Center.
Perhaps most important, the conference report includes $25,000,000 to
continue the work of management reform. If there is one reason why the
Nation's Capital has any hope of recovery, it is because District
agencies which have been mismanaged for years are finally being
reformed and restructured. The Financial Authority and the District's
Chief Management Officer, Camille Barnett, are now midway through the
process of cleaning up the largest agencies of the District government.
While the District is making headway in reversing years of
mismanagement, much work needs to be done to improve service delivery
to District residents. The funds provided in this bill will go toward
projects that will enhance government efficiency and service delivery,
such as expanded emergency medical services and technology
modernization.
The conference report prohibits the use of Federal and local funds
for the implementation of a needle exchange program; for abortion; and
for a ballot initiative to legalize controlled substances. It also
provides badly needed adoption reforms for the District of Columbia.
This conference report would not have been possible without the hard
work and cooperation of my friend, Congressman Charles Taylor, the
chairman of the House Subcommittee on the District of Columbia. We are
confident that this conference report will be supported by the Senate,
the House of Representatives, and the President.

section 139 of interior title

Mr. BINGAMAN. Mr. President, I would like to express my appreciation
to the managers of the Interior title of the Omnibus Appropriations Act
for including section 139, which ratifies payments made by small
refiners under preexisting onshore and offshore royalty-in-kind
programs. I was pleased to work with Senators Enzi, Domenici, Thomas,
Johnson, and Landrieu on this issue. My office served as the point of
contact between the Minerals Management Service and the small refiners
in negotiating the final text of this section, which was then included
by the managers in the bill, so I would like to make two observations
in relation to it. The purpose of this section is to relieve small
refiners of potential additional financial obligations that they are
not in a position to bear, and to avoid the likelihood that a number of
small refiners who participated in a federal program to increase their
access to crude oil for refining would be forced into bankruptcy over a
question as to whether the amount invoiced by government for that crude
oil was correct or not. I do not believe that anything in this section
should be construed as expressing congressional intent on any question
other than the one of whether small refiners should be relieved of this
potential problem. In my opinion, this section does not constitute a
congressional view for or against the use of posted prices for the
valuation of crude oil produced from federal leases.

cwc implementation act of 1998

Mr. HELMS. Mr. President, following Senate approval of the
resolution of ratification for the Chemical Weapons Convention (CWC)
and subsequent ratification of the treaty by the President, it became
necessary for the United States to enact legislation to implement its
various domestic obligations. The Foreign Relations and Judiciary
Committees of the Senate immediately fulfilled their obligation to
prepare implementing legislation once the treaty

[[Page S12745]]

had been ratified. On May 23, 1997, the full Senate passed S. 610--
``the Chemical Weapons Convention Implementation Act of 1997.'' Soon
thereafter, on November 12, 1997, the House of Representatives passed
the implementing legislation, together with sanctions on Russian firms
that are assisting Iran's ballistic missile program.
I regret that it has taken so long to enact the implementing
legislation into law, if for no other reason than that I expect
numerous U.S. companies to challenge the constitutionality of the
treaty and overturn it in the courts. Unfortunately, final resolution
of the legal issues surrounding the CWC, as well as full U.S.
compliance with the treaty, has been delayed this entire session of
Congress because of President Clinton's opposition to the unrelated
missile sanctions provisions of the bill. Indeed, the President sought
to delay and derail CWC implementing legislation throughout the entire
spring. The President alone is responsible for putting the United
States into noncompliance by delaying and then ultimately vetoing the
bill (on June 23, 1998).
It is important that those who are frustrated with the slow pace of
U.S. implementation of the CWC understand that the Congress has
discharged its obligation to provide implementing legislation for the
President's signature not once--but twice. It is the President, not
Congress, who has blocked speedy and complete adherence to the treaty.
For the record, I note that two trade associations were directly
involved in the crafting of the CWC's implementing legislation. The
President and CEO of the Chemical Manufacturers Association wrote to me
on May 7, 1998, stating that S. 610 was ``a reasonable approach to meet
U.S. obligations under the CWC and protect industry's interests.'' The
Vice President for Regulatory Affairs of the American Forest and Paper
Association wrote to Senator Hatch on May 21, 1997, offering its
support for S. 610 since the bill ``contains a number of provisions
that the forest products industry believes are crucial to ensuring that
implementation of the CWC is reasonable and meets the stated purpose of
the treaty.''
I submit the following assessment which details the most significant
provisions of the implementing legislation, together with an
explanation of the Senate's rationale.

Section 3. Definitions. Section 3 specifically lists those
chemical formulae (and a few bio-toxins) falling under the
terms: ``Schedule 1 chemical agent''; ``Schedule 2 chemical
agent''; and ``Schedule 3 chemical agent''. Any chemical not
listed in Section 3 as either a Schedule 1, 2, or 3 chemical
agent is not subject to the any of the requirements under the
legislation relating to such chemical agents (e.g. data
declaration and routine inspections).
The Annex on Chemicals of the CWC excludes some chemicals
which are capable of being used as chemical weapons
precursors, but which also have wide commercial applications.
As a result, verification measures are not applied under the
Convention to those chemicals. For this reason, if the CWC
were to be expanded in scope, the most likely candidates for
addition to the Annex are dual-use chemicals which are
produced in large commercial quantities for purposes not
prohibited under the Convention. The addition of these
chemicals to the Annex on Chemicals likely would increase the
number of businesses affected by the Convention's
verification regime, entailing additional reporting and data
declarations from companies, and subjecting additional
facilities to routine inspections.
Thus the implementing legislation is deliberately
structured to ensure that a change in law will be required
before any provision of the Verification Annex can be applied
to any new chemical or biological substance added to the
Annex on Chemicals. This will provide both the Congress and
the American public sufficient opportunity to examine
proposals by the executive branch to expand the CWC. Indeed,
depending upon the extent to which the addition of a chemical
(or other type of substance) is judged to substantively
increase the scope of application of the CWC, such a change
also might require the advice and consent of the Senate.
The American Forest and Paper Association specifically
supported the requirement that ``additions or deletions from
the list would only be permitted by legislative amendment,
and not through the administrative regulatory process.''
Section 102. No Abridgement of Constitutional Rights. This
section makes clear that the Federal Government may not force
anyone to waive any Constitutional right as a condition for
entering into a contract with the federal government or as a
condition for receiving any other form of benefits from the
government. This provision works in conjunction with Section
308, which amends The Office of Federal Procurement Policy
Act. Many of the companies subject to the reporting and
inspection requirements of the CWC work under contract to the
federal government. Sections 102 and 308 protect these
companies by prohibiting the government from imposing, as a
condition of a contract, the requirement that they must agree
to warrantless searches under the CWC or forego any other
Constitutional right (such as the right to challenge the
constitutionality of the CWC). The same protections apply to
individuals receiving benefits from the United States.
Section 103. Civil Liability of the United States. Section
103 is necessary to address Fifth Amendment problems which
arise with respect to the CWC. The Convention requires that
the United States provide foreign inspectors with intrusive
access into numerous U.S. businesses; this, together with the
mandatory data declaration requirements, holds at risk trade
secrets and critical proprietary information. For instance,
the authority of inspectors to collect data and take samples
for analysis may constitute a form of illegal seizure and the
taking of private property without compensation. But the CWC
contains no provisions to ensure just compensation to those
whose property has been taken.
Proprietary information is often the basis for a chemical
company's competitive edge. As a practical matter, a wide
variety of things are considered proprietary or sensitive.
For instance, the following are often considered to be
``trade secrets'': (1) the formula of a new drug or specialty
chemical; (2) a synthetic route that requires the fewest
steps or the cheapest raw materials; (3) the form, source,
composition, and purity of raw materials or solvents; (4) a
new catalyst that improves the selectivity, efficiency, or
yield of a reaction; (5) the precise order and timing with
which chemicals are fed into a reactor; (6) subtle changes in
pressure or temperature at key steps in a process; (7)
isolation methods that give the highest yields consistent
with good recycling of solvents and reagents; (8) expansion
and marketing plans; (9) raw materials and suppliers; (10)
manufacturing cost data; (11) prices and sales figures; (12)
names of technical personnel working on a particular project;
and (13) customer lists.
The theft of any one of these items could result in a loss
of revenue and investment that could damage a large company,
and drive a small one out of business. Because some trade
secrets are not all that complex, even simple visual
inspection could reveal proprietary information of great
value to a competitor. During routine inspections, for
example, companies will run the risk that a skilled chemical
engineer equipped with knowledge of the target facility and a
list of specific questions to be answered will learn a great
deal about that business' activities.
The Fifth Amendment provides that no private property shall
``be taken for public use without just compensation.'' As one
noted constitutional scholar, Ronald Rotunda, warned the
Foreign Relations Committee on March 31, 1997: ``If the
federal government would simply take this property, the
Constitution requires that it pay just compensation. If the
federal government sets up a legal structure that allows
international inspectors to make off with intellectual
property, there is a `taking' for purposes of the just
compensation clause.''
The CWC, however, does not provide for just compensation in
the event of misuse of treaty inspection rights. In the
absence of a treaty-mandated remedy, the only means of
guaranteeing Fifth Amendment protections is to hold the
federal government liable for the legal structure it has
created by ratifying the CWC. It is the federal government,
after all, which approved a treaty giving foreign nationals
access to U.S. facilities, thereby creating the potential for
the taking of private property.
Section 103 provides U.S. companies and citizens with the
right to bring a civil action for money damages against the
United States for the actions of foreign inspectors and other
OPCW employees (as well as U.S. government personnel)
undertaken pursuant to, or under the color of the CWC or the
implementing legislation. It precludes the federal government
from raising sovereign immunity as a defense, and establishes
a process whereby, once a prima facie case has been
established that proprietary information has been divulged or
taken, the burden to disprove the claim falls upon the United
States. In so doing, Section 103 establishes a reasonable
standard of evidence to be used in resolving this type of
civil action, given the ambiguity that often surrounds
suspicions of the theft of trade secrets.
Section 103 defers action on a civil claim for one year,
providing a period of time for the United States to pursue
diplomatic and other remedies to seek redress for the claim.
However, once the claim moves forward, Section 103
establishes a clear policy and process by which the U.S.
government shall pursue recoupment of all funds paid in
satisfaction of any tort or taking for which the U.S. has
been held liable. In particular, the United States will
impose severe sanctions on all foreign entities (both
governmental and private) involved in the theft of the trade
secret in question. Sanctions against foreign governments can
be waived by the President on a case-by-case basis, though
sanctions against foreign persons are lifted only once the
U.S. has received ``full and complete compensation.''
These provisions are designed to operate together with the
requirements of Condition

[[Page S12746]]

16 of the resolution of ratification for the CWC. Pursuant to
that condition, in the event that ``persuasive information''
becomes available indicating that a U.S. citizen has suffered
financial losses or damages due to the unauthorized
disclosure of confidential business information, the
President is required to secure a waiver of immunity from
jurisdiction for any foreign person responsible for financial
losses or damages to a U.S. citizen, or to withhold half of
the U.S. contribution to the OPCW until the situation has
been resolved ``in a manner satisfactory to the United States
person who has suffered the damages. . .''
Section 302. Facility Agreements. Section 302 prohibits the
United States from concluding facility agreements which would
prohibit U.S. businesses from withholding consent to an
inspection request for any reason or no reason (thereby
triggering a requirement for a search warrant under Section
305). It also ensures that representatives from U.S.
companies may participate in preparations for the negotiation
of a facility agreement, and may observe such negotiations to
the maximum extent practicable.
Section 303. Authority to Conduct Inspections. In addition
to providing the legal basis by which U.S. companies may be
inspected by foreign personnel, Section 303 ensures that at
least one special agent of the Federal Bureau of
Investigation shall accompany each inspection conducted under
the Convention. This ensures a minimum of protection against
the possible theft of trade secrets for U.S. companies.
Section 303 also prohibits OSHA or EPA employees from
escorting or otherwise accompanying inspection teams, and
requires that the number of U.S. government personnel be kept
to the minimum number necessary. The Administration asserted,
in response to a question for the record before the Senate
Select Committee on Intelligence, that the U.S. Government
would be permitted ``to use information or materials obtained
during inspections in regulatory, civil, or criminal
proceedings conducted for the purpose of law enforcement,
including those that are not directly related to enforcement
of the CWC.'' This alarmed many companies.
The American Forest and Paper Association stated its
support for Section 302(b)(2)(B), noting that ``[t]he treaty
should not be used as an omnibus vehicle for regulatory
inspections unrelated to its intended purpose. We believe
that it would be inappropriate to include such government
officials [from OSHA and EPA] on an international
inspection team formed for the purposes set out in the CWC
and would merely serve to detract from the intent of the
inspection.''
By barring EPA and OSHA officials from participating in CWC
inspections, Section 303 prevents the Administration from
using the Convention to gain a degree of access to facilities
which it otherwise is denied. As Professor Rotunda noted in
his March 31, 1997, letter: ``Searches that violate the
Fourth Amendment are not cured of the violation by the simple
expedient of a treaty ratification or an executive
agreement.''
Finally, Section 303 establishes a reasonable legal
standard by which the President is expected to evaluate the
risk posed by an individual inspector to the national
security or economic well-being of the United States. The
President has the right under the CWC to object to an
individual serving as an inspector in the United States.
Section 303 obligates him to give ``great weight to his
reasonable belief that . . . the participation of such an
individual as a member of an inspection team would pose a
risk to the national security or economic well-being of the
United States.''
As has been noted, the CWC provides inspectors from foreign
countries unprecedented access to U.S. facilities--both
commercial and government-related. The risk that trade
secrets or national security secrets could be stolen during
an inspection is very high. In particular, because chemicals
covered by the CWC are used in a variety of aerospace
activities--from the manufacture of advanced composites and
ceramics to additives for paints and fuels--dozens of defense
contractors are targeted for routine inspections under the
CWC. Thus a threat to proprietary information often also will
constitute a threat to national security information.
Certainly a number of countries intend to use CWC
inspections for commercial espionage. Several incidents of
concern have already occurred in this respect. For this
reason, the Senate adopted a common-sense approach to the
standard of evidence required by the President in exercising
the right of inspector refusal. A decision to apply a higher
evidentiary standard than ``reasonable belief'' would be
inconsistent with Section 303.
Section 304. Procedures for Inspections. Section 304
contains a number of critical protections for U.S. companies.
First, Section 304 (b)(3)(B) requires that notification of a
challenge inspection pursuant to Article IX of the Convention
``shall also include all appropriate evidence of reasons
provided by the requesting state party to the Convention for
seeking the inspection. The requirement for specific
identification of the reasons for a challenge inspection will
enable companies to formulate their own views on the extent
to which ``probable cause'' exists for such an inspection. As
the Committee's analysis of Sections 305 makes clear, the CWC
does not require a foreign country to demonstrate ``probable
cause'' when it initiates a challenge inspection of a
commercial U.S. facility. For this reason, the Congress has
adopted implementing legislation which specifically raises
the question of the constitutionality of the CWC's challenge
inspection regime and provides for expedited review by the
courts (under Section 503). Many in the Senate expect the
Supreme Court to rule against the constitutionality of the
sweeping inspection rights under Article IX of the CWC.
Section 304(f) allows the U.S. company or person to be
inspected to determine who shall take samples during an
inspection. It also reiterates the requirement, imposed
pursuant to the resolution of ratification of the CWC, that
``[n]o sample collected in the United States may be
transferred for analysis to any laboratory outside the
territory of the United States.'' This provision mirrors the
Presidential certification requirement contained in Condition
18 of the resolution of ratification for the CWC.
The CWC explicitly affords an inspection team the right to
take samples on-site and, pursuant to Part II paragraph
(E)(55) of the Verification Annex, ``if it deems necessary,
to transfer samples for analysis off-site at laboratories
designated by the Organization.'' As Part II paragraph
(E)(57) makes clear: ``when off-site analysis is to be
performed, samples shall be analysed in at least two
designated laboratories.''
In agreeing to both Condition 18 of the CWC's resolution of
ratification and Section 304(f) of the implementing
legislation, the Executive Branch acknowledged that the
United States intends to field two OPCW-designated
laboratories. Specifically, the Department of Defense intends
to field a mobile laboratory which will be available to
analyze samples taken in the United States. While sample
residue left in the laboratory's equipment would preclude it
from leaving U.S. territory, the lab is intended to serve as
a counterpart to a second mobile laboratory operated by the
OPCW (which could be deployed to countries unable to secure
OPCW approval for a facility).
There is no treaty-requirement that analysis be done in
laboratories operated by countries other than the one where a
sample was taken. The United States may legally preclude the
transfer of samples overseas while still meeting the CWC
requirement that samples-analysis be conducted in two
designated laboratories.
Some have argued that Section 304(f) sets a ``dreadful
example'' prompting countries to deny foreign inspectors the
ability to send chemical samples abroad for analysis at
independent laboratories. Such arguments fail to recognize
several key points. First, any country that succeeds in
obtaining OPCW accreditation for two laboratories has the
treaty-right to insist that samples be analyzed ``in
country,'' regardless of U.S. policy.
Second, opponents of sampling limitations overstate the
scientific capacity and technical capability of proliferant
countries to secure OPCW approval for two laboratories. To
date, the OPCW has not given approval to any lab in any
country; certainly no country has secured approval for two.
Indeed, only a handful of western European countries, and
perhaps Russia and China, have the ability to field two
approved laboratories. The former countries pose no
proliferation concern, and both Russia and China are capable
of completely concealing their chemical warfare program from
international inspectors (making sampling irrelevant). Thus
the argument that U.S. strictures on sampling transfers
will undo the CWC's verification regime are unsupportable.
Third, those who criticize Section 304(f) overstate the
value of sampling analysis to U.S. nonproliferation efforts.
On March 1, 1989, then-Director of Central Intelligence,
Judge William Webster, pointed out the ease with which
chemical weapons production can be concealed: ``. . . within
fewer than 24 hours, some say 8\1/2\ hours, it would be
relatively easy for the Libyans to make the site [at Rabta]
appear to be a pharmaceutical facility. All traces of
chemical weapons production could be removed in that amount
of time.'' Similarly, delays of just a few hours have
undercut UNSCOM's efforts to prove Iraqi chemical and
biological concealment activities.
In contrast, the CWC gives proliferant countries five days
of advance warning to conceal their activities before a
challenge inspection team must be allowed on-site. Very
simple techniques, such as the production of pesticides on a
line used to manufacture nerve agent (e.g. production of the
pesticide methyl-parathion instead of the nerve agent sarin),
will reduce or eliminate the utility of sampling analysis.
Fourth, the over-focus on analysis to be done by
``independent'' laboratories ignores UNSCOM's experience with
Iraq's VX program. In the case of samples taken from warheads
believed to be weaponized with VX, ``independent''
laboratories in France, Switzerland, and the United States
have given contradictory and inconsistent analyses. This has
only complicated U.S. efforts to prove to the international
community that Saddam Hussein's nerve agent program is far
more advanced than admitted by Iraq. This has occurred
despite UNSCOM's relatively unfettered ability--at least in
comparison with the CWC--to take samples when and where it
pleases. Because the CWC's timeframes provide cheating
nations with ample opportunity to mask chemical warfare
signatures, analysis of samples at foreign laboratories is
guaranteed to make U.S. efforts to prove noncompliance
harder, not easier. This

[[Page S12747]]

will be the case regardless of whether sampling analysis is
done ``in-country.''
Fifth, in addition to overselling the value of sampling
analysis to the CWC's verification regime, opponents of
Section 304(f) persist in ignoring the threat that such
procedures pose to legitimate commercial activities. A loss
of proprietary information through sample analysis would
bankrupt many chemical, pharmaceutical, and biotechnology
industries. Moreover, chemical formulas, which are the type
of proprietary information put at greatest risk by sampling,
often are not patented. This is done to preserve competitive
advantage and to prevent disclosure pursuant to Freedom of
Information Act (FOIA) requests. But the lack of a patent
also will make it harder for U.S. companies to prove that a
trade secret has been stolen.
The Congressional Office of Technology Assessment estimated
in August, 1993, that the U.S. chemical industry loses
approximately $3-6 billion per year in counterfeited
chemicals and chemical products. A U.S. pharmaceutical firm
spends on average about $350 million to research and develop
a new compound. Clearly, while it is difficult to assess the
potential dollar losses associated with the CWC, information
gleaned from sampling analysis could be worth millions of
dollars to foreign competitors. Equally troubling is the fact
that the CWC does not require the return of samples to the
country from which they were taken, but instead gives the
Technical Secretariat of the OPCW responsibility over final
disposition. This further increases the possibility that
proprietary information contained in the sample will be
compromised.
As Kathleen Bailey, then-Senior Fellow at Lawrence
Livermore Laboratories, warned in testimony before the
Foreign Relations Committee: ``Experts in my laboratory
recently conducted experiments to determine whether or not
there would be a remainder inside of the equipment that is
used for sample analysis on-site. They found out that,
indeed, there is residue remaining. And if the equipment were
taken off-site, off of the Lawrence Livermore Laboratory
site, or off of the site of a biotechnology firm, for
example, and further analysis were done on those residues,
you would be able to get classified and/or proprietary
information.''
Numerous other distinguished witnesses expressed concern
regarding the threat to trade secrets posed by the CWC's
intrusiveness, including Donald Rumsfeld, former Secretary of
Defense and President and former Chairman and CEO of G.D.
Searle and Company; James Schlesinger, former Secretary of
Defense and former Director of Central Intelligence;
Lieutenant General William Odom, former Director of the
National Security Agency; Lieutenant General James Williams,
former Director of the Defense Intelligence Agency; Edward J.
O'Malley, former Assistant Director of Federal Bureau of
Investigation, Chief of Counterintelligence; and Bruce
Merrifield, former Assistant Secretary of Commerce for
Technology. It was on the basis of the testimony of these
individuals, and the concerns expressed by numerous companies
and industries (ranging from members of the Chemical
Manufacturers Association and the Aerospace Industries
Association to other types of companies such as the one that
manufactures special ink for the dollar bill) that the
Congress chose to prohibit the transfer of samples overseas
for analysis.
Section 305. Warrants. Section 305 builds upon Condition 28
of the resolution of ratification for the CWC, which required
the President to certify to Congress that, for any challenge
inspection where consent has been withheld, the United States
``will first obtain a criminal search warrant based upon
probable cause, supported by oath or affirmation, and
describing with particularity the place to be searched and
the persons or things to be seized. . . .'' Further, the
President certified pursuant to Condition 28 that an
administrative search warrant issued by a United States
magistrate judge would be required for involuntary routine
inspections.
Accordingly, Section 305 requires Administrative search
warrants for routine inspections where consent has been
withheld. It limits routine inspections to no more than one
per year per plant site. Additionally, for Schedule 3
facilities and sites working with discrete organic chemicals,
Section 305 requires the federal government to affirm in
an affadavit, prior to obtaining an administrative search
warrant, that a given routine inspection: (1) ``will not
cause the number of routine inspections in the United
States to exceed 20 in a calendar year;'' and (2) the
facility to be inspected was selected randomly by the
Technical Secretariat, taking into account equitable
geographic distribution of inspections and other relevant
information relating to the site in question. Finally,
Section 305 requires that the federal government stipulate
in its affadavit that the routine inspection will not
exceed the time limits specified in the Convention unless
the owner, operator, or agent in charge of the plant
agrees.
Section 305 requires criminal search warrants for any
challenge inspection where consent has been withheld. In
seeking the warrant, the federal government is required to
provide to the judge of the United States all appropriate
evidence or reasons showing probable cause to believe that a
violation of the implementing legislation (and thus the
treaty) is occurring.
In the event that a frivolous challenge inspection is
initiated against the United States, perhaps in retribution
for a U.S.-initiated inspection, the federal government may
prove unable to provide sufficient probable cause to obtain a
criminal search warrant. Under the CWC, a country wishing to
initiate a challenge inspection is not required to provide
any supporting evidence. The request for an inspection simply
is made; unless 31 of 41 members of the Executive Council of
the OPCW vote against it proceeding within 12 hours of such a
request, the challenge inspection will move forward. Thus the
``screen'' against frivolous or abusive inspections is of a
political, rather than evidentiary, nature. Moreover, review
under the CWC of whether the challenge inspection request was
within the scope of the CWC, or whether the right to request
a challenge inspection had been abused, is allowed only
retroactively (following conclusion of the inspection).
Therefore nothing in the Convention prevents a challenge
inspection from being initiated against a U.S. company
without ``probable cause'' having been demonstrated.
As will be discussed in connection with Section 503, the
courts will ultimately serve as the final arbiter over
questions of the CWC's constitutionality.
Section 307. National Security Exception. Section 307
allows the President to deny any inspection request that
``may pose a threat to the national security interests of the
United States.'' This simple provision is designed to protect
the United States from frivolous inspections.
A recent Stimson Center report makes the claim that ``[t]he
national security exception negates the treaty obligation to
accept a challenge inspection at any U.S. location.'' This
statement incorrectly asserts that the United States has such
an obligation. Condition 28 of the resolution of ratification
clearly established that the United States will not agree to
a broad treaty obligation to accept a challenge inspection at
any U.S. location. Rather, the United States will agree to
inspections under Article IX of the CWC only in those cases
where either consent to an inspection has been given, or
probable cause has been demonstrated and a criminal search
warrant obtained. Under any other circumstances, no access
will be given.
Thus the argument made against Section 307 is flawed on its
face. Moreover, the CWC explicitly gives the United States
the right, for instance, under paragraph 41 of Part X of the
Verification Annex, to ``take such measures as are necessary
to protect national security.'' Indeed, as paragraph 38 makes
clear, access to sensitive facilities must be negotiated
between the inspection team and the inspected State Party;
moreover, the inspection team is obligated to use of the
least intrusive procedures possible. Under paragraph 42,
should the United States provide ``less than full access to
places, activities, or information'' the United States incurs
the obligation to ``make every reasonable effort to provide
alternative means to clarify the possible non-compliance
concern that generated the challenge inspection.''
Section 307 clarifies the fact that the President has the
right, both under the Constitution and pursuant to the
treaty, to deny a potentially-damaging inspection. However,
the exercise of such a denial must be made ``consistent with
the objective of eliminating chemical weapons.'' Thus the
President is obligated to provide alternative means of
clarifying non-compliance concerns, and must consider the
implications of a denial for the operation of the CWC, and
for U.S. nonproliferation efforts. The national security
interests of the United States, however, must remain
paramount.
Section 402. Prohibition Relating to Low Concentrations of
Schedule 2 and Schedule 3 Chemicals. The CWC does not define
the term ``low concentration'' as it relates to Schedule 2
and Schedule 3 chemicals. Section 402 establishes the intent
of the United States to interpret this term to mean a 10
percent concentration of a Schedule 2 chemical and an 80
percent concentration of a Schedule 3 chemical (measured
either by volume or total weight, whichever yields the lesser
percent). In setting the percentages at these levels, Section
402 ensures that Schedule 2 chemicals, which are of direct
concern for chemical weapons production, are captured in low
concentrations. It also recognizes the broad range of
commercial uses for Schedule 3 chemicals, and reduces the
regulatory impact of the CWC on many industries.
No chemical is placed on Schedule 2 of the CWC unless it
meets specific criteria: (1) it must be lethal enough that it
could be used as a chemical weapon by itself; (2) it can
serve as a precursor in the final stage of the manufacture of
a chemical weapon, or otherwise is important to the
production of a chemical weapon; and (3) is not produced ``in
large commercial quantities.'' Obviously, such chemicals
should be tightly controlled even at relatively dilute
levels.
Schedule 3, on the other hand, contains seventeen chemicals
which are produced in large commercial quantities for use in
production of various organic chemicals and agricultural
products. Additionally, these chemicals are used to make
gasoline additives, pharmaceuticals, detergents, flame
retardant materials, and dyestuffs, among other things. There
are 17 compounds on Schedule 3.
Schedule 3A (4), Chloropicrin, has important uses for the
disinfection of cereals and grains, considerably increasing
the potential storage life. It is also used as a soil
insecticide to sterilize the soil before the planting of
crops that are very sensitive to weed competition.

[[Page S12748]]

Schedule 3B (5), Phosphorous oxychloride, is used as an
insecticide, as a chlorinating agent, flame retardant,
gasoline additive, hydraulic fluid, organic synthesis,
plasticizer, and as dopant for semiconductors.
Phosphorous trichloride, Schedule 3B (6), is used in
dyestuffs, surfactants, plasticizers, gasoline additives,
insecticides, and in organic synthesis.
Phosphorous pentachloride, Schedule 3B (7), is used as a
pesticide, in plastics, and in organic synthesis.
Trimethyl phosphite, Schedule 3B (8), is used in
insecticides, organic synthesis, veterinary drugs.
Triethyl phosphite, Schedule 3B (9), is used in insecticide
synthesis, as a lubricant additive, in organic synthesis, and
as a plasticizer.
Schedule 3B (10), Dimethyl phosphite, is used in
insecticide production, as a lubricant additive, in organic
synthesis, and as a veterinary drug.
Diethyl phosphite (Schedule 3B (11)) is used in the
production of insecticides, as a gasoline additive, as a
paint solvent, in the synthesis of pharmaceuticals, and in
organic synthesis.
Sulfur monochloride (Schedule 3B (12)) is used extensively
as an intermediate and chlorinating agent in the production
of dyes and insecticides. It is also used for cold
vulcanisation of rubber, in the treatment of vegetable oils
and for hardening soft woods, in pharmaceuticals, organic
synthesis, as a polymerization catalyst, and in the
extraction of gold from ores.
Thionyl Chloride, Schedule 3B (14), is used in batteries,
engineering plastics, pesticides, as a catalyst, surfactant,
chlorinating agent, and in organic synthesis of herbicides,
drugs, vitamins, and dyestuffs. Common agricultural products
involving this chemical are: Fenvalerate, Endosulfan,
Methidathion, Flucythrinate, Fluvalinate, Lethane,
Diphenamit, Napromaide, Propamide, Tridiphane, Topan, and
Pipertain.
Schedule 3B (17), Triethanolamine, is another chemical with
a widespread use. Because of its surface active properties it
is added to waxes and polishes and is used as a solvent for
herbicides, shellac and various dyes. It is also used for
producing emulsions of various oils, paraffins and waxes, as
well as for breaking up emulsion. It is an important
ingredient of the cutting oil used for metal shaping. Further
uses include in detergents, cosmetics, corrosion inhibitors,
as a plasticizer, rubber accelerator, and in organic
synthesis.
As can be seen from this partial listing, the majority of
these chemicals are used in agriculture, the automobile
industry, and pharmaceuticals production. The vast majority
are used as herbicides or insecticides/pesticides. A decision
to lower the percentage associated with ``low
concentrations'' of Schedule 3 chemicals would dramatically
increase the number of agricultural companies and facilities
subject to the CWC's onerous reporting and inspection
requirements. The costs resulting from such a dramatic
expansion of the CWC's scope would invariably be passed by
such companies to the one consumer who can least afford an
increase in operating costs at this time--the U.S. farmer.
Section 403. Prohibition Relating to Unscheduled Discrete
Organic Chemicals and Coincidental Byproducts in Waste
Streams. Section 403 exempts from reporting and inspection
any ``unscheduled discrete organic chemical'' that is a
``coincidental byproduct . . . that is not isolated or
captured for use or sale . . . and is routed to, or escapes,
from the waste stream of a stack, incinerator, or wastewater
treatment system or any other waste stream.''
The CWC does not list unscheduled discrete organic
chemicals. Instead, it generally defines these substances as:
``any chemical belonging to the class of chemical compounds
consisting of all compounds of carbon except for its oxides,
sulfides and metal carbonates, identifiable by chemical name,
by structural formula, if known, and by Chemical Abstracts
Service registry number if assigned.'' This definition
captures thousands of chemical compounds--so many that it is
impossible to list them. The CWC's sweeping definition of a
``discrete organic chemical'' captures thousands of U.S.
companies under its reporting and inspection obligations.
However, that number would expand exponentially without
Section 403's exclusion of discrete organic chemicals which
form as a byproduct in a variety of manufacturing processes.
The declaration and inspections costs under the CWC would
fall on a far broader number of U.S. companies. Moreover, the
costs of compliance for these additional companies will be
far greater. Companies must declare the aggregate tonnage of
discrete organic chemicals produced. If ``production'' is
defined as the formation of coincidental byproducts in a
waste stream, however, many companies would find it costly,
and perhaps impossible, to comply with the treaty.
The paper industry, in particular, has expressed concern
over the ``discrete organic chemical category,'' warning that
various chemicals such as methanol, phenol, methyl ethyl
ketone, and methyl mercaptan are formed in the process of
paper manufacturing. The American Forest and Paper
Association warned on May 25, 1994, that ``pulp digester
gases containing methanol are vented, and some methanol will
also be lost as fugitive air emissions from the wastewater
treatment system. Methanol is only one component of these
streams; it is not isolated or captured for use or sale.''
Without Section 403, numerous industries are at risk of
being required to measure and report on countless chemical
interactions in waste streams, and to undergo international
inspection to verify the accuracy of their data. On May 21,
1997, the American Forest and Paper Association reiterated
its concern over the broad scope of the CWC and stated its
support for Section 403: ``We strongly support the
prohibition of requirements under the treaty for chemical
byproducts that are coincidently manufactured. Due to the
broad nature of the category of `discrete organic chemicals,'
as defined by the treaty, it is critical to recognize that
inclusion of coincidental byproducts of manufacturing
processes that are not captured or isolated for use or sale
would exceed the stated purpose of the CWC.''
Section 503. Expedited Judicial Review. Section 503 allows
for U.S. citizens to challenge the constitutionality of any
provision of the implementing legislation (and, therefore,
the CWC). Such a challenge must be given priority in its
disposition, and a prompt hearing by a full Court of Appeals
sitting en banc must be given to a final order entered by a
district court.
In reviewing the constitutionality of legislation, the
courts often assume that Congress has exercised its
independent judgment and that the legislation in question is
constitutional. However, as the legislative history of the
CWC makes clear, Congress expressed numerous misgivings about
the constitutionality of the CWC (and thus about the
implementing legislation required). These concerns were
articulated in hearings before the Committees on Foreign
Relations and Judiciary, and in correspondence between the
Senate, Executive Branch, and U.S. businesses. As has been
noted elsewhere, the Senate expressed some specific concerns
over the constitutionality of the CWC as conditions in the
resolution of ratification. The resolution also included
Condition 12, which makes clear that nothing in the CWC
authorizes or requires legislation, or any other action
prohibited by the Constitution of the United States, as
interpreted by the United States.
Many in the Congress are convinced that the Chemical
Weapons Convention is incompatible with the Fourth and Fifth
Amendment rights of Americans. It therefore is expected that
the courts will hold that some, or all, of the CWC and its
implementing legislation is unconstitutional and issue the
appropriate injunctions.

American Competitiveness and Workforce Improvement Act

Mr. ABRAHAM. Mr. President, as part of the omnibus appropriations
bill the Senate today will pass the ``American Competitiveness and
Workforce Improvement Act.'' This legislation represents a bipartisan
compromise resulting from tough negotiations between the House and the
Senate, and between Congress and the White House. The bill will be
included in this form rather than being adopted freestanding because of
a last minute objection from Senator Harkin that has prevented it from
being brought to the floor on its own. Given the 78 to 20 vote for the
American Competitiveness Act prior to the agreement with the White
House, and the 288 to 133 vote in the bill's favor just a few weeks ago
in the House of Representatives, it is clear the legislation would have
passed with overwhelming support in the Senate had it been permitted to
come to a separate vote.
I believe that the passage of the American Competitiveness and
Workforce Improvement Act today is a great victory for American workers
and for the businesses that employ them.
This legislation will protect the competitiveness of American
business in the global marketplace and improve economic and career
opportunities for American citizens.
Let me start by describing the history of this legislation. This past
February, the Senate Judiciary Committee held a hearing at my request
to examine high technology labor market needs. We heard from leaders at
America's top high technology firms that they simply could not find
enough qualified professionals to fill the jobs they needed filled.
They also emphasized that many of the individuals they hired on H-1B
temporary visas not only filled important jobs, but also typically
created jobs for many Americans through their skills and innovations.
At that time, the 65,000 cap on H-1B visas was projected to be
reached as early as June. Instead, it was reached the first week of
May.
In March, I introduced S. 1723, the American Competitiveness Act, to
increase the cap on H-1B visas for foreign born professionals. In
April, that bill passed the Senate Judiciary Committee on a 12 to 6
bipartisan vote. Then in May, the bill passed on a 78 to 20 vote of the
full Senate.
Some time after that, the House Judiciary Committee passed out an H-
1B

[[Page S12749]]

visa bill as well. However, many who supported the increase in
principle found that the House version included so many conditions on
the use of H-1B visas that they would have more than negated the
benefits of raising the cap. Negotiations ensued between the House and
Senate over these provisions, brokered by the leadership of both
chambers. The hope was to find a compromise.
In the end, a compromise was reached that retained the core features
of the Senate bill but also found common ground with the House by
focusing increased attention and requirements on employers, more than
15% of whose workforce are in this country on H-1B visas. The
compromise also imposed a fee to be paid by the employer on each visa,
the proceeds of which would be used for job training and scholarships.
On account of this last provision, the compromise bill was required
to originate in the House. Accordingly, it was incorporated into a
proposed amendment, whose text was worked out by me and by House
Immigration Subcommittee Chairman Smith--a proposed amendment which
Chairman Smith was going to offer as a substitute to H.R. 3736, the
bill that had passed out of House Judiciary.
As the House was preparing to take that bill up before the August
recess, however, the White House issued a public veto threat and listed
15 changes it was seeking to the bill. At that point, I was deputized
to attempt to negotiate the remaining issues with the Administration,
in consultation with Chairman Smith and the House and Senate
leadership.
After several weeks of negotiations, we reached agreement at 7:00
p.m. on September 23. We and the Administration were able to reach an
accommodation on most of the points it had raised. The Administration
withdrew the remaining two points, points 6 and 7, that in our view
could not be accommodated within the existing structure of the bill and
the H-1B program. We instead agreed on a different approach with regard
to the concerns underlying these two points, one that focused instead
on clarifying current program requirements and toughening sanctions for
willful violations of these requirements.
Because the bill was scheduled to be taken up on the House floor the
following day, the results of the agreement had to be quickly
incorporated into a new substitute amendment to H.R. 3736. The
substitute had to be filed by Chairman Smith that evening before the
House went out at 8:30 p.m. so that it could be printed in the
Congressional Record and be made available for Members to review the
following morning. We met this deadline, the amendment was filed, and
on September 24 the amendment was adopted and the bill passed by the
House with the support of a majority of both the Republican and
Democratic caucuses. That bill, with some technical corrections
necessitated by a few omissions that resulted from the tight deadline
under which the original version was produced, is now incorporated into
Title IV of Division C of the Omnibus Appropriations Bill, titled The
American Competitiveness and Workforce Improvement Act.
Let me now turn to the reasons why I believe this bill remains needed
and indeed timely. Mr. President, throughout this session of Congress I
have come to the floor repeatedly to urge that we address the growing
shortage of skilled workers for certain positions in our high
technology sector. I have done this because I believe that the
continued competitiveness of our high-tech sector is crucial for our
economic well being as a nation, and for increased economic opportunity
for American workers.
The importance of high-tech for our economy is beyond doubt. The
importance of high-tech for our economy is beyond doubt. According to
the Department of Commerce's Bureau of Economic Analysis, high
technology companies contributed over one-quarter of America's real
economic growth between 1992 and 1997. Moreover, the declining prices
of computers, software, and semiconductors have made a substantial
contribution to our nation's low level of inflation, thereby improving
the standard of living enjoyed by millions of Americans. Without IT
industries to keep prices down, according to the Bureau of Economic
Analysis, the inflation rate would have been much higher in 1997--3.1
percent versus the actual level of only 2.0.
But high technology firms are experiencing serious worker shortages.
A study conducted by Virginia Tech estimates that right now we have
more than 340,000 unfilled positions for highly skilled information
technology workers. And, while Department of Labor figures project our
economy will produce more than 1.3 million information technology jobs
over the next 10 years, estimates are that our universities will not
produce nearly that number of graduates in related fields. And this is
not only what academic studies are telling us. Firms across the nation
and across my home State of Michigan have been clamoring for people to
fill these skilled positions.
Of course, this issue is not only about shortages, it is about
opportunities for innovation and expansion, since people with valuable
skills, whatever their national origin, will always benefit our nation
by creating more jobs for everyone.
Mr. President, we want and need American companies to keep and expand
major operations in this country. We do not want to see American jobs
go overseas. But, if they are to keep their major operations in the
United States, firms must find workers here who have the skills needed
to fill important positions in their companies.
To make that happen in the long term, we must do more as a nation to
encourage our young people to choose high technology fields for study
and for their careers. In the long run this is the only way we can stay
competitive and protect American jobs.
Through scholarships and job training, the American Competitiveness
and Workforce Improvement Act will help us achieve this goal. It will
provide money and training to low income students who choose to study
subjects, including math, computer science and engineering, that are
important to our high-tech economy. In this way the American
Competitiveness and Workforce Improvement Act will help bridge the gap
between current job skills and the requirements of high paying,
important positions in our economy.
However, over the short term, until we are producing more qualified
high technology graduates, we must also take other steps to bridge the
gap between high technology needs and high technology skills.
We currently allow companies to hire a limited number of highly
skilled foreign born professionals to fill essential roles. To do this
they must go through a fairly onerous process to get one of the 65,000
``H-1B'' temporary worker visas allotted by the INS. Unfortunately,
last year our companies hit the 65,000 annual limit at the end of
August. This year that limit was hit in May.
This bill, in addition to providing significant incentives for
Americans to enter the high technology sector, will temporarily raise
the number of H-1B visas available for the next three years. These
additional visas will enable companies to find the workers they need to
keep facilities and jobs in the United States, and keep our high-tech
industry competitive in the global marketplace.
The legislation also includes a number of provisions ensuring that
companies will not replace American workers with foreign born
professionals, including increased penalties and oversight, as well as
measures eliminating any economic incentive to hire a foreign born
worker if there is an American available with the skills needed to fill
the position.
I would like to thank the members of my staff who worked long hours
negotiating this compromise. I would also especially like to express my
personal gratitude to my colleagues for their support for this
important legislation. I would like to thank in particular Majority
Leader Lott, Senator Hatch, Senator McCain, Senator Gramm, Senator
Gorton, Senator Lieberman, and Senator Graham, as well as the many
cosponsors of the bill, for their crucial support at key moments in
this process. I am also grateful to Senator Kohl and Senator Feinstein
for their support for this legislation in Committee. Finally, I would
like to thank the Subcommittee's Ranking Member, Senator Kennedy, for
the cooperation he showed in moving forward this piece of legislation
despite disagreement with some aspects of the bill's content.

[[Page S12750]]

In the House, I would like to extend special thanks to Speaker
Gingrich, Majority Leader Armey, and Chairman Smith for helping to
reach a compromise that has achieved a true consensus on this issue.
Representatives David Dreier, Jim Rogan and David McIntosh also
provided leadership and help at significant junctures in this process
and I am also grateful for their important efforts.
Because much of this legislation was developed after the conclusion
of the regular Committee process, I have also prepared an explanatory
document that performs the function commonly performed by the Committee
Report of describing the legislation and the purpose and
interrelationship of its various provisions in detail. I ask unanimous
consent that this document be printed in the Record, along with a few
pages of other materials to which the document makes reference.
There being no objection, the material was ordered to be printed in
the Record, as follows:

The American Competitiveness and Workforce Improvement Act of 1998

Section 401. Short Title; Table of Contents; Amendments to Immigration
and Nationality Act

This section specifies the short title, the ``American
Competitiveness and Workforce Improvement Act of 1998,'' the
table of contents for the legislation, and the rule that
unless otherwise specified, the legislation amends the
Immigration and Nationality Act.
Subtitle A
Subtitle A contains the changes the legislation is making
to current law regarding H-1B visas.

Section 411. Temporary Increase in Access to Temporary Skilled
Personnel Under H-1B Program

This section specifies the new ceilings for these visas:
115,000 in FY 1999 and 2000, 107,500 in FY 2001, and 65,000
thereafter.

Section 412. Protection Against Displacement of United States Workers
in Case of H-1B Dependent Employers

This section adds new statements that must be included on
certain H-1B applications and other provisions relating to
these new statements and related aspects of the H-1B program.
Subsection 412(a) amends section 212(n)(1) of the
Immigration and Nationality Act to add three new statements
and provisions relating to these statements that must be
included on applications for H-1B visas filed by certain
employers on behalf of certain H-1B nonimmigrants. Subsection
412(b) contains various definitions relating to the new
statement requirements. Given the close nexus between these
two subsections, they are discussed here together, so as to
allow the discussion of the substantive provisions to be
illuminated by the discussion of the definitions.
1. The ``non-displacement'' attestation. Subsection (a)(1)
first adds a new ``non-displacement'' attestation by amending
section 212(n)(1) of the Immigration and Nationality Act to
add a new subparagraph (E)(i). This provision requires a
covered employer to state that its hiring of the H-1B worker
is not displacing a U.S. worker. The term ``displace'' is
defined in new subparagraph (4)(B) of section 212(n), added
by section 412(b) of this legislation. That paragraph states
that an employer ``displaces'' a U.S. worker to hire the H-1B
if it lays off a U.S. worker with substantially the same
qualifications and experience who was doing essentially the
same job the H-1B worker is being brought in to do. This is a
slight change from a similar definition used in a related
context in an earlier version of this legislation passed by
the Senate, which imposed heightened penalties for a willful
violation of the prevailing wage attestation where the
employer had ``replace[d]'' the U.S. worker with an H-1B
nonimmigrant. In that context S. 1723 defined ``replace'' as
employment of the H-1B nonimmigrant ``at the specific place
of employment and in the specific employment opportunity from
which a United States worker with substantially equivalent
qualifications and experience in the specific employment
opportunity has been laid off.''
The current definition defines ``displace'' as employment
of the nonimmigrant in a job ``that is essentially the
equivalent of the job'' from which the U.S. worker has been
laid off. The reason for the change from the original Senate
language is that it was thought desirable to include within
the scope of this prohibition situations where an employer
sought to evade this prohibition by laying off a U.S. worker,
making a trivial change in the job responsibilities, and then
hiring the H-1B worker for a ``different'' job. This language
is designed to be broad enough to cover those situations as
well. For similar reasons, especially given the nature of the
jobs in question, the geographical reach of the prohibition
was extended so as potentially to cover other worksites
within normal commuting distance of the worksite where the H-
1B is employed. This was to cover the eventuality that an
employer might try to evade this prohibition by laying off a
U.S. worker, hiring an H-1B worker to do that person's job,
but assigning the H-1B worker to a different worksite very
close by in order to conceal what was going on.
At the same time, however, the final version of this
language is significantly narrower than the original language
proposed by the House, which sought to prohibit not only one-
to-one replacements of laid off U.S. workers with H-1Bs, but
the hiring of any H-1B with similar qualifications to those
of any recently laid off U.S. worker. As a result, the
original definition of ``displace'' in the House did not
contain the key phrase ``from a job that is essentially the
equivalent of the job for which the [H-1B worker] is being
sought.'' That phrase was added to make clear that this
provision is not intended to be a generalized prohibition on
layoffs by covered employers seeking to bring in covered H-
1Bs, but rather a prohibition on a covered employer's
replacing a particular laid-off U.S. worker with a particular
covered H-1B.
It should be noted that the language used here is
deliberately different from that used in H.R. 2759, another
piece of legislation that we may pass today. That legislation
authorizes aliens to come in on temporary visas as nurses
under certain circumstances. In order to bring an alien in on
such a visa, a facility must attest that it has not laid off
another registered nurse within the ninety days preceding or
following the filing of the visa petition. That language was
chosen there instead of the language used here because in
that instance the sponsors of that legislation were
interested in doing more than preventing the replacement of a
particular U.S. nurse with a nurse holding such a visa.
Rather in that instance the desire was to prevent the use of
the visas by a facility that had laid off any registered
nurses within the relevant time period. Hence the sponsors
deliberately rejected the language used here forbidding
only one-for-one displacement in favor of broader
language.
The language in the final version of this bill does allow
the Department of Labor to pursue instances where an employer
has in fact laid off a U.S. worker and hired an H-1B worker
to do the U.S. worker's job, but is attempting to conceal
that fact with a slight change in job responsibilities or by
placing the H-1B worker at a different worksite. It is not,
however, intended to go beyond that. Hence, it does not
empower the Department of Labor to find a violation of this
clause unless an H-1B worker is being brought in to replace a
particular laid-off U.S. worker and do that particular U.S.
worker's job. It should also be noted that under new
paragraph (E)(i), in order to qualify, the displacement has
to have occurred within 90 days before or after filing the H-
1B petition. This was viewed as the outer limit for how long
an employer might leave open a job previously held by a U.S.
worker whom the employer intended to replace with an H-1B
worker, or how long the employer might retain the U.S. worker
while also hiring the H-1B worker. In most instances, to
constitute a genuine instance of replacement, the layoff and
hiring would be expected to occur closer in time.
Finally, the definition of ``lays off'' set out in new
subparagraph (3)(D) of 212(n) (added by section 412(b) of
this legislation) hews closely to the language contained in
the original Senate version of this legislation, with two
minor changes. First, while continuing to exclude the
expiration of a temporary employment contract from the
definition, the final version clarifies that the expiration
of such a contract will be treated as a layoff if an employer
enters into such a contract with the specific intent of
evading the anti-displacement attestations contained in new
paragraphs (E) and (F) of subsection 212(n)(1). Second, the
final version notes that its definition of layoff is not
intended to supersede the rights employees may have under
collective bargaining agreements or other employment
contracts. By the same token, of course, the fact that an
employee may have protection under a collective bargaining
agreement or other employment contract against some of the
grounds for termination listed as exceptions to the
definition of ``lays off'' in this legislation has no
consequence for purposes of determining whether an employer
has violated the displacement attestation. Rather, the
employee's remedies for breach of the agreement or contract
remain as they were under the agreement, contract, and pre-
existing law, and are neither expanded nor contracted by
212(n)(3)(D). In other words, whether a layoff does or does
not violate such an agreement has no bearing on whether it is
within or outside the definition set out in 212(n)(3)(D) (and
hence has no bearing on whether it is actionable by the
Secretary of Labor under her authorities to enforce the ``no
displacement'' attestation). Conversely, the fact that a
layoff is outside the definition set out in 212(n)(3)(D) has
no bearing on whether it violates a collective bargaining
agreement or other employment contract and hence on whether
it is actionable by the employee using the remedies available
under other laws for such violations.
In determining whether or not a U.S. worker has been
offered a ``similar employment opportunity'' as an
alternative to loss of employment, and hence has not been
laid off, it is the intent of Congress that the determination
of similarity take into account factors such as level of
authority and responsibility to the previous job, level
within the overall organization, and other similar factors,
but that it not include the location of the job opportunity.
If an employer asserts that it should not be held liable
for a violation of the displacement attestation because a
U.S. worker lost

[[Page S12751]]

his or her employment as the basis for an employee's loss of
employment one of the listed exceptions, it is Congress's
expectation that if the Secretary disputes that, she would
have the burden of disproving the employer's assertion.
2. The ``secondary non-displacement'' attestation. Section
412(a) next adds a ``secondary non-displacement'' attestation
by amending section 212(n)(1) of the Immigration and
Nationality Act to include a new subparagraph (F). This
attestation requires a covered employer to pledge to make
certain inquiries before placing a covered H-1B worker with
any other employer where the H-1B worker would essentially be
functioning as an employee of the other employer. The
requirement that there be ``indicia of employment'' between
the employer with whom the covered employer is placing the
covered H-1B worker and the H-1B worker is intended to
operate similarly to the provisions in the Internal Revenue
Code in determining whether or not an individual is an
employee.
In particular, the covered employer must promise to inquire
whether the other employer will be using the H-1B worker to
displace a U.S. worker whom the other employer had laid off
or intends to lay off within 90 days of the placement of the
H-1B worker. The covered employer must also state that it has
no knowledge that the other employer has done so or intends
to do so.
Making the required inquiries will not insulate a covered
employer from liability should the secondary employer with
which the covered employer is placing the covered H-1B worker
turn out to have displaced a U.S. worker from the job that it
has contracted with the covered employer to have the H-1B
worker fill. That is why subsection 412(a)(2) of this
legislation adds a new requirement to section 212(n)(1) that
the application contain a clear statement regarding the scope
of a covered employer's liability with respect to a layoff by
a secondary employer with whom the covered employer places a
covered H-1B worker. If the covered employer does make the
required inquiries and obtains no information that would lead
it to believe that the secondary employer has used the H-1B
worker to displace a U.S. worker, however, that should weigh
heavily in favor of the covered employer's not having
knowledge or reason to know of the secondary employer's
actions for purposes of the penalty provisions associated
with this attestation specified in new subparagraph (E) of
section 212(n)(2) (added by section 413(c)).
This provision uses the same definitions of ``displace,''
``lays off,'' and other definitions as those used by the
primary non-displacement attestation.
3. The ``recruitment'' attestation. The last new required
statement added by section 412(a) is the ``recruitment''
attestation, to be set out in new subparagraph (G) of section
212(n)(1). It requires a covered employer to state that it
has taken good faith steps to recruit U.S. workers for the
job for which it is seeking the H-1B worker, and has offered
the job to any equally or better qualified U.S. worker.
This provision allows employers to use normal recruiting
practices standard to similar employers in their industry in
the United States; it is not meant to require employers to
comply with any specific recruiting regimen or practice or to
confer any authority on DOL to establish such regimens by
regulation or guideline. Further, it is the intent of
Congress that this provision not require an employer to set
aside its normal standards for selection and recruitment of
employees, including, but not limited to, legitimate
objective criteria and legitimate subjective criteria such as
past job performance, attitude, personal presentation or
others, as long as the employer does not intentionally
discriminate against any applicant based on that applicant's
immigration status, citizenship status, or country of
nationality in the course of applying these criteria.
This intention is further spelled out in section 412(a)(3)
of this legislation. That section adds language at the end of
section 212(n)(1) that states explicitly that the recruitment
attestation is not to be construed to preclude an employer
from using ``legitimate selection criteria relevant to the
job that are normal or customary to the type of job
involved.'' The purpose of this language is to make clear
that an employer may use ordinary selection criteria in
evaluating the relative qualifications of an H-1B worker and
a U.S. worker. It is intended to emphasize that the
obligation to hire a U.S. worker who is ``equally or better
qualified'' is not intended to substitute someone else's
judgment for the employer's regarding the employer's hiring
needs. Rather, the employer remains free to use ordinary
hiring criteria, whether subjective or objective, in deciding
who in the employer's view is the right person for the job.
Moreover, its judgment as to what qualifications are relevant
to a particular job is entitled to very significant
deference.
At the same time, this rule of construction is intended to
insure that U.S. workers are given a fair chance at any job,
rather than being turned down as a result of prejudice a
particular employer may have against U.S. workers. It is not
intended to allow an employer to impose spurious hiring
criteria with the intent of discriminating against U.S.
applicants in favor of H-1Bs and thereby subvert employer
obligations to hire an equally or better qualified U.S.
worker.
The provision is, however, intended to insure that a
properly deferential and latitudinous understanding of the
notion of relevant qualifications is used in interpreting
these provisions. In that regard, it is emphatically not
Congress's intention to invite the kind of elaborate scrutiny
of selection criteria and the accompanying ``validation''
machinery that has developed under ``disparate impact''
analysis of such criteria under Executive Order 11246 and
Title VII of the Civil Rights Act of 1964. Given the absence
of any kind of record that employers use hiring criteria as a
covert mechanism for preferring non-U.S. workers, such an
analysis would make no sense in this context. That is why the
bill deliberately avoids terms like ``job-related,''
``related to the job'', or the ``use'' of selection criteria
to discriminate.
Rather, what is intended is a common-sensical approach,
under which an employer does not have to prove that ordinary
selection criteria such as class rank, a degree from a
superior school, people skills, recommendations from former
employers, or qualities such as dependability are a
legitimate basis on which to prefer one applicant over
another. Likewise, the employer need not prove that a
particular qualification or skill that it is looking for and
that in a common-sense world would obviously be relevant,
helpful, or useful to doing a job is necessary or
indispensable in order to be able to consider that
qualification or skill in its selection decisions.
Additionally, business reasons such as the relative salary
demands of competing candidates may also legitimately be
considered, although only, of course, to the extent
consistent with the employer's obligation under section
212(n)(1)(A) to pay the higher of prevailing or actual wage.
For similar reasons, the intent is not to require employers
to retain extensive documentation in order to be able
retroactively to justify recruitment and hiring decisions,
provided that the employer can give an articulable reason for
the decisions that it actually made.
4. Employers and H-1B workers covered by the new
statements. Section 412(a) of this legislation adds a new
subparagraph (E)(ii) to section 212(n)(1) which specifies
which employers have to include the new statements on their
applications. There are two categories of covered employers:
(1) ``H-1B dependent'' employers and (2) employers who, after
enactment of the Act, have been found to have committed a
willful failure to meet a condition set out in section
212(n)(1) or a willful misrepresentation of material fact on
a labor condition attestation.
The first category, ``H-1B dependent'' employers, is
defined in new paragraph (3)(A) of section 212(n), added by
section 412(b) of this legislation. Under that definition, an
employer is H-1B dependent if it has 51 or more full-time
equivalent employees, 15% or more of whom are H-1B workers.
Employers with 25 or fewer full-time equivalent employees are
H-1B dependent if they have more than 7 H-1B employees, and
employers with between 26 and 50 full-time equivalent
employees are H-1B dependent if they have more than 12 H-1B
employees.
The second category of covered employers is those who have
been found to have committed a willful failure or a willful
misrepresentation under 212(n)(2)(C) or 212(n)(5). These
employers must include the new statements on their
applications for five years after the finding of violation.
Of course, in order to trigger coverage, the finding of
willful violation must have been made in a manner consistent
with the other procedural requirements in the Act, including
the prohibition on the investigation of complaints or other
information provided more than 12 months after the alleged
violation, see 212(n)(2)(A) and 212(n)(2)(G)(v). Thus, this
provision confers no superseding authority for DOL to take
action with respect to violations outside that time period.
Under new subparagraph (E)(ii) of 212(n)(1), employers
required to include the new statements on their applications
are excused from doing so on applications that are filed only
on behalf of ``exempt'' H-1B nonimmigrants. An ``exempt'' H-
1B nonimmigrant is defined in new paragraph (3)(B) of section
212(n) (added by section 102(b) of this legislation) as one
whose wages, including cash bonuses and other similar
compensation, are equal to at least $60,000 or who has a
master's or higher degree (or its equivalent). In determining
whether an employer is H-1B dependent, under new paragraph
(3)(C) (also added by section 412(b) of this legislation),
these exempt H-1Bs are excluded from both the numerator and
denominator in the calculation of the percentage (or, in the
case of employers with 50 or fewer full-time equivalent
employees, from the count of both total full-time equivalent
employees and the count of H-1Bs) for the first six months
after enactment, or until promulgation of final regulations,
whichever is longer.
Finally, subparagraph (E)(ii) specifies that the
requirement to include the new statements on applications
applies only to applications filed before October 1, 2001.
Subsection 412(c) authorizes employers to post information
relating to H-1Bs electronically. This provision is intended
to allow employers a choice of methods for informing their
employees of the sponsorship of an H-1B nonimmigrant. An
employer may either post a physical notice in the traditional
manner, or may post or transmit the identical information
electronically in the same manner as it posts or transmits
other company notices to employees. Therefore, use of
electronic posting by employers should not be restricted by
regulation.
Subsection 412(d) makes the new attestation requirements
effective on the date of issuance of final regulations to
carry them

[[Page S12752]]

out, and the associated definitions and the new posting
provision effective upon enactment.
Subsection 412(e) allows the Secretary of Labor and the
Attorney General to reduce the period for public comment on
proposed regulations to no less than 30 days.

