[Congressional Record Volume 145, Number 8 (Tuesday, January 19, 1999)]
[Senate]
[Pages S497-S501]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

[[Page S497]]

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                                 Senate

          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

                              (Continued)

      By Mr. DeWINE (for himself, Mr. Hollings, Mr. Abraham, Mr. 
        Santorum, Mr. Specter, Mr. Byrd, Mr. Hutchinson, and Mr. 
        Voinovich):
  S. 61. A bill to amend the Tariff Act of 1930 to eliminate 
disincentives to fair trade conditions; to the Committee on Finance.


           The Continued Dumping or Subsidization Offset Act

  Mr. DeWINE. Mr. President, today I join with Senators Abraham, 
Santorum, Specter, Hollings, Byrd, Hutchinson and others to introduce 
the Continued Dumping or Subsidy Offset Act. This legislation is 
designed to ensure that our domestic producers can compete freely and 
fairly in global markets. This bill is a top priority for me and my 
fellow cosponsors--not only because we believe it is good policy, but 
also because it is needed to respond to the current import dumping 
crisis in our steel industry.
  As my colleagues know, the Tariff Act of 1930 gives the President the 
authority to impose duties and fines on imports that are being dumped 
in U.S. markets, or subsidized by foreign governments. Our bill would 
take the 1930 Act one step further. Currently, revenues raised through 
import duties and fines go to the U.S. Treasury. Under our bill, duties 
and fines would be transferred to injured U.S. companies as 
compensation for damages caused by dumping or subsidization.
  We believe this extra step is necessary. Current law simply has not 
been strong enough to deter unfair trading practices. In some cases, 
foreign producers are willing to risk the threat of paying U.S. 
antidumping and countervailing duties out of the profits of dumping.
  Current law also does not contain a mechanism to help injured U.S. 
industries recover from the harmful effects of foreign dumping and 
subsidization. These foreign practices have reduced the ability of our 
injured domestic industries to reinvest in plant, equipment, people, 
R&D, technology or to maintain or restore health care and pension 
benefits. The end result is this: continued dumping or subsidization 
jeopardizes renewed investment and prevents additional reinvestment 
from being made.
  The current steel dumping crisis is the latest sobering example of 
why our legislation, among others, is needed to better enforce fair 
trade. Because of massive dumping, steel imports are at an all-time 
high. According to the American Iron and Steel Institute, 4.1 net tons 
of steel were imported in the month of October--that's the second 
highest monthly total ever, and is 56% higher than the previous year.
  This surge in imports is having a direct impact on our own steel 
industry. In November, U.S. steel mills shipped nearly 7.4 million net 
tons of steel in November of last year--more than one million tons 
below what was shipped one year earlier. We have seen U.S. steel's 
industrial utilization rate fall from 93.1% in March of 1998 to 73.9% 
in January of 1999. And most troubling of all, approximately 10,000 
jobs have been lost in our steel industry since last year. More layoffs 
are certain. Whether these jobs will ever be restored is uncertain. 
This is a genuine crisis for the communities in the Ohio River Valley 
and in other communities across the country.
  This is not a case of being on the wrong side of a highly competitive 
market. Today's U.S. steel industry is a lean, efficient industry--a 
world leader thanks to restructuring and millions of dollars in 
modernization. U.S. steelworkers are the best and most productive in 
the world. In fact, America's workers devote the fewest manpower hours 
per ton of steel.
  Simply being the best is not enough against foreign governments that 
either erect barriers to keep U.S. steel out, or subsidize their 
exports to distort prices. That's why we have trade laws designed to 
promote fair trade. However, it's clear that our current trade policies 
aren't working. Current law did not deter foreign steel producers from 
dumping their products in our country. These foreign producers have 
done the math. They have made a calculated decision that the risk of 
duties is a price they are willing to pay in return for the higher 
global market share they have gained by chipping away at the size and 
strength of our nation's steel industry.
  It's time we impose a heavier price on dumping and subsidization. The 
Continued Dumping or Subsidization Offset Act would accomplish this 
goal. It would transfer the duties and fines imposed on foreign 
producers directly to their U.S. competitors. Under our bill, foreign 
steel producers would get a double hit from dumping: they would have to 
pay a duty, and in turn, see that duty go directly to aid U.S. steel 
producers.
  In order to counter the adverse effects of foreign dumping and 
subsidization on U.S. industries, Congress should pass this bipartisan 
bill.