Section 413. Changes in Enforcement and Penalties

This section specifies the penalty structure for failures
to meet the new labor conditions added by section 412. It
also raises penalties for willful failures to meet existing
labor conditions, and imposes a special penalty for a willful
violation of such a condition in the course of which an
employer displaces a U.S. worker. It also clarifies that
certain kinds of employer conduct constitute a violation of
the prevailing wage attestation, and that other kinds of
employer conduct are also prohibited in the context of the H-
1B program. Finally, it grants certain new authorities to the
Secretary of Labor and establishes a special enforcement
mechanism administered by the Attorney General to address
alleged violations of the selection portion of the
recruitment attestation.
Subsection 413(a) sets out a new version of 212(n)(2)(C) of
the Immigration and Nationality Act, the provision currently
specifying the penalties for certain failures to meet labor
conditions. In that subparagraph as amended, clause (i)
specifies the penalties for a failure to meet a condition of
paragraph (1)(B) (strike or lockout) or a substantial failure
to meet a condition of paragraph (1)(C) (posting) or (1)(D)
(contents of application), or a misrepresentation of material
fact. These remain as they are under current law:
administrative remedies including a $1000 fine per violation
and a one-year debarment. The clause also specifies that
these penalties also apply to a failure to meet a condition
of new paragraphs (1)(E) or (1)(F) (the non-displacement
attestations) and to a substantial failure to meet a
condition of new paragraph (1)(G)(i)(I) (good faith
recruitment). The Secretary should consider an employer's
compliance with the H-1B program as a whole in determining
whether a ``substantial failure'' has occurred.
New clause (ii) of section 212(n)(2)(C) sets out the new
increased penalties for willful failures to meet any
condition in paragraph (1), willful misrepresentations of
material fact, or violations of new clause (iv) prohibiting
retaliation against whistleblowers. These consist of
administrative remedies including a $5000 civil fine per
violation and a 2 year debarment.
New clause (iii) sets out a further enhanced penalty for
willful failures to meet a condition of paragraph (1) or
willful misrepresentations of material fact in the course of
which failure or misrepresentation the employer displaced a
U.S. worker within 90 days before or after the date of the
filing of the visa petition for the H-1B worker by whom the
U.S. worker was displaced. This penalty consists of
administrative remedies including a $35,000 per violation
civil fine and a three year debarment.
The rationale for this new penalty is that there have been
expressions of concern that employers are bringing in H-1B
workers to replace more expensive U.S. workers whom they are
laying off. Current law, however, requires employers to pay
the higher of the prevailing or the actual wage to an H-1B
worker. Thus, the only way an employer could profitably be
systematically doing what has been being suggested is by
willfully violating this obligation. Otherwise, the employer
would have no economic reason for preferring an H-1B worker
to a U.S. worker as a potential replacement. Thus, the new
penalty set out in new clause (iii) is designed to assure
that there are adequate sanctions for (and hence adequate
deterrence against) any such conduct by imposing a severe
penalty on a willful violation of the existing wage-payment
requirements in the course of which an employer
``displaces'' a U.S. worker with an H-1B worker.
At the same time, Congress chose not to make the layoff
itself a violation. The reason for this is that there are
many reasons completely unconnected to the hiring of H-1B
workers why an employer may decide to lay off U.S. workers:
for example, because it decides to discontinue a product line
that is losing money, because it is inefficient to maintain
an office in a particular location, or because it has decided
to refocus on other aspects of its business. Congress did not
want to turn these legitimate business decisions into
investigable, let alone punishable events. Accordingly, it is
important to understand that unlike the new attestation
requirements imposed by the amendments to section 212(n)(1),
clause (iii) of section 212(n)(2)(C) provides no new
independent basis for DOL to investigate an employer's layoff
decisions. The only point at which DOL can do so pursuant to
clause (iii) is after it has already found that the employer
has committed a willful violation of one of the pre-existing
labor condition attestations.
Thus, just as was the case before enactment of clause
(iii), to be actionable by DOL in the first instance, except
where an employer has executed one of the new attestations
added to section 212(n)(1), an allegation must provide
reasonable cause to believe not that an employer has
displaced a U.S. worker with an H-1B worker but that an
employer has violated one of the pre-existing attestations
(and, of course, the other procedural requirements for
initiation of an investigation must be satisfied as well).
Clause (iii) comes into play only after DOL has found that an
employer has committed such a violation, and after it has
been found to be willful. At that point, and not before,
provided that there is reasonable cause to believe that an
employer had also displaced a U.S. worker in the course of
committing that violation, it would be proper for DOL to
investigate, but only in order to ascertain what penalty
should be imposed. The definitions concerning
``displacement'' and the like, set out in new 212(n)(3) and
212(n)(4) of the Immigration and Nationality Act, and
discussed in the previous portion of this section-by-section
analysis dealing with the amendments to that Act made by
section 412 of this legislation, apply in this context as
well.
The ``administrative remedies'' all these clauses refer to
(as well as those referred to in new subparagraph
212(n)(5)(E) added by subsection 413(b) of this Act) are
unchanged from the ``administrative remedies'' the current
version of 212(n)(2)(C) makes available. It should be noted
that these do not include an order to an employer to hire,
reinstate, or give back pay to a U.S. worker as a result of
any violation an employer may commit. In current law, the
Secretary's authority to issue an order for back pay even
with respect to H-1B workers who are not paid the prevailing
wage does not come from the ``administrative remedies''
authority granted in 212(n)(2)(C) but from a separate
provision, 212(n)(2)(D), specifically authorizing the
issuance of ``order[s] . . . for payment of such amounts of
back pay as may be required to comply with the requirements
of paragraph (1), whether or not a penalty under subparagraph
(C) has been imposed.'' That subparagraph would have been
worded quite differently if the authority it granted was
already included in the ``administrative remedies'' authority
granted under subparagraph (C).
This construction of the phrase is reinforced by the fact
that suggestions from a number of quarters, including the
Administration, that the Secretary should be granted the
authority to issue orders of this type with respect to U.S.
workers, were advanced and ultimately rejected in the final
version of this legislation. In the course of negotiations
leading to the bill currently before the Senate, the
Administration ultimately was forced to accept the reality
that authority of this type could not be conferred without
radically transforming the way this program operates and
indicated that acceptance by withdrawing its demand for this
authority in favor of other concessions. The relevant
documents from the Administration demonstrating this are
submitted for the record following this statement. As can be
seen, the initial document contains a point 7 seeking this
authority, and that point 7 is crossed out in the later
document. The reason suggestions for inclusion of this type
of authority were ultimately rejected was the sense that they
would end up transforming the traditional enforcement model
used for the current program into something more resembling a
new font of civil employment litigation.
New clause (iv) essentially codifies current Department of
Labor regulations concerning whistleblowers. It is included
not in order to change current standards concerning when a
person has been the victim of retaliation, but because the
source of statutory authority for the current regulations is
somewhat unclear.
New clause (v) is intended to complement clause (iv) by
directing the Secretary of Labor and the Attorney General to
devise a process to make it easy for someone who has filed a
complaint under clause (iv) to seek a new job. It is
contemplated that this process would be expeditious and easy
to use, so that the employee does not need to wait for a new
employer to obtain approval for a new petition in order to
change jobs in these circumstances.
New clause (vi)(I) prohibits employers from requiring H-1B
workers to pay a penalty for leaving an employer's employ
before a date agreed to between the employer and the worker.
It directs that the Secretary is to decide the question
whether a required payment is a prohibited penalty as opposed
to a permissible liquidated damages clause under relevant
State law (i.e. the State law whose application choice of law
principles would dictate). Thus, this section does not itself
create a new federal definition of ``penalty'', and it
creates no authority for the Secretary to devise any kind of
federal law on this issue, whether through regulations or
enforcement actions. If the Secretary determines that a
required payment is a prohibited penalty under governing
State law, however, under this provision, it is also a
violation of new clause (vi)(I), and the Secretary may take
action under new subclause (vi)(III).
New clause (vi)(II) prohibits employers from requiring H-1B
workers to reimburse or otherwise compensate employers for
the new fee imposed under new section 214(c)(9), or to accept
such reimbursement or compensation.
New clause (vi)(III) specifies that the penalty for
violating subclauses (I) or (II) is a civil monetary penalty
of $1,000 per violation and the return to the H-1B worker (or
to the Treasury, if the H-1B worker cannot be located) of the
required payment made by the worker to the employer.
New clause (vii) addresses an issue known colloquially as
``benching.'' This issue involves a practice under which an
employer brings over an H-1B worker on the promise that the
worker will be paid a certain wage, but then pays the worker
only a fraction of that wage because the employer does not
have work for the H-1B worker to do. There

[[Page S12753]]

is a shortage of evidence on the extent to which employers
are engaging in this practice. The anecdotal information
suggests that to the extent employers are engaging in it,
they are likely principally to be contractors who hire out
their employees to other employers for particular projects.
Subclause (I) clarifies that this practice of ``benching''
is a violation of the employer's obligation to pay the
prevailing or actual wage. It is the intent and understanding
of Congress that this includes an obligation to provide the
full benefits package that the employer would provide to a
U.S. worker as required under clause (viii) discussed below.
Subclause (II) further clarifies that in the case of an H-
1B worker designated as a part-time employee on a visa
petition, an employer commits this violation by failing to
pay the H-1B worker for the number of hours, if any, the
employer has designated on the petition at the rate of pay
designated on the petition. Nothing in subclause (II) is
intended to preclude H-1B employment on a part-time or as-
needed basis, so long as that is the understanding on which
the H-1B employee was hired, or to impose or authorize the
Secretary of Labor or the Attorney General to impose any new
requirement that the employer designate in advance the hours
a part-time H-1B employee is expected to work. Additionally,
nothing in subclauses (I) or (II) is intended to give the
Department of Labor the authority to reclassify an employee
designated as part-time as full-time based on the employee's
actual workload after the employee begins employment.
Finally, of course, nothing in clause (vii) is intended to
prohibit an employer from terminating an H-1B worker's
employment on account of lack of work or for any other
reason.
Subclause (III) describes the manner in which the
provisions of subclauses (I) and (II) apply to an employee
who has not yet entered into employment with an employer. In
such cases, the employer's obligation is to pay the H-1B
worker the required wage beginning 30 days after the H-1B
worker is first admitted, or in the case of a nonimmigrant
already in the United States and working for a different
employer, 60 days after the date the H-1B worker becomes
eligible to work for the new employer. If a change of status
or other formalities beyond approval of the petition are
required in order for the latter nonimmigrant to be eligible
to work for the employer, the 60 days begin to run on the
date that the last formality necessary to make the H-1B
worker eligible to work for the employer has been completed.
Subclause (IV) makes clear that an employer does not commit
a violation of the prevailing/actual wage attestation by
granting an H-1B worker a period of unpaid leave or reduced
pay for reduced hours worked at the request of the H-1B
worker. Thus, H-1B employees taking unpaid leave for other
reasons, i.e. leave under the Family and Medical Leave Act or
other corporate policies, annual plant shutdowns for holidays
or retooling, summer recess or semester breaks, or personal
days or vacations, should not be considered ``benched.'' It
is possible, of course, that the employer might violate some
other law, either State or federal, by failing to pay an
H-1B worker for leave time, if that law requires employers
to pay workers for such leave periods. It is also possible
that the employer might violate new clause (viii) of
section 212(n)(2)(C), discussed below, if it would
ordinarily offer similarly situated U.S. workers paid
leave and is singling out the H-1B worker for denial of
this benefit. Hence the inclusion of subclause (VI), which
makes clear that the fact that a practice is within an
exception covered by this subclause does not insulate it
from challenge under clause (viii). If the leave is
requested by the H-1B worker, however, it does not present
a clause (vii) issue.
Subclause (V) is intended to make clear that a school or
other educational institution that customarily pays employees
an annual salary in disbursements over fewer than 12 months
may pay an H-1B worker in the same manner without violating
clause (vii), provided that the H-1B worker agrees to this
payment schedule in advance. Because Congress is not aware of
all the possible kinds of legitimate salary arrangements that
employers may establish, the situation covered by subclause
(V) may be merely illustrative of other kinds of legitimate
salary arrangements under which an employee's rate of pay may
vary. Accordingly, so long as an H-1B worker is not being
singled out by such a salary arrangement, it is not
Congress's intent that such a salary arrangement be treated
as suspect under or violative of clause (vii) merely because
there is no special provision like subclause (V) addressing
it. To the contrary, if it is an arrangement that the
employer routinely uses with U.S. employees as well as H-1B
workers, it should be treated as presumptively not a
violation of that clause.
Clause (viii) adds an additional clarification concerning
an employer's obligations under the attestation set forth in
212(n)(1)(A). It states that it is a violation of those
obligations for an employer to fail to offer benefits and
eligibility for benefits to H-1B workers on the same basis,
and in accordance with the same criteria, as the employer
offers benefits and eligibility for benefits to U.S. workers.
This obligation is only an obligation to make benefits
available to an H-1B worker if an employer would make those
benefits available to the H-1B worker if he or she were a
U.S. worker. Thus, if an employer offers benefits to U.S.
workers who hold certain positions, it must offer those same
benefits to H-1B workers who hold those positions.
Conversely, if an employer does not offer a particular
benefit to U.S. workers who hold certain positions, it is not
obligated to offer that benefit to an H-1B worker. Similarly,
if an employer offers performance-based bonuses to certain
categories of U.S. workers, it must give H-1B workers in the
same categories the same opportunity to earn such a bonus,
although it does not have to give the H-1B worker the actual
bonus if the H-1B worker does not earn it. While this clause
is not intended to require that H-1B workers be given access
to more or better benefits than a U.S. worker who would be
hired for the same position, it does not forbid an employer
from doing so. For example, an employer might conclude that
it will pay foreign relocation expenses for an H-1B worker
whereas it will not pay such relocation expenses for a U.S.
worker.
Clause (viii)'s phrasing of the employer's duty as an
obligation to provide ``benefits and eligibility for
benefits'', rather than just one or the other, was chosen to
protect against two eventualities. On the one hand, it would
not be proper for an employer to make an H-1B worker
``eligible'' for benefits on the same basis as its U.S.
workers but then proceed to actually provide them to its U.S.
workers but never provide them to the H-1B worker. While this
construction of an obligation to make a person ``eligible''
for a benefit may seem a little strained, sufficient concerns
were expressed about this possibility that it seemed worth
eliminating any ambiguity on the point by including the first
prong of the obligation. On the other hand, in order actually
to receive many kinds of benefits, employees are frequently
required to take some kind of action on their end, whether to
select a plan, to provide partial payment for the benefits,
to work for the employer for a certain period of time, or to
perform at a high level. The actual provision of other kinds
of benefits may also turn on other contingencies, such as, in
the case of some kinds of bonuses and stock options, the
company's year-end performance. Accordingly, the core
obligation that makes sense with respect to many benefits is
an obligation to make H-1B workers ``eligible'' for them.
Finally, the obligation is to make the H-1B worker eligible
``on the same basis, and in accordance with the same
criteria'' as U.S. workers. Thus, in determining whether an
employer is meeting this obligation, care must be taken to
find the right U.S. worker to whom to compare the H-1B worker
in terms of access to benefits.
A few examples are useful in understanding this important
principle. If a particular benefit is available only to an
employer's professional staff, then it only need be made
available to an H-1B filling a professional staff position.
If an employer's practice is not to offer benefits to part-
time or temporary U.S. workers, then it is not required to
offer benefits to part-time H-1B workers or temporary H-1B
workers employed for similar periods. If an employer's
practice is to have its U.S. workers brought in on temporary
assignment from a foreign affiliate of the employer remain on
the foreign affiliate's benefits plan, then it must allow its
H-1B workers brought in on similar assignments to do the
same. Likewise, in that instance, it need not provide the H-
1B workers with the benefits package it offers to its U.S.
workers based in the U.S. Indeed, even if it does not have
any U.S. workers stationed abroad whom it has brought in in
this fashion, it should be allowed to keep the H-1B worker on
its foreign payroll and have that employee continue to
receive the benefits package that other workers stationed at
its foreign office receive in order to allow the H-1B worker
to maintain continuity of benefits. In that instance, the
basis on which the worker is being disqualified from
receiving U.S. benefits (that he or she is receiving a
different benefits package from a foreign affiliate) is one
that, if there were any U.S. workers who were similarly
situated, would be applied in the same way to those workers.
Hence the H-1B worker is being treated as eligible for
benefits on the same basis and according to the same criteria
as U.S. workers. It is just that the criterion that
disqualifies him or her happens not to disqualify any U.S.
workers. Or to put the point a little differently: the H-1B
worker is being given different benefits from the U.S.
workers not because of the worker's status as an H-1B worker
but because of his or her status as a permanent employee of a
foreign affiliate with a different benefits package.
This provision is not meant to supersede an employer's
obligations under other provisions of the law, or its
obligations to comply with international agreements governing
social security benefits, taxes, retirement plans or other
similar benefits. Finally, this provision does not require an
employer to offer benefits or any particular category of
benefits to its H-1B workers (or anyone else) if its practice
is not to offer benefits or the particular category of
benefits to its similarly situated U.S. workers.
Section 413(b) adds a new paragraph (5) at the end of
212(n) that sets out the exclusive remedial mechanism for
alleged violations of the selection portion of the
recruitment attestation set out in new paragraph
212(n)(1)(G)(i)(II) or any alleged misrepresentations
relating to that attestation. It also contains a savings
clause that states that it should not be construed to affect
the Secretary or the Attorney General's authorities with
respect to other violations. This was to address the possible
case where evidence

[[Page S12754]]

tending to establish a violation of the selection attestation
also tends to establish a violation of some other
attestation. This savings clause, however, is not meant to
serve as a backdoor way around the exclusivity of the remedy
set out in 212(n)(5) for a violation of the selection
attestation itself. It should also be noted that by setting
up separate mechanisms, one lodged at Labor concerning
recruitment and one lodged at Justice concerning selection,
this provision contemplates that the two different kinds of
violations be handled differently. Thus, it does not
contemplate, for example, recharacterizing a ``failure to
select'' complaint as a ``failure to recruit in good faith''
and then using the enforcement regime for the latter category
of violations to pursue what in fact is a ``failure to
select'' complaint. Moreover, it is unlikely that evidence
tending to establish a violation of the selection attestation
would tend to establish a violation of the recruitment
attestation, since such evidence, whatever else it would tend
to prove, would tend to prove that the employer had made
sufficient efforts to recruit that others applied for the
job. Finally, it should be noted that nothing in this section
should be construed to give the Attorney General or the
Department of Labor any authority to write regulations or
guidelines concerning permissible and impermissible selection
criteria or mechanisms for determining when such selection
criteria are permissible or impermissible.
Under the enforcement scheme set up by paragraph (5), any
person aggrieved by an alleged violation of
212(n)(1)(G)(i)(II) or a related misrepresentation who has
applied in a reasonable manner for the job at issue may file
a complaint with the Attorney General within 12 months of the
date of the violation or misrepresentation. The Attorney
General is charged with establishing a mechanism for pre-
screening such a complaint to determine whether it provides
reasonable cause to believe that such a violation or
misrepresentation has occurred. If the Attorney General does
find reasonable cause, she is charged with initiating binding
arbitration proceedings by requesting the Federal Mediation
and Conciliation Service to appoint an arbitrator from the
Service's roster.
The arbitrator is to be selected in accordance with the
procedures and rules of the Service. He or she should have
experience with personnel decisions in the industry to which
the employer belongs, unless for some reason this is not
possible. The fees and expenses for the arbitrator are to be
paid by the Attorney General.
The arbitrator is charged with deciding whether the alleged
violation or misrepresentation occurred and whether, if it
occurred, it was willful. The complainant has the burden of
establishing such violation or misrepresentation by clear and
convincing evidence. If the complainant alleges that the
violation or misrepresentation was willful, the complainant
also has the burden of establishing that allegation under the
same standard. This standard was selected in order to avoid
the risk that the arbitrator could otherwise end up simply
substituting the arbitrator's judgment for the employer's
concerning the relative qualifications of potential
employees. The arbitrator's decision should likewise pay
careful heed to the rule of construction set forth at the end
of section 212(n)(1).
The arbitrator's decision is subject to review by the
Attorney General only to the same extent as arbitration
awards are subject to vacation or modification under 9 U.S.C.
10 or 11, and to judicial review only in an appropriate court
of appeals on the grounds described in 5 U.S.C. 706(a)(2).
The remedies for violations resemble those established for
the other violations of the labor condition attestations
(administrative remedies including $1,000 fines per violation
or $5,000 fines per willful violation and a potential
debarment of one year, or two years for a willful violation).
The Attorney General is prohibited from delegating the
responsibilities assigned her to anyone else unless she
submits a plan for such a delegation 60 days before its
implementation to the Committees on the Judiciary of each
House of Congress. This is in order to assure that Congress
has an adequate opportunity to be involved in the decision
regarding where at the Department of Justice the Attorney
General plans on lodging this function.
Section 413(c) adds a new section 212(n)(2)(E) describing
the liability of an employer who has executed the ``secondary
non-displacement attestation'' for placing a non-exempt H-1B
worker with respect to whom it has filed an application
containing such an attestation with another employer under
the circumstances described in paragraph (1)(F). If the other
employer has displaced a U.S. worker (under the definitions
used in this legislation) during the 90 days before or after
the placement, the attesting employer is liable as if it had
violated the attestation. The sanction is a $1,000 civil
penalty per violation and a possible debarment. The attesting
employer can only receive a debarment, however, if it is
found to have known or to have had reason to know of the
displacement at the time of the placement with the other
employer, or if the attesting employer was previously
sanctioned under 212(n)(2)(E) for placing an H-1B
nonimmigrant with the same employer. If an employer has
conducted the inquiry that it is required to attest that it
has conducted before any such placement, and (as that
attestation requires) acquired no knowledge of displacement
of a U.S. worker in the course of that inquiry, it should
ordinarily be presumed not to have known or have reason to
know of a displacement unless there is an affirmative showing
that it did have such knowledge or reason to know. It should
also be noted that an employer can be held liable for such a
placement only if it filed an application that contained the
``secondary non-displacement attestation,'' and only with
respect to H-1B workers covered by such an application.
Subsection 413(d) adds a new section 212(n)(2)(F) granting
the Secretary authority to conduct random investigations of
employers found after enactment of this act to have
committed a willful violation or willful misrepresentation
for five years following the finding.
Subsection 413(e) grants the Secretary limited additional
authority with respect to other employers to investigate
certain kinds of allegations of failures to comply with labor
condition attestations. The Secretary's authority under
current law is limited to investigating complaints concerning
such violations that come from aggrieved parties. Under the
authority granted by new subparagraph (G) of 212(n)(2), added
by paragraph (1) of subsection 413(e) of this Act, under
certain circumstances the Secretary will also be authorized
to investigate for 30 days allegations of willful failures to
meet a condition of paragraph (1)(A), (1)(B), (1)(E), (1)(F),
or (1)G)(i)(I), allegations of a pattern or practice by an
employer of failures to meet such a condition, or allegations
of a substantial failure to meet such a condition that
affects multiple employees even if those allegations do not
come from an aggrieved party.
The rationale for this grant of authority is to make sure
that if DOL receives specific, credible information from
someone outside the DOL that an employer is doing something
seriously wrong but that information comes from someone who
is not an aggrieved party, DOL can nevertheless pursue the
lead.
In order for the Secretary to exercise the authority
granted her under new subparagraph (G), the allegations will
have to be based on specific credible information from a
source who is likely to have knowledge of an employer's
practices of employment conditions or an employer's
compliance with the employer's labor condition application.
Thus, this provision does not authorize ``self-directed'' or
``self-initiated'' investigations by the Secretary. Rather,
as specified in clauses (ii) and (iii), an investigation can
only be launched on the basis of a communication by a person
outside the Department of Labor to the Secretary, or on the
basis of information the Secretary acquires lawfully in the
course of another investigation within the scope of one of
her statutory investigative authorities. The source's
identity must also be known to the Secretary. Thus, the
Secretary may not rely on anonymous tips in exercising this
authority, although she may withhold the source's identity
from the employer or others. As clause (iv) states,
information received from the employer that the employer is
required to file in order to obtain an H-1B visa does not
constitute the ``receipt of information'' under this
subparagraph. This is meant to be illustrative rather than
exclusive. The same principle would prevent other kinds of
information filed by the employer in the course of seeking
some other benefit from DOL, such as labor certification, for
example, to constitute the ``receipt of information'' either.
In giving effect to the provisions specifying the kinds of
alleged violations that may be investigated under this
authority, the purpose of this authority should likewise be
taken into account. Thus, for example, a ``substantial
failure to meet such a condition that affects multiple
employees'' should not be understood to mean an unintentional
posting violation even if it affects many employees. Nor
should it be understood to mean a more significant violation
but one that affects only a handful of people. Rather, it
should be understood to be a violation of a magnitude that
warrants the unusual step of committing DOL's resources even
though there is no aggrieved complaining party.
Subparagraph (G) also establishes several procedural
safeguards to prevent this authority from being abused.
First, under clause (i), there must be a finding of
reasonable cause to believe that an employer is committing
one of the covered violations. Second, the Secretary (or the
Acting Secretary, in the case of the Secretary's absence of
disability) must personally certify that this requirement and
the other requirements of clause (i) have been met before an
investigation may be launched. This authority cannot be
delegated to anyone else in the Department. Third, as in
current law regarding investigations of complaints, the
investigation may only last 30 days. Fourth, rather than
being a generalized grant of authority to investigate the
employer, the Secretary's authority is limited to
investigating only the alleged violation or violations.
Fifth, under clause (ii), the information provided by the
source must be put in writing, either by the source itself or
by a DOL employee on behalf of the source. Sixth, under
clause (v), the information may not concern a violation that
took place longer ago than 12 months, so investigations may
not be launched on the basis of stale information.
Additionally, under clause (vi), the Secretary is directed to
provide notice to an employer of the information that may
lead to the launching of an investigation and an opportunity
to respond to that information before an investigation is
actually initiated.
This last requirement is waivable by the Secretary where
the Secretary determines that complying with it will
interfere with

[[Page S12755]]

her efforts to secure compliance by the employer with the H-
1B program requirements. That the decision whether to waive
it is left to the Secretary's discretion does not mean that
it should be made lightly, or that it should be the rule
rather than the exception. Rather, it is Congress's
expectation that the Secretary will provide the otherwise
required notice unless she has a reasonable belief, based on
credible evidence, that the employer can be expected to avoid
compliance because of the notice. Past, proven willful
violations could be such evidence. Congress's belief,
however, is that most employers will correct a problem if
brought to their attention and it cannot be assumed that
simply because allegations have been made that the employer
will not do so. The scant number of willful violations that
DOL has found in the history of this program suggests that
this is likely to be the rule rather than the exception.
Thus, in many cases, notice will advance the twin ends of
compliance (or a credible explanation demonstrating that the
facts do not support the allegations and an investigation is
not needed) and the ability to preserve the Secretary's
enforcement resources so they can be used on other pressing
matters.
Finally, clause (vii) makes clear that after completion of
the 30-day investigation, if the Secretary finds that a
reasonable basis exists to make a finding that a violation of
the type described in clause (i) has occurred, the procedure
follows the procedure in existing law, under which the
employer is entitled to notice of the finding and an
opportunity for a hearing within 60 days. After the hearing,
the employer is entitled to a finding by the Secretary not
more than 60 days later.
One last point should be noted in regard to this authority.
Both this new grant of authority and existing authority to
investigate complaints require that DOL have ``reasonable
cause to believe'' that the employer is committing a
violation (limited, in the case of the authority granted
in new subparagraph (G), to certain kinds of violations).
This requirement is meant to track that of the Fourth
Amendment. Thus, if an employer believes that DOL does not
have the ``reasonable cause'' required, it is free to
refuse to give DOL access to the materials DOL is seeking
and put DOL to the test on that point. In other words,
Congress's view is that an employer does not waive any
Fourth Amendment rights by applying for an H-1B visa or by
filing any documents required to obtain one, and that DOL
has no authority to use the occasion of the employer's
filing such materials to compel such a waiver.
Paragraph (2) of subsection 413(e) sunsets the new DOL
investigative authority granted by paragraph (1) on September
30, 2001.
Subsection 413(f) clarifies that none of the enforcement
authorities granted in subsection 212(n)(2) as amended should
be construed to supersede or preempt other enforcement-
related authorities the Secretary of Labor or the Attorney
General may have under the Immigration and Nationality Act or
any other law.

Section 414. Collection and Use of H-1B Nonimmigrant Fees for
Scholarships for Low-Income Math, Engineering and Computer Science
Students and Job Training of United States Worker

Subsection 414(a) adds a new paragraph at the end of
section 214(c) of the Immigration and Nationality Act
imposing a $500 fee on employers filing petitions for H-1B
nonimmigrants. This fee is to be collected by the Immigration
and Naturalization Service. The statute requires that the fee
be charged starting on December 1, 1998. INS has informed the
Congress that this will give it sufficient time to establish
a mechanism for collecting the fee that will not delay the
processing of visa petitions. It is the Congress's hope and
expectation that INS will establish that system as
expeditiously as possible, and will have it in place on
December 1. If, however, INS does not have a system up and
running for collecting the fee at that time, it is not
required or expected to stop accepting, processing, or
approving visa petitions. To the contrary, it is expected
that it will continue to accept, process, and approve visas
without delay while also moving as quickly as possible to put
the system for collecting the fee in place.
Under this provision, the fee will be paid by the employer
in three circumstances: (1) upon initial application for the
nonimmigrant to obtain H-1B status (through change from
another status or by securing a visa from abroad); (2) the
first time an employer files a petition for the purpose of
extending the nonimmigrant's H-1B status; and (3) when a new
employer is petitioning for an alien who is already in H-1B
status whom the new employer wants to hire away from the H-
1B's current employer.
The fee will apply to any petition filed by the same
employer that has the effect of extending the nonimmigrant's
status for the first time, whether that is its sole purpose
or whether it is a dual-purpose petition that both, for
example, advises the Immigration and Naturalization Service
of a material change in the terms and/or conditions of the
alien's employment and extends the alien's stay.
On the other hand, an employer will not have to pay the fee
for any extension after a first extension petition filed by
that employer. This section is meant to ensure that a single
employer not be required to pay the $500 fee more than twice
for a single H-1B nonimmigrant. In addition, petitions filed
for such purposes as advising the Immigration and
Naturalization Service of a material change in the terms and/
or conditions of the alien's employment (an amended petition)
or to advise the INS of a change in the circumstances of the
employer (such as notification of a successor-in-interest
following a corporate merger, acquisition or sale), or for
assigning an H-1B worker to a new area of employment or to a
different legal entity within the employer's corporate
structure, will not ordinarily require payment of the fee. To
repeat, the only circumstance in which an employer will have
to pay the fee for a petition of this type is when the
petition also has the effect of extending the alien's status
and is the first petition that employer has filed to extend
that alien's status.
In addition, even when a prior employer paid the fee, a new
employer would be required to pay the fee when it hires an H-
1B nonimmigrant who changes jobs or when an H-1B is hired to
engage in concurrent employment.
Universities and nonprofit research institutes are exempted
from the fee.
Subsection 414(b) amends section 286 of the Immigration and
Nationality Act by adding a new subsection (s) requiring the
establishment of an account for holding the fees assessed
under section 214(c). The new subsection also specifies the
distribution of the funds, to be divided among the Workforce
Improvement Act (56.3%), a new program established by the Act
setting up low-income university scholarships for
mathematics, engineering, and computer science administered
by the National Science Foundation (28.2%), grants for
science and math development for those in kindergarten
through 12th grade through existing programs administered by
the National Science Foundation (8%), DOL processing and
enforcement relating to the H-1B program (6% total), and INS
processing of H-1B visas (1.5%).
With respect to the funding for DOL, although the funds are
not equally divided by law between the processing and
enforcement functions during the first fiscal year, the
expectation is that they will be split 50-50 unless DOL
determines that it needs to spend more funds on processing in
order to get into compliance with the 7 day statutory
deadline under which it is supposed to be either certifying
an application or rejecting it for incompleteness or obvious
inaccuracies. After the first fiscal year, the money is
equally split by statute, except that none of the money can
be spent on enforcement unless the Secretary certifies that
the Department was in substantial compliance with the 7-day
deadline during the previous calendar year. At present, DOL
is routinely violating this obligation, taking up to a month
and sometimes up to three months to certify an application,
despite the fact that the task is essentially ministerial. It
is time for that to end. Moreover, getting into compliance
with this obligation should not be accomplished by
diverting resources from labor certifications for the
permanent employment program. These are presently
routinely taking two years, which is far too long.
The INS funds are designed to enable INS to establish a
mechanism for collecting the new fee, to facilitate its
revision of its forms and computer systems so as to better
enable it to collect the fee and improve its data collection
capacity, and to speed up INS's processing time for
petitions, which is presently taking up to 3 months. This
function should be able to be performed in no more than a
month.
Subsection 414(c) uses a portion of the funds deposited in
the account established under subsection 104(b) for the
Secretary of Labor to provide grants for demonstration
projects and programs for technical skills training for both
employed and unemployed workers. These projects and programs
will be administered through local boards established under
section 121 of the Workforce Investment Act of 1998 or
regional consortia of local boards.
Through this provision, the Secretary will be able to award
grants to innovative programs to train employees to meet the
workforce shortage needs in the high-tech industry. By doing
so, this legislation works to address our country's long-term
employment needs by training American workers to fill these
crucial jobs. In addition, the legislation addresses the
issue of underemployment by allowing grants to go to training
programs for both employed and unemployed workers. A regional
consortium of local boards can also apply for grants that
will encourage regions to work together to meet their area's
unique employment needs and encourage business and community
colleges to work together to train that region's workers.
These grants will allow the Secretary to support innovative
training programs that can serve as models for other training
programs around the country to learn from their best
practices.
Subsection 414(d) authorizes a low-income scholarship
program to be administered by the National Science
Foundation. This program would allow the Director of the
National Science Foundation to award scholarships to low-
income students pursuing an associate, undergraduate or
graduate level degree in mathematics, engineering, or
computer science. The scholarships will be funded through the
account established under subsection 414(b). Like the
previous subsection, this provision invests in the American
workforce by providing scholarships for students interested
in pursuing studies in high-tech fields. By making
scholarships available to low-income students, this
legislation provides incentive and opportunity for

[[Page S12756]]

students to enter careers in the growing high-tech industry.

Section 415. Computation of prevailing wage

Under current law an employer must attest on a Labor
Condition Attestation that an individual on an H-1B will be
paid the greater of the actual or prevailing wage paid to
similarly employed U.S. workers.
Subsection 415(a) amends section 212 of the Immigration and
Nationality Act by adding at the end a new subsection (p)
that spells out how that wage is to be calculated in the
context of both the H-1B program and the permanent employment
program in two circumstances. Paragraph 212(p)(1) provides
that the prevailing wage level at institutions of higher
education and nonprofit research institutes shall take into
account only employees at such institutions. The provision
separates the prevailing wage calculations between academic
and research institutions and other non-profit entities and
those for for-profit businesses. Higher education
institutions and nonprofit research institutes conduct
scientific research projects, for the benefit of the public
and frequently with federal funds, and recruit highly-trained
researchers with strong academic qualifications to carry out
their important missions. The bill establishes in statute
that wages for employees at colleges, universities, nonprofit
research institutes must be calculated separately from
industry. Although this legislation does not explicitly
require separate prevailing wage calculations in relation to
for-profit and other non-profit entities that are not higher
education institutions and nonprofit research institutes this
is not meant to preclude the Department of Labor from making
these same common-sense distinctions for other nonprofit
entities.
New paragraph 212(p)(2) spells out the prevailing wage
criteria for professional sports. Where there is a collective
bargaining agreement (CBA), the minimum wage established
therein constitutes the prevailing pay rate. Where no CBA
exists, the prevailing wage is the minimum salary mandated by
the professional sports league which teams must pay players--
foreign nationals as well as U.S. workers. The system
currently employed to determine the prevailing wage for minor
league professional sports uses a ``mean wage.'' Because
salaries for professional athletes vary greatly (up to 20
times difference between lowest and highest paid players),
using the mean wage to calculate prevailing wage actually
encourages the leagues to pay approximately fifty percent of
the U.S. athletes a lower salary than similarly situated
foreign national athletes. This current system is a
disincentive to increase U.S. workers' salaries.
Subsection 415(b) of this legislation makes these rules for
prevailing wage calculations retroactive so that they may be
applied to any still-open prevailing wage determinations.
This will allow DOL to apply only a single set of rules, that
set out in subsection 212(p), for making these calculations
in these industries, starting on the date of enactment.

Section 416. Improving of Count of H-1B and H-2B Nonimmigrants

Subsection 416(a) requires the Immigration and
Naturalization Service to improve its counting of the number
of actual individuals granted or admitted in H-1B status in
each fiscal year, rather than counting approved petitions,
which may or may not be used by an individual to obtain H-1B
status after approval.
Subsection 416(b) requires the revision of the petition
forms so as to assure that this can be done.
Subsection 416(c) requires the Attorney General to submit
to the House and Senate Judiciary Committees (1) a quarterly
count on the number of individuals issued visas or
provided nonimmigrant status; and (2) beginning in FY
2000, on an annual basis, information on the countries of
origin and occupations of, educational levels attained by,
and compensation paid to, aliens issued H-1B visas. The
first requirement is intended to provide an early warning
system if the cap is coming close to being hit. The second
requirement is intended to develop reliable information on
how these visas are being used.
In collecting additional data regarding H-1B nonimmigrants,
the agency should not have to impose additional or new
paperwork burdens on employers. In fact, it is Congress's
understanding that the data required to be furnished are
currently being collected, but that they are not being
entered into a database that would allow them to be used. As
a result, the only information Congress has had made
available to it on the use of the visas has come from DOL's
compilation of information on applications, which, on account
of multiple filings, does not accurately reflect who is
really coming in. Finally, nothing in this provision should
be construed to allow INS to delay or withhold approval or
adjudication of petitions in order to comply with its
obligations under this provision.

Section 417. Report on Older Workers in the Information Technology
Field

Subsection 417(a) directs the Director of the National
Science Foundation to enter into a contract with the National
Academy of Sciences to study the status of older workers in
information technology field. This study is to focus on the
best available data, rather than on anecdotal information.
Subsection 417(b) requires the results of that study to be
supplied to the Committees on the Judiciary of each House of
Congress no later than October 1, 2000.

Section 418. Report on High Technology Labor Market Needs; Reports on
Economic Impact of Increase in H-1B Nonimmigrants

Subsection 418(a) requires a study and report on high tech,
U.S., and global issues for the next ten years overseen by
the National Science Foundation and done by a panel to be
transmitted to the Judiciary Committees of both Houses by
October 1, 2000.
Subsection 418(b) directs that the Chairman of the Board of
Governors of the Federal Reserve System, the Director of the
Office of Management and Budget, the Chair of the Council of
Economic Advisers, the Secretary of the Treasury, the
Secretary of Commerce, the Secretary of Labor, and any other
member of the cabinet report to Congress on any reliable
study that uses legitimate economic analysis that suggests
that the increase in H-1B visas under this bill has had an
impact on any national economic indicator, such as the level
of inflation or unemployment, that warrants action by
Congress.
Subtitle B
The content of this subtitle was added to S. 1723 on the
Senate floor by an amendment offered by Senator Warner
incorporating the text of H.R. 429, a bill to grant special
immigrant status to certain NATO civilian employees.

Section 421. Special Immigrant Status for Certain NATO Employees

This section amends Section 101(a)(27) of the Immigration
and Nationality Act to add to the class of those eligible for
special immigrant status certain NATO employees and their
children on the same basis as employees of other qualifying
international organizations.
Subtitle C
This subtitle makes an additional amendment to the
Immigration and Nationality Act originally included in S.
1723 regarding permissible payments by universities to
holders of visitors' visas.

Section 431. Academic Honoria

This section amends section 212 of the Immigration and
Nationality Act by adding at the end a new subsection (q)
permitting universities and other nonprofit entities to pay
honoraria and incidental expenses for a usual academic
activity or activities to an alien admitted under section
101(a)(15)(B), so long as the alien has not received such
payment or expenses from more than 5 institutions or
organizations in the previous 6 month period.
____

Proposed Administration Revisions to H.R. 3736 (the July 29, 1998
Version):

1. Require either a $500 fee for each position for which an
application is filed or a $1,000 fee for each nonimmigrant.
Fee to fund training provided under JTPA Title IV. In
addition, a small portion of these revenues should fund the
administration of the H-1B visa program, including the cost
of arbitration.
2. Define H-1B-dependent employers as:
a. For employers with fewer than 51 workers, that at least
20% of their workforce is H-1B; and
b. For employers with more than 50 workers, that at least
10% of their workforce is H-1B.
3. The recruitment and no lay-off attestations apply to:
(1) H-1B dependent employers; and (2) any employer who,
within the previous 5 years, has been found to have willfully
violated its obligations under this law.
4. H-1B dependent employers attest they will not place an
H-1B worker with another employer, under certain employment
circumstances, where the other employer has displaced or
intends to displace a U.S. worker (as defined in paragraph
(4)) during the period beginning 90 days before and ending 90
days after the date the placement would begin.
5. DOL would have the authority to investigate compliance
either: (1) pursuant to a complaint by an aggrieved party; or
(2) based on other credible evidence indicating possible
violations.
6. Establish an arbitration process for disputes involving
the laying-off of any U.S. worker who has replaced by an H-1B
worker, even of a non-H-1B dependent employer. This
arbitration process would be largely similar to that laid out
in H.R. 3736 except that it would be administered by the
Secretary of Labor. The arbitrator must base his or her
decision on a ``preponderance of the evidence.''
7. Reference in the bill to ``administrative remedies''
includes the authority to require back pay, the hiring of an
individual, or reinstatement.
8. There must be appropriate sanctions for violations of
``whistleblower'' protections.
9. Close loopholes in the attestations:
a. Strike the provision that ``[n]othing in the
[recruitment attestation] shall be construed to prohibit an
employer from using selection standards normal or customary
to the type of job involved.''
b. Clarify that job contractors can be sanctioned for
placing an H-1B worker with an employer who subsequently lays
off a U.S. worker within the 90 days following placement.
c. Do not exempt H-1B workers with at least a master's
degree or the equivalent from calculations of the total
number of H-1B employees.
d. Define lay-off based on termination for ``cause or
voluntary termination,'' but exclude cases where there has
been an offer of continuing employment.

[[Page S12757]]

10. Consolidate the LCA approval and petition processes
within DOL, rather than within INS.
11. Broaden the definition of U.S. workers to include
aliens authorized to be employed by this act or by the
Attorney General.
12. Include a provision that prohibits unconscionable
contracts.
13. Include a ``no benching'' requirement that an H-1B
nonimmigrant in ``non-productive status'' for reasons such as
training, lack of license, lack of assigned work, or other
such reason (not including when the employee is unavailable
for work) be paid for a 40 hour week or a prorated portion of
a 40 hour week during such time.
14. Increase the annual cap on H-1B visas to 95,000 in FY
1998, 105,000 in FY 1999, and 115,000 in FY 2000. After FY
2000, the visa cap shall return to 65,000.
15. Eliminate the 7500 cap on the number of non-physician
health care workers admitted under the H-1B program to make
the bill consistent with our obligations under the GATS
agreement.
____

Administration Package--September 14, 1998

* * * * *

8. There must be appropriate sanctions for violations of
``whistleblower'' protections.
9. Close loopholes in the attestations:
a. Strike the provision that ``[n]othing in the
[recruitment attestation] shall be construed to prohibit an
employer from using selection standards normal or customary
to the type of job involved.''
b. Clarity that job contractors can be sanctioned for
placing an H-1B worker with an employer who subsequently lays
off a U.S. worker within the 90 days following placement.
c. Do not exempt H-1B workers with at least a master's
degree or the equivalent from calculations of the total
number of H-1B employees.
d. Define lay-off based on termination for ``cause or
voluntary termination,'' but exclude cases where there has
been an offer of continuing employment.
10. Consolidate the LCA approval and petition processes
within DOL, rather than within INS.
11. Broaden the definition of U.S. workers to include
aliens authorized to be employed by this act or by the
Attorney General.
12. Include a provision that prohibits unconscionable
contracts.
13. Include a ``no benching'' requirement that an H-1B
nonimmigrant in ``non-productive status'' for reasons such as
training, lack of license, lack of assigned work, or other
such reason (not including when the employee is unavailable
for work) be paid for a 40 hour week or a prorated portion of
a 40 hour week during such time.
14. Increase the annual cap on H-1B visas to 95,000 in FY
1998, 105,000 in FY 1999, and 115,000 in FY 2000. After FY
2000, the visa cap shall return to 65,000.
15. Eliminate the 7500 cap on the number of non-physician
health care workers admitted under the H-1B program to make
the bill consistent with our obligations under the GATS
agreement.

* * * * *

____

U.S. Senate,

Committee on the Judiciary,

Washington, DC, October 16, 1998.
Hon. Doris Meissner,
Commissioner, Immigration
and Naturalization Service,
Washington, DC.
Dear Commissioner Meissner: As I am sure you know,
legislation raising the H-1B cap has been included in the
Omnibus Appropriations bill. The final version is the result
of hard work by all involved, including all of those who
negotiated this compromise on behalf of the Administration.
There is one point on which I thought it would be useful to
have a clear record of our shared understanding. The
legislation creates a new $500 filing fee for most visa
petitions, which the Attorney General is tasked with
collecting, and which takes effect on December 1 of this
year. I believe it is everyone's understanding that INS will
be charged with devising the system for collecting this fee.
The point I wanted to confirm is that I also believe that
it is everyone's understanding that if, as a result of
unforeseen circumstances, it does not prove possible to have
a system up and running by that time, our shared
understanding is that the language in the bill concerning the
fee will not result in a cessation of accepting, processing,
or approving petitions on that account. Rather, I believe it
is everyone's view that petitions should be continued to be
accepted, processed, and approved in the interim, while INS
continues to move as expeditiously as possible to finalize
putting the fee-collection system in place.
Thank you for your attention to this matter.
Sincerely,
Spencer Abraham.
____

U.S. Department of Justice, Immigration and
Naturalization Service,
Washington, DC, October 29, 1998.
Hon. Spencer Abraham,
Chairman, Subcommittee on Immigration,
Committee on the Judiciary,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: Thank you for your October 16 letter
concerning the implementation of the H-1B program. The
Immigration and Naturalization Service (INS) has been working
with your staff to identify and to address the management and
administrative challenges associated with the proposed H-1B
legislation that is now included in the Omnibus
Appropriations Bill. These challenges include two sources of
additional workload, those emanating from new requirements
contained within the legislation, and those related to the
increased volume of cases that must be processed.
The INS has already initiated efforts to meet the
challenges posed for us, and fully expects to be able to
implement the new fee provision proposed in the H-1B
legislation by December 1. However, let me assure you that
the INS will continue adjudicating H-1B applications, even if
unforeseen circumstances cause a delay in establishing final
procedures for fee collection and deposit.
If I can be of further assistance, please do not hesitate
to contact me.
Sincerely,
Doris Meissner,
Commissioner.

district of columbia

Mr. BROWNBACK. Mr. President, I want to congratulate the bill
managers for their hard work to reach an agreement on the bill before
us today. I especially want to thank them for including the District of
Columbia Adoption Improvement Act of 1998 in the omnibus appropriations
bill.
As chairman of the Senate Oversight Subcommittee on Government
Management, Restructuring, and the District of Columbia, improving
adoption for foster care in the District is one of my highest
priorities. For the past year, I, along with Senators DeWine, Grassley,
Craig, and Landrieu, have been looking for ways to make it easier for
children in the Nation's Capital to find an adoptive family.
Earlier this year, we hosted an Adoption Fair on Capitol Hill in
which resulted in the adoption of five children to two families. We
also held a hearing in the subcommittee to explore a solution that
would shorten the time it takes for children in the District to be
adopted.
Gordon Gosselink, age 13, testified before the subcommittee at this
hearing about how he entered the District's foster care system at the
age of two. For the next 10 years, he lived in several foster care
homes and even endured physical abuse until he was finally adopted at
the age of 13 by Robert and Mary Beth Gosselink. He said:

Last year, I met Rob and Mary Beth Gosselink at a Christmas
party. When my social worker told me that two people were
hoping to adopt me, I was really excited. I knew that this
was the one. I moved [in] with Rob and Mary Beth last year at
Easter time, and now I am part of the Gosselink Family.
Things are really great now. I like my neighborhood and I am
doing well in school. Best of all, I am with a family who
loves me forever. My parents now are adopting another boy
named Ricardo who is 11 years old. I am looking forward to
having a new brother. I know there are a lot of kids who are
still waiting for a home. I hope they find homes, too, like
me.

Some children are not as lucky as Gordon. Currently, there are 994
children in the District with the goal of adoption but only 50 percent
have been referred to the District's adoption branch. Even worse, many
children in the District grow up moving from foster care home to foster
care home without finding an adoptive family by the age of 18. The most
recent statistics indicate that 67 percent of the children who left the
foster care system,

[[Page S12758]]

left because they turned 18 years old. In other words, one of the only
ways out of the system, is to grow-up to adulthood within the system.
Once these children turn 18, they are released to the streets without a
family or a home.
Allowing just one child to grow up without the love, attention, and
commitment of a family is a tragedy. Allowing hundreds to languish in
foster care is a disgrace.
The District Child and Family Services Agency has been under the
leadership of Ernestine Jones, the Federal court appointed receiver for
nearly one year now. I am hopeful that reforming the system will remain
a priority and these discouraging realities will no longer haunt the
children who need the system most.
We must also recognize foster care and adoptive parents for their
contribution and their example of taking in these children when they
need them most. As many of the Senators, who have adopted children,
know, we need to make it easier, not more difficult, for parents to
adopt.
I believe this can be done and systemic improvements can be made with
positive results--as seen in my home state of Kansas. The Kansas reform
model of the Child and Welfare Services Agency has shown some immediate
signs of success. Within one year of implementing these reforms, Kansas
increased the number of children placed in adoptive homes from 25
percent to 50 percent. Prior to these reforms, the average stay for a
child in the Kansas foster care system was two years. Now, the average
stay in 13 months.
Using the Kansas model, we drafted the D.C. adoption reform language
and came to a bipartisan agreement which included the Federal court
appointed receiver and the Federal court appointed monitor. I am
pleased that this compromise language is included in the omnibus
appropriations bill. First, the bill would require the D.C. Child and
Family Services Agency (CFSA) to maintain an accurate database tracking
all children found by the Family Division of the District of Columbia
Superior Court to be abused or neglected and who is in the custody of
the District of Columbia--including any child with the goal of adoption
or who is legally free for adoption. Unfortunately, this basic step has
been neglected in the past in CFSA. To meet the immediate demand of
placing children in adoptive homes, the bill would also require CFSA to
contract out some of its adoption functions which may include
recruitment, homestudy, and placement services. Like the Kansas model,
these contracts would be required to be performance-based contracts.
Contractors would be compensated once specific goals, such as an
adoption placement or finalization, are achieved. Finally, CFSA and
contractors would be required to work together to identify and lift any
barriers to timely adoptions.
I want to stress that in the end, we are talking about individual
children who are in search of a permanent and secure home. Any
improvement in the system translates into bringing each child closer to
the fundamental need of having a loving, adoptive family.

THE AMERICAN COMPETITIVENESS AND WORKFORCE IMPROVEMENT ACT INCLUDED IN
DIVISION C, TITLE IV

Mr. LIEBERMAN. Mr. President, I speak today in support of the
American Competitiveness and Workforce Improvement Act, which is
included in the Conference Report on H.R. 4328, the Omnibus
Appropriations Act, under Division C, Title IV. The House passed this
Act as H.R. 3736 on September 24. The Senate had passed the companion
bill, S. 1723, on May 18. I cosponsored the Senate bill because I
believe strongly that the U.S. Government's job is to make sure that
U.S. industry has adequate access to the resources necessary to grow
their business. Right now we have the lowest unemployment rate in 28
years. The high-tech sector, which has been the engine of growth in our
economy--creating the most jobs--cannot find enough skilled workers. If
U.S. industry needs more skilled workers than the U.S. labor force can
provide, as the Department of Commerce has documented, then we must
allow them to hire foreign skilled workers, and, as is more often the
case, allow them to hire foreign graduate students educated here in the
United States. These foreign workers create wealth and more jobs in
this country. If we block these visas the research will go abroad.
The Semiconductor Research Corporation, founded by the U.S.
semiconductor industry, supports approximately 800 graduate students
each year with merit-based scholarships. Some of the students receiving
grants are foreigners studying here in the United States. They told me
that this year, for the first time, they have been unable to hire all
of the graduate students whose research they funded, even though the
students wished to remain in the United States, because they cannot get
H-1B visas.
When I cosponsored S. 1723 in May, I believed it was a good bill
because it not only temporarily increased the number of visas available
for skilled workers, but it also set up education and training programs
for Americans so that more U.S. workers will soon be eligible for these
high-paying jobs in the high-tech sector. I am delighted to say that I
believe the bill that emerged from the long and detailed negotiation
between Senator Abraham and the White House is now even better
legislation. The American Competitiveness and Workforce Improvement Act
increases the number of visas available for the next three years,
includes funding to decrease processing time for visa applications, and
funds education and training programs to increase the pool of skilled
workers in the United States. For the benefit of workers, it includes
substantial protections for U.S. workers, increases enforcement
authority for the Department of Labor to protect workers rights, and
creates additional protections for H1-B employees. These new
protections will help eliminate real and/or perceived hiring practices
that came under criticism and made this such a controversial visa
program. Removing the opportunity for abuse of the program makes its a
stronger program and broadens its base of support. This act is in the
best interests of both U.S. and foreign workers and U.S. business.
The funding that is included in this act is vitally important. Too
often, Congress passes legislation with the result that executive
branch agencies or States are expected to provide more services and
programs with less money. This act funds each of the programs it
creates and the increased duties it requires of government agencies
with a fee on each visa. It funds K-12 science programs. It funds
scholarships in the math, science and engineering fields. And it funds
training in high-tech skills.
I would like to speak in particular about the training program
contained in the American Competitiveness and Workforce Improvement
Act, Section 414 (c). As the chief sponsor of this provision, I want in
these remarks to particularly address the intent and meaning of the
provision. Section 414 (c) directs the Secretary of Labor to establish
demonstration projects to provide technical skills training for
workers. What makes this program unique is not just that it is targeted
at technical skills, but that it will be open to both employed and
unemployed workers.
Most Department of Labor training programs are solely for unemployed,
displaced or disadvantaged workers. But in today's market, technology
changes so quickly that no longer can people be trained in their
twenties and expect to use those same skills throughout their career.
American workers used to have one job for life. Now the average
American will have five to ten jobs in a lifetime. Employees need to
update their skills continually to remain competitive. Realistically,
we must allow Department of Labor training programs to include workers
who have jobs now, and want to upgrade and update their skills so they
can qualify for the changing needs of industry, instead of waiting
until they lose their job or become dislocated workers from a declining
industry.
The United States is in the enviable situation at this time of having
under 5% unemployment. The high-tech industry tells us it has as many
as 190,000 unfilled jobs. This does not necessarily mean that we do not
have the people to fill those jobs; it means we don't have the people
who have the skills to fill

[[Page S12759]]

those jobs. Nearly seven out of ten employers say that the high school
graduates they see are not yet ready to succeed in the workplace.
The jobs in the high-tech sector pay more than other jobs. The
average wage in the high-tech sector pays 73% more than the average
wage in the private sector. The average high-tech manufacturing wage is
32% higher than the U.S. manufacturing average wage. We need to help
our citizens get the training they need to get these higher paying
jobs.
The reality is that we have a global economy and there is, more and
more, a global workforce. If companies cannot find skilled workers in
the United States, they will find them in another country. This
training program will help U.S. workers get the skills they need to
stay competitive.
I want to explain my intent for the program established under Section
414 (c). I intend this program to be used for innovative approaches to
solving our labor skills shortage; specifically, consortia and
community-based programs. I intend the program to be used as a catalyst
to bring small and medium sized businesses together to set up
cooperative programs of skills training. I believe the best results can
be gained from industry-driven programs. To have industry involved in
and leading the skills training will ensure that workers are being
trained for jobs that actually exist.
Ninety-nine percent of the 23 million businesses in the United States
are small businesses. But, small businesses often do not have the
resources to operate training programs by themselves. By joining
together in consortia of other small and medium sized businesses with
similar labor needs, with the Local Workforce Investment Boards
established by the Workforce Investment Partnership Act signed into law
this year, with community colleges, or labor organizations, or with
State or local governments, small and medium sized businesses can
participate in training courses that will increase the labor pool of
skilled workers needed in their region.
Companies, however, do not normally cooperate in training workers.
That is why the government is needed to provide the catalyst to bring
companies together to cooperate on training. It is expected that the
fee from the visas will generate approximately $50 million annually for
the training program. It is my hope that the Secretary of Labor will
consider, as she establishes these programs, requiring matching funds
from the consortia. Nothing in this act precludes such matching funds.
Matching funds will help ensure that the companies take an active role
in the training program. The Secretary of Labor has the discretion to
undertake this implementation approach. Of course, available federal
funds are meant only to start the process--federal funding would end
over time after which the consortia would continue the cooperative
training programs alone.
Mr. President, let me give some examples of the type of program I am
discussing. In the last few years, a small number of regional and
industry-based training alliances in the United States have emerged,
usually in partnership with state and local governments and technical
colleges, that exemplify the type of program on which this provision in
the manager's amendment is modeled. In Rhode Island, with help from the
state's Human Resource Investment Council, regional plastics firms
developed a skills alliance which then worked with a local community
college to create a polymer training laboratory linked to an
apprenticeship program that guarantees jobs for graduates. The
Wisconsin Regional Training Partnership, a consortium of metal-working
firms in conjunction with the AFL-CIO, refitted an abandoned mill with
state-of-the-art manufacturing equipment to teach workers essential
metal-working skills. In Washington, DC, telecommunications firms
donated computers and helped set up a program to train public high
school students to be computer network administrators. They then hired
graduates of the program at entry-level salaries of $25,000-$30,000.
Without some kind of support to create alliances, such as created by
the new provision in this act, small and medium sized firms just don't
have the time or resources to collaborate on training. In fact, almost
all the existing regional skills alliances report that they would not
have been able to get off the ground without an independent staff
entity, such as a college or labor organization, to operate the
alliance. Widespread and timely deployment of these kinds of
partnerships is simply not likely to happen without the incentives
established by a federal initiative, which is created by this act. The
training provision in the American Competitiveness and Workforce
Improvement Act can help create successful new training models and
templates that others can replicate across the nation.
I want to thank Senator Abraham and Lee Liberman Otis and Stuart
Anderson of his staff who worked tirelessly to ensure that the American
Competitiveness and Workforce Improvement Act would pass the 105th
Congress. I also want to thank Laureen Daly of my staff for all her
dedicated efforts on this essential legislation.
We have accomplished something important for our workforce needs and
for training in this legislation.

certification regarding certain imf assistance

Mr. CRAIG. Mr. President, I rise to commend Chairman McConnell for
the work he has done on the foreign operations portion of the Omnibus
Appropriations bill.
The fiscal year 1999 foreign operations appropriations package is
very different in size and character from the wasteful ones passed just
a few years ago by liberal Congresses. It represents a sea change in
the way Congress does business and a major victory for conservative,
commonsense principles.
The U.S. Federal budget is now balanced--for the first time since
1969. This is the most positive economic policy development in the
world today. There is room within that balanced budget for a limited,
responsible program of foreign operations.
The chairman's work in this bill advances U.S. leadership and
protects our national security, our economic interests, and American
jobs, in a rapidly changing world.
For example, the way this bill deals with the International Monetary
Fund is not the same old way of doing business.
This bill imposes new, tough standards of accountability and
transparency on the IMF. If American taxpayers are going to invest in
the IMF, hoping it will produce a more stable world economy, they
should be able to see where their money is going.
I know that has been an important priority for Chairman McConnell, as
it has been for me.
I want to thank the chairman in particular for his support and
assistance in making sure the final version of this bill included a
provision we have worked on since the beginning of this year.
This provision covers autos, textiles and apparel, steel, and
shipbuilding, as well as semiconductors. It is of extreme importance to
the thousands of workers at Micron, an Idaho company that manufactures
computer chips and is a world leader in semiconductor technology. This
provision will safeguard many American jobs and is the result of
bipartisan efforts.
This provision directs the Secretary of the Treasury to instruct the
U.S. Executive Director at the IMF to exert the influence of the United
States to oppose further disbursement of funds to the Republic of Korea
unless the Secretary has given a certification that IMF funds are not
being used to subsidize industries with a history of committing unfair
trade practices against American companies and workers.
It is my understanding that the use of the term, ``exert the
influence of the United States'' places a very high obligation on our
Secretary of the Treasury and Executive Director to use all the means
necessary to oppose disbursement of funds unless such certification has
been given.
This effort needs to be persistent and comprehensive, at all levels,
in order to achieve the desired result. It includes the use of the
voice and vote of the United States at the IMF. This language also
constitutes a commitment by the Secretary of the Treasury to the
Congress to see that the influence of the United States is exerted in
all respects.
I've spoken with the Secretary about this matter. It's characteristic
of administration agencies and officials to

[[Page S12760]]

prefer having broad latitude and not being given such specific
direction in legislation. However, I believe the substance of this
provision is consistent with the Secretary's own intentions. The final
language is the product of negotiation with the Administration.
Mr. McConnell. I would concur with the Senator's interpretation of
the effect of this provision. This provision creates an ongoing and
overarching commitment. Accompanying report language should reassure
the people of South Korea that our friendship for them remains strong,
and that we are simply seeking to promote honest, open markets and fair
competition.
Mr. KYL. Mr. President, while many parts of this bill concern me, the
part that I am very proud of is a provision known as the Drug-Free
Workplace Act of 1998. It has been my pleasure to have worked with
Senator Coverdell and I commend him for guiding the drug-free workplace
bill through the Small Business Committee with a unanimous bipartisan
vote. I would also like to thank Representatives Portman, Bishop, and
Souder for their work in passing this important anti-drug legislation
out of the House.
The Drug-Free Workplace Act of 1998 is an excellent example of how
the federal government can work to encourage drug-free workplaces
without placing heavy-handed mandates on businesses. It fosters
partnerships between small businesses and organizations which have at
least two years experience in carrying out drug-free workplace
programs. It also will educate and encourage small businesses about the
advantages of implementing drug-free workplace programs.
Small businesses often feel they lack the money or the expertise to
implement drug testing programs. That is why the drug-free workplace
bill performs such a worthwhile function. Many small firms would like
to start drug testing programs but don't have the ability to overcome
the start up costs. This anti-drug measure provides resources to assist
and educate employers who want the help in implementing drug-free
workplace programs.
As we all know, the American workforce is the main catalyst behind
the tremendous economy that we are enjoying today. It is absolutely
integral to a country's economic well being that it have a competent,
able workforce. Our ability to maintain the high achievements of this
workforce hinges largely on our ability to keep drugs out of the
workplace.
Drug use can take a tremendous toll. For example, 70% of drug users
are employed. Employees who use drugs: Have greater absenteeism; have
increased use of health services and insurance benefits; have increased
risk of accidents; and have decreased productivity.
The costs of drug use are not only confined to the user, just
consider these disturbing statistics: Nearly half of all industrial
accidents in the United States are related to drugs or alcohol; and
drug and alcohol abusers file five times as many workman's compensation
claims as non-abusers, and require 300 percent greater medical
benefits.
Businesses need help dealing with the problem of drug use--especially
small businesses. Thomas Donohue of the U.S. Chamber of Commerce
testified before the House Subcommittee on Empowerment that a large
impediment in the implementation of drug programs is the perceived
costs and problems with the actual initiation of the programs.
The Drug-Free Workplace Act is fair to everyone. It's fair for the
workers who are put at risk by their colleagues' drug abuse. It's fair
to businesses, because it gives them the tools they need, but only if
they want them. it's also fair to society, which ultimately foots the
costly bill that drug abuse brings.
Mr. KERRY. Mr. President, I would ask my distinguished colleague and
Chairman of the Committee on Finance for his attention with regard to a
matter of some concern to the Savings Bank Life Insurance (SBLI)
organizations in Massachusetts, New York, and Connecticut, as well as
their operations in New Hampshire and Rhode Island.
As the Chairman knows, we had hoped this year, after a long
consideration of the matter, to act on a proposal that would clarify
the tax consequences of a state-mandated consolidation of an SBLI
organization in which required payments to policyholders are made over
a period of years. Under the current Internal Revenue Service (IRS)
interpretation, such payments would be non-deductible redemptions of
equity. After considerable effort, we believe we have succeeded in
demonstrating that such an interpretation is incorrect. Of necessity,
however, it appears that a statutory clarification will be required,
and, unfortunately, it does not appear possible this year to consider
this kind of matter in a tax measure.
SBLI entities and policyholders retain unique, long-recognized
characteristics regarding voting rights and rights to surplus which set
them apart from other insurance companies and policyholders and which
form the basis for the needed clarification. The provision we had hoped
would be considered this year would clarify that the Internal Revenue
Code should treat additional policyholder dividends as deductible when
mandated by state law.
While only the Massachusetts SBLI is immediately affected, the sister
entities in New York and Connecticut could be adversely affected if the
appropriate clarification is not made. Unfortunately, if we are unable
to accomplish our objective soon, SBLI and its policyholders throughout
New York and the New England region will be subjected to a tax inequity
which will be unnecessarily passed on to the consumer. It is important
to note that the Treasury Department again this year reiterated that it
does not oppose this clarification.
I would observe that several of my colleagues including Senators
Kennedy, Moynihan, D'Amato, Dodd, Lieberman, Gregg, Smith, Chafee, and
Reed have indicated their support in correspondence with our
distinguished Finance Committee Chairman.
I respectfully ask the Finance Committee to consider this important
measure in the context of comprehensive tax legislation next year.
Mr. ROTH. I thank my colleague from Massachusetts. I am well aware of
your interest in this amendment, as well as the continued interest of
the Senators from New York, New Hampshire, Connecticut and Rhode
Island. The Senator raises important issues with regard to the
uniqueness of such state-mandated payments. Unfortunately, as you know,
we were not able to take up such issues during the 105th Congress. It
would be my intention, though, to address this and other tax matters at
the next available opportunity.
Mr. CRAIG. Mr. President, I rise to commend the leadership and the
members of the Appropriations Committee for their hard work on this
bill. They had to make hard decisions about scarce resources and have
labored to do so fairly. I also appreciate the efforts to make sure the
taxpayers hard-earned dollars are spent effectively and efficiently.
While there are several provisions within this bill which I
wholeheartedly support, I do not agree with every provision of this
bill.
As you all may be aware, section 315 of the Interior portion of the
Omnibus Consolidated Rescissions and Appropriations Act of 1996
authorized the Recreational Fee Demonstration program. The Recreational
Fee Demonstration Program is currently scheduled to expire on September
30, 1999. Language from the House Fiscal Year 1999 Interior and Related
Agencies Appropriations Act to extend this demonstration program an
additional two years (to the year 2001) has been included in the FY1999
Omnibus Consolidated Appropriations Act. I worked to keep similar
language out of the Senate Interior appropriations bill and was
disappointed to see the House language prevail in the final omnibus
bill.
The issue here is that the House action was premature. I am not
totally opposed to a fee demonstration program. In fact, when Congress
authorized the Recreation Fee Demonstration Program in 1996, I voted in
support of this legislation and have been a proponent of user-based
fees. I believe that the program, in concept, has merits. I envisioned
this demonstration program as having the potential to improve the
condition and recreation services of public lands by making more
financial resources available to areas that are used the most heavily,
based on a modest fee allocated to those directly benefitting from the
enjoyment of those lands. Recreation is important in

[[Page S12761]]

Idaho. Because 63 percent of our state is managed by the federal
government, a majority of this recreation must take place on the public
lands. In some of our premier areas the resource is being loved to
death. Appropriated budgets will not see future large increases in
recreation programs even though these areas will undoubtedly continue
to be a popular local, and tourist, attraction.
As a member of the Senate Committee on Energy and Natural Resources,
the authorizing committee with legislative jurisdiction over the fee
demonstration program, as well as the chairman of the subcommittee of
jurisdiction, I am committed to thorough oversight of this program with
an eye toward consideration of any appropriate legislation to improve,
continue, or terminate it depending on the information we gather and
the experiences of the agencies.
On June 11, 1998, the Energy and Natural Resources Committee held an
oversight hearing on the program's first full year of implementation.
Valuable information was gathered from the agencies administering the
programs and the users of the resource. We will continue to monitor
this program during the next two years. A thorough review of the
program, with answers to some serious questions, must be completed
before extending the recreation fee demonstration program. Then we can
accurately assess the merits and problems and decide how to continue.
However, considering this issue settled at this early date will only
lessen the authorizing committee's responsibility to evaluate the
program and make any improvements that are warranted. We should act
after, not before, this demonstration program has had a chance to
demonstrate.
While I voted in favor of this bill for continuing necessary
programs, some provisions, such as a premature extension of the
recreation demonstration program, are not something I agree with or
support. If more time is needed to test the fee demonstration project,
it would have been more appropriate to extend the program nearer the
end of three-year period rather than after only the first full year of
the program. However, I will continue aggressive oversight of this
program in an effort to improve it and possibly end it in areas where
it clearly is not working.
Mr. BIDEN. Mr. President, included within this omnibus appropriations
bill are two important pieces of legislation related to foreign policy.
The first, produced on a bipartisan basis in the Foreign Relations
Committee, is the ``Foreign Affairs Reform and Restructuring Act,''
which involves the institutional structure of, and funding for, the
foreign affairs agencies of the U.S. government. The second bill is
legislation necessary to implement the Chemical Weapons Convention, a
treaty approved by the Senate in April 1997.
The Foreign Affairs Reform and Restructuring Act is not perfect, and
unfortunately it differs in one critical respect from the original bill
approved by the Senate 16 months ago. I say ``unfortunately'' because
this bill does not contain a single dime for our UN arrears. Last year,
Chairman Helms and I agreed on a proposal to authorize the payment of
$926 million in arrears to the United Nations, conditioned on a series
of reforms in that body. The Senate approved the Helms-Biden
legislation twice in 1997, first by a vote of 90-5 in June, then by a
voice vote in November.
The obstacle to making good on our commitments to the United Nations?
A small minority of members in the other body, who have insisted that
our arrears payments to the United Nations should be held hostage to an
unrelated issue regarding family planning. The specific provision--the
so-called Mexico City amendment --would require the withholding of
funds from foreign, non-governmental organizations which use their own
funds to perform abortions or discuss the issue with foreign
governments. The President has indicated on several occasions that he
will veto any bill presented to him that contains the Mexico City
language. Nonetheless, a handful of obstructionists in the other body
march steadily ahead, determined to undermine U.S. foreign policy
interests in order to advance their unrelated cause.
I deeply regret such irresponsible action by the other body, but it
is emblematic of the reckless disregard that many in that body have for
the important responsibilities the United States has as the world s
leading superpower.
In the past few weeks, the Chairman and I attempted to include a $200
million down payment on our UN arrears, which would have been linked to
certain of the conditions in the Helms-Biden legislation. But even this
limited payment of our arrears proved to be too much for the members in
the other body who have taken American foreign policy hostage.
It is essential that we find a way to repay our arrears next year.
For better or for worse, the United Nations is a valuable means to
advance our foreign policy and security interests around the world, by
providing a forum for improved cooperation with other states and by
allowing us, in some instances, to share the burdens and costs of world
leadership.
Our status as a deadbeat is unquestionably hurting our interests, not
only at the UN but with our leading allies--many of whom are owed money
by the UN for peacekeeping operations they undertook, but for which we
have not yet paid. The cost to our interests cannot be measured with
precision, but the resentment against the United States for its failure
to pay its back dues is having a corrosive effect on our agenda at the
UN and elsewhere. It is bordering on scandalous that a big nation like
ours, blessed with abundant wealth, has failed to pay its bills on
time.
Next year, the President is expected to nominate Richard Holbrooke to
be our representative to the United Nations. Ambassador Holbrooke's
nomination offers us a chance for a fresh start in the negotiations on
UN arrears and reforms. Mr. Holbrooke is one of the most creative
diplomats and negotiators of our time, and I am confident he will bring
fresh insights and endless energy to this important issue. I am also
hopeful that the Chairman remains committed to trying to move
legislation in the next Congress to repay the full amount agreed to
last year in our negotiations.
Let me turn now to the provisions of the Foreign Affairs Reform and
Restructuring Act that are contained in the omnibus bill. Much of the
legislative history of bill is set forth in the conference report to
H.R. 1757, which was approved by both houses last spring. But I would
like to take a few minutes to summarize the bill and highlight several
issues.
First, the legislation before us establishes a framework for the
reorganization of the U.S. foreign policy agencies which is consistent
with the plan announced by the President in April 1997. After several
years of debate, last year the President agreed to the abolishment of
two foreign affairs agencies, and their merger into the State
Department. The first agency to be abolished will be the Arms Control
and Disarmament Agency (ACDA), which will be merged into the State
Department no later than April 1, 1999; the U.S. Information Agency
(USIA) will follow no later than October 1, 1999. As with the President
s plan, the Agency for International Development (AID) will remain a
separate agency, but it will be placed under the direct authority of
the Secretary of State. And, consistent with the President s proposal
to seek improved coordination between the regional bureaus in the State
Department and AID, the Secretary of State will have the authority to
provide overall coordination of assistance policy.
The integration of ACDA and USIA into the State Department is not
intended to signal the demise of the important functions now performed
by these agencies. On the contrary, their merger into the Department is
designed to ensure that the arms control and public diplomacy functions
are key elements of American diplomacy.
In that regard, the bill establishes in law two new positions in the
State Department, an Under Secretary of State for Arms Control and
International Security, and an Under Secretary of State for Public
Diplomacy. These senior officers will have primary responsibility for
assisting the Secretary and Deputy Secretary of State in the formation
and implementation of U.S. policy on these matters.
It is expected that the officials who will be named to these
positions will be submitted to the Senate for advice and consent. The
conference committee on H.R. 1757 rejected a proposal by the Executive
Branch to seek authority to

[[Page S12762]]

place officials who are now in analogous positions in these newly-
created positions.
One issue of particular concern regarding ACDA in the reorganization
is the need to maintain the highest standards of competence and
objectivity in the analysis of compliance with arms control and non-
proliferation agreements. As the Foreign Relations Committee stated in
its report last year, it is vital ``that the Under Secretary be able to
call upon expert personnel in these areas who will not feel obligated
to downplay verification or compliance issues because of any potential
impact of such issues upon overall U.S. relations with another
country.'' Chairman Helms and I have urged the Secretary of State to
find a way to make the official for compliance a Senate-confirmed,
Presidential appointee.
The bill puts flesh on the bones of the President's plan with regard
to international broadcasting. The President's proposal was virtually
silent on this question, stating only that the ``distinctiveness and
editorial integrity of the Voice of America and the broadcasting
agencies would be preserved.'' The bill upholds and protects that
principle by maintaining the existing government structure established
by Congress in 1994 in consolidating all U.S. government-sponsored
broadcasting--the Voice of America, Radio and TV Marti, Radio Free
Europe/Radio Liberty, Radio Free Asia, and Worldnet TV--under the
supervision of one oversight board known as the Broadcasting Board of
Governors. Importantly, however, the Board and the broadcasters below
them will not be merged into the State Department, where their
journalistic integrity would be greatly at risk. Instead, the
Broadcasting Board will be an independent federal entity within the
Executive Branch. The Secretary of State will have a seat on the board,
just as the Director of the USIA does now.
Second, the bill authorizes important funding for our diplomatic
readiness, which has been severely hampered in recent years by deep
reductions in the foreign affairs budget. This Congress has stopped the
hemorrhaging in the foreign affairs budget, but I believe that funding
for international programs remains inadequate, given our
responsibilities as a great power.
Although the Cold War has ended, the need for American leadership in
world affairs has not. Our diplomats represent the front line of our
national defense; with the downsizing of the U.S. military presence
overseas, the maintenance of a robust and effective diplomatic
capability has become all the more important. Despite the reduction in
our military readiness abroad, the increased importance of diplomatic
readiness to our nation s security has not been reflected in the
federal budget.
Significantly, this omnibus appropriations bill contains the
emergency funding requested by the Administration for embassy security.
The bombings of the U.S. embassies in East Africa in August demonstrate
that many of our missions overseas remain highly vulnerable to
terrorist attack; it is imperative that we provide the State Department
the resources necessary to protect our employees serving overseas. We
should understand, however, that the urgent funding in this bill is
just the beginning of a long-term program to enhance security at
embassies around the globe.
I am especially pleased that the Chemical Weapons Convention
Implementation Act is also incorporated in the omnibus spending bill.
The Senate passed this legislation unanimously in May of 1997, and we
have waited since then for the leadership of the other body to accept
that complying with our international commitments is a requirement,
rather than a political football. The enactment of this measure will
enable the United States to file the comprehensive data declarations
required by the Convention, and therefore to demand that other
countries' declarations be complete. The United States will now be able
to accept inspections of private facilities, and therefore to request
challenge inspections of suspected illegal facilities in foreign
countries. The United States will finally be able also to protect
confidential business information, acquired in declarations or on-site
inspections, from release under the Freedom of Information Act. After
nearly 17 months of waiting, it is about time.
In closing, I want to pay tribute to Chairman Helms for his continued
good faith and cooperation throughout the last two years on these and
other issues. He has been the driving force behind the legislation to
reorganize the foreign affairs agencies, and I congratulate him for his
achievement. I also want to thank our colleagues in the other body,
particularly the ranking member of the Committee on International
Relations, Lee Hamilton, who is retiring this year after over three
decades of noble service to his district in Indiana and to the American
people. We wish him well as he moves on to new challenges.
Mr. President, I want to reiterate that we are leaving important
unfinished business--the payment of our back dues to the United
Nations. It must be at the top of our agenda in the next Congress. I
look forward to working with the Chairman and the Secretary of State to
find a way to finish the job.

Alternative Fuel Tax Credits

Mr. BURNS. Mr. President, I would like to clarify the intent of
Congress regarding tax incentives for alternative fuels. These
incentives are important tools for our nation's long-term energy
policy.
Starting with the energy crisis in the 1970s, Congress has acted on
numerous occasions to provide tax credits intended to develop
alternative fuels. Prior Congresses took these steps in recognition of
the need to encourage the development and use of alternative fuels
which promise that we as a nation will never be dependent on others for
our energy resources. For example, Section 29, which expired earlier
this year, and Section 45, which is due to expire next June, were both
intended to encourage the development of nonconventional fuels.
Today, our nation not only needs to continue its efforts to develop
alternative fuel resources, but given our ever growing energy
requirements, we must consider the environmental impact that
conventional and nonconventional fuels have on our environment,
particularly in light of the Clean Air Act.
In order to maximize the most efficient use of our nation's
resources, Congress needs to commit to the development of clean
alternative fuels. We need also to use our nation's technologies to
develop environmentally clean alternative liquid fuels from coal.
In Montana, we have vast coal reserves. There are technologies that
can upgrade the coal from these reserves and reduce current
difficulties associated with the development of these fields. However,
these technologies are not likely to be developed, and therefore these
vast natural resources are not likely to be used, unless Congress
provides incentives to develop clean alternative fuels.
I am concerned that we have not been able to fully discuss the merits
of such incentives in our budget debate this past month. For example,
an extension of Section 29 was included in the Senate version of the
tax extenders, but that provision was not included in the final
package.
I would urge my colleagues to bring this debate to the floor in the
106th Congress to ensure that the issue of encouraging the development
of clean alternative fuels is a priority in our nation's energy policy.
Mr. LOTT. I agree with my colleague from Montana. As our nation
continues to seek ways to improve environmental quality and to reduce
the need for imported energy, several new technologies run the risk of
not being developed if Congress does not act to provide incentives to
develop clean alternative fuels.
These technologies provide two significant benefits to our nation.
First, the use of alternative fuels reduces our reliance on foreign
energy sources. Second, the technologies provide cleaner results for
our environment.
For these reasons, I want to assure my colleague from Montana that I
will make a priority of addressing the need for tax incentives to
produce clean alternative fuels.
Mr. GRASSLEY. I agree with my colleagues from Montana and Mississippi
about this very important issue. The development and use of alternative
fuels are important to this nation, and

[[Page S12763]]

we must encourage their use and development.
Wind energy has long been recognized as an abundant potential source
of electric power. A detailed analysis by the Department of Energy's
Pacific Northwest Laboratory in 1991 estimated the energy potential of
the U.S. wind resource at 10.8 trillion kilowatt hours annually, or
more than three times total current U.S. electricity consumption. Wind
energy is a clean resource that produces electricity with virtually no
carbon dioxide emissions. There is nothing limited or controversial
about this source of energy. Americans need only to make the necessary
investments in order to capture it for power.
The Production Tax Credit, section 45 of the Internal Revenue Code
was enacted as part of the Energy Policy Act of 1992. This tax credit
is a sound low-cost investment in an emerging sector of the energy
industry. I introduced the first bill that contained this tax credit,
so you can be sure that I am sincere in my belief in the need to
develop this resource. This tax credit currently provides a 1.5 cent
per kilowatt hour credit for energy produced from a new facility
brought on-line after December 31, 1993 and before July 1, 1999 for the
first ten years of the facility's existence. Last Fall, I introduced a
bill to extend this tax credit for five years. My legislation, S. 1459,
currently has 22 cosponsors, including half of the Finance Committee.
The House companion legislation, introduced by Congressman Thomas,
currently has 90 cosponsors, including over half of the Ways and Means
Committee. These numbers are a strong testament to the importance of
the section 45, and renewable fuels in general.
In addition, I plan to work to expand this tax credit to allow use of
the closed-loop biomass portion of this tax credit. Switchgrass from my
state and other Midwestern states, eucalyptus from the South, and other
biomass, can be grown for the exclusive purpose of producing energy.
This is a productive use of our land, and will be an important step in
our use and development of alternative and renewable fuels.
I was very pleased to see that Congress expressed its understanding
of the importance of alternative and renewable fuels by extending the
ethanol tax credit in this year's T-2 legislation. These tax credits
are a successful way of promoting alternative sources of energy. These
tax credits are a cheap investment with high returns for ourselves, our
children, our grandchildren and even their grandchildren. Congress
needs to again pass this important legislation to ensure that these
energy tax credits are extended into the next century.
Mr. MURKOWSKI. I concur with my colleagues. Implementation of the
1990 Clean Air Act amendments is creating a real need to develop clean
alternative fuels.
For example, of the 64 remaining U.S. coke batteries, 58 are subject
to closure as a result of the Clean Air Act. The steel industry can
either use limited capital to build new clean coking facilities or they
can choose to import coke from China, which uses 50 year old highly
pollutant technologies. Restoring the Section 29 credit to encourage
cleaner coker technologies will greatly reduce emissions and will slow
our increasing dependence on foreign coke, at the same time creating
jobs in the United States in both the steel and coal mining industries.
In addition, the United States has rich deposits of lignite and sub-
bituminous coals. There are new technologies that can upgrade these
coals to make them burn efficiently and economically, while at the same
time significantly reducing air pollution.
This is proven technology, but to make the development of this
technology throughout the nation feasible, the Congress needs to
provide tax incentives.
Mr. ENZI. The people of Wyoming have always had very strong ties to
our land. That is why the words ``Livestock, Oil, Grain and Mines''
appear on our state seal. Those words clearly reflect the importance of
our natural resources to the people of my state, and our commitment to
using our abundant natural resources wisely and for the benefit of
current and future generations of Wyomingites and the people of this
country.
Congress has determined the need to find newer and cleaner
technologies. Wyoming is blessed with an abundance of clean burning
coal reserves. It would seem to be a perfect match. We are eager to
provide what is needed for our country's present and future fuel needs.
But those reserves aren't likely to be developed unless we provide the
incentives necessary to make it possible for the coal to be harvested
in a safe and environmentally friendly manner.
Mr. ABRAHAM. I concur with my colleagues. The development and
production of alternative fuels provides a real opportunity for the
country to improve the environment while ensuring a constant,
reasonably priced fuel supply. But recent efforts to provide such
assurances have been hampered. For example, in the Small Business Job
Protection Act of 1996, Congress extended the placed-in-service date
for facilities producing synthetic fuels from coal, and gas from
biomass for eighteen months.
However, progress in bringing certain facilities up to full
production has been hampered by the Administration's 1997 proposal to
shorten the placed-in-service date and because, in many cases, the
technology used to produce the fuels is new. Such delays have created
uncertainty regarding the facilities eligibility under the placed-in-
service requirement of Section 29
While it is important that the Congress consider again this issue in
the 106th Congress, I would also urge the Secretary to consider the
facilities I mentioned qualified under Section 29 if they met the
Service's criteria for placed-in-service by June 30, 1998 whether or
not such facilities were consistently producing commercial quantities
of marketable products on a daily basis.
Mr. CONRAD. I agree with my colleagues. Through the section 29 tax
credit for nonconventional fuels, Congress has supported the
development of environmentally friendly fuels from domestic biomass and
coal resources. There are lignite resources in my state that could
compete in the energy marketplace if we can find a reasonable incentive
for the investment in the necessary technology. As soon as possible in
the 106th Congress, I hope we will give this crucial subject the
attention it deserves.
Mr. HATCH. I concur with my colleagues. This is a very important tax
credit for alternative fuels. It is an issue of fairness, not one of
corporate welfare.
Earlier this year I, along with 18 of my colleagues, introduced a
bill that would extend for eight months the placed-in-service date for
coal and biomass facilities. The need still exists to extend this date
and I am very disappointed that this was not included.
Mr. BAUCUS. Mr. President, I want to join my colleagues in supporting
tax incentives for alternative fuels. Our country has assumed a
leadership role in the reduction of greenhouse gases because of the
global importance of pollution reduction. As my colleagues have also
pointed out, promotion of alternative fuels is not just an
environmental issue, but an issue important to our domestic economy and
independence as well. We cannot afford to slip back toward policies
which will leave us dependent upon foreign sources of oil for our
economic growth.
With the huge reserves of coal and lignite in the United States and
around the world, as well as the tremendous potential for use of
biomass, wind energy, and other alternatives, it is particularly
important to our economy and the world's environment that new, more
environmentally friendly fuels are brought to market here and in
developing nations.
But bringing new technologies to market is financially risky. In
particular, finding investors to take a new technology from the
laboratory to the market is difficult because so many technical
problems need full-scale testing and operations to resolve. Few
investors are prepared to take on the risks associated with bringing a
first-of-a-kind, full-sized alternative energy production facility on-
line without some level of security provided by a partnership with the
federal government.
Tax incentives represent our government's willingness to work with
the private sector as a partner to bring new, clean energy technologies
to the market. These incentives demonstrate our country's commitment to
the future.

[[Page S12764]]

Mr. GRAHAM. There are two principle reasons I support extension of
Section 29 and 45. First, in a period where America is continuing to
increase its dependence on foreign oil, we need to develop alternative
fuel technologies to prepare for the day when foreign supply of oil is
reduced. These tax credits have spurred the production of fuel from
sources as diverse as biomass, coal, and wind. America will desperately
need fuel from these domestic sources when foreign producers reduce
imports.
Second, the alternative fuels that earn these tax credits are clean
fuels. For example, the capture and reuse of landfill methane prevents
the methane from escaping into the atmosphere. I will support my
colleagues in an effort next year to extend these provisions.
Mr. THURMOND. I join my colleagues in support of extending the tax
credit for Fuel Production from Nonconventional Sources. Through this
credit, Congress has emphasized the importance of establishing
alternative energy sources, furthering economic development, and
protecting the environment. The alternative fuels credit strikes a
proper balance between each of these objectives. I support efforts to
bring this issue to a satisfactory conclusion, early in the next
Congress.
Mr. THOMAS. I strongly agree with my colleagues regarding the
importance of the Section 29 tax credit. Wyoming has some of the
nation's largest coal reserves and this tax credit gives producers an
incentive to develop new and innovative technologies for the use of
coal. I am disappointed that an extension of the Section 29 tax credit
was not included in the Omnibus Appropriations package and urge my
colleagues to make this matter a top priority during the 106th
Congress.
Mr. ROTH. I understand my colleagues' concerns. For some time now I
have been studying how to provide targeted incentives to develop clean
alternative fuels. It is essential for Congress to develop sound tax
policy for alternative energy to help protect our environment. Several
weeks ago, I introduced legislation to provide such incentives for
facilities that produce energy from poultry waste. I look forward to
working with my colleagues on these issues early in the 106th Congress.

Permanent Research Credit

Mr. BINGAMAN. Mr. President, I would like to thank the distinguished
chairman and ranking member of the Committee on Finance for their
continuing work on the research and experimentation tax credit, which
is extended through June of 1999 by this legislation. In my capacity as
ranking member of the Joint Economic Committee, I have taken a strong
personal interest in the research credit and how it can be made into an
effective permanent incentive. It is potentially the most important
incentive in our tax code for stimulating long-term economic growth,
and I believe that we need to make every effort in the upcoming session
of Congress to establish a permanent credit for research and
development.
In the course of these efforts, we need to keep in mind the
substantive issues that are intrinsic to the goal, shared by many of my
colleagues, of a permanent effective R&D tax policy. Can we make the
credit more equitable, to give all R&D-performing firms incentives to
increase their R&D? Can it be made more effective for the industries
that have historically invested heavily in research and development?
Can it be made more accessible by small businesses, which are a growing
sector of our nation's R&D and promise to be a leading source of high-
wage job growth? And can it further encourage research partnerships--
crossing the institutional boundaries of industry, universities, and
public-benefit consortia--that lay the groundwork for our future
technology and medicine through long-term R&D investments?
In the negotiations of the past few weeks, Congress came alarmingly
close to not extending the credit at all. I am concerned that until we
address the substantive issues outlined above, the R&D credit is likely
to continue to teeter along in its current state of uncertainty, and
that under its current structure it will perform less and less
effectively, as an incentive and as an economic stimulus. I am joined
in these concerns by economists who have studied the credit and by
senior leaders of R&D-intensive corporations. As the distinguished
chairman and ranking member know, I and other Senators have introduced
legislation to address these issues in this Congress. Obviously, time
does not permit us to address these issues at this point, but I would
ask them whether they would be willing to have the Committee on Finance
consider these issues in the next Congress, in preparation for further
legislative action on the credit?
Mr. ROTH. I welcome the suggestion made by the Senator from New
Mexico. I believe that the issues that the raises are important ones,
and that his suggestions for comprehensive improvements are worthy of
further consideration by the Committee. I am aware that several of our
other colleagues, including Senators Domenici, Hatch, and Baucus, are
also keenly interested in the future of the credit, and I look forward
to working with all of our colleagues who are interested in these
issues in the next Congress.
Mr. MOYNIHAN. I would agree with the chairman of the Committee that
the issues raised by the Senator from New Mexico deserve further
attention next year, and would also welcome the opportunity to work
with him and with my other colleagues.
Mr. BINGAMAN. I thank the chairman and ranking member.

degradation of service at williston office national weather service

Mr. DORGAN. I would like to inquire of the distinguished Chairman of
the Commerce, Justice, State Appropriations Subcommittee, Mr. Gregg, as
to the intent of language in the FY99 conference report on National
Weather Service operations at Williston, North Dakota.
Mr. GREGG. The conference report includes language which directs the
Secretary of Commerce to ensure continuation of weather service
coverage for the communities of Williston, North Dakota; Caribou,
Maine; Erie, Pennsylvania; and Key West, Florida.
Further, the Conference provides full funding to the NWS for
continued, effective operations at Williston and the other Weather
Service offices mentioned.
Mr. DORGAN. I thank the Subcommittee Chairman for his commitment to
this provision in the bill. The Commerce Secretary has agreed that
closing the Williston weather station would amount to a degradation of
weather service. It is critical, therefore, that Congress send a strong
signal that the station at Williston be kept fully operational.
Mr. GREGG. I will tell the Senator from North Dakota that it is the
intent of the conferees that the National Weather Service maintain
operations at Williston and the other sites, and further that the NWS
take no actions which would suggest an intent to close these offices.
Any actions taken towards closure of these offices will signal to the
Congress that there will be a resulting degradation of service.
Mr. DORGAN. Is it correct to say that the fact that specific funds
are being provided to the National Weather Service to maintain
operations at the offices which were identified in the 1995 Secretary's
report signals that the Congress expects these offices to continue and
that the NWS ought not to be taking any actions that would suggest that
these offices will be closed?
Mr. GREGG. Yes, that is correct. We believe that with respect to
these specific offices, including Williston, North Dakota, the NWS
modernization plan has not sufficiently demonstrated that service will
not be degraded without these offices. The Congress does not want the
NWS to close these offices at this time and we are providing specific
appropriations to ensure their continued operations. I would also add
that we expect the NWS to use these additional funds to develop the
appropriate systems to address the unique weather coverage shortfalls
that exist for these specific communities.
I realize that the most difficult problem for Williston, North Dakota
is the absence of local radar coverage at low altitudes. We expect that
the NWS will use these funds and work cooperatively with the local
residents in Williston to mitigate that concern.

registration of container chassis

Ms. SNOWE. Mr. President, I would like to explain section 109 of
Division C regarding the registration of container chassis. This
section addresses the application of registration fees to trailers

[[Page S12765]]

used exclusively for the purpose of transporting ocean shipping
containers, which the Section refers to as ``container chassis.''
The section provides that a State, such as California, that requires
annual registration and apportioned fees for container chassis may not
limit the operation, or require the registration in the State, of a
container chassis registered in another State, if the container chassis
is operating under a trip permit issued by the non-registration State.
Further, the non-registration State may not impose fines or penalties
on the operation of such a container chassis for being operated in the
non-registration State without a registration issued by that State. For
example, the Attorney General of California or any other person in
California, may not seek to impose fines or penalties from companies
operating container chassis in California, when the container chassis
are registered in another state such as Maine or Tennessee.
Further, under this language, a State that requires annual
registration of container chassis and apportionment of fees for such
registration may not deny the use of trip permits for the operation in
the State of a container chassis that is registered under the laws of
another State. A trip permit provides for a daily use fee that is the
prorated annual registration fees for the vehicle. Under the section, a
trip permit is required only on days when the container chassis is
actually operating on the State's roads and not, for example, when it
remains at an ocean terminal for the entire day.
This section also provides that a State, political subdivision or
person may not, with respect to a container chassis registered in
another State, impose or collect any fee, penalty, fine, or other form
of damages which is based in whole or in part on the nonpayment of a
State's registration related fees attributable to a container chassis
operated in the State before the date of enactment of this section
unless it is shown by the State, political subdivision or person that
the container chassis was operated in the State without a trip permit
issued by the State.
This provision is intended to prevent the imposition of any liability
on this basis for the current and past practice of many companies in
the container shipping industry which register chassis in one State and
operate them in another State under trip permits issued by the non-
registration State. The provision is intended to ensure that past and
current practices which are consistent with the objectives of this
section will not be the basis for the imposition of fees, penalties,
fines or other forms of damages on this segment of the Nation's
intermodal transportation system.
Using the congressional power to regulate interstate commerce, this
section is intended to facilitate movement of containerized cargo in
interstate commerce and to remove an unreasonable impediment to
interstate commerce. It simplifies and rationalizes registration
requirements for this critically important segment of the Nation's
interstate intermodal transportation system.
It is important to note that extensive discussion and consideration
was given to this section. Members from the Senate Commerce Committee,
Appropriations Committee, and the House Appropriations and the House
Transportation and Infrastructure Committee worked on this language and
came to the conclusion that it is necessary. It is clearly the intent
of both Chambers of Congress that States, such as California and
others, which want to limit the operation of chassis that are not
registered in their State, are prohibited from doing so. Further, it is
clearly the intent of both Chambers of Congress that States, such as
California and others, are prohibited from collecting fines or
penalties from companies which register chassis in another State and
operate under a trip permit issued by the State where the chassis is
operated.
Mr. LEVIN. Mr. President, Yogi Berra, explaining the difficulty of
playing in the afternoon sun and shadows of Yankee Stadium's notorious
left field is reported to have commented, ``It gets late early.'' We
have before the Senate a huge Omnibus Appropriations and Emergency
Supplemental bill which spends more than $486 billion and legislates
across a broad range of issues of great importance. We are faced now
with this massive, sweeping legislation because the 105th Congress did
not do its work. In the 105th Congress, it got late early.
From the very outset of this Congress, the majority leadership set a
slow pace and avoided fully addressing the major issues before the
Nation. The 105th Congress failed to reform our campaign finance laws,
failed even to debate a patient's bill of rights, failed to act on
legislation to reduce tobacco use by our young people, failed to even
to take up serious regulatory reform, and failed to address the
problems looming in the future of Social Security. In fact, this
Congress, failed, this year to even meet its responsibility, under law,
to pass a budget, the first time this has occurred. And, it failed to
complete work on 8 of the 13 appropriations bills required to run the
government. Two appropriations bills were never even debated by the
Senate and a third was never passed. On top of that dozens of
legislative proposals were added to this bill which were never debated
and considered in the Senate.
The failure to pass the appropriations bills, as required, prior to
end of the fiscal year on October 1, led directly to the process that
confronts us with this monster Omnibus Appropriations bill today, a
four thousand plus page bill which we were unable to even begin reading
until yesterday.
The Founders of our Nation envisioned a careful contemplative
legislative process which divided power and sought to assure that the
people would be well represented. The process which we have recently
witnessed was hardly that. It was a closed process, which greatly
excluded Democrats in the House and Senate, enhancing the powers of the
Republican leaders of the House and Senate and in an extra-
Constitutional fashion bringing the President into a legislative role.
Where the Congress was more fully represented, its representation was
limited to the members and leaders of the Appropriations Committees of
the House and Senate. This, despite the fact that legislation was
included affecting the jurisdictions of many, if not all, of the
authorizing committees. And then, the entire package was lumped
together and dumped here on the Senate floor on a take it or leave it
basis. Senators have no opportunity to attempt to amend this product,
merely to vote yes or no. Never before in my memory have we been
confronted with appropriations bills and legislative provisions on so
massive a scale which have never even been considered in either the
House or Senate.
The President, and Democrats in the Congress have won some important
victories in this bill. However, even as we acknowledge and applaud
those victories, we must be mindful of the precedents which we set when
we accept this terrible process. Congress should not abdicate its
responsibilities. That is why I joined with Senators Byrd and Moynihan
in fighting the line-item veto in the courts, a battle which was
successful and that is why I am distressed by the process which creates
the bill on the floor today, an ad-hoc process at best and a process
which effectively disenfranchises many Americans by short-changing
their representation, at worst. And that is why, although this
legislation contains many provisions of which I approve, and although I
applaud the work of the Administration and Democrats in Congress in
winning important provisions in this bill, I do not support this
wretched process and cannot in good conscience vote for this bill.
Among the most important positive aspects of this legislation is that
the bill provides additional funding for education. The President and
Democrats in the Congress put forward an education package early this
year. This bill finally acts on key elements of that package, providing
a $1.2 billion downpayment on reducing class size by hiring new
teachers across the country. In addition, the bill includes $698
million for education technology, the $260 million that the President
requested for child literacy, $871 million for summer jobs, a $301
million increase for title I, $491 million for Goals 2000, and a $313
million increase for Head Start.
Unfortunately, the bill excludes the President's school modernization
initiative which would have leveraged nearly $22 billion in bonds to
build and renovate schools. Hopefully, we can revisit this issue in the
next Congress.

[[Page S12766]]

The bill includes $15.6 billion for National Institutes of Health, $2
billion more than FY'98 and $859 million more than the Administration
request, $700 million for Maternal and Child Health Block grant, $9.4
million more than FY98, $105 million for Healthy Start to reduce infant
mortality rates, $9.5 million more than FY98, $160 million for breast
and cervical cancer screening, $16.2 million over FY98, and $2.5
billion for Substance Abuse and Mental Health Services, $341 million
above FY98.
Also, I am pleased that the bill contains language which is a first
step toward restructuring the home health care payment system. I have
been concerned about this problem for some time now. I was an original
co-sponsor of Senator Collins' Medicare Health Equity Act of 1998 I
believe the provision in the Omnibus bill will create a payment system
which is somewhat more equitable than the current system. Under our
current system, health care providers in Michigan have too often been
penalized for prudent efficient use of Medicare resources, and that is
wrong.
In addition to the nearly six billion dollars in the bill for
emergency assistance to farmers who have been hurt by low prices,
drought and natural disasters, it contains important money for Michigan
agriculture for research on subjects from fireblight to wood
utilization. There is a provision to make apple growers in West
Michigan, who suffered fireblight-related tree loss in disastrous
storms, eligible for the Tree Assistance Program. The bill provides the
President's request for an enhanced food safety incentive, plus an
increase in the National Research Initiative of $7.4 million for
nutrition, food quality and health. Some of these additional funds
could and should be used by the Secretary to help develop safer
substitutes for pesticides that might be discontinued in implementation
of the Food Quality Protection Act. Also, the agreement includes
$300,000 for a study of the WIC food package nutritional guidelines
finally looking at the benefits of including dried fruit in WIC
cereals.
I am pleased that the bill continues a moratorium on the use of funds
to increase the CAFE standard for passenger cars and light-duty trucks.
Given the low-price of gasoline and the continued high consumer demand
for larger, safer vehicles, which are made most efficiently by U.S.
manufacturers, increasing CAFE would only harm the U.S. economy and
deprive consumers.
I am disappointed funding for the National Contaminated Sediments
Task Force which I requested was not included in the bill. I am
concerned that this will mean that the existing uncoordinated Federal
approach will continue to fail in adequately cleaning up contaminated
sediments and preventing further contamination.
There will be an additional $400,000 above the President's request
split between operations and acquisition at Keweenaw National
Historical Park. The bill includes $800,000 for land acquisition at
Sleeping Bear Dunes National Lakeshore, and $2.25 million for the final
phase for acquisition of lands from the Great Lakes Fishery Trust as
part of the Consumers Energy Ludington settlement.
This agreement provides the budget request for the International
Joint Commission so that negotiations with the Canadians can begin in
earnest to prevent the export of Great Lakes water. The bill includes
$6.825 million for the Great Lakes Environmental Research Laboratory in
Ann Arbor. Funds ($50,000) for a study of the erosion problems in Grand
Marais Harbor are also included. Unfortunately, the bill does not
include the Senate's increase of $1 million above the budget request
for the Great Lakes Fishery Commission to combat the sea lamprey in St.
Mary's River.
Overall, the bill provides the highest level of funding for the
Federal Highway Administration in history, at $25.5 billion. That is
relatively good news, though, unfortunately, the negotiators have
included over $300 million in new highway money to be handed to four
different states in an apparent effort to bypass the allocation
formulas in TEA-21 that were the subject of much debate earlier this
year.
The bill does contain $10 million for new buses and bus facilities
across facilities, and $600,000 for the Capital Area Transit Authority
in Lansing. And, $200,000 for a study of the viability of commuter rail
in Southeastern Michigan.
As a cosponsor of legislation to delay implementation of Section 110
of the 1996 Immigration Reform bill, which was scheduled to go into
effect on September 30, 1998, requiring individuals entering the U.S.
at the Canadian border to complete a visa card at the point of entry
and register at the time of exit, I am pleased to note that this bill
contains language delaying the provision for 30 months. However, it
should be repealed, not just delayed.
I am pleased that the bill does not include the House version of
the Auto Salvage Title bill since the House dropped the Levin amendment
which I successfully attached to the Senate bill. The House version
would have preempted state laws that provide tougher consumer
protection.

I am also pleased that while the bill provides funding to replenish
the IMF, it will push recipient countries to liberalize trade
restrictions.
Mr. President, let me take a moment to comment on the national
security provisions of the omnibus bill. First, I am pleased that this
legislation includes the funding the President requested for United
States participation in the NATO-led peacekeeping force in Bosnia.
If Congress had not provided this emergency funding, there would have
been disastrous consequences for the readiness and the morale of our
forces serving in, and in support of, Bosnia. We all regret that the
implementation of the civilian aspects of the Dayton Accords has not
gone as fast as we hoped it would, but Congress has done the right
thing by providing the necessary funding to ensure the readiness of our
forces.
This legislation provides a needed $1 billion in additional readiness
funding that the President requested earlier this month for equipment
maintenance, spare parts, and recruiting assistance.
This omnibus bill also contains the funds requested by the President
for the Korean Peninsula Energy Development Organization, also known as
KEDO. This funding is crucial to continuing the Agreed Framework
between the United States and North Korea. That agreement is our best
hope for denuclearizing North Korea and has provided tangible security
benefits to our nation.
Previous legislation would have effectively prevented the funding of
KEDO, and thus given North Korea an excuse for walking away from the
Agreed Framework. That could have led North Korea to produce plutonium
for nuclear weapons, which would cast the Korean Peninsula into an
unnecessary and dangerous crisis. This outcome is the right one.
There are many positive aspects of this legislation for our national
security, but I am disappointed that so much of the ``emergency''
funding in this bill for national security programs is not for
readiness and not for emergencies, but for things the Defense
Department and the administration never asked for, in particular the
addition of $1 billion for ballistic missile defense. Of course, that
$1 billion for ballistic missile defense cannot be spent unless the
President submits an emergency request for these funds. I fully expect
the Administration will exercise good judgement in deciding whether or
not to request these funds as an emergency.
Not only is the money added to this bill for missile defense and
intelligence programs going to fund programs that the administration
did not request funding for on an emergency basis, again, these are
programs for which the administration did not request funding at all.
Furthermore, with regard to missile defense, adding this funding is
in direct contradiction to the testimony of the Secretary of Defense
and other senior officials of the Department of Defense who told the
Armed Services Committee that while there was one instance in which
additional funds could accelerate a program, the Navy Upper Tier
program, in general the Ballistic Missile Defense Organization is
proceeding as fast as it can with all our missile defense programs and
their development is constrained by technology, not funding
availability.
In recent testimony to the Armed Services Committee, senior defense
and

[[Page S12767]]

military leaders told us that the National Missile Defense (NMD)
program is going as fast as it can, and that adding more money will not
make it go faster. Deputy Secretary of Defense John Hamre told the
Committee: ``As a practical matter, we are moving as fast as we can to
develop the elements of an NMD system. Even with more money, we
couldn't go any faster.'' He later emphasized that ``this is as close
as we can get in the Department of Defense to a Manhattan Project. We
are pushing this very fast.''
During that same hearing, General Joseph Ralston, the Vice Chairman
of the Joint Chiefs of Staff, told the Committee that the NMD program
enjoys a unique and privileged status within the Defense Department. He
said: ``I know of no other program in the Department of Defense that
has had as many constraints removed in terms of oversight and reviews
just so we can deploy it and develop it as quickly as possible.''
On October 6th, Secretary of Defense William Cohen testified to the
Armed Services Committee that the NMD program is being developed as
fast as possible and additional money will not speed it up: ``I have
talked to the head of the Ballistic Missile Defense Organization and he
has assured me that no amount of money will accelerate that timetable .
. .'' He went on to say that ``I cannot accelerate it no matter what we
do.''
So, it is clear that the Defense Department is proceeding as fast as
possible to develop a National Missile Defense system, and that more
money will not make this go any faster. Furthermore, the Defense
Department has told us that only one program could be accelerated with
more money. I would note that Congress added $120 million to the Navy
Upper Tier program this year to accelerate it, cut funds from other
theater missile defense programs and made no attempt in the regular
legislative process to add any money for National Missile Defense. So
this unrequested missile defense money cannot speed up most of the
programs that are now being developed. It is not clear what it would be
for, but it is clear that the Defense Department never asked for it.
A few weeks ago, the members of the Joint Chiefs of Staff were
criticized by some of my colleagues on the Armed Services Committee
during our hearings with them for not speaking up soon enough or
forcefully enough about concerns they had with aspects of our defense
program.
Mr. President, it seems a little inconsistent to me for the Congress
to criticize the Pentagon for not speaking up and then after they
express themselves very clearly on the status of the missile defense
program, we ignore their testimony and do the opposite of what they
say.
I am also disappointed that this legislation perpetuates the practice
of not fully funding our obligations to the United Nations. It is in
the national security interest of the United States to have an
effective United Nations and strong U.S. leadership within the United
Nations. It is especially regrettable that this legislation moves us in
the opposite direction in order to score political points on the
abortion issue.