  The steel crisis also has amplified the need for additional 
improvements in our trade laws, as well as tougher enforcement of 
existing laws. Last October, many of us in Congress came together to 
offer an early New Year's resolution for 1999: to stand up for steel.
  Any crisis requires leadership. That's why Congress asked the 
President to make a New Year's Resolution of his own--one that would 
honor a pledge he made in 1992 to strongly enforce U.S. antidumping 
laws. Specifically, Congress asked the President for an action plan no 
later than January 5th--a plan that would end the distortion and 
disruption in global steel markets, as well as the disappearance of 
jobs and opportunity in U.S. steel plants. It was a call for 
presidential leadership.

[[Page S498]]

  On January 8th, the President released a plan that fell far short of 
what we hoped. It was a plan that showed a reluctance to fully utilize 
our laws to ensure free and fair trade. It did not recommend any trade 
legislation to better protect U.S. industry from dumping. As a result, 
it sends a dangerous signal to foreign governments that dumping will 
not meet with a swift response from the United States.
  I am concerned the President has not fully grasped the magnitude of 
this problem. In the past few months, I have visited with Ohio Valley 
steel producers and workers, including a number of the hundreds laid 
off because of foreign dumping. Their message was the same: the surge 
in steel imports represents a crisis of historic proportions.

       The root of the current import crisis is the financial 
     distress that plagues Asia and Russia, which has created a 
     worldwide oversupply of steel. While foreign consumption of 
     steel has nearly dried up, America's strong economy and open 
     markets have made the United States a prime target for 
     exporters. We are dedicated to assisting these economies--so 
     we can avoid a global downturn. But turning a blind eye 
     toward our steel workers is the wrong way to do it. We simply 
     cannot afford to sacrifice the US steel industry and 
     thousands of American jobs in a desperate attempt to prop up 
     faulty foreign economies. This approach simply will not work.

  Although the Commerce Department has initiated an investigation that 
could result in duties imposed against foreign steel, the President 
could pursue a number of options to reduce steel imports: He could 
begin serious and aggressive bilateral negotiations with countries that 
dump steel; initiate a ``201'' petition with the International Trade 
Commission if he believes steel imports pose a substantial threat to 
domestic industry; or take unilateral trade action, including quotas 
and tariffs, under the International Economic Emergency Powers Act.
  The President's plan does not take any of these options. Instead, it 
treats the symptoms of dumping--declining profits and unemployment--
rather than attack the disease itself. The damage from this disease has 
already been done. Absent tough action to address this dumping directly 
makes it more difficult for U.S. producers to regain their declining 
market share, and most important, to restore the jobs that have been 
lost.
  Congress can insist on tough action by the President by passing 
legislation that will further discourage unfair trade practices. 
Passing the Continued Dumping or Subsidization Offset Act would be a 
good start. In addition, I will be joining with Senator Arlen Specter 
of Pennsylvania to introduce legislation that would lower the statutory 
threshold for the International Trade Commission (ITC) to find injury 
caused by imports and establish a steel import permit and licensing 
program, allowing domestic industry access to critical import data more 
quickly.
  Ultimately, we cannot achieve free and fair markets on a global scale 
unless our laws work to encourage all competitors to play by the rules. 
And ultimately, congressional action alone is no substitute for 
presidential leadership. That's why Congress and the American steel 
community need to keep the pressure on. In fact, thousands of steel 
workers from the Ohio Valley are arriving in our nation's capitol in a 
massive call for presidential leadership. It's time our President took 
a stand for fair trade. It's time for our President to stand up for 
steel.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 61

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Continued Dumping and 
     Subsidy Offset Act of 1999''.

     SEC. 2. FINDINGS OF CONGRESS.

       Congress makes the following findings:
       (1) Consistent with the rights of the United States under 
     the World Trade Organization, injurious dumping is to be 
     condemned and actionable subsidies which cause injury to 
     domestic industries must be effectively neutralized.
       (2) United States unfair trade laws have as their purpose 
     the restoration of conditions of fair trade so that jobs and 
     investment that should be in the United States are not lost 
     through the false market signals.
       (3) The continued dumping or subsidization of imported 
     products after the issuance of antidumping orders or findings 
     or countervailing duty orders can frustrate the remedial 
     purpose of the laws by preventing market prices from 
     returning to fair levels.
       (4) Where dumping or subsidization continues, domestic 
     producers will be reluctant to reinvest or rehire and may be 
     unable to maintain pension and health care benefits that 
     conditions of fair trade would permit. Similarly, small 
     businesses and American farmers and ranchers may be unable to 
     pay down accumulated debt, to obtain working capital, or to 
     otherwise remain viable.
       (5) United States trade laws should be strengthened to see 
     that the remedial purpose of those laws is achieved.