Mr. President, the bill that we are voting on today includes S. 2176,
the Federal Vacancies Reform Act of 1998, with several amendments. This
legislation clarifies and updates the current Vacancies Act, an 1868
law meant to encourage the Administration to make timely nominations to
fill positions in the Executive Branch requiring the Senate's advice
and consent.
First, the Vacancies Act provisions in this bill make it explicit
that the Vacancies Act is the sole exclusive statutory authority for
filling advice and consent positions on a temporary basis. It can no
longer be argued that other general statutory authorities creating or
organizing agencies supersede the Vacancies Act and authorize temporary
officials, who have not been confirmed by the Senate, to serve
indefinitely.
Second, the legislation updates the Vacancies Act in several
significant respects to more accurately reflect the realities of
today's nominations process. The clearance process for nominees
requiring Senate confirmation has become much more complex than it was
just a decade ago. Moreover, increasingly adversarial confirmation
proceedings have required that background investigations and other
steps in the vetting process be more thorough and lengthy. In
recognition of this development, the legislation increases the time
period that an individual can serve in an acting position from 120 days
under current law to 210 days from the date of the vacancy. If a
nomination is sent to the Senate during that 210 day period, an
individual may serve in an acting capacity until the Senate has
completed action on the nomination. Moreover, the legislation gives a
new Administration an additional time period of 90 days to submit its
nominations in the first year. The legislation allows first assistants,
other Senate-confirmed officials, and other qualified high-level agency
employees to serve as acting officials.
Finally, the legislation creates an action-enforcing mechanism to
encourage our presidents to promptly submit nominations. Specifically,
the legislation provides that if no nomination to fill a vacant
position is submitted within the 210 day period, the position remains
vacant and any duties assigned exclusively to the position by statute
can be performed only by the agency head. As soon as a nomination is
submitted, however, the legislation provides that an acting official
can assume the job until the Senate acts on the nomination.
The legislation also includes an amendment I authored to address the
problem of lengthy recesses or adjournments. The bill allows a person
to serve in an acting capacity in a vacant position once a nomination
is submitted, regardless of whether the nomination is submitted within
or after the 210 day time period. This is a clarification the
legislation makes to current law. However, there was no provision to
allow a person to serve in an acting capacity after the 210 day time
period if the nomination is made during a recess or adjournment of the
Senate. My amendment, incorporated into the enacted legislation as
section 3349d, provides that during such long recesses, the President's
submission of a written notification that he or she intends to nominate
a designated person promptly when the Senate reconvenes triggers the
provision of the bill that allows a person to act in the position
temporarily until the Senate acts on the nomination. This allows the
President to fill a vacant position with an acting person during a long
recess of the Senate provided the President has identified the person
whose nomination will be submitted when the Senate returns.
Mr. President, I want to commend my colleagues Senator Byrd and
Senator Thurmond for their leadership and sponsorship of legislation to
amend the Vacancies Act. They identified a serious problem in the
failure of Administrations past and present to comply with their
responsibilities under the existing law to promptly nominate persons to
fill advice and consent positions. They worked diligently to resolve
the various conflicts over this legislation, and I am pleased we were
able to bring this legislation to a responsible and timely conclusion.
As we adopt these reforms to the Vacancies Act, we should not forget
that as Senators we have a corresponding duty to act promptly and
responsibly on nominations once they are submitted by the
Administration. We as the Senate rightfully want to protect our
Constitutional prerogative to provide advice and consent on
nominations. However, we must by the same token discharge these duties
in a conscientious and timely manner.
Mr. President, I also want to mention one piece of legislation which
the Congress failed to address this year and which was not folded into
this Omnibus Appropriations bill in the final hours of this Congress. I
am very disappointed that we were not able to enact legislation to
improve the regulatory process this year. Senator Thompson and I
sponsored S. 981, the Regulatory Improvement Act. We had two hearings
on the bill and marked it up in the Governmental Affairs Committee back
in March of this year. It was reported to the full Senate for
consideration in May. The Administration signaled its support for the
bill with certain agreed-to changes in July. And, we've been urging
that the Majority Leader bring the bill to the floor since that time.
The bill now has 17 Republican and 8 Democratic cosponsors.
S. 981 is a reasonable approach to improving the regulatory process
by requiring cost-benefit analysis and risk

[[Page S12768]]

assessment for our most significant regulations. It would bring
meaningful reform to the way the federal government adopts its
regulations, and it would make the rulemaking process far more open and
interactive. We lost a great opportunity this year and invested a lot
of hard work and effort.

further research on fiber polymer additives in asphalt and concrete in
connection with the transportation appropriations act

Mr. THURMOND. Mr. President, I rise to engage in a brief colloquy
with my colleague, the Honorable Chairman of the Transportation
Appropriations Subcommittee, Senator Richard Shelby.
Included in the Senate Appropriations Committee Report accompanying
the Transportation and Related Agencies Appropriations Act for fiscal
year 1999, is a provision directing that additional research be
conducted on a product that I believe could greatly improve highway
pavement quality and maintenance. I am speaking of the use of fiber
polymer additives--also known as ``binders''--in asphalt and concrete,
the use of which appears to yield significant results in pavement
quality and longevity.
While only a limited amount of research has been completed on this
product, the few applications tested under real world circumstances
have shown very positive results. If this product is as good as it
appears to be in initial test results, it would revolutionize the
industry and save states and the Federal Government significant
resources for use on other critical infrastructure needs.
Not only does this product appear to add significant longevity to
pavement life, it also serves an environmental benefit. Mr. Chairman,
as you know, recycling allows us to conserve our natural resources, it
diverts additional material from our landfills, and saves energy. A
company in my home state of South Carolina, Martin Color-Fi, Inc., has
empirical data that shows substantially improved life expectancy for
highways constructed with polymer additives in the pavement. Their
success, and that of others in this area, is encouraging news for
improving the quality and longevity of our Nation's highways.
I note that the Statement of Manager's language accompanying the
Transportation title of the Omnibus Appropriations Act, unlike the
Senate Committee report, does not specify the amount of funds in the
Highway Research, Development and Technology Program for the Federal
Highway Administration (FHWA) to conduct additional demonstrations of
this technology. It is my understanding that Chairman Shelby shares my
commitment to this research. Further, it is my understanding that he
and other members of the committee would join me in strongly
encouraging FHWA to work with an academic institution, and give
priority consideration to applying at least the amount of research
funds specified in the Senate-passed Transportation Appropriations
bill, in order to create an academic and industry-led consortium to
demonstrate the application of polymer additives in pavement for civil
engineering purposes.
Mr. SHELBY. Mr. President, it is my pleasure to stand shoulder-to-
shoulder with my colleague from South Carolina, the distinguished
President pro tempore, in this effort to increase funding for research
into the use of polymer additives for asphalt and concrete pavement.
The Transportation Appropriations Subcommittee directed that $2
million be committed for further research into polymer additives.
Limited resources prohibited us from committing additional resources to
this effort.
The provision the Committee added to the Report was designed to
respond to a shortfall in this area by directing federal research
efforts into further study of the effects of polymer additives on
pavement quality and performance.
I greatly appreciate the Senator from South Carolina's interest in
this matter, and I look forward to working with him and the FHWA to
ensure this research is completed and reported to the states and other
interested parties in a timely fashion.
Mr. KERRY. There were legitimate reasons to vote against the omnibus
appropriations bill. This process was an insult to the Congress. The
Republic leadership has put the Congress in an untenable position by
refusing to pass many appropriations bills in regular order. I chose to
vote for this legislation because of the important things it does for
Massachusetts and the nation, and because I do not believe it is useful
to cast a protest vote. I am hopeful that in the 106th Congress we can
engage in a true legislative process.
Today, the Senate will give final approval to legislation to preserve
a balanced budget for the first time in more than a generation. A
balanced federal budget has been a key objective for me since I came to
the Senate in 1985.
The Federal government had run a deficit continuously for more than
30 years until last year. It soared to dangerous levels in the 1980s
during the Reagan and Bush Administrations. As a result of these
deficits, our national debt multiplied several times, exacting a heavy
toll on our economy, increasing interest rates, squeezing federal
spending and making debt service one of the largest expenditures in the
Federal budget.
In 1993, following President Clinton's election, we began the long
journey back from crushing deficits and toward fiscal responsibility by
passing an enormously successful economic plan. The full power of our
economy was unleashed: unemployment is at record low; interest rats are
subdued; and economic growth continues to be strong. This path
culminated in last years; agreement to balance the budget and provide
substantial broad-based tax relief for working American families and
small businesses.
This year's federal budget is a continuation along the path of fiscal
responsibility. At the same time, it begins to address some of our most
pressing problems in education.
I am pleased that the omnibus appropriations bill rejects the House
Republican approach and expands spending on education. The bill
includes funding to begin hiring one hundred thousand new teachers
which will assist local school communities to reduce class size in the
early grades to 18 students. One hundred thousand new teachers will
allow more individual attention for students which will lead to better
reading and math scores in the future.
The final bill also includes $75 million to recruit and prepare
thousands of teachers to teach in high-poverty areas. It also includes
$75 million to train new teachers in how to use technology so that they
can better assist their students. This funding is focused on assisting
the schools and teachers who need the most help.
We must do everything possible to increase the reading skills of our
children so that they can compete in the global economy in the 21st
century. This budget includes 260 million for the Child Literacy
Initiative which will improve teachers' ability to teach reading,
family literacy, and conduct tutor training to help children learn to
read by the end of the third grade.
Five million children are locked into a school day that ends in the
early afternoon and dumps them into empty apartments, homes or violent
streets despite the fact that we know those post-school hours are when
teen pregnancies occur, drug use begins, and juvenile crime flourishes.
The budget agreement includes $200 million for after-school programs
that will help keep 250,000 children of the streets and into learning.
We also must develop an educational system which prepares our
children and young people for adulthood. Today, we are failing too many
of our children with crumbling schools, overcrowded classrooms, and
inadequately prepared teachers. The federal government provides a small
amount of the total funding for public elementary and secondary
education--less than seven percent of total public spending on K-12
education comes from the federal government, down from just under 10
percent in 1980. Reading scores show that of 2.6 million graduating
high school students, one-third are below basic reading level, one-
third are at basic, only one-third are proficient, and only 100,000 are
at a world class reading level.
Mr. President, I am developing legislation for next year to help
every school make a new start on their own. It will be built on
challenge grants for schools to pursue comprehensive reform and adopt
the proven best practices of any other school, funds to help

[[Page S12769]]

every school become a charter school within the public school system,
incentives to make choice and competition a hallmark of our school
systems, and the resources to help schools fix their crumbling
infrastructure, get serious about crime, restore a sense of community
to our schools, and send children to school ready to learn.
However, increased spending on education is meaningless if there are
no adequate school facilities to teach our children. I am disappointed
that the Democrats' proposed tax credit to build and renovate our
nation's schools was not included in the final budget agreement. Too
many schools now operate in substandard facilities which in some cases
are dangerous to our children. Any initiatives to support education
must also include an investment to modernize our school buildings.
America's children especially need support during the formative,
preschool years in order to thrive and grow to become contributing
adults. Additionally, adequate child care is not affordable or even
available for too many families. That is why I believe we must provide
more help to working families to pay for critically needed, quality
child care, an early learning fund to assist local communities in
developing better child care programs, and sufficient funding to double
the number of infants and toddlers in Early Head Start. President
Clinton shares this view and included in his 1999 budget proposal my
recommendations on this issue. I am pleased that the final budget will
also include $182 million to increase the quality and affordability of
child care to assist our working families.
Transportation funding is also crucial to maintain our aging national
highway infrastructure. I am very pleased that the Omnibus
Appropriations bill contains an additional $100 million in highway
funds for Massachusetts as well as approximately $80 million for
important transportation projects around the state.
The Commonwealth has reached a critical juncture in its efforts to
both complete in Central Artery and Tunnel project and also to maintain
and upgrade roads and bridges throughout the state. As many of my
colleagues are aware, the ISTEA reauthorization bill contained an
unacceptably low level of highway funding for Massachusetts. In order
to secure commitment not to delay Senate consideration of the ISTEA
bill, Majority Leader Lott, Democratic Leader Daschle, Senators Chafee,
and Baucus committed to me, among other things, that Massachusetts
would receive an additional $100 million in highway funds. The
inclusion of this money in the omnibus bill represents the fulfillment
of this promise. I wish to express my sincere appreciation to them for
following through on their commitment. I also wish to thank Senators
Byrd and Lautenberg for their help in securing this funding.
As noted above, the omnibus bill also contains $80 million for
critical transportation projects around the state. It will provide
millions of dollars to assist in completing the revitalization of
historic Union Station in Worcester and Union Station in Springfield.
It will also provide millions to support the construction of intermodal
centers in Pittsfield and Westfield. Finally, the bill contains funds
to support work on the North-South Rail Link in downtown Boston. It is
my hope that his project will continue to receive the funding that it
is so sorely deserves.
Since 1995, when the conservative Republicans took control of this
body and forced upon the Congress the ``Contract-with-America,'' we
continually have had to fight to retain existing environmental
protections. This year, we were successful in deleting a number of
provisions from the final budget that would have set back efforts to
protect our Nation's natural resources--our forests, parklands,
fisheries and wildlife.
The final budget supports our environment and improves the lives of
the families around America by increasing funding for the clean water
state revolving fund, the safe drinking water state revolving fund,
protection of endangered species, preservation of precious lands, and
the development of cleaner energy technologies. I also am very pleased
that the final budget includes an additional $50 million for the
cleanup of Boston Harbor to assist the 2.5 million ratepayers in 61
Boston area communities who will pay for the bonds which have primarily
financed this project--$3.8 billion for the Boston Harbor sewage
treatment project, and $2.8 billion required for combined sewer
overflows (CSOs) and other water and wastewater infrastructure upgrades
for the next 30 years.
I am pleased that Congress agreed to provide the full $17.9 billion
the administration requested to replenish IMF capital funds. The IMF
desperately needs this funding because financial crises in South Korea,
Japan, and Indonesia greatly have depleted its resources. Without full
funding, the IMF would be inhibited from continuing its support of
economic recovery in these countries and others.
As the strongest political and economic power, the U.S. has a
responsibility to step up to the plate and exercise its leadership in
dealing with this problem. I agree that the IMF needs to make some
reforms to achieve greater accountability and management of its
programs. I believe that implementing the IMF reforms, as required
under this bill, will be a strong step in the effort to achieve greater
accountability and management of IMF programs. We must be assured that
IMF rescue packages effectively will harness economic stability while
relieving social and political tensions. The IMF must be a viable and
demonstrable institution that can bring about real change for nations
suffering under the strains of economic instability.
As ranking member of the Committee on Small Business, I must give the
omnibus appropriations bill mixed marks with respect to showing
Congress's support for SBA's small business assistance programs. I am
pleased that the Omnibus Appropriations Act adequately funds SBA's
disaster loan program and fully funds the agency's salaries and
expenses. To do otherwise would have been irresponsible and detrimental
to the nation's small businesses and victims of natural disasters. The
bill takes positive steps with respect to women-owned and veteran-owned
businesses. The funding for SBA's Women's Business Centers is doubled
to $8 million, consistent with reauthorizing legislation enacted last
year, and veteran outreach receives $750,000, the first funding for
veteran-owned businesses since fiscal year 1995. The bill contains a
modest increase for the Small Business Development Centers, which
provide valuable business counseling and training to small businesses
throughout the country. The SBA's venture capital program received
significant increases in funding, and the cornerstone 7(a) loan
guarantee program received substantial funding, although less than the
administration requested for fiscal year 1999.
Unfortunately, although the omnibus appropriations bill contains some
increased funding for SBA's successful Microloan program, I am
disappointed that it fails to adopt the significant increases to the
Microloan program, which the authorizing committees envisioned last
year when Congress passed SBA's three-year reauthorization bill. That
bill, which was reported out of the Committee on Small Business
unanimously, made the Microloan program a permanent part of SBA's
financial assistance portfolio and substantially increased
authorization levels for both loans and technical assistance. Based on
those legislative changes, the Administration requested that direct
microloan be funded at the fully authorized level. During the
appropriations process, Senator Grassley and nine of our colleagues
joined me in sending two letters to the Subcommittee leadership voicing
our support for full funding of the Microloan program, including a
specific request for increased and adequate technical assistance
funding. In those letters we described the relationship between loans
in the Microloan program and technical assistance. Simply put, adequate
technical assistance funding is prerequisite to successful
microlending. The microloan and technical assistance funding contained
in this bill will allow only minimal, if any, growth in this program,
which helps the nation's neediest borrowers.
I am also disappointed that the Economic Research arm of SBA's Office
of Advocacy did not receive the $1.4 million, requested by the
administration and passed by the Senate. The research performed by that
office is highly respected and very valuable to work of

[[Page S12770]]

the Committees on Small Business in both bodies and to other small
business policy makers.
I support the omnibus appropriations bill because I believe it is an
acceptable compromise which keeps the federal government on the path of
fiscal responsibility while beginning to fund critically needed and
long overdue initiatives to assist America's children. I look forward
to building on this budget to address the unfinished business of the
American people in the 106th Congress.

Extension of the Generalized System of Preferences

Mr. GRASSLEY. Mr. President, I am pleased that Congress has once
again extended the Generalized System of Preferences as part of the
omnibus appropriations bill. The GSP is important for many reasons. For
instance, from a foreign relations standpoint it allows the U.S. to
assist developing countries without the use of direct foreign aid.
It is also of great importance to American businesses. Many American
businesses import raw materials or other products. The expiration of
the GSP has forced these companies to pay a duty, or a tax, on some of
these products. That's what a duty is: an additional tax. By extending
the GSP retroactively, these companies will not be required to pay this
tax. This tax is significant and can cost U.S. businesses hundreds of
millions of dollars. So, Mr. President, it is very important that the
GSP be extended and it is very appropriate that the Senate consider it
as part of this bill.
It is essential to remember, however, that since its inception in the
Trade Act of 1974, the GSP program has provided for the exemption of
``articles which the President determines to be import-sensitive.''
This is a very important directive and critical to our most import-
effected industries. A clear example of an import-sensitive article
which should not be subject to GSP and, thus, not subject to the annual
petitions of foreign producers that can be filed under this program, is
ceramic tile.
It is well documented that the U.S. ceramic tile market repeatedly
has been recognized as extremely import-sensitive. During the past
thirty-years, this U.S. industry has had to defend itself against a
variety of unfair and illegal import practices carried out by some of
our trading partners. Imports already dominate the U.S. ceramic tile
market and have done so for the last decade. They currently provide
approximately 60 percent of the largest and most important glazed tile
sector according to 1995 year-end government figures.
Moreover, one of the guiding principles of the GSP program has been
reciprocal market access. Currently, GSP eligible beneficiary countries
supply almost one-fourth of the U.S. ceramic tile imports, and they are
rapidly increasing their sales and market shares. U.S. ceramic tile
manufacturers, however, are still denied access to many of these
foreign markets.
Also, previous abuses of the GSP eligible status with regard to some
ceramic tile product lines have been well documented. In 1979, the USTR
rejected various petitions for duty-free treatment of ceramic tile from
certain GSP beneficiary countries. With the acquiescence of the U.S.
industry, however, the USTR at that time created a duty-free exception
for the then-minuscule category of irregular edged ``specialty'' mosaic
tile. Immediately thereafter, I am told that foreign manufacturers from
major GSP beneficiary countries either shifted their production to
``specialty'' mosaic tile or simply identified their existing products
as ``specialty" mosaic tile on custom invoices and stopped paying
duties on these products. These actions flooded the U.S. market with
duty-free ceramic tiles that apparently had been superficially restyled
or mislabeled.
In light of these factors, the U.S. industry has been recognized by
successive Congresses and Administrations as ``import-sensitive''
dating back to the Dillon and Kennedy Rounds of the General Agreement
on Tariffs and Trade (GATT). Yet during this same period, the American
ceramic tile industry has been forced to defend itself from over a
dozen petitions filed by various designated GSP-eligible countries
seeking duty-free treatment for their ceramic tile sent into this
market.
The domestic ceramic tile industry has been fortunate, to date,
because both the USTR and the International Trade Commission have
recognized the ``import-sensitivity'' of the U.S. market and have
denied these repeated petitions. If, however, just one petitioning
nation ever succeeds in gaining GSP benefits for ceramic tile, then all
GSP beneficiary countries will be entitled to similar treatment. This
could eliminate many American tile jobs and devastate the domestic
industry. Therefore it is my strong belief that a proven ``import
sensitive,'' and already import-dominated product, such as ceramic
tile, should not continually be subjected to defending against repeated
duty-free petitions, but should be exempted from the GSP program.
Mr. REED. Mr. President, it is a bittersweet task that brings us back
to Washington for one last vote before the end of the 105th Congress.
Today, we will complete our work on the fiscal year 1999 budget.
To be sure, there is much that I like about the Conference Report
before us, but there are some provisions that I strongly disagree with.
On balance, however, it is a budget that is worthy of support.
Like many of my colleagues, I must lament the process that has
brought us to this point--20 days after the start of the fiscal year.
The Conference Report that we are about to vote on is almost 4,000
pages long. We have been given only a few hours to examine it. None of
us knows the complete contents of the legislation, and there has been
no opportunity to debate or offer amendments.
Fortunately, we have avoided a budgetary train-wreck similar to the
one that closed down the government in 1995. But, Mr. President, this
year the train is extremely late, and to hear the debate in this
chamber, nobody wants to take responsibility for driving the engine.
We have subverted the regular budgetary process, failing even to pass
a Budget Resolution. The majority could not reconcile its own
discordant priorities to pass this blueprint legislation, which is
required by law.
On this side of the aisle, we had a definitive agenda: preserve the
budget surplus to save Social Security, invest in education, pass
health care reform legislation, pass campaign finance reform, and pass
legislation to prevent the tobacco industry from preying on our
youngsters.
The President made these goals clear in his State of the Union
Address and later with his fiscal year 1999 budget proposal. Claims
that the priorities on this side were hidden until the very end are
false. We have been here all along, working toward goals that the
American people recognize as important, and we have had some success in
achieving these goals in this legislation. There are a few provisions
of the Conference Report that I would like to highlight:
This legislation preserves the surplus to help save Social Security.
It includes $1.2 billion for efforts to reduce class-size, of which
$5.6 million would be awarded to my home state of Rhode Island. The
omnibus bill also allocates funding to improve teacher preparation and
recruitment, a cause that I was actively involved with during the
drafting of the Higher Education Act Amendments of 1998.
The budget bill also includes funding for critical reading
legislation--$260 million to help address the serious declines in
literacy levels that have left 40% of America's fourth graders without
basic literacy skills. The newly created GEAR UP program would receive
$120 million under the bill. This ambitious new initiative will help
encourage youngsters living in high poverty areas to pursue their
higher education goals.
Finally, this Conference Report contains $33 million for the
construction of as many as five new Job Corps centers, including one in
Rhode Island, which is one of only four states currently without a
center.
On the negative side, $800 million in subsidies for the Tennessee
Valley Authority (TVA) was slipped into this legislation. Neither House
of Congress included this level of funding in its version of the Energy
and Water Appropriations bill. The omnibus package also retains a
poorly constructed rider that prevents the Occupation Safety and Health
Administration (OSHA) from conducting inspections on small

[[Page S12771]]

farms in response to fatal accidents involving minors. I am committed
to addressing both of these issues next year.
This Conference Report is also bad for what it does not contain. In
particular, it lacks funding for school construction, which is required
to help meet the $121 billion need for new and refurbished schools, nor
does it include an important bipartisan initiative authored by Senators
Jeffords and Kennedy to help individuals with disabilities join the
workforce while maintaining their essential Medicare and Medicaid
coverage.
Finally, it fails to adequately fund the Leveraging Educational
Assistance Partnership (LEAP), a federal-state program that is a major
source of higher education grant aid. I worked hard with the other
authors of the Higher Education Act Amendments to reauthorize and
improve this program, and I believe the failure to sufficiently fund
LEAP is short-sighted.
Mr. President, there is much that could be done to improve this
Conference Report, but we must pass it to keep the government open. It
is unfortunate that we have been put in the position of having to vote
up or down on this hefty omnibus package with no opportunity to offer
amendments, no opportunity for a substantive debate, and little chance
to review the measure itself. Fast-Track budgeting at the end of a
Congress is no way to make up for time squandered at the beginning. I
hope that this is the last time we follow this kind of eleventh-hour,
gerry-rigged process.

ryan white aids funding under title iv

Mr. LAUTENBERG. I would like to engage the Chairman and Ranking
Member of the Labor-Health and Human Services (HHS) Appropriations
Subcommittee in a brief colloquy concerning pediatric AIDS
demonstrations funded under Title IV of the Ryan White CARE Act.
Mr. SPECTER. I would be pleased to engage in a colloquy.
Mr. HARKIN. I, too, would be pleased to engage in a colloquy with the
Senator from New Jersey.
Mr. LAUTENBERG. I would first like to commend and thank the Chairman
and Ranking Member for their work to ensure our Nation's continued
strong commitment to our children and families tragically infected with
HIV by providing support for Title IV of the Ryan White CARE Act. Title
IV programs are designed to coordinate health care and assure that it
is focused on families' needs and based in their communities. These
programs are the providers of care to the majority of children, youth,
and families with HIV/AIDS in our country, ensuring these families have
access to the comprehensive array of services they need. A portion of
Title IV funds may be used to provide peer-based training and technical
assistance through national organizations that collaborate with
projects to ensure development of innovative models of family centered
and youth centered care; advanced provider training for pediatric,
adolescent, and family HIV providers; coordination with research
programs, and other technical assistance activities.
The Senate report stated that the Committee intends for the
Department to continue its Title IV support of the National Pediatric
and Family HIV Resource Center located within the University of
Medicine and Dentistry of New Jersey. The Title IV funding needed to
support the Center's work is $1.1 million per year. Is it correct that
the managers intend for the Department to continue to support the
National Pediatric and Family HIV Resource Center?
Mr. SPECTER. Yes, the Senator from New Jersey is correct. The
committee intends that the National Pediatric and Family HIV Resource
Center should continue to receive adequate funding.
Mr. HARKIN. I concur with the Chairman.
Mr. LAUTENBERG. I thank the Chairman and Ranking Member for their
support, and for their continued work in this very important component
of our national HIV/AIDS strategy.

parkinson's disease funding

Mr. COCHRAN. Mr. President, one year ago this body adopted, by a vote
of 95 to 3, legislation increasing our nation's commitment to finding
the cause and cure for a long overlooked, but truly devastating
disorder: Parkinson's disease. I was proud to cosponsor and vote for
the Morris K. Udall Parkinson's Disease Research Act, signed into law
as part of the Fiscal 1998 Labor, Health and Human Services, Education
and Related Agencies Appropriations Act. The Udall Act authorized $100
million in research focused on Parkinson's disease to be funded through
the National Institutes of Health in fiscal year 1998, 1999 and beyond.
The passage of the Udall Act was a great accomplishment, particularly
for the hundreds and thousands of victims, and their families and
friends, who worked so diligently to bring this issue to the Congress
and make us aware of the need for additional Parkinson's research
funding. I would also like to commend the Senior Senator from
Pennsylvania, one of the true champions of medical research, for his
strong support of the Udall Act and Parkinson's research.
Mr. SPECTER. I appreciate the remarks of my friend from Mississippi.
He is correct that Parkinson's disease is a very serious disability,
but one for which medical science does hold great promise. In addition,
I too would like to commend the efforts of the Parkinson's community
who have worked tirelessly to achieve passage of the Udall Act and
increase funding for Parkinson's research.
Mr. COCHRAN. Mr. President, I am concerned that the National
Institutes of Health has implemented neither the letter nor the spirit
of the Udall Act, and that funding for Parkinson's-focused research has
not increased in a fashion consistent with Congressional intent. An
independent analysis, conducted by Parkinson's researchers at
institutions all around the country, of the grants NIH defined as its
Parkinson's research portfolio for fiscal year 1997 indicates that a
majority of the grants are in fact not focused on Parkinson's disease.
Only 34 percent of the funding NIH claims is Parkinson's research is
actually Parkinson's-focused research, as required by the Udall Act. As
troubling as that is, the study also found that 38 percent of the
funding has no relation whatsoever to finding a cause or cure for this
terrible affliction.
It is my understanding from published NIH budgetary documents that
$106 million is expected to be allocated to Parkinson's research in
fiscal year 1999. My concern is that without more direction from
Congress, the NIH will undermine the intent of the Udall Act by
continuing to classify, as part of its Parkinson's portfolio, research
that is not focused on Parkinson's disease and, in doing so, will allow
meritorious and much-needed Parkinson's research projects to go
unfunded. I propose that a hearing be held early in 1999 to address and
clarify these matters.
Mr. SPECTER. The gentleman has brought up important issues, which
warrant further discussion.
Mr. CRAIG. As a sponsor of the Udall Act and supporter of Parkinson's
research funding, I appreciate the Chairman's interest in these
matters. The NIH claimed to spend more than $89 million on Parkinson's
research in 1997. The Congress set a baseline authorization of $100
million for Parkinson's research in the fiscal year 1998 bill making
NIH appropriations and clearly stated in report language that
Congressional intent was to increase the commitment of NIH resources to
Parkinson's. Close review of NIH's Parkinson's funding practices
indicates that most of the research funding they define as Parkinson's
is, in fact, not focused on Parkinson's at all. The NIH claimed to
spend more than $89 million on Parkinson's research, in FY 1997. In
reality, we later discovered that less than $31 million--just more than
one third--of that research was truly focused on Parkinson's. Obviously
there seems to be some disconnect here. Congress needs to be as clear
as possible when communicating our intent to NIH, and diligent when
overseeing their funding practices with regard to Parkinson's. I agree
with Senator Cochran that hearings should be held early next year to
address these issues, and I look forward to working with him, the
Chairman, and others to see this resolved.
Mr. SPECTER. I thank the gentleman from Idaho and look forward to
future discussions on his suggestions. It is a pleasure to recognize
the sponsor of the Udall Act, and someone who remains very close to Mo
and the Udall family, the distinguished Senator from Arizona.

[[Page S12772]]

Mr. McCAIN. I thank my friend from Pennsylvania. The Senator is
correct that this is an issue of personal importance to me, and I
appreciate his support as we work to defeat this terrible disease. I
would also like to acknowledge the tremendous efforts of the
Parkinson's community--courageous individuals in my state and all
across the country who have worked so hard to pass the Udall Act and
continue to work to achieve its full funding.
There are an estimated one million Americans living with Parkinson's
disease, and the nature of its symptoms are such that they impact
heavily on families and loved ones as well. Add to these staggering
human costs the fiscal burden of health care expenses and lost
productivity, and it's easy to see that Parkinson's deserves to be a
higher national priority. Parkinson's disease also represents a real
research opportunity, where an investment of funds is likely to yield
improved therapies sure to reduce both the personal and financial costs
to our families and our nation.
To realize this opportunity, though, it is up to Congress and the NIH
to ensure that these funds get allocated to research focused on
Parkinson's. Chairman Specter and others in this body have worked hard
to ensure that NIH has the overall funding it needs to aggressively
pursue research opportunities like those relating to Parkinson's. I
have received a letter dated May 21, 1998 from NIH Director, Dr. Harold
Varmus, which includes a chart indicating that the NIH will spend over
$106 million on Parkinson's research in fiscal year 1999. I look
forward to working with my colleagues and the NIH to see that this
funding goes for research principally focused on the cause,
pathogenesis, and/or potential therapies or treatments for Parkinson's
disease as mandated by the Udall Act.
Mr. SPECTER. I thank the gentleman for his remarks, and look forward
to continuing to work with him on these matters. Now I would like to
recognize the other Senate sponsor of the Udall Act, another Senator
with a deep and sincere connection to Parkinson's disease, the
gentleman from Minnesota, Senator Wellstone.
Mr. WELLSTONE. I thank the Senator, and commend him for his support
on this very important issue. I also wish to thank my friend, Senator
McCain, for joining me last year in sponsoring the Udall Act.
I believed when we passed the Udall Act last year we had begun to
change a sad history of chronic underfunding of Parkinson's by the NIH.
It was a very personal victory for me--and for all those who fought so
hard to see the Udall Act enacted into law.
I am here today, along with my colleagues, in an effort to fulfill
the promise of the Udall Act and the commitment we in Congress made to
people with Parkinson's, their families and those researchers dedicated
to curing this disease. I find it very disheartening to learn that so
little of the research NIH claims to devote to Parkinson's is actually
Parkinson's-focused as called for by the Utall Act. it was our intent
and it is our obligation to ensure that at least $100 million in
research specifically focused on Parkinson's is allocated. And if it
takes stronger language, more oversight, or congressional hearings to
guarantee it gets done, then that's what we must do.
Members of the Senate have expressed their interest in seeing the
Udall Act fully funded in fiscal year 1999, and we have taken some
positive steps this year to accomplish that goal. But our work is not
done. The ultimate goal is not legislative accomplishments. It is not
adding more dollars to this account or that one. The ultimate goal is
to find a cure for this horrible, debilitating disease so that more
people don't have to suffer the way my parents and our family did, or
the way Mo Udall and his family does, or the way countless families do
every day in this country. By passing the Udall Act we made a promise
to put the necessary resources into the skilled hands of researchers
dedicated to finding that cure. I intend, as I know my colleagues and
those in the Parkinson's community intend, to do everything I can to
fulfill that promise.
Mr. SPECTER. I thank the Senator from Minnesota and all of my
colleagues for their remarks today about Parkinson's research funding
through the NIH. I look forward to working closely to address the
concerns expressed here today.

springfield, vt, workforce development center

Mr. JEFFORDS. Mr. President, I would like to engage my good friend
and colleague, the Chairman of the Subcommittee on Labor, Health and
Human Services and Education Appropriations in a colloquy regarding a
provision in this legislation that is of great importance to me.
Mr. SPECTER. I would be pleased to join my good friend and colleague
in a colloquy.
Mr. JEFFORDS. The Springfield region of Vermont currently faces a
crisis in the machine tool industries. Six major machine tool employers
in the area indicate that more than 50 percent of their workforce will
retire within the next five to seven years. This will create the need
for highly skilled employees to fill more than 700 positions in machine
technology. In addition, other employers in the areas of information
technology, hospitality and travel, financial services and food
services industries indicate that they have an urgent need for a
responsive education delivery system designed to meet their growing
demand for skilled labor. I understand that the conference report
includes funds for the Springfield Workforce Development Center to
implement innovative training and vocational education strategies to
meet the education, workforce and economic development needs of the
region.
Mr. SPECTER. The Senator is correct. The Appropriations Committee
recommendation includes funding for the Springfield Workforce
Development Center, and this recommendation is retained in the
conference agreement on the omnibus bill.

medical university of south carolina

Mr. HOLLINGS. May I enjoin the Senator from Pennsylvania in a
colloquy?
Mr. SPECTER. I would be pleased to hear from the Senator from South
Carolina.
Mr. HOLLINGS. I would like to clarify an item contained in the
statement of the managers of the omnibus appropriations bill. In the
health facilities section of the Health Resources and Services
Administration, reference is made to a project intended for the Medical
University of South Carolina. Inadvertently, the word ``Medical'' was
not included in the statement of the managers; however, that word's
inclusion was clearly the intent of the managers.
Mr. SPECTER. I thank the Senator for his clarifying statement.

hepatitis c funding

Ms. MIKULSKI. Will the chairman of the Labor, Health and Human
Services, and Education Appropriations Subcommittee yield for a
question?
Mr. SPECTER. I will be pleased to yield to the Senator from Maryland.
Ms. MIKULSKI. As the chairman knows, hepatitis C is the most common
blood-borne infection in the United States. The CDC estimates that
there are 4 million Americans--or 2 percent of the population--that are
infected. Each year there are 10,000 deaths due to hepatitis C and the
death total will increase to 30,000 a year unless something is done to
intervene with the progression of this disease in the United States.
Unfortunately, the vast majority of people infected with hepatitis C
are not even aware that they are infected because the disease is
``silent`` without symptoms sometimes for decades. Meanwhile these
infected individuals may be passing the disease on, causing new
infections to occur each year. We need to break this cycle by helping
individuals learn they have hepatitis C and by getting them to seek
counseling, testing, and treatment of their infection and begin to
understand the seriousness of this epidemic.
Additional funds are needed to support both a targeted look back
effort to reach the 300,000 Americans who have hepatitis C as a result
of exposure to blood products prior to 1992, when blood was not
adequately screened for hepatitis C and a general media campaign to
alert other Americans infected by hepatitis C. These funds are needed
to fund cooperative efforts of State and local health departments and
national voluntary health agencies such as the American Liver
Foundation to identify, educate, counsel, test and refer for treatment
those infected. The efforts should be bolstered by a toll-free hotline
to help provide information and

[[Page S12773]]

counseling. In addition, since not everyone can afford private testing,
some of these funds should be made available to public health agencies
for clinic testing and other testing options, including FDA-approved
telemedicine testing services.
The chairman and the committee have some very strong report language
focused on this issue and the chairman is well aware of this problem. I
compliment him for the guidance he has given to the CDC on this issue.
I have been informed by the CDC that $48 million is needed and at a
minimum $16 million is needed just to begin to address this epidemic in
fiscal year 1999. Can this amount be found within the totals
recommended by the conferees?
Mr. SPECTER. I thank the Senator for her question. I agree that more
needs to be done by CDC to address the hepatitis C epidemic. The
conferees have provided a substantial increase for Infectious Diseases
at CDC and I will urge the CDC to allocate increased resources to this
matter.
Ms. MIKULSKI. I thank the chairman of the Labor, Health and Human
Services, and Education Appropriations subcommittee for his response.
Again, I compliment him and the ranking member, Tom Harkin, for their
hard work on the Labor/HHS appropriations bill.

drexel university intelligent infrastructure institute

Mr. SPECTER. Mr. President, I have sought recognition to thank the
chairman of the Transportation Appropriations Subcommittee for having
included in this legislation funding for the Drexel University
Intelligent Infrastructure Institute. I have been pleased to have
worked with Drexel for several years on obtaining funding to establish
the institute, which will focus on the link between intelligent
transportation systems and transportation infrastructure. Drexel has
teamed up with the Delaware River Port Authority to study that agency's
infrastructure, which includes four major bridges that provide critical
links in the east coast corridor. Congress has previously appropriated
$750,000 toward this project and authorized establishment of the
institute in the TEA-31 legislation enacted earlier this year.
It is my understanding that it is the intent of the managers for the
Transportation Appropriations bill that the $500,000 provided for the
institute shall be made available pursuant to the provisions of section
5118 of TEA-21, which specifically authorizes the establishment of the
Institute.
Mr. SHELBY. I want to thank the Senator from Pennsylvania for his
comments and to confirm his understanding with respect to the Drexel
Institute. As noted in the Senate committee report, the funds allocated
within the Statement of Managers are to be made available for the
purposes expressed in section 5118 of TEA-21.

the american competitiveness and work force improvement act

Mr. GRAMS. Mr. President, I rise in support of the compromise H-1B
visa legislation included in the omnibus appropriations bill. I am
pleased a compromise was achieved that has now passed the House by a
vote of more than two to one.
With the demand in this country rising for this category of highly
skilled workers currently in short supply in the U.S., I believe there
is a need to temporarily increase this visa category. The engine now
driving our successful economy is being fueled in large part by growth
in the information technology industry. I am told these high tech
industries account for about one-third of our real economic growth.
According to the Information Technology Industry Data Book, 1998-2008,
the domestic revenue from the U.S. information technology industry is
projected to be $703 billion for the year 2000.
With this sudden surge in industry growth, the United States has
found itself unprepared to supply the large numbers of math and
engineering graduates necessary to support this growth. In fact,
American schools are producing fewer math and engineering graduates
than in the past.
We have been forced to address this current imbalance by temporarily
allowing needed high-tech workers to work in our country. This is
necessary until we can develop the expertise we need in the country.
This compromise bill will do just that. For the next 3 years,
additional workers from foreign countries will be allowed to work here.
During this time, Americans will be educated to fill these jobs through
scholarships and job training financed by fees collected from employers
petitioning for the current foreign workers. We must do more to ensure
our work force meet the demands of a growing, more sophisticated
economy--that we have the educated work force we need to continue to
prosper and provide better jobs for Americans.
There are other important issues covered by the bill including
increased penalties for violations of law by employers, random
investigations of employers sponsoring H-1B visas by the Department of
Labor and protection of ``whistleblowing'' employees. I think this
compromise is something that will help us now and in the future. I urge
its passage.
Mr. KOHL. Mr. President, I rise today in opposition to the Omnibus
Consolidated and Emergency Supplemental Appropriations Act before us.
This was not an easy decision because there are many parts of this
legislation I support. But, on balance, I cannot support a bill that is
in essence sloppy--both in the process by which it was constructed and
in its content.
We are asked today to vote--up or down--on a bill that contains eight
of thirteen appropriations bills that fund the government and almost
$500 billion in government spending, nearly 30 percent of our budget.
We have one vote, little debate, and no chance of amendment on what has
been described as the largest piece of spending legislation in recent
history. And beyond the spending sections of the bill, it also includes
various pieces of authorizing legislation--seven different drug bills,
home health care reform, and Internet tax moratorium, a tax cut that
will cost $9.2 billion over the next nine years among other items.
This is a huge measure--a measure that the esteemed Senator Byrd has
called a ``monstrosity,'' and he is right. It is a measure that, in its
entirety, few have seen and no one understands. Yet today, we are asked
to say ``yes'' or ``no'' to it. How can we say ``yes'' to a budget that
we have not read, have not participated in its drafting, have not even
seen? To do so would be irresponsible and undemocratic.
In saying this, I mean no disrespect to those of my colleagues who
have worked very hard to try to make this process fair. The negotiators
were caught in a bind that all of Congress has a responsibility for
creating: We let partisanship and politics get in the way of passing a
thoughtful budget this year, and so now we are stuck slapping a budget
together at the last minute.
I commend the negotiators for doing the best they could. All parties
were as responsive as this terrible situation allowed. The Democratic
leadership in the Senate and Representative Obey were vigilant in
trying to protect the interests of Wisconsin during negotiations, and
they were successful in doing some good for our State and in avoiding a
great deal of bad.
I also do not mean to suggest that there are no items in this
legislation that I support. There are many good policies, provisions
and priorities established here.
For the most part, I am pleased with the final form of the Treasury-
General Government appropriations bill which I worked on as the
Subcommittee's Ranking Member. Controversial language tampering with
the Federal Election Commission's staff was dropped. Important language
guaranteeing adequate contraceptive coverage to federal employees was
retained. And many important law enforcement and financial agencies
were funded at adequate levels. In addition, that bill allocated money
for fighting the war on drugs in my State--an additional $1.5 million
to expand the Milwaukee High Intensity Drug Trafficking Area (HIDTA)
and additional funds for expanding the Youth Crime Gun Interdiction
Imitative operating now in Milwaukee.
The Omnibus bill also makes a strong investment in the education of
our children, starting from early childhood education and continuing
through higher education. The bill increases funding for the Child Care
and Development Block Grant to over $1.18 billion,

[[Page S12774]]

an increase of $182 million. This includes a continuation of the $19.1
million set-aside for resource and referral programs, which help
parents locate quality, affordable child care in their communities. In
addition, we increased funding for Head Start by over $300 million,
increased funding for Disadvantaged Students (Title I) by over $300
million, increased Special Education funding by over $500 million, and
provided $1.1 billion to local school districts to help reduce class
size in the early grades. We also provided over $300 million more for
Student Aid, including an increase in the maximum Pell Grant to $3,125.
In addition to investing in our children, the bill also ensures that
we take care of our nation's elderly. Despite the fact that the House
eliminated funding for LIHEAP, we were able to restore that funding to
its full amount of $1.1 billion, ensuring that the elderly will not
have to choose between food and heat during the cold winter months. We
also increased funding for the Administration on Aging, including a $3
million increase for the Ombudsman program, which serves as an advocate
for the elderly in long-term care facilities.
This appropriations measure also includes vital funding for highways
and transit at the historic levels approved by Congress as part of the
Transportation Equity Act earlier this year and a strong level of
investment in airport improvement. In addition, the transportation
piece of the omnibus bill funds a number of Wisconsin specific items,
including Wisconsin statewide bus programs that play a crucial role in
our welfare to work efforts, the renovation of the Milwaukee Train
Station, crash and congestion prevention technology funding for the
State, commuter rail planning and grade crossing mitigation funds for
Southeastern Wisconsin and funding for the Coast Guard's Great Lakes'
icebreaker and Seagoing Buoy Tender replacement programs.
The transportation piece of the omnibus package includes an important
authorization provision affecting Milwaukee, Wisconsin's East West
Corridor project. In the ISTEA reauthorization debate, the future of
this project fell victim to politics and backroom dealing.
Specifically, a provision was attached to the reauthorization
legislation, the Transportation Equity Act or so-called TEA-21 law,
which sought to undermine the framework of local decision making
created by the original ISTEA in 1991. Worse still, this TEA-21
provision had not been debated as part of either the House or Senate
reauthorization bills, but was added to the final bill at the eleventh
hour despite the objections of those Members of Congress most impacted.
As a member of the Transportation Appropriations Subcommittee, I
attempted to mitigate the damage done by the TEA-21 provision by
attaching an amendment to the Senate Transportation Appropriations bill
for Fiscal Year 1999. My amendment reaffirms the right of local
officials to decide what transportation projects best fit the needs of
their community. It simply makes sure that all parties who deserve to
be at the decision making table have an equal seat at that table. I am
pleased that a compromise version of my amendment is included in the
omnibus package. It is my sincere hope that State and local officials
will now work together to move ahead expeditiously with the East West
Corridor improvements. Fairness has won the day, now consensus and
cooperation must yield progress on a project of vital importance to the
economy and quality of life in Southeastern Wisconsin.
I also am pleased several provisions I worked for throughout the year
have made it into the portion of the bill covering Commerce-Justice-
State appropriations. Most importantly, the legislation includes more
than a threefold increase in crime prevention spending through Title V,
a juvenile crime prevention program I authored six years ago. The
funding level was increased from $20 million to $70 million. This
should provide WI with around $1 million in prevention spending next
year, a big boost from the approximately $340,000 it received last year
out of the lower funding level.
The bill also extends a limited number of important tax provisions in
a fiscally responsible manner--meaning these provisions are paid for,
but not at the expense of the social security surplus. In particular, I
strongly support the acceleration of the increase in the deduction for
health insurance of the self-employed and the permanent extension of
income averaging. Both these measures will go a long way to ease the
tax burdens of Wisconsin's farmers and small business people. When we
return in the spring, it is my hope that we will approve the reforms
necessary to preserve the long term viability of social security, as
well as enact more additional targeted, fiscally sound tax relief
measures, such as my Child Care Tax Credit.
Finally, I applaud the Administration for recognizing the financial
crisis that is sweeping the agricultural sector of the Midwest this
summer. The legislation also wisely adds more money for market losses
and drought in the southern U.S.
In addition, this bill does more than recognize the current problems
in rural America. Although modest, the bill provides more financial
help to maintain the viability of Wisconsin agriculture by
appropriating $17 million more for agricultural research than last
year, allowing the University of Wisconsin to develop the new
technologies that will soon be the new production practices used by
farmers. Soil and Water Conservation programs spending will increase by
$8 million, enhancing programs like the Environmental Quality
Improvement Program (EQIP). An additional $23 million was added for the
Administration's Food Safety Initiative which includes money to
increase the surveillance, research and education relating to food-
borne illnesses. And finally, Congress agreed to pay dairy farmers for
the transitioning of the industry to a more market oriented system as
ordered by the last farm bill. Dairy producers will receive an
estimated $200 million for agreeing to end the price support system in
1999.
However, I still have significant concerns that Congress decided to
postpone the consolidation of the milk marketing orders required by the
1996 Farm Bill and to extend the Northeast Dairy Compact. Our outdated,
unfair pricing system must come to an end. It was wrong to use this
bill to extend its life--and the life of a controversial regional price
fixing scheme--both policies that hurt competitive Wisconsin family
farmers.
Another major problem with this bill is the use of the budget surplus
to fund over $20 billion ``emergency'' spending. Certainly, some of
these funds will go to meet truly unanticipated and urgent needs--like
military deployments, natural disaster recovery efforts, and a response
to the farm crisis sweeping the center of the nation. These are one-
time, compassionate and necessary expenditures that must be made
regardless of budget rules.
Unfortunately, a significant portion of the so-called ``emergency''
money is not for true emergencies. For example, $1.3 billion is for
military readiness--a worthy goal, but one that we ought to budget for
as part of our annual budget process. I certainly hope it is not news
to anyone that we expect our military to be ready to defend us. In
addition, $50 million of that money is for ``morale, welfare, and
recreation.'' Again, I agree with the goal of keeping our troops fit
and content--but doing so should be a priority in every year's budget,
not an off-budget item described as an ``unanticipated need.''
Many of us have argued that we ought not to use the budget surplus as
an excuse to abandon fiscal discipline. We still need to save--for the
Social Security obligations and health care needs of an aging
population, for the rainy day that world economic instability may bring
about, for the trust of the American taxpayer who expect us to use
their tax dollars wisely. We succeeded in balancing the budget; it
makes no sense to celebrate by unbalancing it again.
I am also concerned about the pork that is the inevitable result of
the haphazard and closed process that produced this legislation. I do
not know what it is now, but I do know it will show up as we--and the
public and the press--pore over the 8000 pages of this legislation over
the next few weeks.
In the end, as with any vote, the final decision has to be a result
of weighing the good and the bad. No bill is perfect; most are the
result of compromise. But

[[Page S12775]]

in this bill, the balance of good and bad is tipped by the undemocratic
and irresponsible manner in which it was written. I will vote no this
morning, and I urge my colleagues to join me.
Mr. KYL. Mr. President, for the better part of the last year, we have
been considering what to do with projected budget surpluses should they
ever materialize. Some people suggested setting aside the excess money
to help save Social Security. Some wanted to use a portion for tax
relief, or paying down the national debt. I believe there was merit in
each of those ideas.
It did not take long, however, for all of the good ideas to be swept
aside once the surplus actually materialized. Just three weeks after
confirming that the federal government achieved its first budget
surplus in a generation, we have a bill before the Senate that proposes
to use a third of the surplus to increase spending on government
programs other than Social Security, tax relief, or repayment of the
national debt.
I am very disappointed that we find ourselves in this situation.
President Clinton pledged in his State of the Union address to ``save
every penny of any surplus'' for Social Security, yet he was the first
in line with a long list of programs to be funded out of the budget
surplus. And Congress appears willing to go along. I, for one, intend
to vote against this raid on a surplus that should be saved for Social
Security or tax relief.
Mr. President, the Congressional Budget Office tells my office that
it has not yet determined the cost of the omnibus spending bill, and
may not be able to do so for some time. However, if you total the
figures included in the conference report, it appears that the cost
will approach $520 billion--that is, if funding for the International
Monetary Fund and emergency agriculture money is included. I am looking
at Division A of the bill--for mandatory and discretionary programs.
That compares to $447 billion for the same programs only a year ago.
In other words, we are being asked to approve a bill that proposes to
increase spending 16 percent in a single year. That does not even take
into account the extra spending--another $21 billion--that is to be
financed out of the budget surplus.
That is just too much. To put things into perspective, the average
increase provided by the FY99 spending bills I supported earlier in the
year amounted to just 0.1 percent--a spending freeze, in effect. If we
are to keep the budget balanced and preserve our options on how to use
the budget surplus, we need to follow a more responsible path. This
bill, with its raid on the budget surplus, represents a dangerous
return to the old ways of budget-busting, bigger government.
Mr. President, let me say a few things about the process that spawned
this bill. Eight of the regular appropriations bills are wrapped into
this package. A so-called emergency spending bill is attached, bringing
the total cost of the legislation to over a half-trillion dollars. It
is massive. It is no way to do the people's business responsibly.
I recognize that our leadership had little choice but to make the
best of a bad situation, given President Clinton's propensity to shut
the government down if he does not get his way. Indeed, one of the
President's representatives admitted as much to the Majority Leader a
few weeks ago when he said the White House would shut down the
government if it was in its political interest to do so. That is
reprehensible.
Still, our leadership did manage to secure some very good things in
this bill--things that I would support if they could be separated out
and considered on their own merits. Important funding for our nation's
defense, anti-drug efforts, and increased law enforcement in Indian
country is included. There are resources for 1,000 new Border Patrol
agents, provisions to alleviate problems in the implementation of new
border-security systems, funding for the National Institutes of Health,
and programs to help victims of domestic violence.
However, by failing to prioritize spending, the bill simply throws
more money at bad programs as well as good ones. It is easy to please
everyone by spending more and more money. Yet that is a sure
prescription for a return to the customary budget deficits we worked so
hard to eliminate.
The fact is, this bill was written by a handful of congressional
Members and staff and the White House behind closed doors. Most Members
of Congress have not had a chance to review it, debate it, or offer
amendments. That means our constituents have been shut out of the
process. This is a risky and dangerous precedent that I believe we will
come to regret.
Mr. President, while there are a number of good items in this bill--
items I support--on balance, I believe it blurs the difference between
two competing philosophies of government and, as I said before,
represents a dangerous return to the old ways of budget-busting, bigger
Government, and less freedom.
I will vote no.
Mr. FAIRCLOTH. Mr. President, I rise in support of this legislation.
There are many good things about this bill. It is not perfect--but we
shouldn't let the perfect be the enemy of the good. In our
constitutional process, the Republican majority cannot get everything
it wants and with a very liberal White House, we are forced to
compromise in order to keep the Government functioning.
The most important thing the American people need to know is that
this year the Congress has balanced the budget for the first time in 30
years. Next year, in 1999, we will balance it again. Because we have
stopped the growth of the Federal Government, we finally have stopped
spending more than we collect, and giving the bill to our children and
grandchildren to pay in the future.
Let me discuss the many positive provisions in this bill. First, we
have increased defense spending for an anti-ballistic missile defense.
This involves the very core of our national security. And I should
note, this is the first Congress to increase defense spending since
1985.
We have included provisions to reduce the spread of obscene material
over the Internet. Also, we have doubled the number of Customs agents
to block child pornography coming in from overseas.
In an area that I have particularly been interested in, we have
attached real reforms to the IMF funding, rather than giving funds to
the IMF with no strings attached as the President would have liked us
to.
We have provided funding for new teachers, but maintained local
control over the hiring--and--we have prevented national Federal
testing of students.
We have included seven major proposals to fight the war on drugs.
Bill Clinton has mocked the seriousness of drug use and it has showed.
Drug use among teens has been on the rise during the Clinton
administration.
We are funding increases in health care research, particularly cancer
research and breast cancer research. We kept our commitment from last
year to dramatically increase spending in the fight against cancer. The
bill also contains a requirement that requires insurance companies to
cover breast reconstructive surgery for women afflicted with breast
cancer.
On the tax side, we have extended the research and development tax
credit, which is important to North Carolina.
Further, we are changing the tax laws to permit 100% deductibility of
health insurance for self employed individuals.
And this is another important point that is often overlooked by the
media. This is the first Congress to cut taxes in 16 years. And in this
bill, we have again reduced taxes for the self employed.
This is in stark contrast to the Clinton tax increase of 1993, the
largest in the history of the U.S.
For North Carolina specifically, there are a number of positive
provisions. We have received money for a program called LEARN North
Carolina, which will provide important curriculum information to our
teachers and classrooms over the Internet throughout North Carolina.
The Congress again provided funding for the Reading Together program
which has fifth graders tutoring second graders in reading--it is a
truly remarkable program that has shown very positive results in
increasing the reading skills of elementary students.
The bill provides funding for the North Carolina Center for the
Prevention of School Violence, in order to reduce violence in schools.

[[Page S12776]]

We have provided money to save a national landmark, the Cape Hatteras
Lighthouse.
The bill will provide additional funding for the North Carolina
Criminal Justice Information Network, which will help our state
troopers identify criminal suspects on the spot during traffic steps.
It will save the lives of our police officers.
In order to stop crime before it happens, we have provided funding
for gang resistance in troubled parts of North Carolina.
For transportation, we have secured $10 million for light rail in the
Triangle. In Charlotte, we have $3 million for the planning of light
rail in that booming area of the state.
For our farmers, unlike the White House proposal, we have made sure
that North Carolina farmers can receive aid if they are hit by low
prices. Also, in order to keep our farmers competitive in the global
marketplace, we have provided millions in agriculture research for
North Carolina.
These are just a few of the items that have been secured for our
state.
As I said, Mr. President, this is not a perfect bill.
We are spending too much money under the guise of ``emergency''
spending. Under the banner of ``emergency'' spending, we have funds for
the Bosnian mission, the Year 2000 compliance, farm aid and embassy
security funds. While we can't desert our troops in Bosnia now, we can
find other spending cuts to pay for this mission, if it continues. We
need funds to fix the Year 2000 problem, but we can find other cuts to
offset this spending. And, we need funds to make our foreign missions
more secure. I am willing to vote for these new funds now, but I can
vow that I will seek spending reductions in the next year to offset
them.
For this reason, I am also introducing legislation today that would
require the President to submit a budget next year identifying spending
cuts so that we can pay for the twenty billion in ``emergency''
spending that we have spent in this bill. We must preserve the surplus
for Social Security, and emergency or no emergency, we have to find
cuts in government so that we do not fritter away the surplus.
In conclusion, this bill, on balance, is a bill for a better national
defense, better schools and better health care. For that reason, I plan
to support it.

Olympic and Amateur Sports Act Amendments of 1998

Mr. STEVENS. Mr. President, this legislation includes the Olympic and
Amateur Sports Act Amendments of 1998, a bill that Senator Campbell
joined me in cosponsoring to update the federal charter of the U.S.
Olympic Committee and the frame-work for Olympic and amateur sports in
the United States.
This framework is known as the ``Amateur Sports Act,'' because most
of its provisions were added by the Amateur Sports Act of 1978 (P.L.
95-606). The Act gives the U.S. Olympic Committee certain trademark
protections to raise money--and does not provide recurring
appropriations--so therefore does not come up for routine
reauthorization.
The Amateur Sports Act has not been amended since the comprehensive
revision of 1978--a revision which provided the foundation for the
modern Olympic movement in the United States. The bill we will soon
pass does not fundamentally change the Act because our review showed us
that is still fundamentally sound. We believe the modest changes we
will make will ensure that the Act serves the United States well in the
21st Century.
The significant changes which have occurred in the world of Olympic
and amateur sports since 1978 warrant some fine-tuning of the Act. Some
of the developments of the past 20 years include: (1) that the schedule
for the Olympics and Winter Olympics has been alternated so that games
are held every two years, instead of every four--significantly
increasing the workload of the U.S. Olympic Committee; (2) that sports
have begun to allow professional athletes to compete in some Olympic
events; (3) that even sports still considered ``amateur'' have athletes
who with greater financial opportunities and professional
responsibilities than we ever considered in 1978; and (4) that the
Paralympics--the Olympics for disabled amateur athletes--have grown
significantly in size and prestige.
These and other changes led me to call for a comprehensive review of
the Amateur Sports Act in 1994. The Commerce Committee has held three
hearings since then. At the first and second--on August 11, 1994 and
October 18, 1995--witnesses identified where the Amateur Sports Act was
showing signs of strain. We postponed our work until after the 1996
Summer Olympics in Atlanta, but on April 21, 1997, held a third hearing
at the Olympic Training Center in Colorado Springs to discuss solutions
to the problems which had been identified.
By January, 1998, we'd refined the proposals into possible amendments
to the Amateur Sports Act, which we discussed at length at an informal
working session on January 26, 1998 in the Commerce Committee hearing
room. The bill that Senator Campbell and I introduced in May reflected
the comments received in January, and excluded proposals for which
consensus appeared unachievable. With the help of the U.S. Olympic
Committee, the Athletes Advisory Council, the National Governing
Bodies' Council, numerous disabled sports organizations, and many
others, we continued to fine tune the bill until it was approved by the
Commerce Committee in July.
I will include a longer summary of the bill for the Record, but will
briefly explain its primary components: (1) the bill would change the
title of the underlying law to the ``Olympic and Amateur Sports Act''
to reflect that more than strictly amateurs are involved now, but
without lessening the amateur and grass roots focus reflected in the
title of the 1978 Act; (2) the bill would add a number of measures to
strengthen the provisions which protect athletes' rights to compete;
(3) it would add measures to improve the ability of the USOC to resolve
disputes--particularly close the Olympics, Paralympics, or Pan-American
Games--and reduce the legal costs and administrative burdens of the
USOC; (4) it would add measures to fully incorporate the Paralympics
into the Amateur Sports Act, and update the existing provisions
affecting disabled athletes; (5) it would improve the notification
requirements when an NGB has been put on probation or is being
challenged; (6) it would increase the reporting requirements of the
USOC and NGB with respect to sports opportunities for women,
minorities, and disabled individuals; and (7) it would require the USOC
to report back to Congress in five years with any additional changes
that may be needed to the Act.
Mr. President, I am the only Senator from President Ford's Commission
on Amateur Sports who is still serving. It has therefore been very
helpful to have Senator Campbell--an Olympian himself in 1964--involved
in this process. Over my objection he has included an amendment the
package to name the Act after me. There are many others who deserve
recognition for their work to bring about the 1978 Act, and since he
has prevailed, I will accept this honor on their behalf. I ask
unanimous consent that my summary of the major components of the bill
be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:

Summary of Major Provisions of Section 142, the Olympic and Amateur
Sports Act Amendments of 1998

Section 142 of the omnibus bill is based on S. 2119, the
Olympic and Amateur Sports Act Amendments of 1998, a bill
introduced by Senators Stevens and Campbell on May 22, 1998
and approved by the Senate Commerce Committee in July of
1998. Summary of major provisions:
Olympic and Amateur Sports Act--The federal charter of the
U.S. Olympic Committee (USOC) and framework for Olympic and
amateur sports in the United States is commonly known as the
``Amateur Sports Act'' because most of its provisions were
enacted as part of the Amateur Sports Act of 1978 (P.L. 95-
606). Section 142 would officially rename the underlying Act
as the ``Olympic and Amateur Sports Act.'' An amendment by
Senator Campbell changed section 142 to rename the underlying
Act as the ``Ted Stevens Olympic and Amateur Sports Act.''
Paralympics--Section 142 incorporates the Paralympics into
the Olympic and Amateur Sports Act, so that the Act clearly
reflects the equal status between able-bodied and disabled
athletes. It continues the original focus of the Act to
integrate disabled sports with able-bodied National Governing
Bodies (NGB's), but allows the USOC to recognize paralympic
sports organizations if integration does not serve the best
interest of a

[[Page S12777]]

sport or if the NGB for the sport objects to integration. The
USOC is officially recognized as the national Paralympic
committee.
Athletes--The amendments require the creation of an
Athletes' Advisory Council and National Governing Bodies'
Council to advise the USOC. The amendments also require that
at least 20 percent of the USOC Board be comprised of active
athletes. The USOC already carries out these provisions but
is not required to do us under existing law. The amendments
require the USOC to hire an ombudsman for athletes nominated
by the Athletes' Advisory Council who will provide advice to
athletes about the Olympic and Amateur Sports Act, the
relevant constitution and bylaws of the USOC and NGBs, and
the rules of international sports federations and the
International Olympic Committee (IOC) and International
Paralympic Committee (IPC), and who will assist in mediating
certain disputes involving the opportunity of amateur
athletes to compete. The amendments also require the NGBs to
disseminate and distribute to athletes, coaches, trainers,
and others, all applicable rules and any changes to the rules
of the NGB, USOC, international sports federation, IOC, IPC,
and Pan-American Sports Organization. Section 142 clarifies
that NGBs must agree to submit to binding arbitration with
respect to opportunity-to-compete issues at the request of
the affected athlete under the Commercial Rules of the
American Arbitration Association, but gives USOC authority to
alter the Commercial Rules with the concurrence of the
Athletes' Advisory Council and National Governing Bodies
Council, or by a two-thirds vote of the USOC Board of
Directors;
USOC Administrative/Cost Saving--The amendments allow the
USOC to remove certain lawsuits against it to federal court.
The amendments require the USOC to keep an agent for service
of process only in the State of Colorado, rather than all 50
States. Under the amendments, the USOC is required to report
to Congress only every four years, instead of annually. The
report, however, is required to include data on the
participation of women, disabled individuals, and minorities.
Section 142 protects the USOC against court injunction in
selecting athletes to serve on the Olympic, Paralympic, or
Pan-American teams within 21 days of those games if the
USOC's constitution and bylaws cannot provide a resolution
before the games are to begin.
National Governing Bodies--The amendments in section 142
allow the USOC/NGBs not to send to the Olympics, Pan-American
Games, or Paralympics athletes who haven't met the
eligibility criteria of the USOC and appropriate NGB, even if
not sending those athletes will result in an incomplete team.
The amendments allow NGBs to establish criteria on a sport-
by-sport basis for the ``active athletes'' that must comprise
at least 20 percent of their boards of directors and other
governing boards. Under the amendments, the USOC, AAC, and
NGB Council will set guidelines, but an NGB will be able to
seek exceptions to the guidelines from the USOC. Section 142
includes improved notification and hearing requirements by
the USOC when an NGB is being challenged to be replaced or
being put on probation.
Trademark--The amendment gives USOC trademark protection
for the Pan-American Games, Paralympics, and symbols
associated with each. As passed, it does not grandfather
entities which have previously used these words or symbols.
However, the USOC is directed not to pursue any actions
against entities which already used such words or symbols on
the date of the enactment of section 142 until Congress has
the opportunity to legislatively address this matter. Section
142 also includes a provision to minimize the effects of the
trademark protections in the Olympic and Amateur Sports Act
on certain businesses in Washington State.
Special Report--The amendments in section 142 require the
USOC to submit a report to Congress at the end of five years
on the implementation of the provisions of section 142 and
any additional changes the USOC believes are needed to the
Olympic and Amateur Sports Act.