     SEC. 3. AMENDMENTS TO THE TARIFF ACT OF 1930.

       (a) In General.--Title VII of the Tariff Act of 1930 (19 
     U.S.C. 1671 et seq.) is amended by inserting after section 
     753 following new section:

     ``SEC. 754. CONTINUED DUMPING AND SUBSIDY OFFSET.

       ``(a) In General.--Duties assessed pursuant to a 
     countervailing duty order, an antidumping duty order, or a 
     finding under the Antidumping Act of 1921 shall be 
     distributed on an annual basis under this section to the 
     affected domestic producers for qualifying expenditures. Such 
     distribution shall be known as the `continued dumping and 
     subsidy offset'.
       ``(d) Definitions.--As used in this section:
       ``(1) Affected domestic producer.--The term `affected 
     domestic producer' means any manufacturer, producer, farmer, 
     rancher, or worker representative (including associations of 
     such persons) that--
       ``(A) was a petitioner or interested party in support of 
     the petition with respect to which an antidumping duty order, 
     a finding under the Antidumping Act of 1921, or a 
     countervailing duty order has been entered, and
       ``(B) remains in operation.

     Companies, businesses, or persons that have ceased the 
     production of the product covered by the order or finding or 
     who have been acquired by a company or business that is 
     related to a company that opposed the investigation shall not 
     be an affected domestic producer.
       ``(2) Commissioner.--The term `Commissioner' means the 
     Commissioner of Customs.
       ``(3) Commission.--The term `Commission' means the United 
     States International Trade Commission.
       ``(4) Qualifying expenditure.--The term `qualifying 
     expenditure' means an expenditure incurred after the issuance 
     of the antidumping duty finding or order or countervailing 
     duty order in any of the following categories:
       ``(A) Plant.
       ``(B) Equipment.
       ``(C) Research and development.
       ``(D) Personnel training.
       ``(E) Acquisition of technology.
       ``(F) Health care benefits to employees paid for by the 
     employer.
       ``(G) Pension benefits to employees paid for by the 
     employer.
       ``(H) Environmental equipment, training, or technology.
       ``(I) Acquisition of raw materials and other inputs.
       ``(J) Borrowed working capital or other funds needed to 
     maintain production.
       ``(5) Related to.--A company, business, or person shall be 
     considered to be `related to' another company, business, or 
     person if--
       ``(A) the company, business, or person directly or 
     indirectly controls or is controlled by the other company, 
     business, or person,
       ``(B) a third party directly or indirectly controls both 
     companies, businesses, or persons,
       ``(C) both companies, businesses, or persons directly or 
     indirectly control a third party and there is reason to 
     believe that the relationship causes the first company, 
     business, or persons to act differently than a nonrelated 
     party.

     For purposes of this paragraph, a party shall be considered 
     to directly or indirectly control another party if the party 
     is legally or operationally in a position to exercise 
     restraint or direction over the other party.
       ``(c) Distribution Procedures.--The Commissioner shall 
     prescribe procedures for distribution of the continued 
     dumping or subsidies offset required by this section. Such 
     distribution shall be made not later than 60 days after the 
     first day of a fiscal year from duties assessed during the 
     preceding fiscal year.
       ``(d) Parties Eligible for Distribution of Antidumping and 
     Countervailing Duties Assessed.--
       ``(1) List of affected domestic producers.--The Commission 
     shall forward to the Commissioner within 60 days after the 
     effective date of this section in the case of orders or 
     findings in effect on such effective date, or in any other 
     case, within 60 days after the date an antidumping or 
     countervailing duty order or finding is issued, a list of 
     petitioners and persons with respect to each order and 
     finding and a list of persons that indicate support of the 
     petition by letter or through questionnaire response. In 
     those cases in which a determination of injury was not 
     required or the Commission's records do not permit an 
     identification of those in support of a petition, the 
     Commission shall consult with the administering authority to 
     determine the identity of the petitioner and those

[[Page S499]]

     domestic parties who have entered appearances during 
     administrative reviews conducted by the administering 
     authority under section 751.
       ``(2) Publication of list; certification.--The Commissioner 
     shall publish in the Federal Register at least 30 days before 
     the distribution of a continued dumping and subsidy offset, a 
     notice of intention to distribute the offset and the list of 
     affected domestic producers potentially eligible for the 
     distribution based on the list obtained from the Commission 
     under paragraph (1). The Commissioner shall request a 
     certification from each potentially eligible affected 
     domestic producer--
       ``(A) that the producer desires to receive a distribution;
       ``(B) that the producer is eligible to receive the 
     distribution as an affected domestic producer; and
       ``(C) the qualifying expenditures incurred by the producer 
     since the issuance of the order or finding for which 
     distribution under this section has not previously been made.
       ``(3) Distribution of funds.--The Commissioner shall 
     distribute all funds (including all interest earned on the 
     funds) from assessed duties received in the preceding fiscal 
     year to affected domestic producers based on the 
     certifications described in paragraph (2). The distributions 
     shall be made on a pro rata basis based on new and remaining 
     qualifying expenditures.
       ``(e) Special Accounts.--
       ``(1) Establishments.--Within 14 days after the effective 
     date of this section, with respect to antidumping duty orders 
     and findings and countervailing duty orders in effect on the 
     effective date of this section, and within 14 days after the 
     date an antidumping duty order or finding or countervailing 
     duty order issued after the effective date takes effect, the 
     Commissioner shall establish in the Treasury of the United 
     States a special account with respect to each such order or 
     finding.
       ``(2) Deposits into accounts.--The Commissioner shall 
     deposit into the special accounts, all antidumping or 
     countervailing duties (including interest earned on such 
     duties) that are assessed after the effective date of this 
     section under the antidumping order or finding or the 
     countervailing duty order with respect to which the account 
     was established.
       ``(3) Time and manner of distributions.--Consistent with 
     the requirements of subsections (c) and (d), the Commissioner 
     shall by regulation prescribe the time and manner in which 
     distribution of the funds in a special account shall made.
       ``(4) Termination.--A special account shall terminate 
     after--
       ``(a) the order or finding with respect to which the 
     account was established has terminated;
       ``(B) all entries relating to the order or finding are 
     liquidated and duties assessed collected;
       ``(C) the Commissioner has provided notice and a final 
     opportunity to obtain distribution pursuant to subsection 
     (c); and
       ``(D) 90 days has elapsed from the date of the notice 
     described in subparagraph (C).

     Amounts not claimed within 90 days of the date of the notice 
     described in subparagraph (C), shall be deposited into the 
     general fund of the Treasury.''.
       (b) Conforming Amendment.--The table of contents for title 
     VII of the Tariff Act of 1930 is amended by inserting the 
     following new item after the item relating to section 753:

``Sec. 754. Continued dumping and subsidy offset.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply with respect to all antidumping and 
     countervailing duty assessments made on or after October 1, 
     1996.
                                 ______
                                 
      By Mr. KOHL:
  S. 62. A bill to amend the Internal Revenue Code of 1986 to provide 
for the rollover of gain from the sale of farm assets into an 
individual retirement account; to the Committee on Finance.


             the family farm retirement equity act of 1999

                                 ______
                                 
      By Mr. KOHL:
  S. 63. A bill to amend the Internal Revenue Code of 1986 to provide a 
credit against tax for employers who provide child care assistance for 
dependents of their employees, and for other purposes; to the Committee 
on Finance.