The American Fisheries Act

Mr. STEVENS. Mr. President, we've reached agreement to include the
American Fisheries Act in the legislation being passed today (as title
II of division C of the bill). This Act will not only complete the
process begun in 1976 to give U.S. interests a priority in the harvest
of U.S. fishery resources, but will also significantly decapitalize the
Bering Sea pollock fishery.
The Bering Sea pollock fishery is the nation's largest, and its
present state of overcapacity is the result of mistakes in, and
misinterpretations of, the 1987 Commercial Fishing Industry Vessel
Anti-Reflagging Act (the ``Anti-Reflagging Act''). In 1986, as the last
of the foreign-flag fishing vessels in U.S. fisheries were being
replaced by U.S.-flag vessels, we discovered that federal law did not
prevent U.S. flag vessels from being entirely owned by foreign
interests. We also discovered that federal law did not require U.S.
fishing vessels to carry U.S. crew members, and that U.S. fishing
vessels could essentially be built in foreign shipyards under the
existing regulatory definition of ``rebuild.'' The goals of the 1987
Anti-Reflagging Act therefore were to: (1) require the U.S.-control of
fishing vessels that fly the U.S. flag; (2) stop the foreign
construction of U.S. flag vessels under the ``rebuild'' loophole; and
(3) require U.S.-flag fishing vessels to carry U.S. crews.
Of these three goals, only the U.S. crew requirement was achieved.
The Anti-Reflagging Act did not stop foreign interests from owning and
controlling U.S. flag fishing vessels. In fact, about 30,000 of the
33,000 existing U.S.-flag fishing vessels are not subject to any U.S.
controlling interest requirement. The Anti-Reflagging Act also failed
to stop the massive foreign shipbuilding programs between 1987 and 1990
that brought almost 20 of the largest fishing vessels ever built into
our fisheries as ``rebuilds.'' Today, half of the nation's largest
fishery--Bering Sea pollock--continues to be harvested by foreign
interests on foreign-built vessels that are not subject to any U.S.-
controlling interest standard.
On September 25, 1997, I introduced the American Fisheries Act (S.
1221) to fix these mistakes. Senators from almost every fishing region
of the country joined me in support of this effort, including Senator
Breaux, Senator Hollings, Senator Gregg, Senator Wyden, and Senator
Murkowski. As introduced, the bill had three primary objectives: (1)
require the owners of all U.S.-flag fishing vessels to comply with a 75
percent U.S.-controlling interest standard (similar to the standard for
other commercial U.S.-flag vessels that operate in U.S. waters); (2)
remove from U.S. fisheries at least half of the foreign-built factory
trawlers that entered the fisheries through the Anti-Reflagging Act
foreign rebuild grandfather loophole and that continued to be foreign-
owned on September 25, 1997; and (3) prohibit the entry of any new
fishing vessels above 165 feet, 750 tons, or with engines that produce
greater than 3,000 horsepower.
I am pleased to report that the package we are approving today
accomplishes all three of the main objectives of S. 1221 as introduced.
I wish to thank Senator Gorton for his tremendous effort in this. For
almost a decade now, he and I have had various disagreements about the
Bering Sea pollock fishery and issues relating to the Anti-Reflagging
Act. At the Commerce Committee hearing in March, and later, at an
Appropriations Committee markup in July, Senator Gorton plainly
expressed his concerns with S. 1221. In August, however, he spent
considerable time with representatives from the Bering Sea pollock
fishery and by sheer will managed to develop a framework upon which we
could both agree. After he presented the framework to me, we convened
meetings in September that went around the clock for five days. Those
meetings included Bering Sea pollock fishery industry representatives,
industry representatives from other North Pacific fisheries, the State
of Alaska, North Pacific Council members, the National Marine
Fisheries, the Coast Guard, the Maritime Administration, environmental
representatives, and staff for various members of Congress and the
Senate and House committees of jurisdiction.
At the end of those meetings, a consensus had been achieved among
Bering Sea fishing representatives on an agreement to reduce capacity
in the Bering Sea pollock fishery. For the next three weeks, we drafted
the legislation to give effect to the agreement, and spent considerable
time with the fishing industry from other fisheries who were concerned
about the possible impacts of the changes in the Bering Sea pollock
fishery. The legislation we are passing today includes many safeguards
for other fisheries and the participants in those fisheries. By
delaying implementation of some measures until January 1, 2000, it also
provides the North Pacific Council and Secretary with sufficient time
to develop safeguards for other fisheries.
This legislation is unprecedented in the 23 years since the enactment
of the Magnuson-Stevens Act. With the council system, Congressional
action of this type is not needed in the federal fisheries anymore.
However, the mistakes in the Anti-Reflagging Act and the way it was
interpreted created unique problems in the Bering Sea pollock fishery
that only Congress can fix. The North Pacific Council simply does not
have the authority to turn back the clock

[[Page S12778]]

by removing fishery endorsements, to provide the funds required under
the Federal Credit Reform Act to allow for the $75 million loan to
remove capacity, to strengthen the U.S.-control requirements for
fishing vessels, to restrict federal loans on large fishing vessels, or
to do many other things in this legislation.
While S.1221 as introduced was more modest in scope, I believe the
measures in this agreement are fully justified as a one-time corrective
measure for the negative effects of Anti-Reflagging Act.
I ask unanimous consent that the section-by-section analysis I have
prepared be printed in the Record.
There being no objection, the summary was ordered to be printed in
the Record, as follows:

Section-by-Section Summary

Division A

Section 120.--Appropriation
Section 120 appropriates a total of $30 million for the
American Fisheries Act and other purposes. Specifically, it
provides: (1) $20 million for the federal contribution to the
reduction of capacity in the Bering Sea/Aleutian Islands
(BSAI) pollock fishery; (2) $750,000 for the cost under the
Federal Credit Reform Act of providing a $75 million loan to
the fishing industry for the reduction of capacity in the
BSAI pollock fishery; (3) $250,000 for the cost under the
Federal Credit Reform Act of providing loans totaling $25
million to communities that participate in the western Alaska
community development quota program to enable those
communities to increase their participation in BSAI and other
North Pacific fisheries; (4) $1,000,000 for the cost under
the Federal Credit Reform Act of providing a loan of up to
$100 million to the BSAI crab industry if a fishing capacity
reduction program is implemented in that fishery under
section 312(b) of the Magnuson-Stevens Act; (5) $6 million to
the Secretary of Commerce for the costs of implementing
subtitle II of the American Fisheries Act; and (6) $2 million
to the Secretary of Transportation, primarily to the Maritime
Administration for the costs of implementing subtitle I.

Division C--Title II

Subtitle I--Fishery Endorsements

Section 201.--Short Title
This section establishes the title of the legislation as
the ``American Fisheries Act.'' The provisions of title II of
division C draw substantially from S. 1221 (also called the
American Fisheries Act), which was introduced on September
25, 1997, and cosponsored by Senators Breaux, Murkowski,
Hollings, Wyden, and Gregg. A hearing to review S. 1221 was
held by the Senate Commerce Committee on March 26, 1998, and
a related hearing was held by the House Resources Committee
on June 4, 1998.
Section 202.--Standard for Fishery Endorsements
Subsection (a) of section 202 amends section 12102(c) of
title 46, United States Code to require at least 75 percent
of the interest in entities that own U.S.-flag vessels in the
fishing industry (including fishing vessels, fish tender
vessels and floating processors) to be owned and controlled
by citizens of the United States. U.S.-flag vessels in the
fishing industry that are owned by individuals must be owned
by a citizen of the United States under the requirement of
section 12102(a)(1) of title 46, which allows only an
individual who is a citizen of the United States to own a
vessel that is eligible for documentation. Section 12102(c)
of title 46, as amended by subsection (a), would require
section 2(c) of the Shipping Act, 1916 to be applied in
determining whether an entity meets the 75 percent
requirement. Section 2(c) of the Shipping Act, 1916 states
the following:
``Seventy-five per centum of the interest in a corporation
shall not be deemed to be owned by citizens of the United
States (a) if the title to 75 per centum of its stock is not
vested in such citizens free from any trust or fiduciary
obligation in favor of any person not a citizen of the United
States; or (b) if 75 per centum of the voting power in such
corporation is not vested in citizens of the United States;
or (c) if, through any contract or understanding, it is so
arranged that more than 25 per centum of the voting power in
such corporation may be exercised, directly or indirectly, in
behalf of any person who is not a citizen of the United
States; or (d) if by any other means whatsoever [emphasis
added] control of any interest in the corporation in excess
of 25 per centum is confered upon or permitted to be
exercised by any person who is not a citizen of the United
States.''
The application of section 2(c) is intended to ensure that
vessels with a fishery endorsement are truly controlled by
citizens of the United States. The amendments made by
subsection (a) make clear that the term `corporation' as used
in section 2(c) of the Shipping Act, 1916 means a
corporation, partnership, association, trust, joint venture,
limited liability company, limited liability partnership, or
any other entity for the purposes of applying section 2(c) to
section 12102(c) of title 46, United States Code.
Subsection (a) also amends section 12102(c) (by adding a
new paragraph (2)) to statutorily prohibit some of the types
of control which are impermissible under the standard. A new
paragraph (3) would prohibit vessels with a fishery
endorsement from being leased to a non-citizen of the United
States for use as a fishing vessel (to harvest fish) even if
the control requirements are satisfied. A new paragraph (4)
would allow a person not eligible to own a vessel with a
fishery endorsement to nevertheless have an interest greater
than 25 percent in the vessel, if the interest is secured by
a mortgage to a trustee who is eligible to own a vessel with
a fishery endorsement and who complies with specific
requirements in the law and other requirements prescribed by
the Secretary, and if the arrangement does not violate the 75
percent control requirements.
Subsection (a) amends section 12102(c) with a new paragraph
(paragraph (5)) that would exempt the following vessels from
the 75 percent standard, provided the owners of the vessels
continue to comply with the fishery endorsement law in effect
on October 1, 1998: (1) vessels engaged in fisheries under
the authority of the Western Pacific Fishery Management
Council; and (2) purse seine vessels engaged in tuna fishing
in the Pacific Ocean outside the exclusive economic zone or
pursuant to the South Pacific Regional Fisheries Treaty.
Fishery endorsements issued by the Secretary for these
vessels would be valid only in those specific fisheries and
the vessels would not be eligible to receive a fishery
endorsement to participate in other fisheries unless the
owner complied with the 75 percent standard.
Paragraph (6) of section 12102(c), as amended by subsection
(a), would prevent new large fishing vessels from entering
U.S. fisheries, including former U.S.-flag fishing vessels
that have reflagged in recent years to fish in waters outside
the U.S. exclusive economic zone. Specifically, it would
prohibit the issuance of fishery endorsements to vessels
greater than 165 feet in registered length, of more than 750
gross registered tons, or that have an engine or engines
capable of producing a total of more than 3,000 shaft
horsepower unless: (1) the vessel had a valid fishery
endorsement on September 25, 1997 (the day that S. 1221
was introduced), is not placed under foreign registry
after the date of the enactment of the American Fisheries
Act, and, if the vessel's fishery endorsement is allowed
to lapse or is invalidated after the date of the enactment
of the American Fisheries Act, an application for a new
fishery endorsement is submitted to the Secretary within
15 business days; or (2) the owner of the vessel
demonstrates to the Secretary that a regional fishery
management council has recommended and the Secretary of
Commerce has approved specific measures after the date of
the enactment of the American Fisheries Act to allow the
vessel to be used in fisheries under that council's
authority. The regional councils have the authority and
are encouraged to submit for approval to the Secretary of
Commerce measures to prohibit vessels that receive a
fishery endorsement under section 12102(c)(6) from
receiving any permit that would allow the vessel to
participate in fisheries under their authority, so that a
vessel cannot receive a fishery endorsement through
measures recommended by one council, then enter the
fisheries under the authority of another Council.
Subsection (b) amends section 31322(a) of title 46, United
States Code, to require that a preferred mortgage with
respect to a vessel with a fishery endorsement have as a
mortgagee only: (1) a person that meets the 75 percent U.S.-
controlling interest requirement; (2) a state- or federally-
chartered financial institution that meets a majority (more
than 50 percent) U.S.-controlling interest requirement; or
(3) a person using a trustee under the authority of, and in
compliance with, section 12102(c)(4) of title 46, as amended
by this Act.
Section 203--Enforcement of Standard
Subsection (a) of section 203 specifies that amendments in
section 202 take effect on October 1, 2001, roughly three
years from the date of the expected enactment of the American
Fisheries Act. As introduced, S. 1221 would have required
compliance with the new standard 18 months after enactment.
The extended implementation period is intended to provide
additional time for the fishing industry to prepare for the
new requirements, as well as time for the Secretary of
Transportation to prepare to carry out the requirements.
Subsection (b) requires final regulations to implement
subtitle I to be published in the Federal Register by April
1, 2000, 18 months before the new requirements go into
effect, and requires that the regulations specifically
identify: (1) impermissible transfers of ownership or
control; (2) transactions that will require prior agency
approval; and (3) transactions that will not require prior
agency approval. Subsection (b) prohibits the Secretary of
Transportation from issuing any letter rulings before
publishing the final regulations. It is the intent of
Congress that there be a full opportunity for the public to
comment on the regulations implementing the new requirements
before any decisions are made with respect to specific
vessels or vessel owners. During the implementation of the
1987 Anti-Reflagging Act, numerous letter rulings were issued
by the Coast Guard prior to the publication of final
regulations to implement the U.S.-control requirements, which
limited the Coast Guard's ability to address valid concerns
about the regulations. The implementation process set out in
subsection (b) will provide an 18 month period for the
Secretary of Transportation to promulgate regulations and
fully review public

[[Page S12779]]

comments, followed by an 18 month period in which the fishing
industry can obtain letter rulings before the new
requirements take effect to avoid disruptions where possible.
This framework allows time for the Secretary of
Transportation to consult with Congress if the Secretary has
concerns about Congressional intent or identifies any
technical or other amendments needed to give full effect to
the American Fisheries Act.
Subsection (c) requires the Maritime Administration
(MarAd), rather than the Coast Guard, to administer the new
U.S.-ownership and control requirements for vessels 100 feet
in registered length and greater. MarAd will use a more
thorough process than has been used in the past to ensure
compliance with the new requirements. The process will be
based on the process for federal loan guarantees and
subsidies. The owners of vessels 100 feet and greater will be
required to file an annual statement to demonstrate
compliance with section 12102(c), based on an existing
citizenship affidavit required to be filed under certain
MarAd regulations. Paragraph (2) of subsection (c) directs
MarAd to rigorously scrutinize transfers of ownership and
control of vessels, and identifies specific areas in which
MarAd should pay particular attention.
Subsection (d) directs the Secretary of Transportation to
establish the requirements for the owners of vessels less
than 100 feet to demonstrate compliance with the new
requirements, and allows the Secretary to decide whether the
Coast Guard or MarAd should be the implementing agency.
Subsection (d) further directs the Secretary to minimize the
administrative burden on individuals who own and operate
vessels that measure less than 100 feet.
Subsection (e) directs the Secretary of Transportation to
revoke the fishery endorsement of any vessel subject to
section 12102(c) of title 46 whose owner does not meet the
75-percent ownership and control requirement or otherwise
fails to comply with that section.
Subsection (f) increases the penalties for fishery
endorsement violations. Specifically, it would make the owner
of a vessel with a fishery endorsement liable for a civil
penalty of up to $100,000 for each day the vessel is engaged
in fishing if the owner has knowingly falsified or concealed
a material fact or knowingly made a false statement or
representation when applying for or renewing a fishery
endorsement. This increased penalty is intended to discourage
willful noncompliance with the new requirements.
Subsection (g) provides limited exemptions from the new
U.S.-control and ownership requirements in section 12102(c)
of title 46 for the owners of five vessels (the EXCELLENCE,
GOLDEN ALASKA, OCEAN PHOENIX, NORTHERN TRAVELER, and NORTHERN
VOYAGER) under certain conditions. It exempts the owners
after October 1, 2001 only until more than 50 percent of the
interest owned and controlled in the entity that owns the
vessel changes. The exemption applies only to the present
owners, and the subsection not only requires all subsequent
owners to comply the 75 percent standard, but requires even
the present owners to comply if more than 50 percent of the
interest owned and controlled in that owner changes after
October 1, 2001. The exemption also automatically terminates
with respect to the NORTHERN TRAVELER or NORTHERN VOYAGER if
the vessel is used in a fishery other than under the
jurisdiction of the New England or Mid-Atlantic fishery
management councils, and automatically terminates with
respect to the EXCELLENCE, GOLDEN ALASKA, or OCEAN PHOENIX if
the vessel is used to harvest fish.
Section 204--Repeal of Ownership Savings Clause
Section 204 would repeal the U.S.-ownership and control
grandfather provision of the 1987 Anti-Reflagging Act, which
was interpreted by the Coast Guard (and later upheld by the
U.S. Court of Appeals for the D.C. Circuit, see 298 U.S. App.
D.C. 331) to ``run with the vessel,'' thereby exempting about
90 percent of the U.S.-flag fishing industry vessels in
existence today from any U.S.-ownership and control
requirements. The American Fisheries Act and provisions of
section 204 require that the owners of all vessels comply
with the new U.S.-ownership and control requirements when
those requirements take effect on October 1, 2001 (except as
provided in section 12102(c)(5) of title 46, as amended by
the American Fisheries Act (Hawaii exemption), and in section
203(g) of the American Fisheries Act (five specific
vessels)).

Subtitle II--Bering Sea Pollock Fishery

Section 205--Definitions
Section 205 provides definitions for the following terms
used in subtitle II: (1) Bering Sea and Aleutian Islands
Management Area; (2) catcher/processor; (3) catcher vessel;
(4) directed pollock fishery; (5) harvest; (6) inshore
component; (7) Magnuson-Stevens Act; (8) mothership; (9)
North Pacific Council; (10) offshore component; (11)
Secretary; and (12) shoreside processor.
Section 206--Allocations
Section 206 establishes new allocations in the pollock
fishery in the BSAI beginning in 1999. Subsection (a)
requires 10 percent of the total allowable catch of pollock
to be allocated as a directed fishing allowance to the
western Alaska community development quota program.
Subsection (b) requires an additional amount from the total
allowable catch to be allocated for the incidental catch of
pollock in other groundfish fisheries (including the portion
of those fisheries harvested under the western Alaska CDQ
program). Of the remainder, subsection (b) requires 50
percent to be allocated as a directed fishing allowance for
catcher vessels that deliver to shoreside processors, 40
percent to be allocated as a directed fishing allowance for
catcher/processors and catcher vessels that deliver to
catcher/processors, and 10 percent to be allocated as a
directed fishing allowance for catcher vessels that deliver
to motherships. Section 206 clarifies that the 10 percent of
pollock allocated to the western Alaska CDQ program is
allocated as a target species, consistent with the present
method of allocation and with Congressional intent with the
respect to the target species allocations required under
section 305(i) of the Magnuson-Stevens Act for the western
Alaska CDQ program. The section is intended to ensure the
continuation of the present system under which the bycatch in
the pollock CDQ fishery and the bycatch in the non-pollock
groundfish CDQ fisheries are not counted against the CDQ
allocations.
Section 207--Buyout
Subsection (a) directs the Secretary of Commerce, using
special authority added in 1996 to the title XI loan program,
to provide a loan of $75 million to the shoreside processors
and catcher vessels that deliver to the shoreside processors
to remove fishing capacity from the BSAI pollock fishery.
Subsection (b) sets out the terms for the repayment of the
loan, requiring the shoreside processors and catcher vessels
that deliver to those processors to pay on an equal basis
six-tenths (0.6) of one cent per pound of pollock beginning
in the year 2000 and continuing until the loan is fully
repaid (probably for around 25 years). Subsection (c)
authorizes appropriations of an additional $20 million for
the removal of fishing capacity from the BSAI pollock
fishery, for a total of $95 million.
Subsection (d) establishes the payment formula for the
removal of fishing capacity. Paragraph (1) of subsection (d)
requires $90 million to be paid by the Secretary to the
owners of the nine catcher/processors (also called factory
trawlers) listed in section 209, subject to the conditions
that one of the vessels (the AMERICAN EMPRESS) not be used
outside of the U.S. exclusive economic zone (EEZ) to harvest
stocks that occur within the U.S. EEZ, and that eight of the
vessels be scrapped by December 31, 2000. Paragraph (2) of
subsection (d) requires the payment of $5 million to either
the owners of certain catcher/processors listed in section
208(e), or to owners of catcher vessels eligible under
section 208(b) and the 20 catcher/processors eligible under
section 208(e), depending on whether or not a contract to
implement a fishery cooperative has been filed by December
31, 1998. These payments totaling $95 million are for the
removal of fishing capacity only, and are in no way intended
as compensation for any allocation adjustments, nor should
they be construed to create any right of compensation for any
allocation adjustments or any right, title, or interest in or
to any fish in any fishery. Subsection (d) authorizes the
Secretary of Commerce to reduce the payments by any amount
owed to the federal government which has not been satisfied
by the owners of the vessels.
Subsection (e) allows the Secretary to suspend any or all
of the federal fishing permits held by the owners who receive
payments under subsection (d) if the vessel identified in
paragraph (1) of section 209 is used outside of the U.S.
exclusive economic zone (EEZ) to harvest stocks that occur
within the U.S. EEZ, or if the other eight catcher/processors
identified in section 209 are not scrapped by December 31,
2000.
Subsection (f) allows the repayment period for the $75
million loan to the shoreside processors and catcher vessels
that deliver to the shoreside processors to be paid back over
as many as 30 years. The general authority for fishing
capacity reduction loans under the title XI program allows a
repayment period of only up to 20 years.
Subsection (g) directs the Secretary of Commerce to publish
proposed regulations to implement the fishing capacity
reduction program under title XI and under the Magnuson-
Stevens Act by October 15, 1998. This program was enacted on
October 11, 1996 as part of the Sustainable Fisheries Act
(P.L. 104-297), yet the proposed regulations to implement the
program have not yet been published for review. Subsection
(g) is intended to bring about the expeditious publication of
the proposed regulations.
Section 208--Eligible Vessels and Processors
Subsection (a) of section 208 establishes the criteria for
the catcher vessels that, beginning on January 1, 2000, will
be eligible to harvest the pollock allocated under section
206(b)(1) for processing by the inshore component. To be
eligible a vessel must: (1) have delivered at least 250
metric tons of pollock in the BSAI directed pollock fishery
(or at least 40 metric tons if the vessel is less than 60
feet in length overall) to the inshore component in one of
1996 or 1997, or before September 1, 1998; (2) be eligible
for a license under the license limitation program; and (3)
not be eligible under subsection (b) to deliver pollock to
catcher/processors. Any vessel which cannot meet these
criteria will be ineligible as of January 1, 2000 to harvest
the pollock allocated for processing by the inshore
component.
Subsection (b) lists the particular catcher vessels and
establishes criteria for other

[[Page S12780]]

catcher vessels that, beginning on January 1, 1999, will be
eligible to harvest pollock allocated under section 206(b)(2)
for processing by catcher/processors. In addition to the
seven listed vessels, any catcher vessel which (1) delivered
at least 250 metric tons and at least 75 percent of the
pollock it harvested in the BSAI directed pollock fishery to
catcher processors in 1997, and (2) is eligible for a license
under the license limitation program, will also be eligible
as of January 1, 1999 to harvest pollock allocated for
processing by catcher/processors. Any vessel which is not
listed or cannot meet these criteria will be ineligible as of
January 1, 1999 to harvest the pollock allocated for
processing by catcher/processors.
Subsection (c) lists the particular catcher vessels and
establishes criteria for other catcher vessels that,
beginning on January 1, 2000, will be eligible to harvest
pollock allocated under section 206(b)(3) for processing by
motherships. In addition to the twenty listed vessels, any
catcher vessel which (1) delivered at least 250 metric tons
of pollock from the BSAI directed pollock fishery to
motherships in one of 1996 or 1997, or before September 1,
1998, (2) is eligible for a license under the license
limitation program, and (3) is not eligible under subsection
(b) to deliver pollock to catcher/processors, will also be
eligible as of January 1, 2000 to harvest pollock allocated
for processing by motherships. Any vessel which is not listed
or cannot meet these criteria will be ineligible as of
January 1, 2000 to harvest the pollock allocated for
processing by motherships.
Subsection (d) lists the three motherships that will be
eligible beginning on January 1, 2000 to process the pollock
allocated under section 206(b)(3). Any vessel which is not
listed will be ineligible as of January 1, 2000 to process
the pollock allocated for processing by motherships in the
BSAI directed pollock fishery.
Subsection (e) lists the particular catcher/processors
that, beginning on January 1, 2000, will be eligible to
harvest pollock allocated under section 206(b)(2) for
processing by catcher/processors. In addition to the twenty
vessels listed, under paragraph (21) of subsection (e), any
catcher/processor which harvested more than 2,000 metric tons
of pollock in the BSAI directed pollock fishery in 1997, and
is eligible for a license under the license limitation
program, will be eligible to harvest a small portion of the
pollock allocated under section 206(b)(2). The vessel or
vessels eligible under paragraph (21) are prohibited from
harvesting more than one-half percent in the aggregate of the
pollock allocated under subsection 206(b)(2). This provision
is intended to allow a small number of catcher/processors
(perhaps as few as one) to continue to harvest the relatively
small amount of pollock they harvested in the past while
relying primarily on other fisheries. The last sentence of
subsection (e) would allow the catcher/processors listed in
paragraphs (1) through (20) to continue to be eligible for a
fishery endorsement even if it is ultimately determined that
the vessel did not satisfy the foreign rebuild grandfather
provisions of the 1987 Anti-Reflagging Act--provided that the
owner of the vessel complies with all other requirements for
a fishery endorsement. The removal of nine catcher/processors
in section 209 is intended to address the overcapacity
concerns that resulted from the entry under the Anti-
Reflagging Act of foreign built vessels contrary to
Congressional intent.
Subsection (f) establishes the criteria for shoreside
processors to which the catcher vessels eligible under
section 208(a) may deliver pollock from the BSAI directed
pollock fishery beginning on January 1, 2000. To be eligible,
a shoreside processor (which may include moored vessels) must
have processed more than 2,000 metric tons of pollock in the
inshore component of the BSAI directed pollock fishery during
each of 1996 and 1997. Any shoreside processor that processed
pollock in the inshore component in 1996 or 1997, but
processed less than 2,000 metric tons, would be allowed under
paragraph (1)(B) to continue processing up to 2,000 metric
tons per year after January 1, 2000. Paragraph (2) of
subsection (f) would allow the North Pacific Council to
recommend (and the Secretary to approve) the entry of
additional shoreside processors to process the allocation
under section 206(b)(1) if the total allowable catch for
pollock increases by more than 10 percent above the 1997
total allowable catch, or if any of the shoreside processors
eligible to process more than 2,000 metric tons is lost.
Subsection (g) establishes requirements for the replacement
of any of the vessels eligible to harvest pollock under
section 208 if the vessel is lost by an event other than the
willful misconduct of the owner or agent of the owner.
Subsection (h) allows vessels and shoreside processors for
which an application for eligibility under section 208 has
been filed to be allowed to participate in the BSAI directed
pollock fishery until the Secretary of Commerce can make a
final determination about the eligible of the vessel or
shoreside processor. This subsection is intended to minimize
disruptions in the event the Secretary is unable to complete
determinations for all vessels and processors prior to the
effective dates of the eligible criteria.
Subsection (i) clarifies that eligibility under section 208
does not confer any right of compensation if the eligibility
is subsequently revoked or limited, does not create any right
to any fish in any fishery, and does not waive any provision
of law otherwise applicable to an eligible vessel or
shoreside processor. Section 208 simply prevents the
participation of vessels and shoreside processors not listed
or that do not meet the eligibility criteria, and ineligible
vessels and shoreside processors similarly have no right of
compensation or right to any fish of any kind.
Section 209--List of Ineligible Vessels
Section 209 identifies nine catcher/processors that,
effective December 31, 1998, are permanently ineligible for
fishery endorsements. Section 209 also extinguishes all
claims associated with the vessels that could qualify the
owners of the vessels for any limited access system
permit.
Section 210--Fishery Cooperative Limitations
Subsection (a) of section 210 requires all contracts
implementing a fishery cooperative in the BSAI directed
pollock fishery and all material modifications to those
contracts to be filed with the North Pacific Council and
Secretary of Commerce, and requires information about the
contracts to be made available to the public. With the
limitations in section 208 on further entry into the BSAI
directed pollock fishery, the American Fisheries Act
increases the likelihood that fishery cooperatives will be
formed under the 1934 Act (15 U.S.C. 521 et seq.) that allows
fishermen to ``act together . . . in collectively catching,
producing, preparing for market, processing, handling, and
marketing'' fish and fish products without being subject to
federal anti-trust laws. The 1934 Act does not require the
public disclosure of the details from contracts implementing
fishery cooperatives, nor does it include many of the other
restrictions and limitations in section 210 that would apply
to fishery cooperatives in the BSAI directed pollock fishery.
Subsection (a) will require at a minimum the public
disclosure of the parties to the contract, the vessels
involved, the amount of fish each vessel is expected to
harvest, and, after the fishing season, the amount of fish
(including bycatch) each vessel actually harvested. In
addition, the North Pacific Council and Secretary may require
other information that they deem appropriate from
participants in a fishery cooperative for public disclosure.
Subsection (b) allows the catcher vessels that deliver
pollock to shoreside processors to form fishery cooperatives
with fewer than the whole class of vessels eligible under
section 208(a) so that they will be able to compete in the
event that fishery cooperatives are formed in the other BSAI
directed pollock fishery sectors which have fewer vessels.
Paragraph (1) requires the Secretary to establish a separate
allocation within the allocation under section 206(b)(1) if
at least 80 percent of the catcher vessels that delivered
most of their pollock in the previous year to a shoreside
processor decide to form a fishery cooperative to deliver
pollock to that shoreside processor and that processor has
agreed to process the pollock. The allocation for those
vessels would be equal to the average percentage those
vessels caught in the aggregate in 1995, 1996, and 1997. If a
fishery cooperative is formed, other catcher vessels that
delivered most of the their catch to that shoreside processor
would be required to be allowed to join the fishery
cooperative under the same terms and conditions as other
participants at any time before the calendar year in which
fishing under the cooperative will begin. Vessels which
participate in a fishery cooperative will not be allowed to
harvest any of the pollock that remains in the ``open
access'' portion of the allocation under section 206(b)(1).
The ``open access'' portion will be equal to the average
percentage that the vessels which do not elect to participate
in fishery cooperatives caught in the aggregate in 1995,
1996, and 1997. The vessels eligible to harvest pollock
allocated for processing by shoreside processors would
continue to have the authority to form a fishery cooperative
on a class-wide basis as well.
Subsection (c) requires at least 8.5 percent of the pollock
allocated under section 206(b)(2) for processing by catcher/
processors to be available for harvesting by the catcher
vessels eligible under section 208(b). This requirement will
help ensure that the traditional harvest of those catcher
vessels will not be reduced. The catcher vessels may
participate in a fishery cooperative with the 20 catcher/
processors eligible under section 208(e), but may participate
during 1999 only if the contract implementing the fishery
cooperative includes penalties to prevent the catcher vessels
from exceeding their traditional harvest levels in other
fisheries. Under a fishery cooperative, vessel owners have
more control over the time during which they will fish, and
without these provisions in 1999, the catcher vessels could
target other fisheries during the time they would
traditionally be participating in the BSAI directed pollock
fishery. By the year 2000, the North Pacific Council will
have been able to recommend (and the Secretary to approve)
any measures needed to protect other fisheries.
Subsection (d) extends the 1934 fishery cooperative
authority to motherships for purposes of processing pollock
if 80 percent of the catcher vessels eligible to harvest the
pollock allocated for processing by motherships decide to
form a fishery cooperative. The possible extension of this
authority would not begin until January 1, 2000, and would
remain in effect only for the duration of the contract
implementing the fishery cooperative. If a fishery
cooperative is formed, other catcher vessels eligible to
harvest the pollock allocated for processing by

[[Page S12781]]

motherships would be required to be allowed to join the
fishery cooperative under the same terms and conditions as
other participants at any time before the calendar year in
which fishing under the cooperative will begin.
Subsection (e) prohibits any individual or any single
entity from harvesting more than 17.5 percent of the pollock
in the BSAI directed pollock fishery to ensure competion.
Presently in that fishery, a single entity in that fishery
harvests close to 30 percent of the pollock in the BSAI
directed pollock fishery. In addition, paragraph (2) of
subsection (e) directs the North Pacific Council to establish
an excessive share cap for the processing of pollock in the
BSAI directed pollock fishery. Paragraph (3) requires any
individual or entity believed by the North Pacific Council or
Secretary to have exceeded the harvesting or processing caps
to submit information to MarAd, and requires MarAd make a
determination as soon as possible. If an individual or entity
owns 10 percent or more of another entity, they will be
considered to be the same entity as that other entity for the
purposes of the harvesting and processing caps.
Subsection (f) requires contracts that implement fishery
cooperatives in the BSAI directed pollock fishery to include
clauses under which the participants will pay landing taxes
established under Alaska law for pollock that is not landed
in the State of Alaska. The failure to include the clause or
to pay the landing taxes results in the permanent revocation
of the authority to form fishery cooperatives under the 1934
Act for the parties to the contract implement the fishery
cooperative and the vessels involved in the fishery
cooperative.
Subsection (g) specifies that the violation of any of the
provisions of section 210 (fishery cooperative limitations)
or section 211 (protections for other fisheries and
conservation measures) constitutes a violation of the
prohibited acts section of the Magnuson-Stevens Act and is
subject to the civil penalties and permit sanctions under
section 308 of the Magnuson-Stevens Act. In addition,
subsection (g) specifies that any person found to have
violated either of section 210 or 211 is subject to the
forfeiture of any fish harvested or processed during the
commission of the violation.
Section 211--Protections for Other Fisheries; Conservation
Measures
Subsection (a) of section 211 directs the North Pacific
Council to submit measures for the consideration and approval
of the Secretary of Commerce to protect other fisheries under
its authority and the participants in those fisheries from
adverse impacts caused by the subtitle II of the American
Fisheries Act or by fishery cooperatives in the BSAI directed
pollock fishery. The Congress intends for the North Pacific
Council to consider particularly any potential adverse
effects on fishermen in other fisheries resulting from
increased competition in those fisheries from vessels
eligible to fish in the BSAI directed pollock fishery or in
fisheries resulting from any decreased competition among
processors.
Subsection (b) includes specific measures to restrict the
participation in other fisheries of the catcher/processors
eligible to participate in the BSAI directed pollock fishery
(other than the vessel or vessels eligible under paragraph
(21) of section 208(e)). While these types of limitations are
appropriately for the North Pacific Council to develop, the
catcher/processors eligible under section 208(e) may form a
fishery cooperative for 1999 before the North Pacific Council
can recommend (and the Secretary approve) necessary
limitations. The restrictions in subsection (b) would
therefore take effect on January 1, 1999 and remain in effect
thereafter unless the North Pacific Council recommends and
the Secretary approves measures that supercede the
restrictions. Subparagraphs (A) and (B) of paragraph (2)
prohibit the catcher/processors eligible to participate in
the BSAI directed pollock fishery from exceeding the
aggregate amounts of targeted species and bycatch in other
fisheries that catcher/processors from the BSAI directed
pollock fishery caught on average in 1995, 1996, and 1997.
Subparagraph (C) prohibits those catcher/processors from
fishing for Atka mackerel in the eastern area of the BSAI or
from exceeding specific percentages in the central area or
western area. The limitations in subparagraphs (A), (B), and
(C) do not ensure that the BSAI pollock-eligible catcher/
processors will be able to harvest any amount of fish, they
simply establish additional caps after which those catcher/
processors, as a class, will be prohibited from further
fishing.
Paragraph (3) of section 211(b) prohibits the catcher/
processors eligible to participate in the BSAI directed
pollock fishery from processing any of the pollock allocated
for processing by motherships or shoreside processors in the
BSAI directed pollock fishery and from processing any species
of crab harvested in the BSAI. Paragraph (4) prohibits the
BSAI pollock-eligible catcher/processors from harvesting any
fish in the Gulf of Alaska, from processing any groundfish
harvested in area 630 of the Gulf of Alaska, from processing
any pollock in the Gulf of Alaska other than as bycatch, and
from processing in the aggregate a total of more than 10
percent of the cod harvested in areas 610, 620, and 640 of
the Gulf of Alaska. Paragraph (5) prohibits BSAI-eligible
catcher/processors and motherships from harvesting or
processing fish in any fishery under the authority of another
regional fishery management council unless the council
authorizes their participation, with the exception of the
Pacific whiting fishery under the Pacific Council's
authority, where the catcher/processors and motherships are
already participating.
Paragraph (6) of section 211(b) requires the BSAI pollock
eligible catcher/processors to carry two observers on board
and to install scales on board and weigh all fish harvested
by the vessel while participating in pollock and other
groundfish fisheries under the North Pacific Council's
authority. The requirements of paragraph (6) take effect in
1999 for catcher/processors that will harvest pollock
allocated to the western Alaska community development quota
program, and in 2000 for the other BSAI pollock-eligible
catcher/processors.
Subsection (c) of section 211 requires the North Pacific
Council to submit measures by July 1, 1999 to prevent the
expanded participation of BSAI pollock-eligible catcher
vessels in other fisheries as a result of BSAI pollock
fishery cooperatives and to protect processors in other
fisheries from any adverse effects caused by subtitle II of
the American Fisheries or by BSAI pollock fishery
cooperatives. Paragraph (1) of subsection (c) allows the
Secretary to restrict or change the BSAI pollock fishery
cooperative authority for catcher vessels delivering to
shoreside processors (including by allowing those vessels to
deliver to shoreside processors other than those which are
BSAI pollock-eligible) if the North Pacific Council does not
recommend measures by July 1, 1999 or if the Secretary
determines that those measures are not adequate.
Paragraph (2)(A) prohibits the BSAI pollock-eligible
motherships and shoreside processors from processing in the
aggregate more crab in fisheries under the North Pacific
Council's authority than the percentage of crab those
motherships and shoreside processed in the fishery in the
aggregate and on average in 1995, 1996, and 1997. The intent
of paragraph (2) is to protect processors that are not BSAI
pollock-eligible from increased competition from the
shoreside processors who may have a financial advantage as a
result of the increased pollock allocation under the American
Fisheries Act or by receiving pollock under a fishery
cooperative. Paragraph (2)(B) directs the North Pacific
Council to establish excessive share harvesting and
processing caps in the BSAI crab and non-pollock groundfish
fisheries for similar purposes.
Paragraph (3) of subsection (c) directs the Pacific Council
to submit any measures that may be necessary to protect
fisheries under its authority by July 1, 2000 and allows the
Secretary of Commerce to implement measures if the Pacific
Council does not submit measures or if the measures submitted
are determined by the Secretary to be inadequate.
Subsection (d) give the North Pacific Council the authority
with approval of the Secretary to publically disclose
information on a vessel-by-vessel basis from any of the
groundfish fisheries under the Council's authority that may
be useful in carrying out the requirements of the Magnuson-
Stevens Act which require the avoidance of bycatch. The North
Pacific Council is directed to use this new authority to the
maximum extent necessary to fully implement the bycatch
measures added to the Magnuson-Stevens Act by the 1996
Sustainable Fisheries Act.
Subsection (e) creates a special federal loan program
within the existing title XI loan program to allow
communities eligible to participate in the western Alaska
community development quota program to increase their
participation in the Bering Sea pollock fishery by purchasing
all or part of an ownership interest in vessels and shoreside
processors.
Section 212--Restriction on Federal Loans
Section 212 amends the title XI loan program to prohibit
federal loans for the construction or rebuilding of vessels
that will be used to harvest fish and that are greater than
165 feet, of more than 750 tons, or that have an engine or
engines capable of producing a total of more than 3,000 shaft
horsepower. The prohibition does not apply to vessels to be
used only in the menhaden fishery or a tuna purse seine
fishery outside the U.S. EEZ or in the area of the South
Pacific Regional Fisheries Treaty.
Section 213--Duration
Subsection (a) of section 213 explains that the provisions
of the American Fisheries Act take effect upon its enactment,
except where other effective dates are specified. The
allocations in section 206, BSAI pollock eligibility
criteria/lists of vessels in section 208, and fishery
cooperative limitations in section 210 remain in effect only
until December 31, 2004, and are repealed on that date except
to the extent the North Pacific Council has recommended, and
the Secretary has approved measures to give effect to those
sections thereafter.
Subsection (b) clarifies that except as specifically
provided, none of the provisions in subtitle II of the
American Fisheries Act limit the authority of the North
Pacific Council or the Secretary of Commerce under the
Magnuson-Stevens Act. Subsection (c) sets out specific
circumstances under which the North Pacific Council may
submit measures to supersede provisions of subtitle II. The
Council may submit measures to supersede any of the
provisions of subtitle II, with the exception of the
provisions of section 206 (BSAI pollock allocations) and
section 208 (eligibility criteria/vessels), for conservation

[[Page S12782]]

purposes, to mitigate adverse effects in other fisheries or
in the BSAI pollock fishery, or to mitigate adverse effects
on the participants in the BSAI directed pollock fishery that
only own only one or two vessels. If the Council does submit
such measures, the measures must take into account all
factors affecting the fisheries and be imposed fairly and
equitably to the extent practicable among and within the
sectors in the BSAI directed pollock fishery. With respect to
the allocations in section 206, the Council may submit
measures to increase the allocation to the western Alaska
community development quota program for the year 2002 and
thereafter if the Council determines that the program has
been adversely affected by any provision of subtitle II of
the American Fisheries Act. To the extent of its authority
under the Magnuson-Stevens Act, the Council has general
authority to submit measures that affect or supersede the
fishery cooperative limitations in section 210. Paragraph (3)
of section 213(c) identifies the specific authority of the
Council to submit different catch-year criteria for the
calculation of the allocations for catcher vessels that
deliver to shoreside processors and that form fishery
cooperatives.
Subsection (d) requires the North Pacific Council to report
to the Secretary of Commerce and to the Congress by October
1, 2000 on the implementation and effects of subtitle II of
the American Fisheries Act.
Subsection (e) requires the General Accounting Office to
submit a report to the North Pacific Council and the
Secretary of Commerce by June 1, 2000 on whether subtitle II
of the American Fisheries Act has negatively affected the
market for fillet or fillet blocks, and requires the North
Pacific Council to submit for Secretarial approval any
measures it determines appropriate to mitigate any negative
effects that have occurred.
Section (f) specifies that if any of the provisions of the
American Fisheries Act are held to be unconstitutional, the
remainder of the Act shall not be affected.
Section (g) specifies that in the event the new U.S.
ownership and control requirements or preferred mortgage
requirements of subtitle I of the American Fisheries Act are
deemed to be inconsistent with an existing international
agreement relating to foreign investment with respect to a
specific owner or mortgagee on October 1, 2001 of a vessel
with a fishery endorsement, that the provision shall not
apply to that specific owner or mortgagee with respect to
that particular vessel to the extent of the inconsistency.
Section (g) does not exempt any subsequent owner or mortgagee
of the vessel, and is therefore not an exemption that ``runs
with the vessel.'' In addition, the exemption in section (g)
ceases to apply even to the owner on October 1, 2001 of the
vessel if any ownership interest in that owner is acquired by
a foreign individual or entity after October 1, 2001.
Customary international law and the United Nations
Conference on the Law of the Sea (article 62) clearly protect
the right of a coastal nation to harvest the living resources
of its exclusive economic zone. Many of the bilateral
treaties to which the United States is a party that might
otherwise involve U.S. fisheries or investments in U.S.
fisheries include specific exemptions for fishing vessels and
for measures to protect the fishery resources. For example,
the Treaty of Friendship, Commerce, and Consular Rights
between the United States and the Kingdom of Norway (1932)
provides that ``[n]othing in this Treaty shall be construed
to restrict the right of either [the United States or Norway]
to impose, on such terms as it may see fit, prohibitions or
restrictions designed to protect human, animal, or plant
health or life'' (emphasis added). The Treaty and Protocol
between the United States and Japan Regarding Friendship,
Commerce, and Navigation (1953) provides that
``Notwithstanding any other provision of the present Treaty,
each Party may reserve exclusive rights and privileges to its
own vessels with respect to the coasting trade, national
fisheries, and inland navigation'' (Article XIX(6); emphasis
added). Similarly, the Agreement between the United States
and the Republic of Korea Regarding Friendship, Commerce, and
Navigation (1957) provides that ``each Party may reserve
exclusive rights and privileges to its own vessels with
respect to the coasting trade, inland navigation, and
national fisheries'' (Article XIX(3); emphasis added).
While Congress does not believe that any of the
requirements of the American Fisheries Act violate any
international agreements relating to foreign investment to
which the United States is a party, subsection (g) is
included as a precaution. If the citizenship or preferred
mortgage requirements in subtitle I are deemed to be
inconsistent with such an international agreement, only the
current owner on October 1, 2001 to which the international
agreement applies will be grandfathered, and to the extent
that any interest in that owner/entity is sold, the interest
must be sold to citizens of the United States until the
owner/entity comes into compliance with the 75 standard.

Mr. HARKIN. Mr. President, the legislation that is pending provides
funding for nearly all domestic discretionary programs for the upcoming
year. As we know, it combines 8 of the 13 regular spending bills, as
well as a large number of other unrelated legislative provisions.
It truly is a legislative behemoth, and is one which I have very
mixed feelings about. One part I don't have any mixed feelings about is
the process, particularly for the unrelated nonappropriation measures.
It is the worst that I have witnessed in my years in Congress. Here we
have a 40-pound, nearly 4,000-page bill which not only includes over
half of the year's appropriations bills, but countless other unrelated
measures, many of which were never debated and never brought to the
floor of the Senate. Then we are given less than a day--just a matter
of hours--to look it over.
That certainly is not any way to do the people's business. In fact, I
say that the Republican leadership in the Senate and the House has
shown a tremendous disrespect for the taxpayers' dollars.
This is really a cavalier treatment of taxpayers dollars when you
think about the way this bill was put together. Nobody knows how much
is in there. Billions of dollars are being spent, and a lot of it was
never debated or shown the light of day in either the House or the
Senate. The taxpayers deserve a little bit better treatment for their
tax dollars than that.
Before I get into my other concerns, I want to speak about what I see
as one of the true bright spots, which will lead me to vote in favor of
the overall measure, even with all my misgivings about it, and that is
the progress it makes toward improving the quality and affordability of
education, health care and job training for American families.
As the ranking member on the Appropriations Subcommittee on the
Department of Health and Human Services and Education, I want to focus
my comments initially on that section of the bill.
First, I want to thank Senator Specter for his outstanding leadership
on the legislation. He has worked tirelessly to put together a strong,
bipartisan bill. I want to publicly thank Bettilou Taylor, Jim
Sourwine, Jack Chow, Mary Deitrich, Mark Laisch and Jennifer Stiefel. I
also thank those on my staff, on the minority side--Marsha Simon and
Ellen Murray--for their long and hard work in taking care of all of the
important details of the legislation. They literally have been here
around the clock for the last several weeks putting the bill and report
together.
I also extend my sincere appreciation to our colleagues in the
House--Chairman Porter and ranking member Obey. There were many
significant differences between our two bills and it required much work
to bridge the gulf. I appreciate their willingness to work with us to
craft a strong Labor-HHS-Education bill to send to the President.
The Labor-HHS-Education component of this bill is notable in a number
of areas. It makes many vital investments in the human infrastructure
of our Nation.
Mr. President, I am very pleased that the bill before us provides the
biggest funding increase in history in our search for medical
breakthroughs. Almost every day, the paper has a new story about one
advance or another in medical research. New therapies, more effective
intervention and treatment strategies--we are making great progress. We
aren't suffering from a shortfall of ideas, but a shortfall of
resources.
At the present time, the National Institutes of Health is able to
fund only one-fourth of their peer-reviewed grant proposals. As a
result, too many worthy projects never get off the ground. The tragedy
is that the 3 of 4 unfunded grants could have led to a cure for breast
cancer, or a more effective treatment for Parkinson's disease, or a way
to reverse spinal chord injury.
This must change, and the pending legislation provides a generous 15
percent increase for the NIH and is the first step toward doubling the
budget for biomedical research.
Another important victory for improved health is the inclusion of a
proposal I authored to substantially improve research on complementary
and alternative medicine. Consumers need and deserve reliable
information about these promising therapies. And, if appropriately
implemented, the new National Center for Complementary and Alternative
Medicine at NIH will provide just that.
Mr. President, one of the great disappointments of the 105th Congress
was the defeat by the Republican leadership of comprehensive
legislation to protect

[[Page S12783]]

children from tobacco. Their action is costly: Every day, more than
3,000 young people will start smoking, and one-third will die
prematurely from tobacco-related diseases.
I am pleased, however, that the bill before us makes at least a very
modest downpayment on fighting tobacco. It provides $46 million to fund
antitobacco activities--the largest increase for preventing and
treating the addiction, disease, and death caused by tobacco use. The
CDC will receive additional funding to help communities keep tobacco
products out of the hands of children, help smokers kick the habit, and
combat the tobacco industry's daily multimillion dollar misinformation
campaigns.
I want to be clear, however, that this is by no means a replacement
for comprehensive reform. We should make reform of the tobacco scourge
a major agenda item for the next Congress.
Another important drug problem--and tobacco is a drug problem--facing
us in this Nation is the scourge of methamphetamine. It is ravaging my
State and other States in the Midwest. So I am pleased that the bill
before us includes my proposal to expand support for prevention and
treatment of meth addiction. It also contains a significant increase to
boost our law enforcement efforts to combat this problem. But I am
extremely disappointed that the leadership blocked inclusion of my
Comprehensive Methamphetamine Control Act. Their action, I think, is
extremely shortsighted and is a defeat for our efforts to get tougher
on methamphetamine.
The bill before us includes the important initiative to combat fraud,
waste and abuse in Medicare. It would expand nationwide a program I
started 2 years ago to train retired nurses, doctors, accountants,
insurance writers, and other professionals to be expert resources in
their local communities to help fellow seniors identify and report
suspect cases of abuse. The Senior Waste Patrol, as it is known, has
been a great success in Iowa and the 11 other States in which it now
exists on a pilot program basis. This bill, as I said, will extend the
Senior Waste Patrol to every State in the Nation. I believe it will be
one of the keys that we will have in really cutting down on the waste,
fraud and abuse that is so rampant in Medicare.
Mr. President, for the last several years, I have worked to eradicate
abusive child labor around the world, and I am pleased that the
legislation provides resources to help end this exploitative practice
here at home and around the world.
The bill signals a strong commitment by the United States to ending
this unconscionable practice of child labor by providing a $27 million
increase, from $3 million to $30 million, to the International
Programme for the Elimination of Child Labor, otherwise known as IPEC.
In the past, IPEC initiatives have been instrumental in reaching
agreements in Bangladesh for child garment workers, and in Pakistan for
the children making soccer balls. As a result, thousands of these
children in both countries have been moved from factories to schools.
This increase for IPEC will ensure that we can do in those countries
and in other countries to get child laborers out of factories and into
schools.
However, if we intend to lead the world in ending this terrible
practice of child labor, we must here lead by example. I am deeply
concerned about the rising incidence of child labor in our own country.
Although no official estimate exists, studies place the number of
illegally employed children in the U.S. at between 300,000 a 800,000.
To respond to the problem, this legislation has fully funded the
President's child labor initiative by providing $15 million for migrant
education and $5 million for at-risk youth in agriculture.
Additionally, $4 million was added for 36 new investigators to enforce
child labor laws. We must make eradication of child labor a top
priority, and these resources will make that possible.
I do want to publicly thank and compliment Secretary of Labor Herman
for her leadership in this area and for her focus and determination to
crack down on the use of child labor in our country. She has taken
great leadership on this. The additional funding we put in this bill
will enable her to do her job even more effectively.
Mr. President, this legislation makes some significant investments in
education, which are critical to the future of our country. The bill
provides an additional $2.1 billion--that's $2.1 billion more than last
year--to improve our Nation's schools and help them meet the needs of
our schoolchildren.
There are many problems facing our nation's schools. 14 million
students attend classes in schools that are literally crumbling around
them; too many students are in classes that are too big; and too many
children do not have a safe place to be in the hours after school. We
can and must address these important matters.
The pending legislation provides us with a good foundation. The bill
provides additional resources through the Title I program to reduce
class size and it fully funds the President's after-school initiative.
However, I was disappointed that we could not hold on to the funds
provided in the Senate bill to help modernize and repair our nation's
crumbling schools.
I might add that I just came back, like so many Senators, last night
from my home State to discover that in my State of Iowa over one-
third--36 percent--of the elementary and secondary schools in Iowa
don't even meet the fire and safety codes. I know that our State is
very good. If it is that bad in Iowa, it has to be bad in other States,
too.
That is why the money is needed so desperately from the Federal
Government--to help rebuild the infrastructure of our schools, not just
in meeting the fire and safety codes but to make sure that they are
wired, that they get the technology that they need to hookup to the
Internet, and to get the technology to our kids in elementary and
secondary schools.
The legislation also makes other important investments in education.
The bill provides a $500 million increase for special education and
additional funds for Head Start to make sure that students are ready to
start school.
Education must be our Nation's top priority and while I am pleased
with the investments made in this legislation, we must recognize that
this is just the first step forward. Our future depends on us to do
even more next year and the year after.
The bill provides new funding to higher and train up to 100,000 new
teachers, increases the maximum Pell grant to its highest level ever,
$3,125, and provides additional resources for child care and eliminates
cuts to worker protection programs.
Mr. President, I am also pleased that the final bill restored the
massive cuts contained in the House bill for the Summer Jobs Program
and the Low-Income Heat and Energy Assistance Program. These cuts in
the House bill--not in the Senate bill--unfairly targeted some of our
Nation's most needy citizens, and had to be reversed. I am glad it was
reversed.
As has been the case in recent years, the appropriations committees
was confronted with a number of legislative riders. This is a source of
continuing frustration for our committee because we continue to believe
there should be no authorizing legislation on appropriations bills.
The House bill included an amendment to the Individuals With
Disabilities Education Act, or IDEA, that would have given school
officials expanded authorities to remove children with disabilities
from school. I vigorously opposed that amendment, because it would have
removed critical civil rights protections for children with
disabilities--this on the heels of just a little over a year ago, after
years of negotiation, when Congress enacted the 1997 amendments to
IDEA. These amendments made a number of important changes to the law,
including provisions governing the discipline of children with
disabilities. The '97 amendments give schools new tools for addressing
the behavior of children with disabilities, including more flexible
authorities for removing children with disabilities engaged in
misconduct involving weapons, drugs, or behavior substantially likely
to result in injury. More information is needed on the implementation
of these amendments before any additional changes to the law are
considered by the Congress.
For example, I keep hearing from some people that if a child with a
disability brings a gun to school there is nothing they can do with
them, but if

[[Page S12784]]

a nondisabled kid brought a gun to school they could expel them.
Nothing could be further from the truth. If any child, such as a child
with disabilities, under IDEA brings a gun, a weapon, a drug to school,
they can be immediately dismissed, expelled, for up to 10 days, and
then placed in an alternative setting for 45 more days. Again, people
can expel a child right away who brings a gun or a dangerous weapon to
school.
I just say that as a way of pointing out that there is a lot of
misinformation out there about the law, because the law was changed
last year, and the rules and regulations have not yet been promulgated
by the Department of Education. Hopefully, that will be done prior to
the end of this year.
Again, I would like to close these remarks on this section of the
bill by thanking Chairman Specter for his outstanding leadership
throughout the process of putting this part of the bill together.
I therefore support the recommendation of the conferees for a GAO
study on the discipline of children with disabilities in lieu of making
any changes to the authorizing legislation itself. The conference
agreement charges GAO with obtaining information on how the '97
amendments have affected the ability of schools to maintain safe school
environments conducive to learning. In order to enable the Congress to
differentiate between the need for amendments as opposed to better
implementation of the law, it is critical that GAO look at the extent
to which school personnel understand the provisions in the IDEA and
make use of the options available under the law.
For example, in the past, there has been considerable confusion and
misunderstanding regarding the options available to school districts in
disciplining children with disabilities. The GAO should determine
whether schools are using the authorities currently available for
removing children. These include: removing a child for up to 10 school
days per incident; placing the child in an interim alternative
educational setting; extending a child's placement in an interim
alternative educational setting; suspending and expelling a child for
behavior that is not a manifestation of the child's disability; seeking
removal of the child through injunctive relief; and proposing a change
in the child's placement.
In addition, the law now explicitly requires schools to consider the
need for behavioral strategies for children with behavior problems. I
continue to believes that the incidence of misconduct by children with
disabilities is closely related to how well these children are served,
including whether they have appropriate individualized education plans,
with behavioral interventions where necessary. Again, to enable the
Congress to interpret information on the effect of the IDEA on dealing
with misconduct, this GAO report should provide information on the
extent to which the schools are appropriately addressing the needs of
students engaged in this misconduct. I would be opposed to giving
school officials expanded authority for removing children who engage in
misconduct, if such misconduct could be ameliorated by giving these
children the services to which they are entitled. We need information
on the effect of appropriate implementation of the IDEA on the ability
of schools to provide for safe and orderly environments, and that is
what the GAO study should evaluate.
Finally on this matter, I want to emphasize that the provisions in
the IDEA for removing children are only needed in those cases in which
parents and school officials disagree about a proposed disciplinary
action. Therefore, it is important that the GAO study also provides us
information on the extent to which parents are requesting due process
hearings on discipline-related matters and the outcomes of three
hearings.
Turning to another important component of this bill, Mr. President,
I'd like to talk for a few minutes about agriculture. Since early
summer, I have been working, along with a number of my colleagues, to
inform this body about the very serious economic crisis gripping our
nation's agriculture sector and to develop an emergency assistance
package. Farm families and rural communities are not currently sharing
in the prosperity of our broader economy. With farm income down over 20
percent from just two years ago, our farm economy is suffering its
worst downturn in over a decade.
There are ominous signs that unless we turn this situation around, we
are on the path to a full-blown agricultural depression on a scale of
the 1980s farm crisis. My State of Iowa simply cannot stand to go down
that road again, nor can our nation.
So I am pleased that through our concerted efforts, this bill
includes a substantial package of emergency assistance for America's
farmers. President Clinton vetoed the first Agriculture appropriations
bill. He was right to do so. It was woefully inadequate. So we brought
it back. And that veto by the President set the stage for the extensive
improvements that we now have in this bill.

This bill increases funding by about 85 percent above the amount that
was in the vetoed bill for assistance to replace income lost because of
low commodity prices--an 85-percent increase over the bill that was
vetoed. This is a victory but a partial victory. While this bill will
provide a good deal of assistance in the form of a one-time payment, it
falls far short of what is needed for the future.
This bill really has been a ``missed opportunity'' in which we could
have put underneath the so-called Freedom to Farm bill a farm income
safety net, but did not. When the so-called Freedom to Farm bill was
passed in 1996, commodity prices were high and the safety net was
thrown out the window. But prices go down as well as go up.
Since 1996 farm commodity prices have plummeted across our country.
Now it is clear that the 1996 farm bill has failed, and has failed
drastically, in protecting against disastrous losses in farm income.
The bill that is before us just plows more money right into the Freedom
to Farm payment system, which has already proven itself incapable of
responding to low commodity prices.
We proposed a better way. We proposed to focus assistance more
carefully on farmers who really need it because of low prices. We
proposed to direct the benefits towards actual farmers instead of
toward landlords. We proposed to restore a farm income safety net
responsive to commodity prices. And we proposed to link assistance to
actual production to avoid windfalls for those choosing not to plant
the supported crop. Lastly, we supported a measure of fiscal
responsibility so that rising commodity prices would limit USDA farm
program spending.
Despite all of these advantages, the Republican majority rejected any
alternative to the Freedom to Farm payment scheme. So what is going to
happen is farmers will get a payment this fall. Even farmers who chose
not to plant a crop will get a payment for it. They will get a payment
having no relationship to the market price--just a flat payment across
the board--fairly generous for those commodities with relatively better
prices, much too little for commodities suffering the worst price
losses. Also, a good number of farmers who will not be farming next
year will get payments this fall, and somehow that will all have to be
sorted out.
With fixed cash payments, landlords are in a great position to put
the pressure on and claim a lot of that money in the form of rent for
next year. Again, farmers fortunate enough to produce a good crop and
whose commodities already have high prices and who are not suffering
will still get a payment. This scheme makes no sense whatsoever. And
yet it is strictly the triumph of ideology over practicality. The
Republican ideology is not to have any farm income safety net and if
there is a crisis to throw money at it.
So what we have done for the farm crisis is we have just thrown a lot
of money at it. Well, that will help for this year, but it still won't
be as good as what we proposed. Equally important, this bill does
nothing toward restoring a farm income safety net for the longer term.
What we proposed would have provided more income support for farmers
and done so in a way that helps farmers deal with the practical reality
of commodity markets. But, no, the Republican majority's ideology said
we are going to stick with Freedom to Farm no matter what. And yet we
know that a majority of farmers, a majority, a huge majority of the
farmers wanted to take the caps off of marketing loan rates and they
wanted to have some storage payments. Why?

[[Page S12785]]

So they could take the bumper crop we are having this year, store it,
wait for the grain prices to go up and market it later on.
Well, this bill gives them nothing in this regard. Oh, they will get
a payment this fall. But it will not be as much income protection as
what we would have provided by taking the caps off of the marketing
loan rates. Will it help? Sure, it will help. But it is a wasteful and
fundamentally unsound way of helping our farmers.
Well, as I said, Republicans just decided to throw money at the
problem--a triumph of ideology over practicality.
One last point. One of my biggest concerns about this bill is the $9
billion add-on to the Pentagon budget--$9 billion thrown in at the last
minute. Despite the rhetoric from the Republican side, precious little
of this fiscally irresponsible add-on is targeted at troop readiness
and other emergencies in the military.
Congressional leadership talks a lot about shortages of spare parts
and about troop pay problems. So where are the proposals to fix the
Pentagon's antiquated supply system? Where are the proposals to
increase pay for the troops? Not in this bill. But there is $1 billion
for star wars. There are billions more in pork barrel projects not
requested by the Pentagon. And at the same time that this bill piles on
the Pentagon pork, it is shortchanging reform. The General Accounting
Office and the Pentagon's own inspector general constantly report
rampant waste and mismanagement in the military's purchasing and supply
system, yet this bill lets the waste and mismangement continue
unchecked, and throws in a few more gold-plated weapons systems to
boot.
What a boondoggle. What a boondoggle. We talk about troop readiness,
so where does this bill put the money? It puts it into star wars. It
puts it into pork projects that the Pentagon doesn't want, some more
gold-plated weapons systems, but precious little in fact, for troop
readiness.
I have mixed feelings about this 40-pound, 4,000-page whopper that we
have before us. It has some important provisions that we worked
together on in a bipartisan fashion--to improve medical research, for
example, and to improve education. A number of the components of this
bill truly will improve the lives of hard-working American families,
but the bill also has a number of awful provisions, add-ons, fiscally
irresponsible giveaways.
In the end, I will vote for it because I believe the good does
outweigh the bad, but I want to be clear that if this bill were in the
many separate pieces of legislation as it should have been, a lot of
them I would have voted against, and I don't think a lot of them would
ever have gotten through this body.
As I have said earlier, and as many of my colleagues have said, this
process which we just went through is bad for Americans. This is no way
to do the Nation's business. The Republican leadership, as I said
earlier, has treated our taxpayer dollars cavalierly. This is no way to
flagrantly throw around the hard-earned tax dollars of the taxpayers of
this country, to throw it away on boondoggles, to throw it away on
items that were never debated or saw the light of day in the Senate or
the House.
I can only hope that the next Congress will not go through this
exercise again. I hope the leadership of the next Congress will get the
appropriations bills through on time, will debate these matters openly
so that we can have the opportunity to discuss them openly, so we will
know what is in the bills before we vote on them. I think Senator
Robert Byrd of West Virginia said it best--as I read in the newspaper.
He said, ``Only God knows what's in this bill.''
Well, I don't know, Mr. President, I don't know if we will ever know
what all is in this bill, but I am certain, certain as I am standing
here, we are going to see inquiring reporters, investigative
journalists who will begin looking at this bill. They will begin
looking at all of those hidden items, and I bet you piece by piece, bit
by bit, it is going to come out, maybe next month, maybe in January,
maybe in March, all of the little hidden things that were in there. And
I say, shame on this Congress, shame on the leadership for treating the
American taxpayers this way. We have got to do better in the way we do
the Nation's business.
Mr. President, I yield the floor.

opposition to deletion of the agjobs amendment

Mr. SMITH of Oregon. Mr. President, as we take up the Omnibus
appropriations bill, I would like to take this opportunity to express
my extreme disappointment that the Agricultural Job Opportunity
Benefits and Security Act amendment, known as AgJOBS, was eliminated
from the Omnibus bill.
The bipartisan AgJOBS amendment received a veto proof majority vote
of 68-31 when it was added to the Commerce, Justice, State
Appropriations bill earlier this year. We had a golden opportunity to
reform the current bureaucratic H-2A immigrant visa program that has
made fugitives out of farmworkers and felons out of farmers. The
amendment would have created a workable system for recruiting farm
workers domestically and preventing our American crops from rotting in
the fields.
Unfortuantely, the Clinton Administration was content with the status
quo and threatened to veto the Omnibus bill if the balanced AgJOBS
amendment was included.
Mr. President, I find the Administration's veto threat quite
troubling since the Omnibus appropriations bill contains a multi-
billion dollar disaster relief package for traditional program-crop
agriculture to help deal with losses sustained as a result of the world
financial crisis.
The disaster relief goes to producers who already have a long history
of reliance on federal assistance, yet the farm disaster bill does
nothing to help producers of labor intensive commodities--fruits,
vegetables, and horticultural specialties--who are not supported by the
government and who are facing a crisis of nationwide labor shortages
created by our own government. This crisis has been exacerbated by our
current unworkable legal foreign worker program.
A farmworker shortage ultimately affects America's ability to compete
in the world agriculture market. According to the United States
Department of Agriculture data, about three off-farm jobs are sustained
by each on-farm production job. Therefore, nearly three times as many
U.S. workers will lose their U.S. jobs as the number of foreign
farmworkers kept out of the United States increases.
Mr. President, I also cannot understand the inconsistency of the
Administration enacting the H-1B high-tech worker bill and not enacting
H-2A reform as embodied in our AgJOBS bill.
Our AgJOBS bill contains worker benefits far in excess of those
provided by the H-1B high-tech worker bill. Our bill guarantees above-
prevailing wages for lower wage occupations, free housing to both U.S.
and foreign workers recruited from outside the local area,
reimbursement of inbound and return transportation costs to both U.S.
and foreign workers recruited from outside the local area, and
penalties that include lifetime program debarment for violations. The
H-1B requires only the prevailing wage without any housing or
transportation benefits and provides a maximum penalty of a 3-year
debarment.
Mr. President, we cannot continue to allow our farmers and
farmworkers to be trapped in a system that rewards illegal labor
practices and punishes the most vulnerable.
As we address reform of the H-2A immigrant visa program early next
year, I hope my colleagues will work with me to finally safeguard basic
human rights, provide a reliable documented work force for farmers, and
reward legal conduct to both farmers and farmworkers.

QUINCY LIBRARY GROUP LEGISLATION

Mrs. FEINSTEIN. Mr. President, I am very pleased that the Quincy
Library Group bill has been included in the omnibus appropriations
bill. This legislation embodies the consensus proposal of the Quincy
Library Group, a coalition of environmentalists, timber industry
representatives, and local elected officials in Northern California,
who came together to resolve their long-standing conflicts over timber
management on the national forest lands in their area.
The Quincy Library Group legislation is a real victory for local
consensus decision making. It proves that even some of the most
intractable environmental issues can be resolved if

[[Page S12786]]

people work together toward a common goal.
I first met the Quincy Library Group back in 1992 when I was running
for the Senate, and was then very impressed with what they were trying
to do.
The members of the Quincy Library Group had seen first hand the
conflict between timber harvesting and jobs, environmental laws and
protection of their communities and forests, and the devastation of
massive forest fires. Their overriding concern was that a catastrophic
fire could destroy both the natural environment and the potential for
jobs and economic stability in their community. They were also
concerned the ongoing stalemate over forest management was ultimately
harming both the environment and their local economy.
The group got together and talked things out. They decided to meet in
a quiet, non-confrontational environment--the main room of the Quincy
Public Library. They began their dialogue in the recognition that they
shared the common goal of fostering forest health, keeping ecological
integrity, assuring an adequate timber supply for area mills, and
providing economic stability for their community.
One of the best articles I have read about the Quincy Library Group
process recently appeared in the Washington Post. Mr. President, I ask
unanimous consent that this article be printed in the Record at the end
of my statement.
The PRESIDING OFFICER. Without objection, it is so ordered.
(See exhibit 1.)
Mrs. FEINSTEIN. Mr. President, after dozens of meetings and a year
and a half of negotiation, the Quincy Library Group developed an
alternative management plan for the Lassen National Forest, Plumas
National Forest, and the Sierraville Ranger District of the Tahoe
National Forest.
In the last 5 years, the group has tried to persuade the U.S. Forest
Service to administratively implement the plan they developed. While
the Forest Service was interested in the plan developed, they were
unwilling to fully implement it. Negotiations and discussions began in
Congress. This legislation is the result.

the quincy library group legislation

Specifically, the legislation directs the Secretary of Agriculture to
implement the Quincy Library Group's forest management proposal on
designated lands in the Plumas, Lassen and Tahoe National Forests for
five years as a demonstration of community-based consensus forest
management. I would like to thank Senators Murkowski, Bumpers, and
Craig, Representatives Herger and Miller, as well as the Clinton
Administration, for the thoughts they contributed to the development of
the final bill.
The legislation establishes significant new environmental protections
in the Quincy Library Group project area. It protects hundreds of
thousands of acres of environmentally sensitive lands, including all
California spotted owl habitat, as well as roadless areas. Placing
these areas off limits to logging and road construction protects many
areas that currently are not protected, including areas identified as
old-growth and sensitive watersheds in the Sierra Nevada Ecosystem
Project report.
However, in the event that any sensitive old growth is not already
included in the legislation's off base areas, the Senate Energy and
Natural Resources Committee provided report language when the
legislation was reported last year, as I requested, directing the
Forest Service to avoid conducting timber harvest activities or road
construction in these late successful old-growth areas. The legislation
also requires a program of riparian management, including wide
protection zones and streamside restoration projects.
The bottom line is that the Quincy Library Group legislation will
provide strong protections for the environment while preserving the job
base in the Northern Sierra--not just in one single company, but across
35 area businesses, many of them small and family-owned.
The Quincy Library Group legislation is strongly supported by local
environmentalists, labor unions, elected officials, the timber
industry, and 27 California counties. The House approved the Quincy
Library Group legislation by a vote of 429 to one last year. The Senate
Energy Committee reported the legislation last October. The legislation
has been the subject of Congressional hearings and the focus of
nationwide public discussion.
I thank my colleagues for ensuring that this worthy pilot project has
a chance.

Exhibit No. 1

[From the Washington Post, Oct. 11, 1998]

Grass-Roots Seeds of Compromise

(By Charles C. Mann and Mark L. Plummer)

Every month since 1993, about 30 environmentalists,
loggers, biologists, union representatives and local
government officials have met the library of Quincy--a timber
town in northern California that has been the site of a nasty
15-year battle over logging.
Out of these monthly meetings has emerged a plan to manage
2.4 million acres of the surrounding national forests.
Instead of leaving the forests' ecological fate solely to
Washington-based agencies and national interest groups, the
once-bitter adversaries have tried to forge a compromise
solution on the ground--a green version of Jeffersonian
democracy. When the House of Representatives, notorious for
its discord on environmental legislation, approved the plan
429-1 in July 1997, the Quincy Library Group became the
symbol for a promising new means of resolving America's
intractable environmental disputes.
The Quincy Library Group is one of scores of citizens'
associations that in the past decade have brought together
people who previously met only in court. Sometimes called
``community-based conservation'' groups, they include the
Friends of the Cheat River, a West Virginia coalition working
to restore a waterway damaged by mining runoff; the Applegate
Partnership, which hopes to restore a watershed in
southwestern Oregon while keeping timber jobs alive, and
Envision Utah, which tries to foster consensus about how to
manage growth in and around Salt Lake City.
Like many similar organizations, the Quincy Library Group
was born of frustration. In the 1980s, Quincy-based
environmental advocates, led by local attorney Michael B.
Jackson, attempted with varying success to block more than a
dozen U.S. Forest Service timber sales in the surrounding
Plumas, Lassen and Tahoe national forests. The constant
battles tied the federal agency in knots and almost shut down
Sierra Pacific Industries, the biggest timber company there,
imperiling many jobs. The atmosphere was ``openly hostile,
with agitators on both sides,'' says Linda Blum, a local
activist who joined forces with Jackson in 1990 and aroused
so much opprobrium that Quincy radio hosts denounced her on
the air for taking food from the mouths of the town's
children.
Worn down and dismayed by the hostility in his community,
Jackson was ready to try something different. He got a chance
to do so late in 1992, when Bill Coates, a Plumas County
supervisor, invited the factions to talk to each other, face
to face. Coates suggested that the group work from forest-
management plans proposed by several local environmental
organizations in the mid-1980s. By early 1993, they were
meeting at the library and soon put together a new proposal.
(The Forest Service eventually had to drop out because the
Federal Advisory Committee Act, which places cumbersome
requirements on groups who meet with federal agencies.) Under
this proposal, timber companies could continue thinning and
selectively logging in up to 70,000 acres per year, about the
same area being logged in 1993 but drastically lower than the
1990 level. Riverbanks and roadless areas, almost half the
area covered by the plan, would be off-limits.
The Quincy group asked the Forest Service to incorporate
its proposal into the official plans for the three national
forests, but never got a definite answer. Convinced that the
agency was too dysfunctional to respond, in 1996 the group
took its plan to their congressman, Wally Herger, a
conservative Republican. Herger introduced the Quincy
proposal in the House, hoping to instruct the agency to heed
the wishes of local communities. It passed overwhelmingly--
perhaps the only time that Reps. Helen Chenoweth (R-Idaho), a
vehement property-rights advocate, and George Miller (D-
Calif.) one of the greenest legislators on Capitol Hill, have
agreed on an environmental law. Then the bill went to the
Senate--and slammed into resistance from big environmental
lobbies.
From the start, the Quincy group had kept in touch with the
Wilderness Society, the Natural Resources Defense Council and
the Sierra Club. The three organizations offered comments,
and the Quincy group incorporated some. Still, the national
groups continued to balk, instead submitting detailed
criteria necessary to ``merit'' their support. When the
Quincy plan became proposed legislation, the national groups
stepped up their attacks. The Quincy approach, said Sierra
Club legal director Debbie Sease, had a ``basic underlying
flaw'' using a cooperative, local decision-making process to
manage national assets. Jay Watson, regional director of the
Wilderness Society, said: ``Just because a group of local
people can come to agreement doesn't mean that it is good
public policy.'' And because such parochial efforts are
inevitably ill-informed and always risk domination by rich,
sophisticated industry representatives, the Audubon Society
warned, they are ``not necessarily equipped

[[Page S12787]]

to view the bigger picture.'' Considering this bigger
picture, it continued, ``is the job of Congress, and of
watchdog groups like the National Audubon Society.''
Many local groups regard national organizations as more
interested in protecting their turf than in achieving
solutions that advance conservation. ``It's interesting to me
that it has to be top-down,'' said Jack Shipley, a member of
the Applegate Partnership. ``It's a power issue, a control
issue.'' The big groups' insistence on veto power over local
decision-making ``sounds like the old rhetoric--either their
way or no way,'' Shipley says. ``No way'' may be the fate of
the Quincy bill. Pressured by environmental lobbies, Sen.
Barbara Boxer (D-Calif.) placed a hold on it in the Senate.
Despite the group's setback, community-based conservation
efforts like Quincy provide a glimpse of the future. Under
the traditional approach to environmental management,
decisions have been delegated to impartial bureaucracies--the
Forest Service, for example, for national forests. Based on
the scientific evaluations of ecologists and economists, the
agencies then formulate the ``right'' policies, preventing
what James Madison called ``the mischief of faction.''
But today, according to Mark Sagoff of the University of
Maryland Institute for Philosophy and Public Policy, it is
the bureaucrats who are beset by factions; big business and
environmental lobbies. For these special-interest groups, he
argues, ``deliberating with others to resolve problems
undermines the group's mission, which is to press its purpose
or concern as far as it can in a zero-sum game with its
political adversaries.'' The system ``benefits the lawyers,
lobbyists and expert witnesses who serve in various causes as
mercenaries,'' he says, ``but it produces no policy worth a
damn.''
In contrast, community-based conservation depends on all
sides acknowledging the legitimacy of each other's values.
Participants are not guaranteed to get exactly what they
want; no one has the power to stand by and judge the
``merit'' of the results. Although ecology and economics play
central roles, ecologists and economists have no special
place. Like everyone else, they must sit at the table as
citizens, striving to make their community and its
environment a better place to live.
In short, Quincy's efforts and those like it represent a
new type of environmentalism: republican environmentalism,
with a small ``r.'' This new approach cannot address global
problems like climate change. Nor should it be routinely
accepted if a local group decides on irrevocable changes in
areas of paramount national interest--filling in the Grand
Canyon, say. But even if some small town would be foolish
enough to decide to do something destructive, there's a whole
framework of national environment laws that would prevent it
from happening. And, despite the resistance of the national
organizations, the environmental movement should not reject
this new approach out of hand. Efforts to protect the
environment over the past 25 years have produced substantial
gains, but have lately degenerated into a morass of
litigation and lobbying. Community-based conservation has the
potential to change things on the ground, where it matters
most.

Mr. CRAIG. It is agreed that certain language added to the Quincy
Library Group Forest Recovery and Economic Stability Act after the bill
was proposed by Congressman Wally Herger related to grazing within the
pilot project areas may have introduced ambiguities that could lead to
adverse effects. Is there any intent for the Quincy Library Group
legislation to negatively impact grazing in general?
Mrs. FEINSTEIN. No, neither the authors of the bill, nor the Quincy
Library Group ever intended to negatively impact grazing generally.
Mr. CRAIG. What does ``specific location'' as referred to in
subsection (c)(2)(C) of the legislation mean? Can the riparian
management or SAT guidelines referred to by this legislation be applied
to the entire pilot project area?
Mrs. FEINSTEIN. The only location where these guidelines would apply
to grazing is where cattle are actually in the work area and at the
same time a QLG activity is taking place. The QLG resource management
activities include building defensible profile zones, single or group
tree selection thinning, and riparian management projects.
Mr. CRAIG. Will the SAT riparian management guidelines referred to in
this measure apply to riparian management projects outside of the pilot
project area or to grazing activities within the pilot project area
where no riparian management activities are taking place?
Mrs. FEINSTEIN. Under the terms of this bill the SAT guidelines
affecting grazing will apply only to the specific work area location
and only at the specific time that projects are conducted within the
pilot project area. The applicability of these guidelines outside of
the pilot project area is not addressed by this legislation.

Children's Online Privacy

Mr. BRYAN. Mr. President, the Children's Online Privacy Act was
reported out of Committee by voice vote. Because of time constraints at
the end of the session, we have been unable to file a Committee Report
before offering it as an amendment on the Senate floor. Accordingly, I
wish to take this opportunity to explain the purpose and some of the
important features of the amendment.
In a matter of only a few months since Chairman McCain and I
introduced this bill last summer, we have been able to achieve a
remarkable consensus. This is due in large part to the recognition by a
wide range of constituencies that the issue is an important one that
requires prompt attention by Congress. It is also due to revisions to
our original bill that were worked out carefully with the participation
of the marketing and online industries, the Federal Trade Commission,
privacy groups, and First Amendment organizations.
The goals of this legislation are: (1) to enhance parental
involvement in a child's online activities in order to protect the
privacy of children in the online environment; (2) to enhance parental
involvement to help protect the safety of children in online fora such
as chatrooms, home pages, and pen-pal services in which children may
make public postings of identifying information; (3) to maintain the
security of personally identifiable information of children collected
online; and (4) to protect children's privacy by limiting the
collection of personal information from children without parental
consent. The legislation accomplishes these goals in a manner that
preserves the interactivity of children's experience on the Internet
and preserves children's access to information in this rich and
valuable medium.
I ask unanimous consent that a summary of the bill's provisions be
printed in the Record.
There being no objection, the summary was ordered to be printed in
the Record, as follows:
Sec. 1301. Short Title
This Act may be cited as the ``Children's Online Privacy
Protection Act of 1998.''
Sec. 1302. Definitions
(1) Child: The amendment applies to information collected
from children under the age of 13.
(2) Operator: The amendment applies to ``operators.'' This
term is defined as the person or entity who both operates an
Internet website or online service and collects information
on that site either directly or through a subcontractor. This
definition is intended to hold responsible the entity that
collects the information, as well as the entity on whose
behalf the information is collected. This definition,
however, would not apply to an online service to the extent
that it does not collect or use the information.
The amendment exempts nonprofit entities that would not be
subject to the FTC Act. The exception for a non-profit entity
set forth in Section 202(2)(B) applies only to a true not-
for-profit and would not apply to an entity that operates for
its own profit or that operates in substantial part to
provide profits to or enhance the profitability of its
members.
(7) Parent: The term ``parent'' includes ``legal
guardian.''
(8) Personal Information: This is an online children's
privacy bill, and its reach is limited to information
collected online from a child.
The amendment applies to individually identifying
information collected online from a child. The definition
covers the online collection of a first and last name,
address including both street and city/town (unless the
street address alone is provided in a forum, such as a city-
specific site, from which the city or town is obvious), e-
mail address or other online contact information, phone
number, Social Security number, and other information that
the website collects online from a child and combines with
one of these identifiers that the website has also collected
online. Thus, for example, the information ``Andy from Las
Vegas'' would not fall within the amendment's definition of
personal information. In addition, the amendment authorizes
the FTC to determine through rulemaking whether this
definition should include any other identifier that permits
the physical or online contacting of a specific individual.
It is my understanding that ``contact'' of an individual
online is not limited to e-mail, but also includes any other
attempts to communicate directly with a specific,
identifiable individual. Anonymous, aggregate information--
information that cannot be linked by the operator to a
specific individual--is not covered by this definition.
(9) Verifiable Parental Consent: The amendment establishes
a general rule that ``verifiable parental consent'' is
required before a

[[Page S12788]]

web site or online service may collect information online
from children, or use or disclose information that it has
collected online from children. The amendment makes clear
that parental consent need not be obtained for each instance
of information collection, but may, with proper notice, be
obtained by the operator for future information collection,
use and disclosure. Where parental consent is required under
the amendment, it means any reasonable effort, taking into
consideration available technology, to provide the parent of
a child with notice of the website's information practices
and to ensure that the parent authorizes collection, use and
disclosure, as applicable, of the personal information
collected from that child.
The FTC will specify through rulemaking what is required
for the notice and consent to be considered adequate in light
of available technology. The term should be interpreted
flexibly, encompassing ``reasonable effort'' and ``taking
into consideration available technology.'' Obtaining written
parental consent is only one type of reasonable effort
authorized by this legislation. ``Available technology'' can
encompass other online and electronic methods of obtaining
parental consent. Reasonable efforts other than obtaining
written parental consent can satisfy the standard. For
example, digital signatures hold significant promise for
securing consent in the future, as does the World Wide Web
Consortium's Platform for Privacy Preferences. In addition, I
understand that the FTC will consider how schools, libraries
and other public institutions that provide Internet access to
children may accomplish the goals of this Act.
As the term ``reasonable efforts'' indicates, this is not a
strict liability standard and looks to the reasonableness of
the efforts made by the operator to contact the parent.
(10) Website Directed to Children: This definition
encompasses a site, or that portion of a site or service,
which is targeted to children under age 13. The subject
matter, visual content, age of models, language, or other
characteristics of the site or service, as well as off-line
advertising promoting the website, are all relevant to this
determination. For example, an online general interest
bookstore or compact disc store will not be considered to be
directed to children, even though children visit the site.
However, if the operator knows that a particular visitor from
whom it is collecting information is a child, then it must
comply with the provisions of this amendment. In addition, if
that site has a special area for children, then that portion
of the site will be considered to be directed to children.
The amendment provides that sites or services that are not
otherwise directed to children should not be considered
directed to children solely because they refer or link users
to different sites that are directed to children. Thus a site
that is directed to a general audience, but that includes
hyperlinks to different sites that are directed to children,
would not be included in this definition but the child
oriented linked sites would be. By contrast, a site that is a
child-oriented directory would be considered directed to
children under this standard. However, it would be
responsible for its own information practices, not those of
the sites or services to which it offers hyperlinks or
references.
(12) Online Contact Information: This term means an e-mail
address and other substantially similar identifiers enabling
direct online contact with a person.
Sec. 1303. Regulation of Unfair and Deceptive Acts and
Practices
This subsection directs the FTC to promulgate regulations
within one year of the date of enactment prohibiting website
or online service operators or any person acting on their
behalf from violating the prohibitions of subsection (b). The
regulations shall apply to any operator of a website or
online service that collects personal information from
children and is directed to children, or to any operator
where that operator has actual knowledge that it is
collecting personal information from a child.
The regulations shall require that these operators adhere
to the statutory requirements set forth in Section 203(b)(1):
1. Notice.--Operators must provide notice on their sites of
what personal information they are collecting online from
children, how they are using that information, and their
disclosure practices with regard to that information. Such
notice should be clear, prominent and understandable.
However, providing notice on the site alone is not sufficient
to comply with the other provisions of Section 202 that
require the operator to make reasonable efforts to provide
notice in obtaining verifiable parental consent, or the
provisions of Section 203 that require reasonable efforts to
give parents notice and an opportunity to refuse further use
or maintenance of the personal information collected from
their child. These provisions require that the operator make
reasonable efforts to ensure that a parent receives notice,
taking into consideration available technology.
2. Prior Parental Consent.--As a general rule, operators
must obtain verifiable parental consent for the collection,
use or disclosure of personal information collected online
from a child.
3. Disclosure and Opt Out for a Parent Who Has Provided
Consent.--Subsection 203(b)(1)(B) creates a mechanism for a
parent, upon supplying proper identification, to obtain: (1)
disclosure of the specific types of personal information
collected from the child by the operator; and (2) disclosure
through a ``means that is reasonable under the
circumstances'' of the actual personal information the
operator has collected from that child. It would be
inappropriate for operators to be liable under another source
of law for disclosures made in a good faith effort to fulfill
the disclosure obligation under this subsection. Accordingly,
subsection 203(a)(2) provides that operators are immune from
liability under either federal or state law for any
disclosure made in good faith and following procedures that
are reasonable. If the FTC has not issued regulations, I
expect that such procedures would be judged by a court based
upon their reasonableness.
Subsection 203(b)(1)(B) also gives that parent the ability
to opt out of the operator's further use or maintenance in
retrievable form, or future online collection of information
from that child. The opt out of future collection operates as
a revocation of consent that the parent has previously given.
It does not prohibit the child from seeking to provide
information to the operator in the future, nor the operator
from responding to such a request by seeking (and obtaining)
parental consent. In addition, the opt out requirement
relates only to the online site or sites for which the
information was collected and maintained, and does not apply
to different sites which the operator separately maintains.
Subsection 203(b)(3) provides that if a parent opts out of
use or maintenance in retrievable form, or future online
collection of personal information, the operator of the site
or service in question may terminate the service provided to
that child.
4. Curbing Inducements to Disclose Personal Information.--
Subsection 203(b)(1)(C) prohibits operators from inducing a
child to disclose more personal information than reasonably
necessary in order to participate in a game, win a prize, or
engage in another activity.
5. Security Procedures.--Subsection 203(b)(1)(D) requires
that an operator establish and maintain reasonable procedures
to protect the confidentiality, security, and integrity of
personal information collected online from children by that
operator.
Exceptions to Parental Consent: Subsection 203(b)(2) is
intended to ensure that children can obtain information they
specifically request on the Internet but only if the operator
follows certain specified steps to protect the child's
privacy. This subsection permits an operator to collect
online contact information from a child without prior
parental consent in the following circumstances: (A)
collecting a child's online contact information to respond on
a one-time basis to a specific request of the child; (B)
collecting a parent's or child's name and online contact
information to seek parental consent or to provide parental
notice; (C) collecting online contact information to respond
directly more than once to a specific request of the child
(e.g., subscription to an online magazine), when such
information is not used to contact the child beyond the scope
of that request; (D) the name and online contact information
of the child to the extent reasonably necessary to protect
the safety of a child participant in the site; and (E)
collection, use, or dissemination of such information as
necessary to protect the security or integrity of the site or
service, to take precautions against liability, to respond to
judicial process, or, to the extent permitted under other
provisions of law, to provide information to law enforcement
agencies or for an investigation related to public safety.
For each of these exceptions the amendment provides
additional protections to ensure the privacy of the child.
For a one-time contact, the online contact information
collected may be used only to respond to the child and then
must not be maintained in retrievable form. In cases where
the site has collected the parents' online contact
information in order to obtain parental consent, it must not
maintain that information in retrievable form if the parent
does not respond in a reasonable period of time. Finally, if
the child's online contact information will be used, at the
child's request, to contact the child more than once, the
site must use reasonable means to notify parents and give
them the opportunity to opt out.
In addition, subsection (C)(ii) also allows the FTC the
flexibility to permit the site to recontact the child without
notice to the parents, but only after the FTC takes into
consideration the benefits to the child of access to online
information and services and the risks to the security and
privacy of the child associated with such access.
Paragraph (D) clarifies that websites and online services
offering interactive services directed to children, such as
monitored chatrooms and bulletin boards, that require
registration but do not allow the child to post personally
identifiable information, may request and retain the names
and online contact information of children participating in
such activities to the extent necessary to protect the safety
of the child. However, the company may not use such
information except in circumstances where the company
believes that the safety of a child participating on that
site is threatened, and the company must provide direct
parental notification with the opportunity for the parent to
opt out of retention of the information. For example, there
have been instances in which children have threatened suicide
or discussed family abuse in such fora. Under these
circumstances, an operator may use the name and online
contact information of the child in order to be able to get
help for the child.

[[Page S12789]]

Throughout this section, the amendment uses the term ``not
maintained in retrievable form.'' It is my intent in using
this language that information that is ``not maintained in
retrievable form'' be deleted from the operator's database.
This language simply recognizes the technical reality that
some information that is ``deleted'' from a database may
linger there in non-retrievable form.
Enforcement.--Subsection 203(c) provides that violations of
the FTC's regulations issued under this amendment shall be
treated as unfair or deceptive trade practices under the FTC
Act. As discussed below, State Attorneys General may enforce
violations of the FTC's rules. Under subsection 203(d), state
and local governments may not, however, impose liability for
activities or actions covered by the amendment if such
requirements would be inconsistent with the requirements
under this amendment or Commission regulations implementing
this amendment.
Sec. 1304. Safe harbors
This section requires the FTC to provide incentives for
industry self-regulation to implement the requirements of
Section 203(b). Among these incentives is a safe harbor
through which operators may satisfy the requirements of
Section 203 by complying with self-regulatory guidelines that
are approved by the Commission under this section.
This section requires the Commission to make a
determination as to whether self-regulatory guidelines
submitted to it for approval meet the requirements of
Commission regulations issued under Section 203. The
Commission will issue, through rulemaking, regulations
setting forth procedures for the submission of self-
regulatory guidelines for Commission approval. The
regulations will require that such guidelines provide the
privacy protections set forth in Section 203. The Commission
will assess all elements of proposed self-regulatory
guidelines, including enforcement mechanisms, in light of the
circumstances attendant to the industry or sector that the
guidelines are intended to govern.
The amendment provides that, once guidelines are approved
by the Commission, compliance with such guidelines shall be
deemed compliance with Section 203 and the regulations issued
thereunder.
The amendment requires the Commission to act upon requests
for approval of guidelines for safe harbor treatment within
180 days of the filing of such requests, including a period
for public notice and comment, and to set forth its
conclusions in writing. If the Commission denies a request
for safe harbor treatment or fails to act on a request within
180 days, the amendment provides that the party that sought
Commission approval may appeal to a United States district
court as provided for in the Administrative Procedure Act, 5
U.S.C. Sec. 706.
Sec. 1305. Actions by States.
State Attorneys General may file suit on behalf of the
citizens of their state in any U.S. district court of
jurisdiction with regard to a practice that violates the
FTC's regulations regarding online children's privacy
practices. Relief may include enjoining the practice,
enforcing compliance, obtaining compensation on behalf of
residents of the state, and other relief that the court
considers appropriate.
Before filing such an action, an attorney general must
provide the FTC with written notice of the action and a copy
of the complaint. However, if the attorney general determines
that prior notice is not feasible, it shall provide notice
and a copy of the complaint simultaneous to filing the
action. In these actions, state attorneys general may
exercise their power under state law to conduct
investigations, take evidence, and compel the production of
evidence or the appearance of witnesses.
After receiving notice, the FTC may intervene in the
action, in which case it has the right to be heard and to
file an appeal. Industry associations whose guidelines are
relied upon as a defense by any defendant to the action may
file as amicus curiae in proceedings under this section.
If the FTC has filed a pending action for violation of a
regulation prescribed under Section 3, no state attorney
general may file an action.
Sec. 1306. Administration and applicability
FTC Enforcement: Except as otherwise provided in the
amendment, the FTC shall conduct enforcement proceedings. The
FTC shall have the same jurisdiction and enforcement
authority with respect to its rules under this amendment as
in the case of a violation of the Federal Trade Commission
Act, and the amendment shall not be construed to limit the
authority of the Commission under any other provisions of
law.
Enforcement by Other Agencies: In the case of certain
categories of banks, enforcement shall be carried out by the
Office of the Comptroller of the Currency; the Federal
Reserve Board; the Board of Directors of the Federal Deposit
Insurance Corporation, the National Credit Union
Administration Board, and the Farm Credit Administration. The
Secretary of Transportation shall have enforcement authority
with regard to any domestic or foreign air carrier, and the
Secretary of Agriculture where certain aspects of the Packers
and Stockyards Act apply.
Sec. 1307. Review.
Within 5 years of the effective date for this amendment,
the Commission shall conduct a review of the implementation
of this amendment, and shall report to Congress.
Sec. 1308. Effective date
The enforcement provisions of this amendment shall take
effect 18 months after the date of enactment, or the date on
which the FTC rules on the first safe harbor application
under section 204 if the FTC does not rule on the first such
application filed within one year after the date of
enactment, whichever is later. However, in no case shall the
effective date be later than 30 months after the date of
enactment of this Act.

Section 110

Mr. D'AMATO. Mr. President, I am pleased that this Omnibus
Appropriations Bill will include a delay of the implementation of
Section 110 of the Illegal Immigration Reform and Immigrant
Responsibility Act of 1996.
The 1996 immigration law mandated the implementation of an exit-entry
system at all U.S. borders by September 30, 1998. If implemented, the
impact of this provision would be devastating, causing insufferable
delays at the U.S.-Canadian border, particularly in my own state of New
York. Trade, tourism and international relations would all suffer.
Last year, I joined with Senator Spencer Abraham and other colleagues
to introduce the Border Improvement and Immigration Act of 1997 (S.
1360) which would maintain current cross-border traffic along the
northern border and I testified at a Senate Subcommittee hearing on the
repercussions of implementing Section 110 on New York. On April 23,
1998, the Senate Judiciary Committee considered and marked up the bill.
The bill approved by the Committee allows land border and seaports to
be exempt from the new system. The full Senate passed S. 1360 in July
1998 and also voted in support of a full repeal of Section 110.
However, as the date of implementation grew closer, Congress enacted
a two and a half year delay, which is included in the Omnibus
Consolidated and Emergency Supplemental Appropriation Act for Fiscal
Year 1999. While we have some ``breathing room'', rest assured that I
will continue to press for a full repeal of Section 110. I thank my
colleagues for working with Senator Abraham and I on this important
provision.
Mrs. BOXER. Mr. President, I have decided to vote for the omnibus
appropriations bill because it contains many things which are very
beneficial to the people and the economy of my state of California, and
it includes two of my top priorities--afterschool programs and the
Salton Sea Restoration Act.
I want to make it clear, however, that the process that brought us
this bill is severely flawed. While the Senate Appropriations
Committee, on which I sit, did its work and reported each
appropriations bill to the full Senate, the leaders of this Congress
failed to do the appropriations work. This omnibus bill is not the
right way to legislate.
I also want to say that I strongly object to the environmental riders
in the bill, including legislation that will double the timber cut in
several national forests in California. I realize that some of the
riders were dropped from the final legislation and others were
negotiated to have less impact, but the presence of any riders that
harm our environment is unacceptable to me.
First, let me say what I like about the omnibus legislation:

education

The most significant achievement of the bill is its emphasis on
funding for public education, including:
$129 million to recruit, hire and train 3,500 teachers for California
schools in order to reduce class size in the primary grades.
$20 million to expand afterschool programs for 25,000 children in
California. This is a $16 million increase for California. I am
particularly gratified by the outcome here because I believe it
reflects my bill, the ``Afterschool Education and Safety Act'', and the
amendment I successfully attached to the Senate Budget Resolution
calling for more afterschool funding.
$77 million, a $12 million increase, for technology in schools
programs, to help train teachers, and ensure computer literacy and
access to Internet for California students.
$875 million to California schools, a $35 million increase over last
year, for disadvantaged students under the Title I program. Senator
Feinstein and I worked very hard for this increase.

[[Page S12790]]

$550 million for California Head Start programs, to serve 3,280 more
California children than last year for a total of more than 80,000.
$58 million, an increase of $3.6 million, through the Goals 2000
program to promote higher academic standards, increase student
achievement, and help 12000 California schools implement school
reforms.
$26 million for California through the ``America Reads'' program, to
help children in grades K-3 improving reading skills--all new funds.
The largest Pell Grant ever to California: $920 million, an increase
of $43 million over last year, to increase the maximum grant to college
students to $3,125, 36% higher than maximum award last year.

health

The bill provides funding for several federal programs that are very
important in my state, and the omnibus funding levels will result in
great benefits to California:
$2.3 billion, a $300 million increase, for medical research grants to
California universities and research institutions through the National
Institutes of Health (est.)
$238 million , a $43 million increase, for the Ryan White Care Act
for health care services to Californians with HIV and AIDS.
At least $13 million for HIV/AIDS prevention and treatment for
minority communities.
An increase of between $11 and 21 million in funding for Housing
Opportunities for Persons With Aids (HOPWA) who have limited financial
resources.
In addition, the bill accelerates the implementation of the health
insurance premium tax deduction for the self-employed. By 2003, the
deduction will be 100 percent.
The omnibus legislation also requires federal health plans to provide
coverage for contraceptive drugs and devices.
Finally, the bill increases funding for the Centers for Disease
Control by $226 million over last year--even more than the president's
request--and specifies funds for important priorities such as childhood
immunization ($421 million), breast and cervical cancer screening ($159
million), and chronic and environmental disease ($294 million).

economy

The legislation extends provisions of current law that help
California's economy, including:
The Research and Experimentation Tax Credit, which is of great
importance to California's high tech and bio tech companies.
The Work Opportunity Tax Credit, which encourages businesses to hire
disadvantaged workers.
The Trade Adjustment Assistance program, which helps workers and
businesses adversely affected by free trade agreements.
The Generalized System of Preferences authority of the President,
which allows him to extend duty-free treatment on imports from certain
development countries.
There are a number of other funding provisions that are beneficial to
my state's businesses and industries, and our economy, including:
$204 million for the Advanced Technology Program, an increase of $11
million over last year, to develop cutting edge technologies.
California receives more than any other state.
$100 million for ``Next Generation Internet'', a federal program to
connect universities to the Internet and to one another. Many
California universities are part of this program: UCLA, Stanford,
Berkeley, UC-Davis, UC-Irvine, UC-San Diego, Calif. Tech, and Cal
State, and others.
A 3-year moratorium on new taxes on Internet activities.
Full funding for the international Monetary Fund.
About double the number of visas available to foreign high tech, high
skilled workers under the H-1B program. The bill raises the annual cap
from 65,000 to 115,000 for next 2 years.
An increase in the Federal Housing Administration's loan limit from
$86,000 to $109,000, which will give more housing ownership
opportunities to Californians.
$283 million nationally for 50,000 Welfare to Work Housing Vouchers
for families trying to make transition to jobs. This new program will
help them get housing closer to jobs.

Agriculture

The bill includes a number of important funding and legislative
provisions for California farm interests:
Extension of time for California citrus growers to conduct scientific
review of whether Argentine citrus should be permitted into the U.S.
Continued affordability for California farmers for crop insurance.
$500,000 for pest control research that affects citrus fruit trees.
$90 million for the Market Access Program, which benefits California
companies that sell product overseas.
In addition, the bill provides an increase of $75 million--to $633
million--for the Food Safety Initiative, to help implement improvements
in surveillance of food borne illnesses, education about proper food
handling, research, and inspection of imported and domestic foods.

environment

The omnibus bill includes some good things for California, including:
Salton Sea legislation to require a Department of Interior study on
options for restoring the Sea. The bill also provides $14.4 million to
fund research and restoration activities.
$10,000 for an appraisal of the Bolsa Chica mesa.
$2 million for land acquisition in the Santa Monica Mountains
National Recreation Area.
$273,000 for operations at the Manzanar National Historic Site
Continuation for the moratorium on new Outer Continental Shelf oil/
mineral leases and drilling.
$1 million for land acquisition in the San Bernardino National
Forest.
More generally, the bill provides a substantial increase for global
climate change programs to more than $1 billion, a 25.6 percent
increase over 1998. It also funds the President's Clean Water Action
Plan at $1.7 billion--a 16.1 percent increase over 1998. This 5-year
program helps communities and farmers clean up waterways which are
currently deemed unswimmable and unfishable.

infrastructure

The bill provides a total of $293 million for California
transportation projects, including $70 million for Los Angeles
Metropolitan Transportation Authority Red Line, $40 million for the
BART-to-San Francisco Airport line, and $17 million for the Santa
Monica Bus Transitway for a dedicated highway express lane for buses.
Other major California projects that are funded include $50 million
for Los Angeles River flood control, $52 million for Port of Los
Angeles expansion, $6 million for Port of Long Beach expansion, and
$1.5 million for Marina Del Rey dredging (Boxer request)

community development and services

Allows LA City and County to use up to 25 percent of Los Angeles
Community Development Block Grant for public services, such as job
training, child care, crime and drug abuse prevention--federal cap
normally is 15 percent. This gives LA more flexibility in deciding how
to spend the CDBG funds.
Funds the Low Income Home Energy Assistance program at $1.1 billion
nationally. Last year, the program benefited 300,000 low income
families in California.
Summer Youth Employment program is funded at $871 million, same as
last year, nationwide. Last year, California received $140.1 million,
creating 70,510 jobs for economically disadvantaged youth.

crime

The omnibus appropriations bill funds the COPS program with an
additional $1.4 billion nationwide. This will allow the hiring of an
additional 1,700 new police in California. The bill also includes $2
million for the ``Tools for Tolerance'' program, a new grant under the
Byrne Grant program for the Simon Wiesenthal Center in Los Angeles.
This program helps police officers learn how they can reduce prejudice
in their communities.

immigration assistance to states

The legislation includes about $585 million to states as
reimbursement for the cost of incarcerating illegal immigrants.
California receives about half the national total. The bill also
includes roughly $150 million to reduce backlog at INS in processing
requests by legal immigrants to become U.S. citizens. Forty percent of
the current backlog is in California.
These are all good provisions that will be of benefit to my state.
However, I am very disappointed that the omnibus bill contains a number
of harmful provisions, as well, including:

[[Page S12791]]

Legislation to allow doubling the cut of timber in 2\1/2\ national
forests in California.
An 8-month delay of implementation of new oil valuation royalty
rules, which deprives California schools of funds they are entitled to.
Zero funding for the U.N. Fund for Population Activities--
international family planning assistance.
Continuation of the prohibition, except in cases of life
endangerment, rape or incest, on the use of any federal funds for
abortion services.
Continuaiton of the ban on federal employee health benefit plans for
covering abortion services except in cases of life endangerment, rape
or incest.
The bill provides about $8 million in ``emergency'' fiscal year 1999
spending for defense and national security. The Joint Chiefs of Staff
have said there are billions in the defense budget for items not
requested by them. I believe they are right and that some of the
unrequested items could have been cut to offset needed additional
defense funds included in the omnibus bill.
Mr. President, for the good that is in the bill, I will vote for it.
However, it is my strong feeling that this ``omnibus, consolidated,
emergency, supplemental'' bill is not a good way to put together the
budget of the United States. Too many decisions--important decisions
that affect millions of Americans--were left to the end of the year and
made by just a handful of people, rather than being considered
carefully and thoroughly over a period of months, in open committee and
floor debates. I hope that this process will not be repeated in future
years.
Overall, I remain strongly and deeply committed to a budget and
legislative agenda that puts top priority on education for all American
children, health research that will make life better for all Americans,
technology development to keep America's economy the strongest in the
world, and infrastructure that promotes safety, economic activity, and
higher quality of life for all our people.

INTERNET MORATORIUM ACT

Mr. BREAUX. Mr. President, I am pleased that the Internet Moratorium
Act is included in the 1998 omnibus appropriations bill. Present
federal law neither authorizes, nor imposes, nor ratifies any excise,
sales, or domain registration tax on Internet use for electronic
interstate commerce, and only one fee for the Intellectual
Infrastructure Fund. This temporary moratorium will prevent federal and
state governments from implementing or enforcing taxes imposed on
Internet commerce over the next three years. We would also like to
clarify that this Congress has not ratified or authorized any federal
taxes on Internet domain name registrations. The U.S. Federal Court has
stated that Section 8003 ratifies what was previously declared to be an
unconstitutional tax. However, it was never intended to ratify a tax on
the Internet; it only speaks to a fee for the Intellectual
Infrastructure Fund. Because the fee constitutes an unconstitutional
tax, it was not ratified by section 8003. I am confident that this
moratorium will enable Congress to develop a coherent national strategy
of appropriate taxation of business transactions conducted over the
Internet without hindering business opportunities and would also like
to reiterate that this Congress has never ratified an unconstitutional
tax on the Internet.

INCLUSION OF NORTH DAKOTA IN THE MIDWEST HIDTA

Mr. CONRAD. Mr. President, I rise today to thank the conferees who
worked on the fiscal year 1999 omnibus appropriations bill for
retention of my amendment calling for inclusion of North Dakota in the
Midwest High Intensity Drug Trafficking Area, or HIDTA.
As North Dakota Attorney General Heidi Heitkamp and US Attorney John
Schneider have pointed out, North Dakota--like other Midwestern
states--has been inundated by a relentlessly rising tide of
methamphetamine trafficking, production, and abuse. Unless action is
taken swiftly, the Attorney General and US Attorney warn that North
Dakota is at high risk to attract a meth manufacturing industry.
This is because my state's sparse population, great size, and
abandoned buildings offer excellent locations for meth laboratories.
Counter-drug operations in the southwestern US are also forcing this
easily-relocated industry to find alternative production locations.
The numbers speak for themselves. There were no meth purchases by
undercover agents in North Dakota in 1993. By 1997, there were 181
meth-related cases reported by state and federal law enforcement. In
1993, meth-related cases represented only 6 percent of the drug-related
workload of the Office of the US Attorney. In five short years this
number has skyrocketed to 75 percent. It is undeniable that increased
production of meth in North Dakota along with associated trafficking
has contributed to a spike of violent crime.
This unacceptable increase in meth-driven crime in North Dakota is
placing a growing burden on North Dakota law enforcement, and
represents a growing danger to the people of my state. It demands an
immediate--and coordinated--federal response. Similar problems in the
states of South Dakota, Iowa, Nebraska, Missouri, and Kansas were
countered with the formation of the Midwest HIDTA.
North Dakota meets all the statutory criteria for inclusion in the
Midwest HIDTA. In the words of Heitkamp and Schneider, joining the
HIDTA will allow federal, state, and local law enforcement to ``work
together to disrupt, dismantle, and destroy street and mid-level
elements of methamphetamine organizations and/or groups operating in
North Dakota, the Midwest, and Canada.''
During floor consideration of the Treasury-Postal appropriations
bill, I was pleased to work on this matter with the distinguished
leadership of the Treasury-Postal Appropriations Subcommittee, Senators
Campbell and Kohl. I greatly appreciate their good work in conference
to retain my amendment. I am also pleased that the conference report
includes additional funding for the new HIDTAs designated in this
legislation, and I urge the Administration to consider favorably North
Dakota's request for $1.97 million in fiscal year 1999 funding for
integration of my state into the Midwest HIDTA.
Mr. President, passage of the omnibus bill is an important step in
getting tough on methamphetamine in my state. It is simply imperative
that there be coordinated federal, state, and local law enforcement
response to North Dakota's drug crisis, and I again thank Senators
Campbell and Kohl for their assistance in making this a reality.

District of Columbia Appropriations

Mr. ROBB. Mr. President, I rise to bring to the Senate's attention to
a matter of concern to the government of the District of Columbia and
to commuters in the capital area.
Each workday, about one thousand people a day use an informal carpool
system to get in and out of the nation's capital. These commuters
gather in ``slug lines'' at unofficial pick up points to catch rides
with others driving into the District. At the end of the day, these
``slugs'' catch rides home.
Nearly everyone benefits from this system. The drivers get to work
more quickly because they get to use the carpool lane. The ``slugs''
get a free ride. Other drivers benefit from reduce traffic. And all of
us benefit from less pollution due to increased carpooling.
Not everyone is happy with the slugs however. The District of
Columbia police have raised concerns that drivers picking up slugs will
slow traffic or create a safety hazard. As reported in recent articles
in the Washington Post, city police officers have ticketed these
drivers and considered forcing the commuters to find a new pick up
point. Fortunately, District Police Chief Ramsey has decided against
his approach. Instead, he will study the traffic situation along 14th
Street to see how we can improve the flow of traffic.
I welcome this approach. We may be able to address the District's
concerns about safety and traffic congestion while preserving the slug
lines. I've asked the managers of the legislation to consider this
problem during conference, and if possible, to include language
directing the Department of the Interior and the District of Columbia
Department of Public Works to study the feasibility of providing
commuter pick-up lanes to serve commuters in the busy 14th Street
Corridor south of Constitution Avenue. The Interior Department and the
District would report to the Appropriations Committees of the Senate
and House of Representatives on their joint recommendations

[[Page S12792]]

to address this matter. Even if conference report language could not be
included, I believe the idea of the study, with recommendations would
be helpful.
I would like to emphasize that many of these commuters are Federal
employees, and so I think it's appropriate to get the federal
government involved. I am certainly willing to work with the District
Government to seek federal funds or easements to create commuter pick
up lanes, and I hope the District will look closely at this option. I
think it could be a triple play--a win with respect to the District's
safety concerns, a win for drivers on our congested highways, and of
course, a win for the slugs.
Mr. President, I would appreciate hearing the comments of the joint
managers on this issue, and I yield the floor.
Mr. FAIRCLOTH. I think the Senator has a workable plan to move this
toward a solution, and I urge the Department of the Interior and the
District Government to study the matter and report back to us early
next year.
Mrs. BOXER. I thank the Senator from Virginia for raising this issue.
The commuter lane proposal sounds like an excellent compromise, and I
hope Interior and the District will begin looking at this option
immediately.
As the ranking Democrat of the D.C. I would like to thank Senator
Faircloth for his efforts as Chairman of the D.C. Appropriations
Subcommittee. He has worked hard to address the District's financial
ills, and I am pleased that we have begun to make some progress for the
District to resolve its serious financial problems.
In fact, the fiscal well being of the District has improved
dramatically. The District ended fiscal year 1997 with a budget surplus
of almost $186 million. The June, 1998 projections suggest that the
District may have a surplus of $302 million for fiscal year 1998.
The fiscal year 1999 D.C. Appropriations includes $494.59 million in
Federal Funds. This amount represents an increase of $8.39 million
above the President's Budget request for the District of Columbia. It
is $38.4 million below the FY 1998 level.
With regard to the District of Columbia Funds, the legislation
largely reflects the consensus budget formulated by the Mayor, the City
Council, and the Control Board.
It is important to note that because of abuses of taxpayer funds,
there is no appropriation to the Advisory Neighborhood Commissions
(ANCs) as provided for in the consensus budget. However, this deletion
of funds does not preclude the District from including funds for the
commissions in future budgets so long as there are sufficient
safeguards to protect taxpayers' interests.
Mr. President, with respect to specific provisions of this bill,
there are some good things, but there are also some bad provisions.
On the plus side, this bill includes a $25 million federal payment
for management reform. Within these funds, special attention will be
given to fire and emergency medical services, the reopening of the
Chief Medical Officer's laboratory, and implementation of a high-speed
city-owned fiber network for voice and data services.
The bill provides funds for the repair and maintenance of public
safety facilities in the District. The Federal highway funds made
available to the District include $98 million for local streets.
The bill includes a $25 million federal contribution to the
Washington Metropolitan Area Transit Authority for improvements to the
Metrorail station at the site of the proposed Washington Convention
Center project.
I am pleased that the bill sets aside $5 million to address the
chronic need for additional community-based housing facilities for
seriously and chronically mentally ill individuals in the District.
The bill also provides an appropriation to the Children's National
Medical Center for the Community Pediatric Health Initiative. This
reestablishes an important public-private partnership to provide
pediatric services to high risk children in medically under-served
areas.
The bill requires the Control Board to report to Congress on the
status of any agreements between the District and all non-profit
organizations that provide medical and social services to the
District's residents. This will ensure that the District re-evaluates
the decisions to terminate support and where possible renew support for
these critical programs, including those of Children's Hospital.
I am especially pleased that funding for homeless programs in the
District will remain level for fiscal year 1999. In previous years,
these programs were threatened with funding cuts and I am happy that
these cuts are no longer being proposed.
Finally, I am pleased that this legislation does not divert any funds
from the District of Columbia Public School system for private school
vouchers as was included in the D.C. Appropriations bill passed by the
House of Representatives.
Mr. President, unfortunately this legislation includes a number of
objectionable provision which violate the principle of home rule and
infringe on the rights of District residents.
Again this year, the bill includes a ban on the use of local funds
for abortions, and a ban on the use of local funds to expand health
care benefits to unmarried couples. I continue in my strong opposition
to these provisions.
I also have serious concerns about the provision to cap the funds
available to reimburse attorneys who represent children who obtain
special education placements in hearing sunder the Individuals with
Disabilities Education Act. This provision will seriously inhibit the
ability of children with special needs to obtain their legal right to
an education.
I am disappointed by the inclusion of a provision that prohibits the
District from using funds to provide assistance to any civil action to
require Congress to provide the District of Columbia with voting
representation.
The bill also includes a repeal of a recently enacted residency
requirement, a matter of some controversy.
I know that the Administration strongly objects to several provisions
in the bill, including a ban on funds to organizations that participate
in needle exchange programs.
All of these provisions are unnecessary and inappropriate intrusions
into the District's own priorities and the rights of its citizens.
Overall, I support the proposed allocation of funds for the District
of Columbia, but I am disappointed by the many inappropriate riders in
this legislation. Without these provisions, this would have been a much
better bill.
Again, I would like to recognize Chairman Faircloth, and to
acknowledge the hard work of the staff for this bill: Mary Beth
Nethercutt of the Majority Staff, Minority Deputy Staff Director, Terry
Sauvain; Liz Blevins and Neyla Arnas of the Committee staff; and
Danielle Drissel of my legislative staff.
I would especially like to express my appreciation to Senator Byrd,
the Ranking Democrat of the Committee on Appropriations, for assigning
his Deputy Staff Director, Terry Sauvain, to serve as Minority Clerk of
the D.C. Appropriations Subcommittee. Terry is a long time
appropriations staff member who is a consummate professional and a
pleasure to work with, and I have really enjoyed and counted on his
advice and council.