                   the child care infrastructure act

  Mr. KOHL. Mr. President, I rise today to introduce the Family Farm 
Retirement Equity Act, a bill to help improve the retirement security 
of our nation's farmers.
  As we begin the 106th Congress, we can anticipate legislative action 
to strengthen retirement security and to boost individual savings on 
behalf of all Americans. With good reason, these issues have risen to 
the top of the nation's agenda. Americans are living longer and 
changing jobs more often. Medical costs are rising and demogarphic 
trends are undermining the long-term viability of our social security 
system. Comprehensive planning for the many years Americans are often 
able to enjoy in retirement is now more important than ever.
  We took some steps to address retirement security in the 105th 
Congress, but the job is far from accomplished. We must be vigilant in 
acting to reform social security on behalf of all Americans and in 
addressing the unique retirement needs of individual groups of 
Americans. The legislation I introduce today attempts to act on behalf 
of one such group, a group at the heart of our American traditions, the 
family farmer.
  As many of my colleagues know, farming is a highly capital-intensive 
business. To the extent that the average farmer reaps any profits from 
his or her farming operation, much of that income is directly 
reinvested into the farm. Rarely are there opportunities for farmers to 
put money aside in individual retirement accounts. In addition, as 
self-employed business people, farmers do not have access to the 
pension or retirement funds that many Americans enjoy. When the time 
comes, farmers tend to rely on the sale of their accumulated capital 
assets, such as real estate, livestock, and machinery, in order to 
provide the income to sustain them during retirement. However, all too 
often, farmers are finding that the lump-sum payments of capital gains 
taxes levied on those assets leave little for retirement.
  To alleviate this predicament, my legislation would provide retiring 
farmers the opportunity to rollover the proceeds from the sale of their 
farms into a tax-deferred retirement account. Instead of paying a large 
lump-sum capital gains tax at the point of sale, the income from the 
sale of a farm would be taxed only as it is withdrawn from the 
retirement account. Such a change in method of taxation would help 
prevent the financial distress that many farmers now face upon 
retirement.
  Second, my legislation would address the diminishing interest of our 
younger rural citizens in continuing in farming. Because this 
legislation will facilitate the transition of our older farmers into a 
successful retirement, the Family Farm Retirement Equity Act will also 
pave the way for a more graceful transition of our younger farmers 
toward farm ownership. While low prices and low profits in farming will 
continue to take their toll on our younger farmers, I believe that my 
proposal will be one tool we can use to make farming more viable for 
the next generation.
  In past Congresses, this proposal has enjoyed the support of farmers 
and farm organizations throughout the country and the endorsement of 
the American Farm Bureau Federation, the American Sheep Industry 
Association, the American Sugar Beet Association, the National 
Association of Wheat Growers, the National Cattleman's Beef 
Association, the National Corn Growers Association, National Pork 
Producers Council, and the Southwester Peanut Growers Association. In 
addition, a modified version of this legislation was included in the 
Targeted Investment Incentive and Economic Growth Act of 1997, as 
introduced by Minority Leader Daschle and other Senators. I look 
forward to working with these groups and my colleagues again this 
Congress to act on this important legislation as swiftly as possible.
  In addition, I am introducing the Child Care Infrastructure Act, a 
bill to provide a tax credit for businesses that create child care 
opportunities for their employees. While I will have much more to say 
about this important legislation at a later date, I did want to put it 
in the hopper today. Providing quality child care is and should be at 
the center of our agenda for the 106th Congress. My proposal is a low-
cost approach to address this issue by involving the private sector and 
has received praise from businesses, parents, and day care workers 
alike.
  I ask unanimous consent that the full text of these bills be printed 
in the Record.
  There being no objection, the bills were ordered to be printed in the 
Record, as follows:

                                 S. 62

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

     SECTION 1. SHORT TITLE; REFERENCE TO INTERNAL REVENUE CODE.

       (a) Short Title.--This Act may be cited as the ``Family 
     Farm Retirement Equity Act of 1999''.

[[Page S500]]

       (b) Reference to Internal Revenue Code of 1986.--Except as 
     otherwise expressly provided, whenever in this Act an 
     amendment or repeal is expressed in terms of an amendment to, 
     or repeal of, a section or other provision, the reference 
     shall be considered to be made to a section or other 
     provision of the Internal Revenue Code of 1986.

     SEC. 2. ROLLOVER OF GAIN FROM SALE OF FARM ASSETS TO 
                   INDIVIDUAL RETIREMENT PLANS.

       (a) In General.--Part III of subchapter O of chapter 1 
     (relating to common nontaxable exchanges) is amended by 
     inserting after section 1034 the following new section:

     ``SEC. 1034A. ROLLOVER OF GAIN ON SALE OF FARM ASSETS INTO 
                   ASSET ROLLOVER ACCOUNT.