Glacier Bay National Park and Preserve Commercial Fishing

Mr. STEVENS. Mr. President, the omnibus package, H.R. 4328, includes
a measure involving commercial fishing in Glacier Bay and Upper Dundas
Bay within Glacier Bay National Park and Preserve. While working on
this in the past weeks, a fisherman commented to my office that the
choices presented are like choosing whether to cut off your finger,
hand, or arm. In short, because the Department of the Interior has
taken the position that commercial fishing in Glacier Bay and Dundas
Bay should end, there simply has been no solution that Alaskans can
fully support. In the omnibus bill we have chosen the lesser of evils.
Without Congressional action, the National Park Service would have
gone forward with regulations to phase out fishing in the Bay over 15
years and eventually ban it altogether. The National Park Service would
also have blocked Dungeness crab fishermen who fish in Upper Dundas Bay
and the Beardslee Islands, the so-called wilderness waters, from
continuing a fishery that has existed for nearly 20 years

[[Page S12793]]

with no evidence of environmental damage. Whether the Service would
have ever agreed to a fair plan to compensate these crabbers is
doubtful. Discussions have been ongoing for three years without the
Park Service putting a compensation plan on the table.
Without Congressional action, the Service might have proceeded with
plans to shut down the scallop fishery, stop flounder fishing, close
out crabbing, and block fisheries outside Glacier Bay itself, again
relying on what it believes are its inherent powers to stop commercial
activities in parks, the spirit and letter of the Alaska National Lands
Conservation Act to the contrary. In my opinion and the opinion of the
State of Alaska, the Service has no such authority because regulation
of fisheries is a state prerogative in Alaska as well as the rest of
the nation. Furthermore, the Alaska Department of Law maintains that
the submerged land within Glacier Bay and, as a result, the water
column above it, both fall under the jurisdiction of the State of
Alaska under the Submerged Lands Act and the Alaska Statehood Act.
When this issue was brought before this Congress, I supported Senator
Murkowski's amendment to the Interior Appropriations bill to block the
Park Service's planned regulations to give us more time to work out a
solution. I also cosponsored Senator Murkowski's bill to resolve this
problem once and for all. Unfortunately, because of Administration
opposition, the bill did not pass Congress, leaving us with the
provision for a moratorium on regulations in the Interior bill.
As we approached the end of the fiscal year, the Administration
became more vocally opposed to allowing traditional fisheries in
Glacier Bay to continue even though there is no scientific evidence
that either the fisheries or other resources which depend on them are
in trouble. For example, whale counts are actually up in Glacier Bay,
an indication that there is an abundance of fish upon which to feed.
Secretary Babbitt threatened to recommend a veto of the bill if the
provision blocking the Park Service's fishing ban was included in the
spending bills.
At the same time, the Congressional leadership stepped up efforts to
develop an omnibus spending package the President would sign. As much
as they supported the Delegation's efforts in Glacier Bay, the
Congressional leadership were not willing to give the President any
excuse to veto bills and shut down the government to divert attention
from other matters. I was asked to try to work out a solution that the
President would accept. We worked for nearly a week to develop a plan;
and after consultation with fishermen, crabbers, and the other members
of the Delegation, I reluctantly concluded that this proposal was
better than taking no action at all.
The plan we developed allows the fishermen who have historically
operated in Glacier Bay to continue to fish for the rest of their
lives. We had sought the right to allow fishermen to pass on their
permits to their children or assignees, but that was rejected by the
Interior Department. Had the regulations gone forward in their current
form, all fishermen would have been banned from the Bay in 15 years.
The proposal also offers a compensation package to the five or six
crabbers who will be forced out of designated wilderness areas in
Glacier Bay and Upper Dundas Bay. It will compensate them for their
permit and lost income for six years or $400,000, which ever is
greater. In addition, if a fisherman chooses to be compensated for his
or her permit and lost income, he or she may also sell to the Secretary
his or her boat and gear for additional compensation. Each crabber will
obviously have the option of keeping their boat and gear and fishing
elsewhere. Lost income is net after expenses which should be calculated
by taking gross receipts and subtracting the cost of insurance, crew,
fuel, and bait. Paper losses such as depreciation used for Internal
Revenue purposes only, should not be subtracted in calculating net
income.
The crabbers will have until February 1st to file a claim and the
Interior Department will then have six months to act on those claims.
There will be an appeals process with a right to go to court if no
agreement is reached on an acceptable compensation plan. The office of
the Assistant Secretary for Parks and Wildlife has pledged to me to
expedite this process so the Dungeness crabbers will be compensated as
quickly as possible.
The compromise that was reached also maintains the State of Alaska's
prerogatives with respect to state management of the state's fisheries.
There will be a cooperative management plan developed jointly by the
Interior Department and the State of Alaska. As that plan is developed,
I have been assured by the Secretary's office that the Glacier Bay
Working Group representing the fishing industry will be consulted.
There will be a full public process including hearings, testimony, and
an opportunity to comment on any proposed plan.
In addition, the legislation includes a savings clause to clarify
that nothing in the Act undermines the power and authority of the State
of Alaska to manage fisheries in the State. Finally, I want to make
clear that unless explicitly provided in the Act, the legislation is
not intended to amend the Alaska National Interest Lands Conservation
Act which generally and specifically governs management of Glacier Bay
National Park and Preserve as well as subsistence and commercial
fishing.
With respect to subsistence fishing, while the Interior Department
would not agree to explicitly allow subsistence activities, I was
assured by the Secretary's office that personal use fisheries could
continue, most notably for the people of Hoonah who have had a long
running dispute with the Park Service on this issue. I was advised that
the Park Service is authorized under National Park Service Organic Act
to recognize a state-run personal use fishery.
Of critical importance is the status of the outer waters of Glacier
Bay. The original proposal made by the Interior Department offered no
assurance that commercial fishing could continue outside the Bay
itself. Language was specifically included to address this shortcoming,
making it clear that commercial fishing is authorized under law and
will continue to be permitted in the outer waters. Although the
Secretary, acting jointly in consort with the State of Alaska, through
the cooperative management plan, may retain the right to protect park
resources, that goal must be achieved through reasonable regulation.
For example, an area around a seal rookery may be closed to salmon
fishing to protect that specific location, but the rest of the outside
waters must remain open to salmon fishing.
I view this compromise as an insurance policy, a safety net that
offers better protection to Glacier Bay's fishermen than was offered by
the draft Park Service regulations. But I do not view it as the end of
the story. There are provisions I do not like.
Senator Murkowski has already indicated his intention to introduce
legislation on this issue and hold hearings in the Senate Energy
Committee which he chairs. I also have indications that Congressman
Young, the Chairman of the House Resources Committee, has similar
plans. The Secretary of the Interior agreed to extend the comment
period on the pending agency regulations until January 15, 1999.
One issue that has not been addressed in this legislative compromise
are the losses of local communities and fish processing companies. The
Interior Department acknowledges that this is a shortcoming and has
pledged to work with me and the rest of the Delegation to address this
issue. I pledge to work with local communities and processors in the
months ahead.

Internet Speech Regulation

Mr. LEAHY. Mr. President, last week's Washington Post proclaimed in
one headline, ``High Tech is King of the Hill,'' citing the passage of
several bills which I actively supported, including restricting
Internet taxes, enhancing protection for copyrighted works online, and
encouraging companies to share information to avoid Year 2000 computer
failures. Yet, anyone familiar with the Internet proposals buried in
the Omnibus Appropriations measure would be writing a different
headline this week.
Certain provisions in this huge spending bill repeat the mistakes
about regulating speech on the Internet that the last Congress made
when it passed the Communications Decency Act, the

[[Page S12794]]

``CDA-I.'' I opposed the CDA from the start as fatally flawed and
flagrantly unconstitutional. I predicted that the CDA would not pass
constitutional muster and, along with Senator Feingold, sought to
repeal the CDA so that we would not have to wait for the Supreme Court
to fix our mistake.
We did not fix the mistake and so, as I predicted, the Supreme Court
eventually did our work for us. All nine Justices agreed that the CDA
was, at least in part, unconstitutional. Justice Stevens, writing for
seven members of the Court, called the CDA ``patently invalid'' and
warned that it cast a ``dark shadow over free speech'' and
``threaten[ed] to torch a large segment of the Internet community.''
Reno v. ACLU, 117 S.Ct. 2329, 2350 (1997). The Court's decision came as
no surprise to me, and should have come as no surprise to the 84
members of the Senate who supported the legislation.
We had been warned by constitutional scholars and Internet experts
that the approach we were taking in the CDA would not stand up in court
and did not make sense for the Internet. In the end, three district
court panels and the Supreme Court all ultimately agreed in striking
down the CDA-I as an unconstitutional restriction on free expression.
Congress is about to make the same mistake again by including in the
Omnibus Appropriations bill the ``Child Online Protection Act,'' or
``CDA-II.'' I have spoken before, on July 21, 1998, about my opposition
to a version of this legislation that was included, without debate, on
the annual funding bill for the Commerce, State and Justice
Departments.
My opposition to these efforts to regulate Internet speech should not
be misunderstood. I join with the sponsors of these measures in wanting
to protect children from harm. I prosecuted child abusers as State's
Attorney in Vermont, and have worked my entire professional life to
protect children from those who would prey on them. In fact, earlier
this month, the Congress passed the Hatch-Leahy-DeWine version of the
``Protection of Children from Sexual Predator Act,'' H.R. 3494, to
enhance our Federal laws outlawing child pornography. We should act
whenever possible to protect our children, but we have a duty to ensure
that the means we use to protect our children do not do more harm than
good. As the Supreme Court made clear when it struck down CDA-I, laws
that prohibit protected speech do not become constitutional merely
because they were enacted for the important purpose of protecting
children.
CDA-II makes a valiant effort to address many of the Supreme Court's
technical objections to the CDA. Nevertheless, while narrower than its
CDA-I predecessor, this legislation continues to suffer from
substantial constitutional and practical defects. The core holding of
the CDA-I case was that ``the vast democratic fora of the Internet''
deserves the highest level of protection from government intrusion--the
highest level of First Amendment scrutiny. Courts will assess the
constitutionality of laws that regulate speech over the Internet by the
same demanding standards that have traditionally applied to laws
affecting the press.
The CDA-II provisions included in the Omnibus Appropriations bill do
not meet those standards.
CDA-II would penalize the posting ``for commercial purposes'' on the
World Wide Web of any material that is ``harmful to minors.'' Penalties
include fines of up to $50,000 per day of violation, up to 6 months'
imprisonment and, under a separate section of the bill, forfeiture of
eligibility for the Internet tax moratorium. Like the old CDA-I, this
new provision creates an affirmative defense for those who restrict
access by requiring use of a credit card, debit account, adult access
code, adult personal identification number, a digital certificate
verifying age, or other reasonable measures. This new criminal
prohibition raises a number of constitutional and practical issues that
have been entirely ignored by this Congress.
First, the scope of CDA-II is unclear. The prohibition applies to
anyone ``engaged in the business'' of making any communication for
commercial purposes by means of the World Wide Web. Vendors selling
pornographic material from Web sites are clearly covered, but also many
other unsuspecting persons and businesses operating Web sites will
likely fall under this prohibition. Under new section 231(e)(2)(B) of
title 47, U.S.C., ``it is not necessary that the person make a profit''
or that the Web site ``be the person's sole or principal business or
source of income.'' Does CDA-II cover companies that offer free Web
sites, but charge for their off-line services? If CDA-II does not apply
in that circumstance, would the measure have the unintended effect of
encouraging the posting of ``harmful'' materials on the Web for free?
Does CDA-II apply to a business that merely advertises on the Web? Does
CDA-II apply to public service postings sponsored by businesses on the
Web?
In the face of this uncertainty, entrepreneurs, small businesses and
other companies who maintain a Web site as a way to enhance their
business may face criminal liability if they post material--for free,
for advertising, or for a fee--which some community in this country may
perceive to be ``harmful to minors.''
Second, CDA-II adopts a ``harmful to minors'' standard that will
likely be found unconstitutional. CDA-II defines ``material that is
harmful to minors'' as what the ``average person, applying contemporary
community standards,'' would find, taken as a whole and with respect to
minors, is designed to appeal to the prurient interest, depicts in a
manner patently offensive to minors actual or simulated sexual acts or
contact, and lacks serious literary, artistic, political or scientific
value. The provision further defines a ``minor'' to be ``any person
under 17 years of age.''
The ``17 year old'' age cutoff in CDA-II makes this measure
significantly more restrictive than the ``harmful to minors'' statutes
adopted in most states, including in my home state of Vermont. Most
state ``harmful to minors'' statutes restrict materials that would be
harmful to minors under the age of 18. These statutes are interpreted
to prohibit only that material which would be harmful for the oldest
minor. Thus, by setting the age at ``under 17,'' CDA-II would prohibit
material on the Web that is inappropriate or harmful for 16 year olds.
Consequently, CDA-II would impose more restrictions on the material
that can be freely accessible on the World Wide Web than most states
impose on materials available for sale in bookstores, news stands, and
movie theaters within their borders.
Yet, unlike books, magazines, movies or even broadcasts, where the
vendor can control the physical places to which the material is
distributed, a person posting material on a Web site cannot restrict
access to only Internet users from certain geographic regions. Indeed,
Web site operators often cannot determine the region of the country, or
the world, from which users are initiating their access.
As a consequence, Web site operators will have to tailor the material
accessible on their sites to content that would pass muster in the most
conservative community in the country for children 16 years old and
younger. The standards of every other community would be discounted.
Thus, the bill's core effect will be to set--for the first time--a
single, national harmful to minors standard for material on the World
Wide Web. Moreover, this standard will be more restrictive than those
already in place in most states.
This result runs counter to existing ``harmful to minors'' law as
articulated by the Supreme Court. The Supreme Court has never approved
of a single, national obscenity standard, nor has it approved a
``harmful to minors'' statute based on a national, as opposed to local,
standard. On the contrary, the Supreme Court in Miller v. California,
413 U.S. 15, 30-32 (1973), stated that:

our Nation is simply too big and too diverse . . . to
reasonably expect that such standards could be articulated
for all 50 States in a single formulation. . . . It is
neither realistic nor constitutionally sound to read the
First Amendment as requiring that the people of Maine or
Mississippi accept public depiction of conduct found
tolerable in Las Vegas, or New York City.

Reducing the material available on the Web to that which only the
most conservative community in the country deems to be appropriate for
16-year-olds, could very well remove material that is both
constitutionally protected and socially valuable. The online
publication of the Starr report, in whole or in part, Robert
Mappelthorpe's pictures, or PG, PG-13, and certainly R-

[[Page S12795]]

rated movies or TV shows would be suspect.
CDA-II provides an affirmative defense for online publishers of such
material that demand credit card numbers or other adult identification.
A similar defense did not save CDA-I, however, and remains insufficient
to reduce the significant burden on protected speech that the new
prohibition imposes. The Supreme Court noted in analyzing this defense
in CDA-I, that such a requirement would ```completely bar adults who do
not have a credit card and lack the resources to obtain one from
accessing any blocked material.''' 117 S.Ct at 2337.
In addition to burdening the speech rights of adults, the Supreme
Court questioned the effectiveness of this defense in CDA-I to protect
children, stating:

. . . it is not economically feasible for most noncommercial
speakers to employ such verification . . . Even with respect
to commercial pornographers that would be protected by the
defense, the Government failed to adduce any evidence that
these verification techniques actually preclude minors from
posing as adults. Given that the risk of criminal sanctions
`hovers over each content provider, like the proverbial sword
of Damocles,' the District Court correctly refused to rely on
unproven future technology to save the statute.'' 117 S.Ct.
at 2349-50.

The technology required to exercise the affirmative defense remains
practically difficult and prohibitively expensive for many Web sites.
As a result, just as the Supreme Court found with CDA-I, CDA-II would
effectively chill the publication of a large amount of valuable,
constitutionally-protected speech on popular commercial web sites such
as CNN.com, amazon.com, or the New York Times online. As the Court
restated in its decision on CDA-I, ```[t]he level of discourse reaching
a mailbox simply cannot be limited to that which would be suitable for
a sandbox.''' 117 S.Ct. at 2346.

Third, CDA-II will be ineffective at protecting children. In
evaluating whether the burdens that CDA-II will place on Web publishers
are justified, we must take a realistic look at how well these new
restrictions will work to protect children from harmful online
materials. As the Supreme Court noted, adult identification or
verification techniques can be falsely used by children to gain access
to forbidden material.
In addition, CDA-II is limited to activity on the Web, presumably to
capture the material that the Supreme Court believed was susceptible to
use of verified credit cards. Those of us who use the Internet
recognize that the Web is merely one of several Internet protocols,
although the one most amenable to pictorial or graphic displays.
Limiting the reach of this measure to the Web excludes newsgroups, FTP
sites, e-mail, chat rooms, private electronic bulletin board systems
(BBS), and gopher sites, where children may continue to access harmful
materials. Indeed, I am concerned that the unintended consequence of
applying CDA-II's ill-considered speech restrictions on the Web will
simply force Internet content providers and users to use or develop
other protocols with which they would be able to exercise their First
Amendment rights unfettered by the threat of criminal prosecution.
Those of us who use the Internet and the World Wide Web also
recognize that this is a global medium, not just a network under United
States control. Indeed, a large percentage of content on the Internet
originates outside the United States, and is as accessible over the Web
as material posted next door. Objectionable material is likely to come
from outside the United States and be unreachable by American laws.
The Justice Department, in a letter dated October 5, 1998, on CDA-II
that I would ask to be included in the record, stated, ``the practical
or legal difficulty in addressing these considerable alternative
sources from which children can obtain pornography raises questions
about the efficacy of the [CDA-II] and the advisability of expending
scarce resources on its enforcement.''
The warning by the Justice Department that this measure will detract
from current efforts to stop the distribution of illegal child
pornography has apparently gone unheeded by Congress. The Justice
Department has made clear that CDA-II would ``divert the resources that
are used for important initiatives such as Innocent Images,'' a
successful online undercover program to stop child predators and
pornographers. The work that the Justice Department has done in going
after the worst offenders, highlighted by the recent international
crack down on child-pornography, should not be diluted by broadening
their enforcement load to embrace an unconstitutional standard.
Fourth, Congress simply has not done its homework to consider
alternative effective means to protect children from harmful online
materials. The Senate is considering CDA-II, including its creation of
a new Federal crime, as part of an omnibus spending measure. Until
recently the Senate had rules and precedent against this kind of
legislating on an appropriations bill. Under Republican leadership,
that discipline has been lost and we are left to consider significant
legislative proposals as part of annual appropriations. These matters
are far-reaching. They deserve full debate and Senate consideration
before good intentions lead the Senate to take another misstep in
haste.
The Congress has not held hearings on the CDA-II provisions before
us. The Senate Commerce Committee hearing in February, 1998, elicited
only the testimony of this measure's primary sponsor about a prior
version of the bill, and no other testimony about its
constitutionality. The Congress has made only the most minimal efforts
to determine whether technical tools or this measure would be the least
restrictive means of protecting children. There has been no study, no
discussion, and no comparison of the effectiveness of various
approaches, their likely impact on speech, and their appropriateness
for the Internet.
Ironically, CDA-II puts the proverbial cart-before-the-horse by
enacting new speech restrictions at the same time the bill establishes
a ``Commission on Online Child Protection'' to study the technical
means available to protect children from harmful material. While the
selection of the members of this Commission is left solely to
Republican congressional leadership, we should at least hear from the
Commission before legislating. As the letter from the Department of
Justice advises, ``Congress should wait until the Commission has
completed its study and made its legislative recommendations before
determining whether a criminal enactment would be necessary, and if so,
how such a statute should be crafted.'' This approach would allow
Congress to create a record on the most effective means to solve the
problem instead of passing an ineffective law.
In striking the CDA-I as unconstitutional, the Supreme Court
specifically cited ``the absence of any detailed findings by the
Congress, or even hearings addressing the special problems of the CDA''
as grounds for its finding ``that the CDA is not narrowly tailored if
that requirement has any meaning at all.'' 117 S.Ct. at 2348. The
Congress is repeating this mistake here, since it has again not
established a record showing that the extraordinary restrictions on
Internet expression proposed in the CDA-II are the least restrictive
way to achieve our goal of protecting children online. Congress is
required to establish such a record if it seeks to impose these sorts
of burdens of the speech of our citizens.
Experts have told us that there are better ways to protect children
that have less of an impact on constitutionally protected speech,
including the use of blocking and filtering tools that give parents the
ability to control access to harmful content both within and outside of
the United States. Harvard Law School Professor Larry Lessig, who is an
expert on both constitutional law and Internet law, has described at
least one less restrictive alternative--the use of voluntary ``kid
certificates'' online--that would have the same effect Congress is
trying to achieve while placing far less of a burden on free speech. I
ask that his letter be made part of the Record.
It is precisely because these less restrictive means exist, and
because Congress has not shown otherwise, that the CDA-II is most
likely to fail in the courts.
Finally, there are constructive steps that Congress can and should
take. Although CDA-II would not solve the problems facing parents and
educators on how to protect their children from

[[Page S12796]]

harmful and inappropriate online material, there are several steps that
Congress could take which would prove more effective.
We should hear from the Commission on Online Child Protection that is
authorized in this bill to study the technical means available to
protect children from harmful material.
We should do more to protect children's privacy. The Omnibus
appropriations bill contains a provision authorizing the FTC to require
parental consent from children to give out personal information to Web
sites aimed at children or where the age of child has been collected.
These privacy provisions have broad support and could be a way for
Congress effectively and constitutionally to protect children online
without detracting from the current mission of law enforcement.
We should not rush to legislate when non-legislative solutions may be
more effective and consistent with our constitutional principles.
Instead of trying to create a national harmful to minors standard,
Congress should encourage companies and non-profit organizations who
have responded to this problem with wide-ranging efforts to create
child-friendly content collections, teach children about appropriate
online behavior, and develop voluntary, user-controlled, technology
tools that offer parents the ability to protect their own children from
inappropriate material. Unlike legislative approaches, these bottom-up
solutions are voluntary. They protect children and assist parents and
care-takers regardless of whether the material to be avoided is on an
American or foreign Web site. They respond to local and family
concerns, and they avoid government decisions about content.
We can and must do better than CDA-II. This measure will do almost
nothing to protect children from harmful material online, but will
divert Federal enforcement resources, restrict constitutionally-
protected free speech online and set a dangerous precedent for Federal
regulation of the Internet. Perhaps worst of all, it will create the
illusion of a solution. This Congress should not be in the business of
lulling parents into a false sense of security while in fact doing
nothing to protect children online.
Many members who have supported CDA-II are no doubt motivated by the
same thing that motivates me in this area: a desire to protect children
online. I am afraid, however, that we have not taken the time to craft
a legislative solution that will actually help solve this problem. The
Congress has been put on notice that our approach will not work, and
will probably end up in court for yet another battle. We should not run
another ambiguous speech regulation up the flagpole and expect the
courts to salute. We owe it to the millions of Americans who use the
Web not to make the same mistake a second time.
Now, Mr. President, I ask unanimous consent that a letter from Acting
Attorney General Anthony Sutin from the Department of Justice and a
letter from Harvard University Professor Lawrence Lessig in opposition
to the Child Online Protection Act be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:

U.S. Department of Justice,

Office of Legislative Affairs,

Washington, DC, October 5, 1998.
Hon. Thomas Bliley,
Chairman, Committee on Commerce,
House of Representatives, Washington, DC.
This letter sets forth the views of the Department of
Justice on H.R. 3783, the ``Child Online Protection Act''
(``the COPA''), as ordered reported. We share the Committee's
goal of empowering parents and teachers to protect minors
from harmful material that is distributed commercially over
the World Wide Web. However, we would like to bring to your
attention certain serious concerns we have about the bill.
The principal provision of the COPA would establish a new
federal crime under section 231 of Title 47 of the United
States Code. Subsection 231(a)(1) would provide that:
``Whoever, in interstate or foreign commerce, by means of
the World Wide Web, knowingly makes any communication for
commercial purposes that includes any material that is
harmful to minors without restricting access to such material
by minors pursuant to subsection (c) shall be fined not more
than $50,000, imprisoned not more than 6 months, or both.''
Subsection 231(a)(2), in turn, would provide for additional
criminal fines of $50,000 for ``each day'' that someone
``intentionally violates'' Sec. 231(a)(1); and Sec. 231(a)(3)
would provide for additional civil fines of $50,000 for
``each day'' that a person violated Sec. 231(a)(1).
Subsection 231(b) would exempt certain telecommunications
carriers and other service providers from the operation of
Sec. 231(a)(1). Subsection 231(c)(1) would establish what is
denominated an ``affirmative defense'':
``(1) Defense.--It is an affirmative defense to prosecution
under this section that the defendant, in good faith, has
restricted access by minors to material that is harmful to
minors--
``(A) by requiring use of a credit card, debit account,
adult access code, or adult personal identification number;
or
``(B) by any other reasonable measures that are feasible
under available technology.''
Subsection 231(e) would define, inter alia, the following
terms in the criminal prohibition: (i) ``by means of the
World Wide Web''; (ii) ``commercial purposes''; (iii)
``material that is harmful to minors,'' and ``minor.'' See
proposed Sec. 231(e) (1), (2), (6) & (7). In particular,
``material that is harmful to minors'' would be defined as:
``. . . any communication, picture, image, graphic image
file, article, recording, writing, or other matter of any
kind that--
``(A) the average person, applying contemporary community
standards, would find, taking the material as a whole and
with respect to minors, that such material is designed to
appeal to or panders to the prurient interest;
``(B) depicts, describes, or represents, in a patently
offensive way with respect to minors, an actual or simulated
sexual act or sexual contact, actual or simulated normal or
perverted sexual acts, or a lewd exhibition of the genitals
or female breast; and
``(C) taken as a whole, lacks serious literary, artistic,
political, or scientific value for minors.''
The Department's enforcement of a new criminal prohibition
such as that proposed in the COPA could require an
undesirable diversion of critical investigative and
prosecutorial resources that the Department currently invests
in combating traffickers in hard-core child pornography, in
thwarting child predators, and in prosecuting large-scale and
multidistrict commercial distributors of obscene materials.
For example, presently the Department devotes a significant
percentage of our resources in this area to the highly
successful Innocent Images online undercover operations,
begun in 1995 by the FBI. Through this initiative, FBI agents
and task force officers go on-line, in an undercover
capacity, to identify and investigate those individuals who
are victimizing children through the Internet and on-line
service providers. Fifty-five FBI field offices and a number
of legal attaches are assisting and conducting investigations
in direct support of the Innocent Images initiative. To
ensure that the initiative remains viable and productive, the
Bureau's efforts include the use of new technology and
sophisticated investigative techniques, and the coordination
of this national investigative effort with other federal
agencies that have statutory investigative authority. We also
have allocated significant resources for the training of
state and local law enforcement agents who must become
involved in our effort. To date, the Innocent Images national
initiative has resulted in 196 indictments, 75 informations,
207 convictions, and 202 arrests. In addition, 456
evidentiary searches have been conducted.
We do not believe that it would be wise to divert the
resources that are used for important initiatives such as
Innocent Images to prosecutions of the kind contemplated
under the COPA. Such a diversion would be particularly ill-
advised in light of the uncertainty concerning whether the
COPA would have a material effect in limiting minors' access
to harmful materials. There are thousands of newsgroups and
Internet relay chat channels on which anyone can access
pornography; and children would still be able to obtain ready
access to pornography from a myriad of overseas web sites.
The COPA apparently would not attempt to address those
sources of Internet pornography, and admittedly it would be
difficult to do so because restrictions on newsgroups and
chat channels could pose constitutional questions, and
because any attempt to regulate overseas web sites would
raise difficult questions regarding extraterritorial
enforcement. The practical or legal difficulty in addressing
these considerable alternative sources from which children
can obtain pornography raises questions about the efficacy of
the COPA and the advisability of expending scarce resources
on its enforcement.
Second, such a provision would likely be challenged on
constitutional grounds, since it would be a content-based
restriction applicable to ``the vast democratic fora of the
Internet,'' a ``new marketplace of ideas'' that has enjoyed a
``dramatic expansion'' in the absence of significant content-
based regulation. Reno v. ACLU, 117 S. Ct. 2329, 2343, 2351
(1997). As the Court in ACLU suggested, id. at 2341
(discussing Ginsberg v. New York, 390 U.S. 629 (1968)), it
may be that Congress could, consistent with the First
Amendment, enact an Internet version of a ``variable
obscenity,'' harmful-to-minors prohibition, analogous to
state-law statutes prohibiting bookstores from displaying to
minors certain materials that are obscene as to such minors.
See, e.g., American Booksellers v. Webb, 919 F.2d 1493 (11th
Cir. 1990), cert denied, 500 U.S. 942 (1991); American
Booksellers Ass'n v. Virginia, 882 F.2d 125 (4th Cir. 1989),
cert denied, 494 U.S. 1056 (1990), Davis-Kidd Booksellers,
Inc. v. McWherter, 866 S.W.2d 520

[[Page S12797]]

(Tenn. 1993). However, it is not certain how the
constitutional analysis might be affected by adaptation of
such a scheme from the bookstore context in which it
previously has been employed to the unique media of the
Internet. Because it may be more difficult for Internet
content providers to segregate minors from adults than it is
for bookstore operators to do the same, and because the
Internet is, in the Court's words, a ``dynamic, multifaceted
category of communication'' that permits ``any person with a
phone line'' to become ``a town crier with a voice that
resonates farther than it could from any soapbox,'' ACLU, 117
S. Ct. at 2344, the Court is likely to examine very carefully
any content-based restrictions on the Internet.
The decision in ACLU suggests that the constitutionality of
an Internet-based ``harmful-to-minors'' statute likely would
depend, principally, on how difficult and expensive it would
be for persons to comply with the statute without sacrificing
their ability to convey protected expression to adults and to
minors. And the answer to that question might depend largely
on the ever-changing state of technology, the continuing
progress that the private sector makes in empowering parents
and teachers to protect minors from harmful material, and the
scope and detail of the record before Congress. In this
regard, it is notable that the COPA also would establish a
Commission (see Sec. 6) to study the ways in which the
problem could most effectively be addressed in a time of
rapidly evolving technologies. In light of the difficult
constitutional issues, we believe that Congress should wait
until the Commission has completed its study and made its
legislative recommendations before determining whether a
criminal enactment would be necessary, and if so, how such a
statute should be crafted.
Finally, the COPA as drafted contains numerous ambiguities
concerning the scope of its coverage. Such ambiguities not
only might complicate and hinder effective prosecution; they
also might ``render [the legislation] problematic for
purposes of the First Amendment,'' by ``undermin[ing] the
likelihood that the [bill] has been carefully tailored to the
congressional goal of protecting minors from potentially
harmful materials.'' ACLU, 117 S. Ct. 2344. Among the more
confusing or troubling ambiguities are the following:
``(a) While the COPA mentions that minors' access to
materials on the Internet `can frustrate parental supervision
or control' over their children, Sec. 2(1), the only
`compelling interest' that the COPA would invoke as a
justification for its prohibition is `the protection of the
physical and psychological well-being of minors by shielding
them from materials that are harmful to them,' id. Sec. 2(2).
The constitutionality of the bill would be enhanced if
Congress were to identify as the principal compelling
interest the facilitation of parents' control over their
children's upbringing, in addition to the government's
independent interest in keeping certain materials from minors
regardless of their parents' views. See, e.g., ACLU, 117 S.
Ct. at 2341 (noting that the statute in Ginsberg presented
fewer constitutional problems than the Communications Decency
Act because in the former, but not the latter, parents'
consent to, or participation in, the communication would
avoid application of the statute).
``(b) While the bill would not appear to apply to material
posted to the Web from outside the United States, that
question is not clear; and the extraterritoriality of the
prohibition might affect the efficacy and constitutionality
of the statute. See ACLU, 117 S. Ct. at 2347 n. 45.
``(c) It is unclear what difference is intended in
separately prohibiting `knowing' violations (proposed
Sec. 231(a)(1)) and `intentional' violations
(proposed ``Sec. 231(a)(2)); and there is no indication
why the two distinct penalty provisions are necessary or
desirable. Moreover, it is not clear, in subsection
(a)(1), which elements are modified by the ``knowingly''
requirement. For example, must the government prove that
the defendant knew that the communication contained the
harmful-to-minors material? That the defendant knew the
materials were, in fact, harmful to minors? Nor is it
clear what it would mean, in the context of distribution
of the targeted materials over the World Wide Web, to
violate subsection (a)(1) ``intentionally.''
``(d) Proposed Sec. 231(a)(3) would provide for civil
penalties; but that section does not indicate how such
penalties are to be imposed and enforced--e.g., who would be
responsible for bringing civil actions. In this regard, we
should note that if Congress were to eliminate criminal
penalties altogether, in favor of civil penalties, that would
improve the likelihood that the statute eventually would be
found constitutional. See, e.g., ACLU, 117 S. Ct. at 2342
(distinguishing the civil penalties upheld in the
``indecency'' statute at issue in FCC v. Pacifica Foundation,
438 U.S. 726 (1978), from the criminal penalties in the CDA).
``(e) The titles of Sec. 3 of the bill, and of proposed
Sec. 231 of Title 47, refer to materials ``sold by means of
the World Wide Web''; and yet the prohibition itself does not
appear to prohibit merely the ``sale'' of harmful material,
although it is limited to communications ``for commercial
purposes.''
``(f) One of the elements of the basic prohibition in
proposed Sec. 231(a)(1) would be that the defendant made the
communication ``without restricting access to such material
by minors pursuant to subsection (c).'' Yet subsection (c)
itself would provide that such a restriction of access is an
affirmative defense. This dual status of the ``restricting
access' factor appears to create a redundancy; at the very
least, it leaves unclear important questions regarding
burdens of proof with respect to whether a defendant
adequately restricted access.
``(g) The COPA definition of ``materials that is harmful to
minors'' would be similar to the ``variable obscenity''
state-law definitions that courts have upheld in cases (cited
above) involving restrictions on the display of certain
material to minors in bookstores. Those state statutes have,
in effect, adopted the ``obscenity as to minors'' criteria
approved in Ginsberg as modified in accordance with the
Supreme court's more recent obscenity standards announced in
Miller v. California, 413 U.S. 15, 14 (19873). But the COPA's
definition would, in several respects, be different from the
definitions typically used in those state statutes, and the
reasons for such divergence are not clear. Is the definition
intended to be coterminous with, broader, or narrower than,
the standards approved in the cases involving state-law
display statutes? The breadth and clarity of the coverage of
the COPA's ``harmful to minors'' standards could have a
significant impact on the statute's constitutionality.
``(h) Particular ambiguity infects the first of the three
criteria for ``material that is harmful to minors,'' proposed
Sec. 231(e)(6)(A). (i) The words ``that such material''
appear extraneous. (ii) It is unclear whether ``is designed
to'' is supposed to modify ``panders to,'' and, if not,
whether the ``panders to'' standard is supposed to reflect
the intended or the actual effect of the expression ``with
respect to minors.'' (iii) Which ``contemporary community
standards'' would be dispositive? Those of the judicial
district (or some other geographical ``community'') in which
the expression is ``posted''? Of the district or local
community in which the jury sits? Of some ``community'' in
cyberspace? Some other ``community''? Resolution of this
question might well affect the statute's constitutionality.
See ACLU, 117 S. Ct. at 2345 n.39.
``(i) Must the material, taken as a whole, ``lack serious
literary, artistic, political, or scientific value'' for all
minors, for some minors, or for the ``average'' or
``reasonable'' 16-year-old minor? See, e.g., American
booksellers, 919 F2d at 1504-05 (under a variable obscenity
statute, ``if any reasonable minor, including a seventeen-
year-old, would find serious value, the material is not
`harmful to minors' ''); Davis-Kidd Booksellers, 866 S.W. 2d
at 528 (same); American Booksellers Ass'n, 882 F.2d at 127
(sustaining constitutionality of a state variable obscenity
statute after state court had concluded that a book does not
satisfy the third prong of the statute if it is ``found to
have a serious literary, artistic, political or scientific
value for a legitimate minority of normal, older
adolescents'').
``(j) In the definition of ``engaged in the business''
(proposed Sec. 231(e)(2)(B)), it is not clear what is
intended by the reference to ``offering to make such
communications.'' Also unclear is the effect of the modifier
``knowingly'' in that same definition's clarification that a
person may be considered to be ``engaged in the business of
making, by means of the World Wide Web, communications for
commercial purposes that include material that is harmful to
minors only if the person knowingly causes the material that
is harmful to minors to be posted on the World Wide Web or
knowingly solicits such material to be posted on the World
Wide Web.'' Must the person know that the material is posted
on the Web? That the material is harmful to minors? That he
or she ``cause[d]'' the material to be posted?''
In addition, we have concerns with certain facets of the
proposed Commission on Online Child Protection, which would
be established under Sec. 6 of the bill. The Commission would
be composed of fourteen private persons engaged in
business, appointed in equal measures by the Speaker of
the House and the Majority Leader of the Senate, as well
as three ``ex officio'' federal officials (or their
designees): the Assistant Secretary of Commerce, the
Attorney General and the Chairman of the Federal Trade
Commission. The principal duty of the Commission, see
Sec. 6(c)(1), would be:
``. . . to conduct a study . . . to identify the
technological or other methods to help reduce success by
minors to material that is harmful to minors on the Internet,
[and] which methods, if any--
``(A) that the Commission determines meet the requirements
for use as affirmative defenses for purposes of section
231(a) . . . ; or
``(B) may be used in any other manner to help reduce such
access.''
If subsection (A) of this provision were construed to
permit or to require the Commission to ``determine,'' as a
matter of law, which methods would satisfy the affirmative
defense established in Sec. 23(c), it would violate the
constitutional separation of powers because most of the
Commission members would be appointed by congressional
officials and would not be appointed in conformity with the
Appointments Clause of the Constitution, article II, section
2, clause 2. Accordingly, we would urge deletion of the
portion of Sec. 6(c)(1) that follows the word ``Internet.''
For similar reasons, we urge deletion of Sec. 6(d)(4), which
would require the Commission, as part of the report it
submits to Congress, to describe ``the technologies or
methods identified by the study that may be used as
affirmative defenses for purposes of section 231(c) . . .''
(Even if such a delegation of responsibility to the proposed
Commission

[[Page S12798]]

were otherwise permissible, it would be unwise, in our view,
as a matter of policy to permit the Commission--in essence--
to make such determination about a criminal offense.)
Thank you for the opportunity to present our views on this
matter. The Office of Management and Budget has advised that
there is no objection from the standpoint of the
Administration's program to the presentation of this report.
Sincerely,
L. Anthony Sutin,
Acting Assistant Attorney General.
____

Harvard Law School,

Cambridge, MA, October 10, 1998.
Re H.R. 3783.

Hon. John McCain,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: I note that the Senate passed a version
of Congressman Oxley's H.R. 3783 earlier this year. On
September 11, I testified before the Subcommittee on
Telecommunications, Trade, and Consumer Protection, of the
House Committee on Commerce, at a hearing devoted to various
proposals for regulating access to material deemed ``harmful
to minors.'' Subsequent developments have convinced me that
the approach presently being considered is unconstitutional.
My view at that time, with respect to H.R. 3783, was that
while the idea of require adult IDs could in principle be
constitutional, the existing ID technologies would be
constitutionally too burdensome. Given other adult ID
technologies, the requirement (predominate in the statute)
that adult turn credit numbers over to pornographers in order
to get access to constitutionally protected speech struck me
as too great a burden.
Since my testimony, an argument by Professor Mark Lemley of
The University of Texas Law School, has strengthened my view
that there are serious constitutional problems with this
approach. Lemley proposes that rather than requiring adult
IDs, a less restrictive alternative would be a statute that
facilitated the development of kid IDs--digital certificates
that would be bound to a user's browser, but that would
simply identify the user as a minor. A law could then require
that servers with material deemed ``harmful to minors'' block
access by users with such certificates. Such certificates,
again, would reveal no information except that a user was a
minor.
Such a proposal, in my view, would be seen by a court to be
a clearly less restrictive alternative under First Amendment
jurisprudence. If so, the proposal would then render the
means proposed in H.R. 3783 unconstitutional.
While there are important details to be worked out in the
``kid IDs'' alternative, I will note one other feature that
might be of interest. If kid IDs were generally available,
then Congress could more easily require commercial sites not
to gather data from kids. As it is, any rule that commercial
sites not gather data from kids would be hard to enforce. But
if such IDs became common, these other regulatory purposes
would be more easily achieved.
If there is more information that I can provide, please let
me know.
With kind regards,
Lawrence Lessig.

Mr. HATCH. Mr. President, I suppose that it is appropriate that we
are passing this bill just a week before Halloween. It seems as though
we have spent the better part of five days trying to unmask its
provisions. And, some of the sections have been like ghosts--first you
see them, now you don't.
I confess that I share the frustration voiced by many of my
colleagues yesterday from both sides of the aisle about this extremely
unorthodox process. I suppose it is somewhat reassuring that Senators
on both sides of the aisle are similarly put off by the process because
perhaps then we will not inflict it on ourselves or the American people
next year.
Let me start with the fact that, at least technically, it is out of
order to authorize on an appropriations bill. We have from time to time
bent that rule--sometimes quite liberally. But, today, we not only bent
it, we smashed it to smithereens. I admit to having tried to amend
appropriations bills with authorizations during my tenure in the
Senate, but I am quickly coming around to the notion that we must get
back to a stricter adherence to that particular rule of the Senate.
One of the reasons for this rule, in addition to being able to
control the appropriations process, is to ensure that the authorizing
committees are not circumvented. The authorizing committees of the
Senate have developed expertise on the various policy issues we must
consider and act upon, and I believe that we do not fully carry out our
duty to citizens and taxpayers when we fail to vet thoroughly these
proposed changes in law.
I am not talking only about the Judiciary Committee, although I do
feel strongly that we could have provided constructive input. The
authorizing committees play an important role in policy development.
And, I think it is essential that we assert right here and now that
national policy is not just about money. While the appropriations
aspects of Congress' job is certainly of utmost importance, the
authorizing process shapes the programs and establishes the rules for
the expenditure of federal funds. One function is as important as the
other. I do hope that this major bypass of the authorizing committees
will not become habit-forming.
Second, we should all be concerned about the perception that this
backwards procedure--one in which we are considering conference reports
on bills that have not even passed the Senate yet--will set a precedent
for the future.
Mr. President, I hope my colleagues on both sides of the aisle will
join me in a sweeping denunciation of this as anything other than a
one-time event. We cannot consider this omnibus, catch-all, 11th hour
approach to be a model for how to extract ourselves from the dangerous
prospect of an imminent government shutdown.
And, by the term``we,'' I also include the President of the United
States. I would like to send a message to President Clinton right now.
Don't try playing this game of legislative chicken again. I may resolve
much differently.
Third, while I appreciate the effort of Senators Lott and Stevens and
others to ensure that this bill does not make permanent changes in the
budget rules or lift the budget caps we so painstakingly negotiated in
the Balanced Budget Act, the bill before us takes the unheard of step
of designating tax breaks as ``emergencies.''
While I strongly support the idea of tax relief--indeed, I have
strongly supported each one of the items in this tax package for
farmers--I am not so sure that we should be starting down the steep and
slippery slope of using the emergency designation in this way. I hope
that we will all look at this as one-of-a-kind occurrence and not as a
new procedural loophole that we continue to use in the future.
Fourth, Mr. President, I am also disappointed by the fact that we are
using a portion of the surplus to pay for additional spending. I
supported the pledge of saving the surplus for Social Security and
thought that we should move toward that goal. This bill, however,
breaks that promise.
Last January, one of the President's most memorable lines from his
State of the Union speech was ``Save Social Security first.'' In
reality, however, he has supported, practically insisted, on using that
same surplus for more government spending. I applaud Senator Lott and
Speaker Gingrich for keeping this encroachment on the surplus and
Social Security to a minimum.
I hope that during the next Congress, we can resurrect that
bipartisan spirit of fiscal integrity and responsibility we shared to
get the budget balanced in order to keep the budget balanced. If we
continue to feed the voracious appetite of big government at the trough
of the so-called surplus, we will not have that surplus for long.
If there is one thing that we should all be united in, it is
maintaining a balanced budget. This is perhaps the most important thing
that any Congress can do. It is critical for the future growth of the
U.S. economy, increases in the standard of living for our workers, and,
indeed, the very future of the country.
Mr. President, the unorthodox process is certainly one issue, but it
is not the only or even the principal issue. There are substantive
problems with this bill as well.
Let me begin with a provision that is under the jurisdiction of the
Judiciary Committee. I must speak out against inclusion of Title One of
the euphemistically entitled ``Citizens Protection Act.'' This ill-
advised provision passed the House as an amendment to the House
Commerce, State, Justice Appropriations bill but it never passed the
Senate. Indeed, it has been opposed by a bipartisan majority of the
Senate Judiciary Committee. Under the guise of setting ethical
standards for federal prosecutors and other attorneys for the
government, it will severely hamper the ability of the Department of
Justice to enforce federal law and cede authority to regulate the
practice of law by federal prosecutors in our federal courts to more
than fifty state bar associations. Indeed, this provision alone

[[Page S12799]]

caused me to consider voting against this conference report.

The sponsor of this measure is Representative Joe McDade, a man who,
by all accounts, was wrongly prosecuted by zealous federal prosecutors
and who has been vindicated. I have great respect for Representative
McDade and sympathy for the objectives he seeks to protect.
Many in Congress and citizens around the country have been, at one
time or another, the subject of unfounded ethical or legal charges. No
one wants more than I to ensure that all federal prosecutors are held
to the highest ethical standards. That is why the Judiciary Committee
staff met with Congressman McDade and his staff. That is why we
proposed a more narrow, workable version of his ethics amendment. That
is why I proposed that we establish a Commission to investigate alleged
cases of wrongdoing by federal prosecutors and to make recommendations
to Congress.
Unfortunately, the House Leadership and others did not accept my
proposal. Instead, I fear that, in a understandable desire to redeem
those who have been wronged by zealous prosecutors, we have included a
provision which is far too broad.
In its most relevant part, the so-called McDade provision states that
an ``attorney for the government shall be subject to State laws and
rules . . . governing attorneys in each state where such attorney
engages in that attorney's duties, to the same extent and in the same
manner as other attorneys in that state.'' This may sound innocuous,
until one realizes why state laws and rules governing the conduct of
attorneys exist in the first place--to protect the integrity of the
civil and criminal legal systems in the state and govern the practice
of law in the courts of that state. It is this very purpose which makes
inappropriate the blanket application to federal attorneys in federal
court of all state bar rules.
The federal government has a responsibility and the legitimate lead
role in the investigation and prosecution of complex multistate
terrorism, drug, fraud or organized crime conspiracies, or in rooting
out and punishing fraud against federally funded programs such as
Medicare, Medicaid, and Social Security. It is in these very cases that
the McDade provision will have its most pernicious effect.
Federal attorneys investigating and prosecuting these cases, which
frequently encompass three, four, or five states, will be subject to
the differing state and local rules of each of those states, plus the
District of Columbia, if they are based here. Their decisions will be
subject to review by the bar and ethics review boards in each of these
states at the whim of defense counsel, even if the federal attorney is
not licensed in that state. Practices concerning contact with
unrepresented persons or the conduct of matters before a grand jury,
perfectly legal and acceptable in federal courts, will be subject to
state bar review and, as a result, could put an end to some undercover,
federal investigations. And the very integrity and success of sensitive
investigations could be compromised by the release of information
during the course of these reviews. This provision is also an open
invitation to clever defense attorneys to stymie federal criminal or
civil investigations by bringing frivolous state bar claims.
Mr. President, the McDade provision is opposed by Attorney General
Reno and by the Administration. It is opposed by a bipartisan group of
six former Attorneys General of the United States from the Nixon,
Carter, Reagan and Bush administrations. It is opposed by the Director
of the FBI, the Administrator of the Drug Enforcement Administration,
and the Director of the Office of National Drug Control Policy. It is
opposed by law enforcement organizations such as the Fraternal Order of
Police, the National Sheriffs Association, the National District
Attorneys Association and the Federal Criminal Investigators
Association. The National Victims Center opposes it on behalf of the
victims of crime. And this provision is vigorously opposed by an
overwhelming bipartisan majority of the Senate Judiciary Committee, the
committee with jurisdiction over this matter. The Committee's Ranking
Member Senator Leahy has opposed this provision. Former Committee
Chairmen Senators Kennedy and Thurmond, and Committee members Senators
Sessions, Kohl, DeWine, Durbin, Abraham, Feingold, Thompson, and
Feinstein have also written in opposition.
I would note, however, that in response to our concerns, the
Leadership has inserted a provision which will delay the implementation
of this provision for six months. At the very least, this will give the
Department of Justice and others the opportunity to educate the
Congress as to the serious effect this blanket provision will have on
law enforcement. It is my hope and expectation that, during the next
six months, we will be able to develop a more workable and effective
solution.
In addition, the so-called 100,000 Teachers program so trumpeted by
President Clinton will do virtually nothing for Utah. As if the concept
of this teacher hiring program would be any more effective than the
100,000 cops program, we are appropriating $1.2 billion at the
insistence of President Clinton and under threat of government
shutdown.
Well, Mr. President, Utah is continually disadvantaged by the use of
the Title I funding formula, which is how this money will be
predominantly allocated among the states. Under this formula, we are
year after year punished for our demographics. We will be lucky to eke
enough out of this grant to hire a handful of teachers per district.
And, the irony is that Utah ranks among those states with the highest
average class sizes. This program claims reduction of class size to be
its raison d'etre. I think not.
Furthermore, Mr. President, the President had an opportunity to
reward states that were taxing themselves heavily for education and
that were addressing the needs of poorer and rural school districts
with state funds. Did he support an appropriation for the effort and
equity component of the Title I formula? No, he did not.
And, what happened to ed-flex, one of the more innovative, albeit
common sense, educational reforms we have seen in recent years? We are
told the President would have vetoed the bill with the ed-flex
provisions in it. I find myself resentful that I am in the position of
being grateful for the limited flexibility that has been incorporated
into the Teacher program.

I do not mean to cast any aspersions on my colleagues, who I know
worked very hard to keep some local control in this program and who
support educational flexibility as much as I do.
But, I ask President Clinton: What is your problem with giving states
and local school districts some authority to make decisions about
resource allocation? Are you afraid that the state or the locally
elected boards of education may have a different priority than you do?
I am most annoyed at this lost opportunity to give states and local
school districts some unrestricted federal assistance. There is no
question in my mind that Utah could stretch the impact of federal help
much further if given the freedom to make these determinations and to
pool resources more effectively.
In view of all of this, some have suggested that I vote against this
bill. I will say that on the basis of a few of these provisions, I was
tempted to do so.
But, there are also some very worthy provisions in the bill which
mitigate its poorer aspects.
For example, I am pleased that the tax extenders package is included
in this bill. Despite my dislike for the idea of inserting a tax bill
in an appropriations bill, I am glad we are getting this done. These
tax provisions should not be allowed to expire; in fact, we ought to be
making them permanent so we would not have to face this annual
expiration crisis.
I am particularly pleased that the bill accelerates the deduction for
health insurance premiums for self-employed people. It is about time we
gave entrepreneurs a break on this.
I support the funding of the empowerment zones. This program is a
powerful tool for revitalizing our urban areas; and I appreciate the
fact that much of it is private sector driven.
Of course, the Interior Department appropriation, which is contained
in the Omnibus bill, is critical to Utah. It contains funds for
Washington County's desert tortoise habitat conservation program; the
Bonneville Shoreline

[[Page S12800]]

Trail; program development and facility construction at the Grand
Staircase-Escalante National Monument; and a prohibition on funds to
study draining Lake Powell or decommissioning the Glen Canyon dam.
While I am critical of the Administration's educational priorities, I
support the additional funds for IDEA and Impact Aid. Utah, because of
our heavy concentration of federal installations, will benefit from
this sizable boost in Impact Aid.
I am sincerely grateful to my colleagues on the Appropriations
Committee and in the leadership for their attention to the pressing
transportation needs in Utah as well as to the planning that is
underway for security at the 2002 Winter Olympic Games.
Staging this event is going to require a state-of-the-art
transportation system, including intermodel centers, light rail, an
adequate fleet of buses, and intelligent transportation systems. This
appropriation will give Utah the ability to move ahead in these areas.
Additonally, I am extremely worried about our defense. We have
alarming reports that entire air squadrons are grounded for lack of
spare parts to keep planes in the air. We are told that junior officers
and experienced non-commissioned officers are packing up and leaving
the service, creating manpower and staffing problems in every branch of
the military.
Military readiness backs up diplomacy. The latter cannot succeed
without the former. We simply must stop using the defense budget like a
bank we can go to for spending offsets when we want them. We are
risking our nation's strength and ability to influence outcomes
throughout the world. And, what is more, if we do not properly maintain
equipment, if we do not invest in new technologies, if we do not
provide adequate housing and medical care, we do not honor our men and
women in uniform.
This bill begins the process of recognizing the importance of
reinvesting in defense. I support the supplemental spending in this
bill for defense, particularly the emphasis on readiness and personnel.
Some defense funds are also directed toward drug interdiction
efforts. This is one of several positive actions taken in this bill to
fight the war on drugs. Drugs are poisoning our society, particularly
our children. Drugs contribute to a variety of other crimes, including
murders and robberies. We must not give up trying to eradicate this
cancer from our communities, and I applaud the addition of these anti-
drug measures to this bill.
I remember when, more than a year ago, Speaker Gingrich, Congressman
Hastert, and I met to discuss how we might force this Administration to
focus on the worsening drug problem. We decided that we needed to
undertake a comprehensive, bicameral effort. And so we did. We met with
the Administration, held numerous hearings, and worked in a cooperative
manner, extending our hands across the Capitol in a united effort to do
what's best for our children.
I am pleased to say that our efforts have led to some success. A
number of these important provisions were produced and considered by
the Senate Judiciary Committee. I want to express my pleasure with the
decision to include my proposal to reauthorize the Office of National
Drug Control Policy. As well, I am pleased that we were able to include
the Drug Demand Reduction Act, a measure sponsored by Congressman
Portman in the House. I was pleased to work with Congressman Portman on
getting this measure considered and put in a form which would pass the
Senate. In fact, I recently introduced the Senate companion measure.
For all of those involved in the effort to include this important,
comprehensive anti-drug package in the bill--Speaker Gingrich; Senators
Coverdell, Grassley, and DeWine; and Congressmen Hastert, McCollum,
Portman and others--I want to express my congratulations and thanks.

Mr. President, let me conclude by saying that although there are some
very ligitimate things to complain about regarding the bill--and
process is one of them--we must recognize as well as the bill is a
compromise. And, a compromise by definition means that neither side
gets everything it wants.
If I were king, would I have put forward this bill? Certainly not.
But, I am not king, and neither is Senator Lott nor Senator Stevens.
Neither is President Clinton nor Representative Gephardt.
The stakes in this negotiation were particularly high. We were in a
situation in which we were faced with an imminent shutdown of the
federal government and all of the confusion, disruption, and
dislocation that entails. So, when asked by pundits why the Republicans
did not hold firm on a key issue like redirecting $1.2 billion in
educational assistance to states and local schools with fewer strings
attached, the answer is not difficult. Because in our system of checks
and balances, the President has the veto pen.
Had we engaged in a war of wills, we could have held out for a
perfect version of this educational component--a more perfect version
of the entire appropriation--but the result would not necessarily be
good for the country. Maybe some day, the American people will reward
Republicans for being better statesmen than they are politicians.
Instead we negotiated a bill that is, indeed, a compromise. There are
beneficial elements to it. It is not all bad. I would like to commend
the Majority Leader, Senator Lott, and Speaker Gingrich for their
efforts on this bill. Faced with a situation in which we could not act
on the regular appropriations bills individually, as we would all have
preferred, he steered us through this negotiation in the best manner he
could. He deserves great credit, and he deserves our support.
How we ended up in this situation has already been addressed by
several members on this side of aisle. Suffice it to say that it should
not be necessary to file cloture petitions on appropriations bill; it
should not be necessary to debate nongermane amendments ad infinitem.
But, regardless of how we ended up here, we have made the best of it,
and, I believe, have finally delivered a reasonable appropriations
package.
It is always easier to criticize a compromise than it is to carve one
out of disparate views and agendas. I have had some experience in this.
I have often been criticized for a result that was not viewed as
perfect or politically advantageous, even if it was fair or worthwhile.
This omnibus appropriation is not perfect. I dare say the Majority
Leader would not say it is perfect. But, it is fair, and it is
worthwhile. It is worthwhile because of the components I believe merit
support, some of which I have advocated for years. It is also
worthwhile because it will relieve the American taxpayers of the dread
and uncertainty that the government will shutdown and of their anger
and frustration that their government still doesn't get it.
It is worthwhile, I believe, because it is time to put the country
first--ahead of the ``wag the dog'' diversionary strategy and ahead of
seeking partisan advantage on election day.
Therefore, I will vote for this omnibus appropriations bill.

washington state's use of the word ``olympic''

Mr. GORTON. Mr. President, a small but important element of the
Omnibus appropriations measure is the Olympic and Amateur Sports Act
Amendments of 1998, and more specifically, a provision within this Act
that recognizes that Washington state's claim to the name ``Olympic''
is both first in time, and first in right over the claim of the United
States Olympic Committee.
Vital geographic features that dominate and define the State of
Washington, Mount Olympus in the Olympic Mountain range, within the
Olympic National Forest on the massive Olympic Peninsula, were named
long before Congress chartered the USOC and permitted it to use the
word ``Olympic'' to raise money to support the Olympic games and
encourage the USOC's activities. In an opinion interpreting the current
statute, the United States Supreme Court noted that it was fair for
Congress to allow the USOC to receive the benefit of its efforts to
promote and distinguish the word ``Olympic.'' In the same vein,
however, where the use of the word ``Olympic'' has geographical
significance that pre-dates and is independent of the USOC, it is only
fair that the USOC not be able to interfere with this use.
Although there are relatively few instances in which the USOC, crying

[[Page S12801]]

``mine, mine, mine,'' has gone after any of the thousands of businesses
in Washington state that use the word ``Olympic,'' the attitude that
the USOC has displayed in these few instances demands correction. I
would like to thank State Representative Jim Buck for bringing them to
my attention. I am as much a sports enthusiast as the next person, and
it has never been my intent to undermine the USOC's ability to raise
money through licensing. The USOC remains a creature of Congress,
however, and it is incumbent on us to prescribe reasonable limits--to
remind the Committee that its privilege to the use of the word
``Olympic'' is not absolute, and is secondary, for example, to the
rights of geographic reference on the part of Washington state
businesses. The provision that I have included in the Amateur Sports
Act serves as a statutory admonition that the USOC must share the word
``Olympic''.
The need for a reasonable restriction on the USOC, which I believe
this bill contains, is widely recognized in Washington state. On
September 25, The News Tribune wrote that we have ``produced a
reasonable and narrow compromise that will protect Washington
businesses and protect the USOC's legitimate concerns.'' The Seattle
Times concurred when it urged the Olympic Committee members to ``get
over their Olympic-sized egos and support this modest and sensible
tweaking of the law.''
Having just chastised the USOC for its past abuses, let me say that I
am heartened by the assurances and commitments the Committee made
during discussion of my amendment, assurances that the past abuses were
anomalous and inconsistent with USOC policy, and commitments that the
USOC will not abuse its privileges with respect to the use of the word
``Olympic.'' I trust the Committee will live up to its promise to rein
in its organizing committees and other affiliated entities' overzealous
pursuit of businesses using the name ``Olympic,'' even when there is no
likelihood that such use will be confused with the Olympic games or
activities of the USOC.
The language in the omnibus bill is narrower than what I had included
in the bill that passed the Commerce Committee. The ``safe harbor''
created for Washington as a subterfuge to obtain immunity from USOC
action, then quickly extend their business, goods, or services to other
locations, such as Salt Lake City, the site of the next Winter
Olympics, with the intent of capitalizing on the games.
To allay the USOC's concerns, the final language creates a clear safe
harbor for businesses using the word ``Olympic'' when they operate and
conduct most of their sales and marketing west of the Cascades. This
safe harbor will remove the threat that hangs over the thousands of
businesses in Western Washington--the threat that the USOC will deprive
them of the ability to continue to use the word ``Olympic.''
Henceforth, Olympic Cleaners in Kirkland, Olympic Auto Sales in Kent,
Olympic Golf Repair in Port Angeles, Olympic Ambulance in Sequim, as
well as thousands of other businesses in Washington, can rest assured
that a creature of the Federal government, the USOC, won't come
knocking to collect, not only their taxes, but their name.
Finally, I point out that the language is silent about what happens
if the business using the word ``Olympic'' substantially extends its
operations, sales, and marketing beyond Western Washington. It
certainly is not the intent of Congress to place Washington businesses
using the word ``Olympic,'' in a geographical cage that constrains
their growth so long as the operations of these Washington businesses
do not wrongfully capitalize on the work of the USOC by confusing
people into making an association with the Olympic games, and not the
Olympic Mountain range, Olympic Peninsula, or other geographic
features. No court should infer that, in creating the safe harbor for
businesses in Western Washington, Congress intended in any way to
affect the current law with respect to businesses operating outside of
this area. We did not.