       ``(a) Nonrecognition of Gain.--Subject to the limits of 
     subsection (c), if for any taxable year a taxpayer has 
     qualified net farm gain from the sale of qualified farm 
     assets, then, at the election of the taxpayer, such gain 
     shall be recognized only to the extent it exceeds the 
     contributions to 1 or more asset rollover accounts of the 
     taxpayer for the taxable year in which such sale occurs.
       ``(b) Asset Rollover Account.--
       ``(1) General rule.--Except as provided in this section, an 
     asset rollover account shall be treated for purposes of this 
     title in the same manner as an individual retirement plan.
       ``(2) Asset rollover account.--For purposes of this title, 
     the term `asset rollover account' means an individual 
     retirement plan which is designated at the time of the 
     establishment of the plan as an asset rollover account. Such 
     designation shall be made in such manner as the Secretary may 
     prescribe.
       ``(c) Contribution Rules.--
       ``(1) No deduction allowed.--No deduction shall be allowed 
     under section 219 for a contribution to an asset rollover 
     account.
       ``(2) Aggregate contribution limitation.--Except in the 
     case of rollover contributions, the aggregate amount for all 
     taxable years which may be contributed to all asset rollover 
     accounts established on behalf of an individual shall not 
     exceed--
       ``(A) $500,000 ($250,000 in the case of a separate return 
     by a married individual), reduced by
       ``(B) the amount by which the aggregate value of the assets 
     held by the individual (and spouse) in individual retirement 
     plans (other than asset rollover accounts) exceeds $100,000.

     The determination under subparagraph (B) shall be made as of 
     the close of the taxable year for which the determination is 
     being made.
       ``(3) Annual contribution limitations.--
       ``(A) General rule.--The aggregate contribution which may 
     be made in any taxable year to all asset rollover accounts 
     shall not exceed the lesser of--
       ``(i) the qualified net farm gain for the taxable year, or
       ``(ii) an amount determined by multiplying the number of 
     years the taxpayer is a qualified farmer by $10,000.
       ``(B) Spouse.--In the case of a married couple filing a 
     joint return under section 6013 for the taxable year, 
     subparagraph (A) shall be applied by substituting `$20,000' 
     for `$10,000' for each year the taxpayer's spouse is a 
     qualified farmer.
       ``(4) Time when contribution deemed made.--For purposes of 
     this section, a taxpayer shall be deemed to have made a 
     contribution to an asset rollover account on the last day of 
     the preceding taxable year if the contribution is made on 
     account of such taxable year and is made not later than the 
     time prescribed by law for filing the return for such taxable 
     year (not including extensions thereof).
       ``(d) Qualified Net Farm Gain; Etc.--For purposes of this 
     section--
       ``(1) Qualified net farm gain.--The term `qualified net 
     farm gain' means the lesser of--
       ``(A) the net capital gain of the taxpayer for the taxable 
     year, or
       ``(B) the net capital gain for the taxable year determined 
     by only taking into account gain (or loss) in connection with 
     dispositions of qualified farm assets.
       ``(2) Qualified farm asset.--The term `qualified farm 
     asset' means an asset used by a qualified farmer in the 
     active conduct of the trade or business of farming (as 
     defined in section 2032A(e)).
       ``(3) Qualified farmer.--
       ``(A) In general.--The term `qualified farmer' means a 
     taxpayer who--
       ``(i) during the 5-year period ending on the date of the 
     disposition of a qualified farm asset materially participated 
     in the trade or business of farming, and
       ``(ii) owned (or who with the taxpayer's spouse owned) 50 
     percent or more of such trade or business during such 5-year 
     period.
       ``(B) Material participation.--For purposes of this 
     paragraph, a taxpayer shall be treated as materially 
     participating in a trade or business if the taxpayer meets 
     the requirements of section 2032A(e)(6).
       ``(4) Rollover contributions.--Rollover contributions to an 
     asset rollover account may be made only from other asset 
     rollover accounts.
       ``(e) Distribution Rules.--For purposes of this title, the 
     rules of paragraphs (1) and (2) of section 408(d) shall apply 
     to any distribution from an asset rollover account.
       ``(f) Individual Required To Report Qualified 
     Contributions.--
       ``(1) In general.--Any individual who--
       ``(A) makes a contribution to any asset rollover account 
     for any taxable year, or
       ``(B) receives any amount from any asset rollover account 
     for any taxable year,