The North Pacific Pollock Fishery

Mr. GORTON. Mr. President, after threatening to filibuster an
appropriations measure over provisions relating to S. 1221, the
American Fisheries Act, I now want to emphasize my support of the
substitute version of the American Fisheries Act that has been included
in this mammoth bill.
It has been an unexpected privilege and a pleasure to work with, as
opposed to against, the Senior Senator from Alaska and his staff on
legislation affecting the allocation and management of pollock in the
North Pacific. Together, we have crafted a substitute measure designed
to achieve the goals of his original legislation, which aimed to
Americanize and decapitalize the North Pacific pollock fishery. Not
only is this substitute, in my view, fundamentally more fair than the
original S. 1221, it is considerably better in that it allows for new
methods of managing the largest fishery in the United States, methods
that promise to end the race for fish and to ensure that the
decapitalization is permanent.
Americanization, decapitalization, and rationalization. These were
the three things most participants in the pollock fishery said that
they wanted from legislation when I convened an industry meeting in
Seattle during the August recess. To these goals, I added my own: no
summary elimination of foreign-controlled vessels without compensation,
and the protection of independent pollock harvesters and processors.
Due largely to the perseverance of Senator Stevens, the consensus
that eluded the pollock industry in August was reached a month later.
The basic elements of the September accord called for increasing the
U.S. ownership and control requirements for all fishing vessels;
arranging for the buy out by the onshore sector of a significant
portion of the pollock catch and of nine Norwegian-controlled vessels;
limiting the amount of fish that any one company can harvest and
process; and laying the groundwork for a new management scheme to
eliminate the race for fish by limiting participants in the pollock
fishery and permitting these participants to decide in advance how to
divide the resource.
Translating the agreement-in-concept into legislation in the few
weeks that remained in this Congress was a tremendous challenge. A
myriad of questions arose, and we attempted to answer them as best we
could with input from the participants in the pollock and other
fisheries, state officials, North Pacific Fishery Management Council
members, the National Marine Fisheries Service, the U.S. Coast Guard,
the Maritime Administration, Community Development Quota
representatives, and others.
As we progressed through various drafts of the legislation, we tried
to anticipate and address issues like how to require and enforce
greater U.S. ownership and control of fishing vessels without
disrupting existing and future financing arrangements; the effects of
the transfer of fish from the offshore sector on the product mix;
ensuring that catcher vessels have sufficient input into the formation
and conduct of fishery cooperatives; preventing the vessels being
removed from the U.S. Exclusive Economic Zone from contributing to
overcapacity in other fisheries; and many, many others.
One of the most difficult issues is how to protect participants in
other fisheries from possible adverse effects of ending the race for
pollock. Crabbers and other groundfish fishers are concerned that
pollock fishers who participate in cooperatives will spend more time
and effort in other, already overcapitalized, fisheries. After
considering various legislative proposals to limit effort in other
fisheries, I believe we made the right choice to leave this task to the
regional councils. Because the measures to end the race for fish in the
onshore and mothership sectors will not go into effect until 2000, we
delegated to the North Pacific and the Pacific Fishery Management
Councils the responsibility of ensuring that the new cooperative
management regime provided for in this legislation does not
decapitalize and rationalize the pollock fishery at the cost of further
overcapitalizing other fisheries. For the offshore sector, which we
anticipate will form cooperatives and stop racing for fish in 1999,
before the regional management councils have an opportunity to impose
restrictions on these vessels, we prescribed limits on participation in
other fisheries.
One of the questions for which we could not get a definitive answer
is whether we have appropriated enough

[[Page S12802]]

money to cover the cost of the loan that will be used for the vessel
buy out. A critical element of this bill is the purchase of nine
pollock catcher processor vessels and their pollock fishing history. In
exchange for being allocated significantly more fish, and permanently
eliminating these nine vessels from all U.S. fisheries, the onshore
pollock sector has agreed to pay $75 million to the vessel owners. This
$75 million will be advanced as a loan by the federal government, and
repaid to the federal government by the onshore sector over a long
period of time. This $75 million payment from the onshore sector to the
offshore sector is supplemented in this bill by a $20 million federal
appropriation, so that the total payment to the offshore catcher
processors is $95 million. Of this amount, $90 million is to be paid to
the owners of the nine catcher processors being excluded. The
additional $5 million is to be paid to the catcher processors whose
allocation is reduced even though their vessels are not removed.
Because the nine vessels are to be excluded and the allocation to
catcher processors to be reduced on January 1, 1999, we have provided
that the buy out payments to the owners and the catcher processors be
made before the end of 1998. To do this, we have appropriated the $20
million federal share of the buy out, and an additional $750,000 for
the cost of the direct loan of $75 million. The $750,000 is one percent
of the loan amount, and is the amount that both NMFS and the Office of
Management and Budget believe is enough to cover the cost of the $75
million loan. Because this type loan is unprecedented, however, OMB has
been unable to say with absolute certainty that $750,000 is the correct
amount.
If OMB determines that $750,000 is insufficient to cover the cost of
the $75 million loan, we expect OMB and NMFS to inform us of this
immediately, and to immediately secure sufficient funds to cover the
cost of a direct loan of $75 million so that $90 million can be paid to
the owners of the nine excluded vessels before the end of this year.
These funds can be secured by reprogramming part of the $6 million
provided to NMFS to carry out the provisions of this Act.
Another question that has arisen recently involves the interpertation
of the section that allows offshore catcher vessels to catch 8.5
percent of the pollock allocation reserved for these catcher boats and
specified catcher processors. We included this section to ensure that
the catcher boats delivering to catcher processors were not squeezed
out of the sector. We anticipated that the fish caught by these catcher
vessels would be delivered for processing only to the twenty catcher
processors named in the bill as eligible to participate in the offshore
pollock fishery and eligible to participate in a cooperative, and we
did not intend for these catcher vessels to be able to increase the
pollock processing capacity by delivering their catch to catcher
processors other than the 20 listed vessels.
But just as we did not have a definitive answer to the question of
the cost of the loan guarantee, we did not have answers to many of the
questions that arose from this proposal that so dramatically changes
the operation of the largest fishery in the United States: we will rely
heavily on the expertise of the North Pacific Fishery Management
Council and of NMFS, to flesh out many of the details of this truly
revolutionary legislation. Even without all of the answers, however, I
believe that we made the right decision to seize a unique opportunity
to Americanize, decapitalize, and rationalize this fishery, and, at
long last, bring peace to an industry whose internecine battles over
the years have led to the inefficient operation of the pollock fishery
and caused a rift between Washington and Alaska.

The Montana Fish and Wildlife Conservation Act of 1998

Mr. BAUCUS. Mr. President, I rise to speak in support of Title X of
the FY 1999 Omnibus Appropriations bill. I drafted this provision as a
substitute amendment to S. 1913, the Montana Fish and Wildlife
Conservation Act of 1998, a bill that I sponsored and Senator Burns
from Montana co-sponsored. I am pleased that this provision has been
included in the Omnibus Appropriations bill.
As amended, the Montana Fish and Wildlife Conservation Act of 1998
(now Title X) creates an exciting opportunity to exchange lands at
Canyon Ferry Reservoir for other lands in Montana to conserve fish and
wildlife, enhance public hunting, fishing, and recreational
opportunities, and improve public access to public lands.
Mr. President, I would like to take a moment to thank my good friends
and colleagues from Montana--Senator Burns and Congressman Hill.
Together, we have worked long hours on this project. We certainly would
not be where we are today if not for this team effort. I would also
like to take a moment to thank their staffs as well--especially Leo
Giacometto, Ric Molen and Ryan Thomas from Senator Burns' office and
Mark Baker and Kiel Weaver from Congressman Hill's office. These staff
members have logged long hours on this project and this accomplishment
belongs as much to them as to anyone.

Legislative History

So that there will be no question as to the origins of this
provision, let me provide a brief history of this legislation. On April
2, 1998, I introduced S. 1913, the Montana Fish and Wildlife
Conservation Act of 1998. Senator Burns joined me as a co-sponsor of
this legislation. This bill, like Title X of the Omnibus Appropriations
bill, proposed to exchange 265 cabin sites at Canyon Ferry Reservoir
for public lands elsewhere in the state. Like the adopted provision, S.
1913 proposed to accomplish this exchange through the use of a
permanent trust that would hold the proceeds of the cabin site sale
pending acquisition of other lands.
While S. 1913 actually created two trust funds (one for local land
acquisitions and one for land acquisitions elsewhere in Montana), Title
X to the Omnibus bill simplifies this arrangement by creating one land
acquisition trust, but then specifying that no more than 50% of the
proceeds from this trust can be used outside of the local area in any
given year. This trust arrangement is set forth in Section 1007 of
Title X.
On May 3, 1998, I held an Environment and Public Works Committee
field hearing on S. 1913 in Helena, Montana. That hearing was attended
by over 200 cabin owners and sportsmen--all of whom overwhelmingly
supported the Montana Fish and Wildlife Conservation Act of 1998.
On May 22, 1998, Congressman Hill from Montana introduced a related
piece of legislation in the House. Like S. 1913, H.R. 3963 established
a mechanism for the sale of the 265 cabin sites. Unlike S. 1913, H.R.
3963 made no provision for the use of the proceeds from this sale.
Between May and August of 1998, these two bills received substantial
attention in Montana. In early August, the Montana delegation sat down
to craft a consensus bill. By mid-August, we had reached agreement in
principle on a substitute amendment for S. 1913.
Under our agreement, we would use the land trust idea encompassed in
S. 1913, but would add two provisions to provide additional benefits to
Broadwater County, Montana. These provisions (sections 1005 and 1008 of
Title X) are designed to improve recreational opportunities in
Broadwater County, without diverting any of the cabin site revenues
away from the land acquisition trust.
After drafting legislative language to encompass this agreement in
principle, I then sat down with Administration officials to gain their
support for this legislation. In response to concerns voiced by
Department of Interior officials and others in the Administration, I
made a number of substantive changes to this bill. One of these changes
was to add section 1009 of Title X to clarify the Bureau of
Reclamation's authority to improve public recreation and to conserve
wildlife at Canyon Ferry Reservoir.
On October 10, 1998 after I revised the legislation to respond to the
concerns of the Administration, Jack Lew, Director of the White House
Office of Management and Budget, wrote to express the Administration's
support for this new bill. Mr. Lew wrote: ``as amended, S. 1913 creates
a unique opportunity to exchange lands at Canyon Ferry Reservoir for
other lands in the state to conserve fish and wildlife, enhance public
hunting, fishing, and recreational opportunities, and improve public
access to public lands.'' Mr. President, I ask that the entire text of

[[Page S12803]]

the OMB letter of support be printed in the Congressional Record
following this statement.
The PRESIDING OFFICER. Without objection, it is so ordered,
(See Exhibit 1.)
Mr. BAUCUS. Soon after reaching an agreement with the Administration
on final bill language for a substitute to S. 1913, the House and
Senate Appropriations Committees agreed to include this Act as Title X
of the FY1999 Omnibus Appropriations bill.

Provisions of Title X

Title X grew out of a decision made by the Bureau of Reclamation in
the late 1950s, soon after Canyon Ferry dam was completed near Helena,
Montana. It was at that time that the Bureau decided to lease 265 cabin
sites on the north end of Canyon Ferry Reservoir to local families. As
conditions of their leases, the Bureau required the families to build
and maintain cabins on these sites. In the intervening forty years,
many of these cabins have been expanded into full fledged houses, with
yards, driveways and carports.
Mr. President, there are many things that the federal government does
well. I'm not sure that being a landlord is one of them. This intensive
concentration of cabin sites has led to on-going conflicts between the
Bureau and the cabin owners. Most recently, these conflicts escalated
when the Bureau moved to raise rental rates for these cabin sites by as
much as 300 percent. From the cabin owner's perspectives, this is an
inequitable situation. They have invested time and money in these sites
and yet live with the constant worry that their leases will be
terminated and their cabin sites taken away.

To resolve these conflicts, Title X directs the Secretary of Interior
to sell the 265 cabin sites at Canyon Ferry Reservoir in Montana in one
transaction to the highest bidder. The minimum bid for this transaction
is set at the fair market value of all 265 sites, appraised
individually using standard federal appraisal procedures.
I would like to note that, while the appraisal process for rental
rates has been a point of contention between the cabin owners and the
Bureau of Reclamation in the past, recently these two parties reached
an accord for completing a joint appraisal for the purposes of setting
rental rates. I applaud this cooperation and expect that the Bureau
will continue this agreement and this cooperation in appraising these
sites for the purposes of this bill.
Title X contains protections to ensure that each cabin owner has an
option to purchase their site from the highest bidder and to protect
the existing lease rights of each cabin owner. At the same time, Title
X contains ample protections to ensure that the public gets a fair deal
too.
Mr. President, the Bureau of Reclamation, the U.S. Forest Service,
and other federal agencies lease cabin sites across the West. I would
not want to suggest that the solution contained in Title X is
appropriate in each case where cabin owners have conflicts with the
federal government. To the contrary, I believe that the Canyon Ferry
situation is unique in a number of respects.
First, these are not isolated cabin sites around which the public and
wildlife can move freely. At Canyon Ferry Reservoir, there are 265
cabin sites arranged in tight clusters. This is one of the largest
concentrations of residences on public lands in the West. This tight
pattern of development dramatically lowers the value of these sites to
the general public and largely precludes the use of the area by
wildlife.
Second, in this case, the lessees were required to make improvements
to their property and, in many cases, have gone so far as to build
houses on these sites. Many of these houses have now become primary
residences for local families. Though the federal government leases
cabin sites across the West, few are occupied by families living year-
round in their homes.
Even under circumstances such as these, however, I do not believe
that the federal government should support the sale of cabin sites. Mr.
President, as a matter of principle, I am opposed to the sale of public
lands. I believe that the sale of public lands threatens to establish a
dangerous precedent that, over time, could erode our public lands
heritage.
Let me be clear though--I am not opposed to trading lands with low
value to the general public for lands that are important for fish and
wildlife conservation or that are more accessible to the public.
Across the West, the federal government has recognized that land
exchanges can be useful tools to allow the government to trade out of
lands that have low values for the general public in order to acquire
lands that are more accessible to the public or that are more important
for fish and wildlife. Just this year, Congress approved S.1719 to
complete the Gallatin Land Exchange near Bozeman. I was the primary
sponsor of that bill in the Senate and can say first hand that
legislation produced enormous benefits for the public.
I modeled the Montana Fish and Wildlife Conservation Act after this
and other land exchanges to ensure that our public land heritage is not
eroded and to try to improve our public lands holdings.
Because public lands are important to Montanans and, indeed, to all
Americans. We take our children fishing on these lands. They're where
we hunt, hike, and recreate. We take our families out for picnics at
the local Forest Service campground and we ride our horses in the high
alpine meadows. These lands serve as the backdrop for our homes and our
communities. Mr. President, you might say that I'm a big fan of public
lands, and that's why this bill is so important to me.
Title X directs the Secretary of Interior to sell 265 cabin sites at
Canyon Ferry Reservoir in Montana. The proceeds from this sale are then
placed into a new trust called ``The Montana Fish and Wildlife
Conservation Trust.''
Title X very explicitly specifies the appropriate uses of the
proceeds from this trust. The Act states that the trust is to ``provide
a permanent source of funding to acquire publicly accessible land and
interests in land, including easements and conservation easements, in
the State from willing sellers at fair market value to: a) restore and
conserve fisheries habitat, including riparian habitat; b) restore and
conserve wildlife habitat; c) enhance public hunting, fishing, and
recreational opportunities; and d) improve public access to public
lands.''
Mr. President, these provisions are very important. First, this trust
is dedicated to acquisition of land and interests in land in Montana.
The land-for-land concept is a critical component of this Act. To
reiterate, this bill has been modeled after other land exchanges. By
using the intermediary step of a trust, however, we have created a new
breed of land exchange known as a ``bifurcated'' or ``land-trust''
exchange. It is my belief that this tool, by functioning as a permanent
source of funding, and by allowing for more targeted acquisitions over
time, may have benefits not found in the traditional land exchange
process.
In commenting on an early debate over this provision, the Helena
Independent Record noted on July 9, 1998:

The problem here is the ideological question of public
land, of which they aren't making any more. While some feel
that almost any public land would be more productive in
private hands, backers of Baucus' bill believe that a public
land value should be sold off only in return for an equal
land value--not marinas or roads or other things that can,
after all, be funded in other ways.

Just as it is perfectly all right for the Forest Service to
trade off checkerboard landholdings, as long as the public
receives equal value, so selling the Canyon Ferry lease
sites is acceptable--so long as equal value land values
are received in return. . . . That's why it is the Senate
version that should be enacted into law.

Mr. President, I agree with this statement and endorse very strongly
the land-for-land concept embodied in this bill.
Second, it is important to note that the bill language makes clear
that this land trust is dedicated to the conservation and public
enjoyment of Montana's fish and wildlife resources. The title of S.1913
and the purposes of Title X emphasize that this trust is established to
promote fish and wildlife conservation. Similarly, the title of the
trust itself and the requirement in section 1007(c)(3)(B) that the
members of the citizen advisory board have a dedicated commitment to
fish and wildlife conservation should leave no question of the goals
that we are trying to achieve with this legislation.

[[Page S12804]]

While the trust may be used to acquire land and interests in land to
improve recreation and access to public lands, it is the intent of this
bill that the recreation and access provisions should be complimentary
to, not contradictory with, the purposes of fish and wildlife
conservation. Toward that end, it is my expectation that the members of
the citizen advisory board will recommend, and members of the federal-
state agency board will request, expenditures from this trust that meet
both the letter and spirit of this important bill. It is also the
intent of this legislation that, under section 1007(e), lands acquired
under this substitute amendment will be managed in a manner that
promotes fish and wildlife conservation.
Because the land-for-land and conservation principles are so
critical, this bill establishes a management framework for this trust
designed to ensure that the trust is as effective as possible. The
permanent trust is to be managed by a trust manager who is responsible
for investing the corpus of the trust and for ensuring that the
proceeds from the trust are dispersed only in accordance with the terms
of the bill.
Requests for dispersal must be submitted by a five-member board
consisting of representatives of the U.S. Forest Service, Bureau of
Land Management, Bureau of Reclamation, U.S. Fish and Wildlife Service,
and the Montana Department of Fish, Wildlife, and Parks. The federal-
state agency board is directed to ensure that any requests for
dispersal will meet the purposes of the trust. The bill intends that
the federal-state agency board will base its decisions regarding
expenditures from this trust on the trust plan compiled by a four-
member citizen advisory board.
The citizen advisory board contains a representative from a Montana
organization representing agricultural landowners, a Montana
organization representing hunters, a Montana organization representing
fishermen, and a Montana nonprofit land trust or environmental
organization. Each of these members is to have a demonstrated
commitment to improving public access to public lands and to fish and
wildlife conservation.
Mr. President, this citizen advisory board is integral to the proper
functioning of this legislation. It is my intent that this group of
citizens should play a very active role in identifying critical
properties for acquisition and in setting the priorities of this trust.
Because this trust is intended to supplement, not supplant, regular
Land and Water Conservation Fund expenditures, I do not expect that the
federal agencies' priority list for LWCF expenditures will govern the
expenditures from this trust.
Rather, it is the intent of this legislation that the citizen
advisory board will take an independent look at land acquisition needs
in Montana as they craft and update the trust plan. The legislation
intends that the federal-state agency board will rely heavily on
direction set by the citizen group and the trust plan and contemplates
that the two boards will work hand-in-hand together. The legislation
also requires the trust manager to consult with the citizen advisory
board to ensure that expenditures from the trust are strictly limited
to those authorized by this legislation.
Mr. President, I would also like to take a moment to comment on a
number of additional provisions in this substitute amendment. First,
section 1004(b)(3)(C) provides that restrictive covenants will be
placed on deeds to the cabin sites at the time of transfer to ensure
the maintenance of both existing and adequate public access to and
along the shoreline of Canyon Ferry Reservoir and to restrict future
uses of these properties to the ``type and intensity of uses in
existence on the date of enactment of this Act, as limited by the
prohibitions contained in the annual operating plan of the Bureau of
Reclamation for the Reservoir in effect on October 1, 1998.''
These provisions were very important to the Administration to ensure
that the privatization of these sites does not diminish the values of
adjacent public lands. It is important that lands acquired in an
exchange have public values at least equal to those traded away. It is
equally important to ensure that the lands that are traded out of the
federal estate do not compromise the values of adjacent public or
private lands. I would also like to note the distinction between
protecting ``existing'' and ensuring ``adequate'' access. These
provisions were added to ensure that the public continues to have
access to and along the shore of Canyon Ferry Reservoir and, where
access is not currently adequate, to ensure that such access is
improved.
I want to note, however, that the historical use restriction is not
intended to require cabin owners to remove or modify structures that
were in existence on the date of this Act. As noted in the letter from
OMB that I mentioned earlier, this provision ensures that subsequent
owners of these properties will ``preserve the existing character of
this area.'' Quite simply, it is the intent of this bill that this area
should not be turned into another Lake Tahoe Resort. However, it is
also the intent of this bill that the historical use provision should
not unduly burden the cabin owners by requiring new limitations on the
type and intensity of uses that are allowed on these sites.
Second, section 1004(d)(2)(A) specifies that, if the Canyon Ferry
Recreation Association (``CFRA'') submits the highest bid for these
cabin sites, the Secretary will sell a cabin site to a lessee, if he
receives a purchase request from that lessee. Section 1004(d)(2)(D)
provides that CFRA and the lessees must purchase at least 75 percent of
the properties by August 1 of the year following the first sale of a
cabin site. Section 1004(d)(2)(E) provides that the Secretary shall
continue to lease the cabin sites to those lessees who have not
purchased their sites by that time.
While this is a complex arrangement, the intent should be clear. It
is the intent of this bill that every cabin owner have an opportunity
to purchase their lot so long as they are leasing from the Bureau of
Reclamation. This bill requires that, if CFRA submits the highest bid
for these sites, CFRA will purchase at least 75% of the lots by August
1 of the year following the first sale of a cabin site. CFRA's
obligation to purchase 75% of the lots is, of course, offset by sites
that have been purchased by individual cabin owners by that time.
It is further the intent of this bill that the Bureau should continue
to lease to remaining cabin owners who have not purchased by that time,
and that the Bureau should continue to provide each lessee with the
option of purchasing their site so long as they continue to lease their
site from the Bureau. It is important to note that, once CFRA submits
the highest bid, section 1004(d)(2)(g) requires that all rental revenue
from the cabin sites will be distributed to the Fish and Wildlife
Conservation Trust and to reduce the Pick-Sloan debt as set forth in
section 1006 of the bill.

conclusion

Mr. President, this bill is the result of exhaustive negotiations
between local citizens, wildlife groups, county commissioners, the
cabin owners, the Montana delegation and, most recently, the
Administration. I am pleased that we have been able to reach a broad
consensus on this matter and I support its inclusion as Title X of the
Omnibus Appropriations bill.
Again, in closing, I would like to thank Senator Burns and
Congressman Hill for their work on this important effort--I look
forward to working together on many more such collaborative efforts.

Exhibit 1

Executive Office of the President, Office of Management
and Budget,
Washington, DC, October 10, 1998.
Hon. Max Baucus,
U.S. Senate, Washington, DC.
Dear Senator Baucus: I am writing to express the
Administration's support for your substitute amendment to S.
1913, the Montana Fish and Wildlife Conservation Act. As
amended, S. 1913 creates a unique opportunity to exchange
lands at Canyon Ferry Reservoir for other lands in the state
to conserve fish and wildlife, enhance public hunting,
fishing, and recreational opportunities, and improve public
access to public lands.
We would like to commend you for your leadership in
vigorously pursuing legislation that promotes conservation
and for the cooperation shown by you and your staff in
working with us to address our concerns.
As you know, S. 1913 directs the Secretary of the Interior
to sell the affected Federal properties around Canyon Ferry
Reservoir as a single block. Although, as a general rule, we
believe the Secretary of the Interior

[[Page S12805]]

should have administrative discretion as to how such a
transaction should occur, we believe that the procedures
contained in the Baucus substitute amendment are acceptable
given the unique situation of this property.
The substitute also includes a number of provisions that we
feel are necessary for the Administration's support of this
bill. First, it is our understanding that you have made the
changes that we have requested to the bill's land appraisal
procedures to ensure a fair and accurate appraisal of market
value of the properties to be sold and to avoid creating
opportunities for needless litigation. Second, the bill
ensures that subsequent owners of these properties will
maintain public access to Canyon Ferry Reservoir and preserve
the existing character of this area. And, third, this
substitute amendment preserves the ability of the Secretary
to manage Canyon Ferry Reservoir for its Congressionally
authorized purposes.
We believe that this legislation, with the changes noted
above, will enhance public recreation and fish and wildlife
opportunities for this area while protecting Federal
interests in the operation and management of the Canyon Ferry
Project.
Sincerely,
Jacob J. Lew,
Director.

Mr. FEINGOLD. Mr. President, I want to state my opposition to the
omnibus appropriations bill, and outline some of my concerns with both
the content of that measure, and with the process in which it was
crafted.
First and foremost, Mr. President, this omnibus appropriations bill
shreds the tough spending limits established by last year's bipartisan
budget agreement. It does so through the expedient of declaring nearly
21 billion dollars in spending as a budget emergency, thus exempting
that spending from the spending caps and budget discipline that was so
central to last year's budget agreement.
Mr. President, as I have noted on the floor previously, the emergency
exception to our budget rules was intended to allow Congress to act
quickly to provide funding to assist victims of natural disasters or to
help ensure an adequate and timely response to an international crisis.
Sadly, that exception has now become the rule, and we now see emergency
declarations attached to appropriations provisions not because those
provisions were unexpected or urgent, but because doing so permitted
Congress to duck its budget responsibilities.
That is a gross abuse of the emergency provisions incorporated in our
budget rules, and it must stop.
Mr. President, of particular concern is the use of the emergency
exception to add funds to an already bloated defense budget.
Mr. President, the only emergency in our defense readiness is the
sorry state of posturing by Congress for more defense spending. Some
Members insist Congress must throw more money into the Department of
Defense, even when our military leaders say they don't need it.
But, Mr. President, the Pentagon does not need more money. The money
going to the Pentagon needs to be spent more wisely. Unfortunately, too
often Congress does everything in its power to make sure that does not
happen.
Congress continues to spend billions of dollars on pork-barrel
projects that the Pentagon does not need and does not want. Congress
bars the closing of unnecessary bases, and refuses to address
accounting fraud so destructive that Senator Grassley recently stated
that, ``If we put adequate controls on the money we have, there should
be no need for more defense spending.''
Last week, Mr. President, the Washington Post reported there were at
least 30 items that appeared for the first time in the fine print of
the $250 billion defense spending bill. These included: $250,000 to
study the potential uses of a caffeinated gum, reportedly slipped into
the defense spending bill by a Member of the other body on behalf of
the firm in his Illinois district that makes this gum; $2.4 million for
a device called the American Underpressure System, reportedly another
late addition to the defense spending bill pushed by the San Diego
businessman who holds the patent on the device; and, $5 million to fund
the purchase of electronic locks manufactured by a Kentucky firm,
reportedly added by a member of that State's delegation to the defense
spending bill during conference deliberations. The Washington Post
story reported the Kentucky lockmaker was able to obtain still another
earmark in the Energy Department spending bill for $2 million.
Mr. President, this practice is an outrage, but one many in both
chambers choose to ignore, or, worse, perpetuate. If we cut the pork
and allowed the Pentagon to close inefficient bases, we would not even
need to discuss so-called emergency spending for defense.
Among the most abusive uses of the emergency exception in the defense
budget is the proposed $1.9 billion in funding for U.S. troops in
Bosnia.
Mr. President, I have always had serious questions about U.S.
involvement in this mission. I was the only Democrat to vote against
the deployment of U.S. troops back in 1995, in large part because I did
not believe that the United States would be able to complete the
mission in the time projected and for the price tag that was originally
estimated. Unfortunately, I have been proven right, and I take no
pleasure in it.
U.S. forces have now been in Bosnia for almost three years, much
longer than the original one-year mandate, and I do not think anyone
has a good idea how many more years we will be there. More
significantly, the cost of our involvement in Bosnia has increased
dramatically--easily more than quadrupling the original $2 billion
estimate to more than $8 billion, not including the $1.9 billion now
proposed to be added by the omnibus appropriations measure.
But beyond the strict policy concerns of our mission in Bosnia, Mr.
President, is the troubling budget maneuvering that has been done to
add still more funding to this questionable mission.
Mr. President, the funding for the Bosnia mission will not be forced
to comply with our budget caps. The additional $1.9 billion provided in
this bill is designated as emergency funding.
Mr. President, our Bosnia mission can hardly be characterized as an
unexpected event, something deserving of emergency funding. Far from
it. Our mission in Bosnia is a substantial, long-term commitment. It is
something the United States has, for better or worse, decided to do for
the long-term.
Webster's New Collegiate Dictionary defines the word ``emergency'' as
follows: ``an unforeseen combination of circumstances or the resulting
state that calls for immediate action.''
This definition clearly does not apply to the Bosnia mission. The
Bosnia mission is an emergency only in the strange language of
appropriations bills. The Bosnia ``emergency'' is a legislative
fiction.
U.S. troops have been on the ground in Bosnia for nearly three years.
In December of 1997 the President announced that he would forego
imposing a deadline altogether, and opt instead for a policy of
benchmarks whose definitions remain open to interpretation.
Given that policy, Mr. President, how can Congress and the President
possibly argue to the American people that the additional costs for the
Bosnia mission constitute an emergency? On the contrary, it has been
clear for quite a while now that the cost of this mission would again
rise substantially. Some would say it has been clear from the start.
Ironically, Congressional appropriators and our military leaders have
planned for many months on obtaining these so-called emergency funds.
Mr. President, the mission in Bosnia does not represent an emergency
that legitimately calls for us to depart from our established, vital
budget rules.
Mr. President, as I noted, the Bosnia funding is only one example.
What compounds this dangerous trend away from budget discipline is the
reported evolution of much of the emergency spending. In particular, it
has been reported that the negotiations surrounding the omnibus
appropriations bill at one point centered on the insistence of some
that for every emergency dollar added for one group of programs,
another had to be added for a different set of programs. Essentially,
the budget negotiation became a bidding contest in which deficit-
financed spending was the currency.

This brings me to my second serious objection to the measure before
us, namely the process by which it was crafted.
Mr. President, continuing resolutions and omnibus appropriations are
fast becoming the standard process in Congress. Deliberate, careful,
and open

[[Page S12806]]

consideration of agency budgets, with the full participation of
everyone's elected representatives in a public forum has been shunted
aside, and instead we have a process of back room deals by a powerful
few.
Mr. President, that is not democracy in action, and it rewards those
well-funded, well-connected special interests that already distort the
policy agenda of the Federal government.
We should not be surprised, then, when dozens of special interest
earmarks and policy riders find their way into the omnibus measure with
little or no public debate.
The normal appropriations process is already tainted to a great
extent with this kind of influence. The closed door dealings in which
this legislation was developed only make that problem worse.
A telling example of the policy that can result from this flawed
process is the language delaying implementation of the most modest of
reforms in our nation's dairy policy.
Language included in this omnibus measure extends USDA's rulemaking
period on Federal Milk Marketing Order reform for six months. This
extension will delay implementation of the new federal milk pricing
system to October of 1999, instead of the original date of April, 1999
set in the Farm Bill. Mr. President, officials at USDA have assured me
that they did not request this extension nor do they need it.
Mr. President, this dairy provision was included solely to intimidate
and bully USDA and Secretary Glickman into an anti-Wisconsin dairy
pricing reform. Instead of allowing USDA to do its job, some Members of
Congress want to do it for them, and do it to benefit their own
producers at the expense of dairy farmers in the Upper Midwest.
It is ridiculous that today, in times of advanced technologies,
Wisconsin producers receive a Class I differential of $1.20 per
hundredweight, while producers in Kansas City, Missouri receive $1.92,
and our friends in Miami get $4.18. Dairy farmers in Miami make nearly
$3.00 more per hundredweight than farmers in the Upper Midwest for the
same product. The current system just does not make sense in today's
world.
The extension of USDA's rulemaking had another intent as well.
Extending the rulemaking period automatically extends the life of the
Northeast Interstate Dairy Compact. The 1996 Farm Bill requires a
sunset of the Compact when the new federal pricing system is
implemented. At the rate Congress is going, tacking this issue onto
appropriations bills, there is no telling when implementation will now
occur.
The effects of the Compact on consumers within the region and
producers outside of it are indisputable. Dairy compacts are harmful,
unnecessary and a burden to this country's taxpayers.
The worst part of this entire sixty-five-year dairy fiasco is its
effect on the producers in the Upper Midwest. The six-month extension
puts an additional 900 Wisconsin producers at risk. Wisconsin loses
approximately three dairy farmers a day. Producers cannot stand six
more days of the current program, let alone six more months.
Mr. President, not only is legislating dairy policy on this bill
inappropriate, it is bad precedent, it circumvents the appropriate
committees, the Agriculture and Judiciary Committees, and circumvents
USDA's authority. We ought to give USDA the opportunity to do the right
thing for today's national dairy industry and put an end to the unfair
Eau Claire system now, not six months from now.
Mr. President, once again I urge my colleagues to take a second look
at this antiquated and harmful policy. Stand up for equity, fairness,
and for what is best for America's dairy industry, our consumers and
our taxpayers.
Mr. President, the omnibus measure is also the vehicle for a number
of anti-environment riders. Here again, by burying these provisions in
this mammoth appropriations bill, those promoting these anti-
environmental provisions are able to avoid full and open debate of
their proposals. They succeed in avoiding a separate vote on matters
that are quite controversial.
That is the nature of this kind of bill and this kind of process, Mr.
President. An unamendable, ``must pass'' bill inevitably will be a
magnet for proposals that cannot stand up to the scrutiny of open
debate.
Mr. President, some may blame the nature of the annual budget process
for putting Congress in the position of having to pass an omnibus
appropriations bill. Some might suggest the inability to pass all the
appropriations bills in a timely manner is inherent in the annual
budget process, and in this regard I am certainly willing to give the
biennial budget process a try. I was pleased to cosponsor the measure
offered by the Senator from New Mexico (Mr. Domenici) to move to a
biennial process.
But the annual budget process is not the central problem. The central
problem is the corrupting influences that permeate the entire
policymaking environment, from our system of campaign finance, to the
problems of revolving door hiring practices, to the inadequate lobbying
and gift restrictions on Members.
And the incentives in such a corrupting environment all encourage
just this kind of process--back room negotiations, among only a few
powerful people, with little or no outside input or public scrutiny.
Mr. President, as this bill so graphically demonstrates, until the
Senate and the other body do something to address that underlying
problem, Congress cannot be trusted even to abide by the spending
limits to which it agreed only a year ago.
Mr. KENNEDY. Mr. President, I support this legislation because it
will help millions of families across the country. One of the most
important provisions offers urgently needed aid to communities to
improve their public schools. Democrats worked effectively to provide
funds for more teachers and smaller classes, and these efforts were
successful. The result is that assistance is on the way for this
important aspect of school reform.
The bill provides $1.2 billion on the current fiscal year for this
vital initiative to reduce class sizes in the nation's public schools.
This is the first installment in an ongoing effort to help schools
throughout the nation hire 100,000 more teachers, so that all students
will get the attention they need in school to succeed in life.
The bill also contains a major literacy initiative that will provide
$260 million to help children learn to read well by the end of the
third grade. It's a strong response to President Clinton's America
Reads Challenge, and it makes a significant additional victory for
education reform.
In addition, the legislation includes $871 million for summer jobs
for disadvantaged youth. For many of these youth, summer jobs are their
first opportunity to work and their first step in learning the work
ethic.
This legislation also fully funds the Youth Opportunity grants
established by the Workforce Investment Act signed into law in August.
This innovative new program will offer education and career
opportunities for teenagers most at risk and living in the poorest
communities.
The bill also contains the level of funding recommended by President
Clinton for Head Start and after-school programs. These programs are
vital to children across the country, and these funds are urgently
needed.
Another key part of this bill provides much needed assistance for
home health care for senior citizens and persons with disabilities
under Medicare. In 1997 in Massachusetts, approximately 150 home health
agencies cared for 125,000 Medicare beneficiaries. But the Balanced
Budget Act of 1997 contained provisions that led to an unintended 15
percent reduction in reimbursement for the state's home health
providers. That reduction translated into a $110 million cut this year
for providers across the state. Ten home health agencies in
Massachusetts have closed their doors since January 1--in part due to
the unanticipated consequences of the 1997 Act.
Last February, Congressman Jim McGovern of Massachusetts and I
introduced legislation to remedy this problem, and I am pleased that
this bill achieves our goal. No senior citizens or persons with
disabilities who depend on Medicare for home health services should
have to worry that health care won't be available when they need it
most.
By delaying a forthcoming reduction in payments and by improving the
formula for reimbursements, this bill enables home health agencies to
provide

[[Page S12807]]

the medical care needed for patients to stay in their own homes and
communities, and out of hospitals and nursing homes. All of us who are
concerned about this issue welcome the progress we have made, and we
will continue to do all we can to see that home health care is widely
available to those who need it in our states.
The legislation also makes important changes in the immigration laws.
It temporarily increases the number of visas available to skilled
foreign workers to meet the demands of colleges, and the high-tech
industry. It also contains a substantial investment to improve job
training and educational opportunities for U.S. workers and students.
In addition, the bill ensures that the 49,000 Haitians who came to
this country fleeing persecution will have the opportunity to apply for
asylum to remain in the United States permanently. The bill also
provides $171 million for naturalization activities. Without this
support, the processing of naturalization applications would fall even
farther behind.
The legislation also takes a major step toward more effective
enforcement of the civil rights laws. For the first time in many years,
the Equal Employment Opportunity Commission will receive the level of
funds needed to fulfill its important mission.
In many other respects, this legislation also deserves support. I
commend the bipartisan support it has received, and I urge the Senate
to approve it.
However, in passing this important bill, this Congress leaves behind
a number of key initiatives of great importance to working families. I
know that my Democratic colleagues join me in pledging to renew our
efforts early next year on behalf of the unfinished business of the
current Congress.
First, we must act on the Patient's Bill of Rights, which will end
the abuses of HMOs and guarantee the 161 million Americans who use HMOs
that medical decisions affecting their families will be made by doctors
and patients, not insurance company accountants.
Democrats will also give high priority to campaign finance reform
next year. The greatest gift that Congress can give the American people
is clean elections. This reform is important for our democracy, and it
deserves to be enacted at the beginning of 1999, so that it will
clearly apply to elections in the year 2000.
Our nations school buildings are crumbling, and many areas of the
country do not have enough classrooms. The 105th Congress did not act
on our proposal to give localities tax breaks for bond initiatives to
pay for school construction. And we will pursue this proposal again
next year.
We must also act in 1999 to reduce youth smoking and save millions of
children from a lifetime of addiction and early death. Three thousand
more children a day start smoking, and a thousand of them will die
prematurely from tobacco-induced disease.
We need strong legislation to prevent tobacco companies from
targeting young Americans. It is the only effective way to stop this
tragedy.
Another top priority should be action on the minimum wage. At this
time of extraordinary national prosperity, millions of minimum wage
earners are working full time but still living in poverty. We proposed
a modest increase of $1.00 an hour over two years to give a much-needed
raise to 12 million Americans. The fight for this proposal--so
important to working families across America--must be and will be
renewed next year.
We had landmark, bi-partisan legislation to assist Americans with
disabilities to obtain skills and go to work, rather than sit a home on
public assistance. Disabled Americans want the dignity of work. But
this bill, too, was not considered by this Congress.
The tragic deaths of James Byrd, an African American killed because
of his race, and Matthew Shepard, a gay University of Wyoming student
killed because of his sexual orientation, brought the issue of hate
crimes to the forefront this year. Their deaths and other senseless
acts of hate resulting in death or serious injury should be a catalyst
for passage of the Hate Crimes Prevention Act. This bill ranks high
among the unfinished business of the 105th Congress, and we will pursue
it again next year.
All of us regret that this massive legislation is being considered
under end-of-session restrictions that make sensible debate impossible.
But overall, I believe the bill deserves to pass, and I look forward to
renewing the debate next year about the nation's basic priorities.

medicare home health care provision

Mr. GRASSLEY. Mr. President, I wish to comment on the Medicare home
health care provisions in the omnibus bill the Senate passed today over
my dissenting vote. Along with a bipartisan group of my colleagues,
I've worked since early this year to persuade the Senate to revisit
home care. Now that we've done so, I have mixed feelings about the
product. First, let me tell you what is good about it.
It is good that we listened to our constituents and took action on
this issue. The Aging Committee held a hearing on this issue in March,
and it was clear then that we had a major problem on our hands. From
then to now, believe me, every step has been a struggle. As late as
last Thursday, this issue was declared dead here in the Senate. But
last minute calls from a number of us to the leadership led to the
issue being taken up, and that's a good thing.
It is good that the bill delays the 15-percent across-the-board cut
in home health payments that was slated to occur in October 1999 if
HCFA missed the deadline for the new Prospective Payment System (PPS).
It's HCFA's fault, not that of home health providers, that PPS won't be
ready in time, so the cut would have been unfair. The bill delays the
cut until October 2000, and PPS should be ready by then, meaning that
the across-the-board cut will never occur. We will all need to monitor
the development of PPS closely, but this delay buys us some important
time.
The final good thing I can say about the bill is that it does provide
modest relief to low-cost agencies, such as most Iowa providers. It
moves them about one-third of the way up to the national median. That's
all.
So what's wrong with it? In short, its increase in payment to low-
cost agencies is far too small. The negotiators accepted the House view
that all high-cost agencies should be held harmless. This tied up money
which should have been used to provide more equity to low-cost
agencies, the ``good guys'' who provide home care without unnecessarily
burdening Medicare.
Because the bill provides so little relief to low-cost agencies,
those agencies are still at risk of closure. If an agency can't stay in
business for at least another year, the delay of the 15-percent cut
scheduled for October 1999 will not help it. For me, saving those
agencies--in order to preserve access to home care for those they
serve--was the foremost reason to act this year. We did not do what we
needed to do.
In a sense, the new law makes that bad situation even worse. If
existing agencies must close their doors, especially in lightly
populated rural areas, we could hope that new agencies would open to
take on their patients. But the Senate receded to a House provision
putting such new agencies at a marked payment disadvantage, making it
unlikely that any will open. This should be a matter of grave concern
to all of us.
The bill that I drafted with Senators Breaux, Baucus, and
Rockefeller, S. 2323, was a hard-fought compromise among differently
situated States. As evidence that it was a good compromise, it garnered
a majority of Finance Committee members as cosponsors, including those
from States with relatively high- and low-cost agencies. It also
greatly simplified the Interim Payment System, providing for more
uniform payment for agencies, and eliminating the distinction between
old and new agencies. If anything, the provision in the omnibus bill
makes our earlier bill look even more attractive, because today's bill
further complicates home health payment, and makes payment even less
uniform.
Finally, Mr. President, I cannot resist pointing out the flaws in the
process by which this provision was developed. The process was
profoundly undemocratic. After many months' discussion, a strong
majority of the Finance Committee agreed on an approach to this issue.
We were then told that, out of the whole Senate, only a single Senator
from a State with a tremendous number of agencies, many

[[Page S12808]]

with very high costs, would object to this consensus approach. Unlike
other Senators from similar States, who recognized the need for some
high-cost agencies to accept some reductions as part of a compromise,
this Senator had not cosponsored any of the reasonable reform bills or
otherwise contributed to the discussions during the course of the year.
While that Senator cited fiscal responsibility as the reason for his
objection, it was no secret that his constituents included so many of
the highest-cost home health agencies--the defense of which would seem
to be the antithesis of fiscal responsibility.
Precious days passed while no action was taken, and no explanation
was offered. We Finance Committee members were essentially strung
along, learning to our dismay each day that the bill had not been
brought to the floor, where the objecting Senator would have to defend
his position, if he dared. In the end, a deal was cut in a rushed,
secret negotiation at the eleventh hour. Members who had labored for
months to find a workable compromise were not invited to participate,
while the alleged objector was. That Senator's State's high-cost
agencies were thus given virtual veto power. It should be no wonder
that we ended up with what we did.
Here in Congress, a good process does not guarantee a good result,
but a bad process almost certainly guarantees a bad result. It pains me
that the seniors and disabled who rely on the Medicare home health
benefit will have to bear the consequences of the Senate's bad process.
While noting the errors of the Senate on this issue, I would be
remiss not to note the responsibility of the home health industry and
the Clinton Administration. The industry spent months pursuing
unrealistic approaches and failing to unite behind reasonable reform.
We'll never know how differently this debate might have turned out if
they had been willing to make some hard choices earlier in the process,
rather than do the impossible by attempting to please all their
constituents. Similarly, we will never know how the issue would have
played out if the Administration had participated as full partners.
Throughout the year, they were willing only to provide technical
assistance, never offering reform ideas of their own, no matter how
much Members of Congress from both parties pleaded. I will never
understand why they decided that home health care was Congress' problem
and not theirs. I hope that the industry, the Administration, and
Congress will all approach this issue differently next year.
The prospect of dealing with this issue again in 1999 is not one that
many of us relish. But I'm afraid that we will have to do it. In fact,
what I really fear is that our best, most efficient home health
providers will not be around when we return to this issue. We simply
did not do enough for them this year. Let's not kid ourselves that we
did.
Mr. MOYNIHAN. Mr. President, the budget agreement reached on Thursday
evening was celebrated by both parties in competing press conferences,
and there may well be much to commend in the Omnibus Consolidated and
Emergency Supplemental Appropriations Act. The trouble is, how would
anyone know?
According to a wire service report on Friday, the bill was ``expected
to be more than one foot thick.'' In fact, it is closer to two feet
thick, and contains some 4,000 pages. Will any Senator or
Representative know what's in that monster bill when it is passed
shortly--as is now inevitable?
Of course not. Yet in recent years we are given to feel that even to
ask such a question is to reveal an embarrassing naivete.
Last year, as Ranking Member of the Committee on Finance, I was Floor
Manager during Senate consideration of an 820-page bill somewhat
unconvincingly entitled the ``Taxpayer Relief Act of 1997.'' While it
was pending before the Senate, the only copy of the bill present on the
Senate floor was on the Democratic Manager's desk, having been obtained
by our resourceful and learned Minority Chief Tax Counsel, Mr. Nick
Giordano. A second copy provided to the majority Manager, Chairman
Roth, had been lent to the Budget Committee so that it could be
inspected for violations of assorted rules.
During that debate, many Senators, having no other way to find out,
came round to ask if I could ascertain whether this or that provision
was in the bill. Sensing my opportunity, I would reply, ``I could, but
what will you pay me?''
This year's legislation is no different; we continue to discover
items that mysteriously found their way into--or out of--the text long
after the agreement was announced. And so as we reflect on the
successes and failures of the 105th Congress now ending, I rise simply
to sound a note of caution, if not alarm. Having served here for 22
years now--I looked up at the beginning of this Congress to find myself
9th in seniority among Senate Democrats, and 14th in the Senate
overall--I am troubled that of late we are getting ominously careless
with our procedures. This growing neglect of our rules is becoming
increasingly hurtful to the institution of the United States Congress.
Surely it is not how business ought to be conducted in the national
legislature of the United States of America.
In an article yesterday headlined ``Spending Deal Represents Failure,
Not Success,'' the distinguished Vice President and columnist for the
Associated Press, Walter Mears, recalls that

A decade ago, President Reagan confronted Congress with the
``43 pounds of paper'' it passed in 1987 to finance the
government in one catchall bill after failing to enact
separate appropriations. Reagan told the Democratic Congress
not to pass any more ``behemoths'' like that, and said he
wouldn't sign one again.
``The budget process has broken down,'' said Reagan, ``It
needs a drastic overhaul.''

I do not assert that in some earlier, happier time, every Member of
Congress read every word of every bill. That has never been possible.
But only quite recently have the negotiations over, and contents of,
our mammoth annual budget measures been kept secret from nearly
everyone save the two Republican Leaders and the White House Chief of
Staff. We are beginning to resemble a kind of bastard parliamentary
system. Members loudly debate issues on the floor, but the real
decisions are made in a closed room by three or four people.
This deterioration in the process has taken place over about the last
half decade, or so I would reason. Such things would never have been
attempted, or tolerated, when I arrived here. That was a time when the
rules and prerogatives of this institution were still revered. One
shudders to think how the current state of affairs would be viewed by
men of the House such as Thomas P. O'Neill or Dan Rostenkowski, or by
giants of the Senate like Howard H. Baker or Russell B. Long.
But the reality is that in recent years, a growing lack of respect
for the institution of the Congress has begun to manifest itself in any
number of damaging ways. To cite just a few other examples:
The budget process has broken down. This year, for the first time in
24 years, Congress failed to pass a budget resolution. And we have had
great difficulty passing reconciliation bills. In fact, the last
proper, complete reconciliation bill we were able to enact was the
Omnibus Budget Reconciliation Act of 1993. Since Thursday night we have
been busily congratulating ourselves over completion of the latest
budget--as if the simple act of keeping the government open is a unique
achievement.
Committees of Conference have been reduced to formalities. Meetings
of conference committees are now rarely convened, and when they are, it
is frequently done only to announce an outcome that has been
predetermined--generally without participation by the minority. The
appointment of conferees has sometimes been corrupted, with conference
membership or party ratios within conferences subject to manipulation
for partisan advantage.
Even the ``scope of the conference'' requirement of Rule 28 of the
Standing Rules of the Senate, which prohibited consideration by
conference committees of provisions not in the bill passed by either
house, has been overturned. On October 3, 1996, the Senate casually did
away with that rule by a vote of 56-39.
Likewise we no longer prohibit legislating on appropriations bills.
This was a most useful rule that had existed since the adoption of the
Standing

[[Page S12809]]

Rules of the Senate in 1884; it helped prevent all manner of mischief
in the annual appropriations process.
Yet on March 16, 1995, during consideration of a bill to provide
emergency supplemental appropriations for the Department of Defense, we
voted, in effect, to repeal the rule. An amendment was offered to
impose a moratorium on listing of new endangered species by the Fish
and Wildlife Service. The Chair promptly sustained a point of order
that the amendment violated the rule against legislation on
appropriations bills.

Without any thought given to the consequences, the ruling of the
Chair was immediately appealed and then overturned, by a vote of 57-42.
A new precedent had been set, and the rule was wiped out. Not one word
was said on the floor, before or after the vote, about the terrible
precedent we were creating.
I voted against both of those changes to our rules. I found it
astonishing on both occasions that the Senate would so blithely
disregard its own procedures.
The gigantic new Omnibus Appropriations Act, filled with hundreds of
non-appropriations provisions never considered separately in either
house, is the latest example of why those two little-noticed votes were
big mistakes. Indeed, the distinction between appropriations measures
and legislative changes is now so blurred that on Sunday, the House
Appropriations Committee posted a press release on its website
announcing ``Significant Legislative Provisions in Appropriations
Bills.''
Parliamentary irregularities are creeping their way into acceptance.
For instance, in several cases the Senate has, by unanimous consent,
``deemed'' bills passed before they are received from the House of
Representatives. In 1997, a provision giving a $50 billion tax credit
to the tobacco industry was slipped into a conference report after the
conference committee had completed its work. (That provision was
repealed soon after its existence was discovered.)
In another case in 1998, the routine right to modify a floor
amendment was used for a different purpose altogether: to undo a
compromise agreement on assistance to tobacco farmers, and to defeat
without a vote a bipartisan measure reported by the Committee on
Finance. Also of concern is the now common practice of filing ``motions
to bring to a close debate'' under Rule 22--cloture motions--on bills
before a single word of debate has been uttered on the floor.
This nonchalance about our procedures reached an extreme in 1995 and
1996 when we took up the Balanced Budget Amendment to the Constitution
and the Line Item Veto Act. These measures, which were part of Item One
in the ``Contract with America,'' proposed to dramatically alter the
procedures by which Congress, under Article I, Sections 7 and 8, of the
Constitution, exercises the power of the purse.
We had the good sense to defeat the Balanced Budget Amendment, albeit
narrowly. However, the Line Item Veto Act passed the Senate by a vote
of 69-31 on March 27, 1996--notwithstanding the pleas of this Senator
and others that the bill was unconstitutional. Ultimately, of course,
that Act was declared unconstitutional by the Supreme Court on June 25,
1998 in the case of Clinton v. City of New York. But not before the
Senator from New York, along with our revered leader Senator Byrd and
Senators Levin and Hatfield, had to take the extraordinary step of
becoming plaintiffs in one lawsuit, which was vacated due to lack of
standing, and amici curiae in a second suit. Happily, as I say, we
finally prevailed.
In his powerful concurring opinion concluding that the Line Item Veto
Act violated the separation of powers, Justice Anthony M. Kennedy wrote
that ``Liberty is always at stake when one or more of the branches seek
to transgress the separation of powers.'' Justice Kennedy went on to
say this: ``The citizen has a vital interest in the regularity of the
exercise of governmental power.''
I repeat: ``The citizen has a vital interest in the regularity of the
exercise of governmental power.''
Surely this admonition applies to the regularity of the exercise of
power in the United States Senate. We are not talking about mere
technicalities or niceties to be observed or ignored at whim. The rules
and procedures of the United States Congress matter. Just as the
finely-wrought proscriptions in our Constitution matter. Article I,
Section 5 of the Constitution provides that ``Each House may determine
the Rules of its Proceedings. . .'' Those rules are meant to be, and
must be, obeyed.
The Supreme Court held that the Line Item Veto Act threatened liberty
by distorting the carefully designed constitutional procedure for
passage and enactment of laws. In quite the same way, our failure to
observe the rules and procedures of this institution threaten,
ultimately, democratic representation of the American people in the
Congress. Disregarding our rules erodes the power conferred by citizens
on each elected Member of the Congress, undermining the integrity of
our legislative process. And it therefore weakens the Congress as an
institution and contributes to cynicism and a loss of confidence among
the citizenry about our competence to govern. If we do not take better
care, I fear we will find this institution in decline.
I know that my friend Senator Robert C. Byrd, whose knowledge of the
Senate rules is unsurpassed, shares these concerns. Yesterday on the
floor, he said this of the pending Omnibus Appropriations Act:

I will never vote for another such monstrosity for as long
as I am privileged to hold this office. I hope that I never
see another such monstrosity. I will never again support such
a convolution of the legislative process as the one we have
seen this year, and I hope that others will agree that this
process is just as silly and as sad and as ridiculous and as
disgraceful as I think it is. I hope they will join me in an
effort to prevent it in the future.

That is not the kind of statement that Robert C. Byrd, the Ranking
Member of the Committee on Appropriations and our sometime President
pro tempore, would make lightly. I hope Senators were listening.
Perhaps the Committee on Rules and Administration, on which Senator
Byrd and I serve together, will see fit to take up this issue. And I do
hope all Senators will recognize the importance of regular order and
take greater care with the rules of this institution when the 106th
Congress convenes in January of 1999.
In the meantime, on this measure, my vote is No.
Mr. LOTT. I believe the yeas and nays have been ordered, Mr.
President. We are ready to proceed to the vote.
The PRESIDING OFFICER (Mr. Inhofe). The question is on agreeing to
the conference report. The yeas and nays have been ordered. The clerk
will call the roll.
The assistant legislative clerk called the roll.
Mr. NICKLES. I announce that the Senator from North Carolina (Mr.
Helms) and the Senator from Alaska (Mr. Murkowski) are necessarily
absent.
Mr. FORD. I announce that the Senator from Arkansas (Mr. Bumpers),
the Senator from Ohio (Mr. Glenn), the Senator from South Carolina (Mr.
Hollings), and the Senator from Hawaii (Mr. Inouye) are necessarily
absent.
The PRESIDING OFFICER. Are there any other Senators in the Chamber
who desire to vote?
The result was announced, yeas 65, nays 29, as follows:

[Rollcall Vote No. 314 Leg.]

YEAS--65

Abraham
Akaka
Bennett
Biden
Bingaman
Bond
Boxer
Breaux
Brownback
Bryan
Burns
Campbell
Chafee
Cleland
Cochran
Conrad
Coverdell
Craig
D'Amato
Daschle
DeWine
Dodd
Domenici
Dorgan
Durbin
Faircloth
Feinstein
Ford
Frist
Gorton
Graham
Gregg
Harkin
Hatch
Hutchinson
Hutchison
Jeffords
Johnson
Kempthorne
Kennedy
Kerry
Landrieu
Lautenberg
Leahy
Lieberman
Lott
Mack
McConnell
Mikulski
Moseley-Braun
Murray
Reed
Robb
Roberts
Rockefeller
Roth
Sarbanes
Shelby
Smith (OR)
Stevens
Thompson
Thurmond
Torricelli
Warner
Wyden

NAYS--29

Allard
Ashcroft
Baucus
Byrd
Coats
Collins
Enzi
Feingold
Gramm
Grams
Grassley
Hagel
Inhofe
Kerrey
Kohl
Kyl
Levin
Lugar
McCain
Moynihan
Nickles

[[Page S12810]]

Reid
Santorum
Sessions
Smith (NH)
Snowe
Specter
Thomas
Wellstone

NOT VOTING--6

Bumpers
Glenn
Helms
Hollings
Inouye
Murkowski
The conference report was agreed to.
Mr. LOTT addressed the Chair.
The PRESIDING OFFICER. The majority leader.

____________________