     shall include on the return of tax imposed by chapter 1 for 
     such taxable year and any succeeding taxable year (or on such 
     other form as the Secretary may prescribe) information 
     described in paragraph (2).
       ``(2) Information required to be supplied.--The information 
     described in this paragraph is information required by the 
     Secretary which is similar to the information described in 
     section 408(o)(4)(B).
       ``(3) Penalties.--For penalties relating to reports under 
     this paragraph, see section 6693(b).''.
       (b) Contributions Not Deductible.--Section 219(d) (relating 
     to other limitations and restrictions) is amended by adding 
     at the end the following new paragraph:
       ``(5) Contributions to asset rollover accounts.--No 
     deduction shall be allowed under this section with respect to 
     a contribution under section 1034A.''.
       (c) Excess Contributions.--
       (1) In general.--Section 4973 (relating to tax on excess 
     contributions to individual retirement accounts, certain 
     section 403(b) contracts, and certain individual retirement 
     annuities) is amended by adding at the end the following new 
     subsection:
       ``(e) Asset Rollover Accounts.--For purposes of this 
     section, in the case of an asset rollover account referred to 
     in subsection (a)(1), the term `excess contribution' means 
     the excess (if any) of the amount contributed for the taxable 
     year to such account over the amount which may be contributed 
     under section 1034A.''.
       (2) Conforming amendments.--
       (A) Section 4973(a)(1) is amended by striking ``or'' and 
     inserting ``an asset rollover account (within the meaning of 
     section 1034A), or''.
       (B) The heading for section 4973 is amended by inserting 
     ``ASSET ROLLOVER ACCOUNTS,'' after ``CONTRACTS''.
       (C) The table of sections for chapter 43 is amended by 
     inserting ``asset rollover accounts,'' after ``contracts'' in 
     the item relating to section 4973.
       (d) Technical Amendments.--
       (1) Section 408(a)(1) (defining individual retirement 
     account) is amended by inserting ``or a qualified 
     contribution under section 1034A,'' before ``no 
     contribution''.
       (2) Section 408(d)(5)(A) is amended by inserting ``or 
     qualified contributions under section 1034A'' after 
     ``rollover contributions''.
       (3)(A) Section 6693(b)(1)(A) is amended by inserting ``or 
     1034A(f)(1)'' after ``408(o)(4)''.
       (B) Section 6693(b)(2) is amended by inserting ``or 
     1034A(f)(1)'' after ``408(o)(4)''.
       (4) The table of sections for part III of subchapter O of 
     chapter 1 is amended by inserting after the item relating to 
     section 1034 the following new item:

``Sec. 1034A. Rollover of gain on sale of farm assets into asset 
              rollover account.''.
       (e) Effective Date.--The amendments made by this section 
     shall apply to sales and exchanges after the date of the 
     enactment of this Act.
                                  ____


                                 S. 63

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Child Care Infrastructure 
     Act of 1999''.

     SEC. 2. ALLOWANCE OF CREDIT FOR EMPLOYER EXPENSES FOR CHILD 
                   CARE ASSISTANCE.

       (a) In General.--Subpart D of part IV of subchapter A of 
     chapter 1 of the Internal Revenue Code of 1986 (relating to 
     business related credits) is amended by adding at the end the 
     following:

     ``SEC. 45D. EMPLOYER-PROVIDED CHILD CARE CREDIT.

       ``(a) In General.--For purposes of section 38, the 
     employer-provided child care credit determined under this 
     section for the taxable year is an amount equal to 25 percent 
     of the qualified child care expenditures of the taxpayer for 
     such taxable year.
       ``(b) Dollar Limitation.--The credit allowable under 
     subsection (a) for any taxable year shall not exceed 
     $150,000.
       ``(c) Definitions.--For purposes of this section--
       ``(1) Qualified child care expenditure.--The term 
     `qualified child care expenditure' means any amount paid or 
     incurred--
       ``(A) to acquire, construct, rehabilitate, or expand 
     property--
       ``(i) which is to be used as part of a qualified child care 
     facility of the taxpayer,
       ``(ii) with respect to which a deduction for depreciation 
     (or amortization in lieu of depreciation) is allowable, and
       ``(iii) which does not constitute part of the principal 
     residence (within the meaning of section 121) of the taxpayer 
     or any employee of the taxpayer,
       ``(B) for the operating costs of a qualified child care 
     facility of the taxpayer, including costs related to the 
     training of employees, to scholarship programs, and to the 
     providing of increased compensation to employees with higher 
     levels of child care training,
       ``(C) under a contract with a qualified child care facility 
     to provide child care services to employees of the taxpayer, 
     or
       ``(D) under a contract to provide child care resource and 
     referral services to employees of the taxpayer.

[[Page S501]]

       ``(2) Qualified child care facility.--
       ``(A) In general.--The term `qualified child care facility' 
     means a facility--
       ``(i) the principal use of which is to provide child care 
     assistance, and
       ``(ii) which meets the requirements of all applicable laws 
     and regulations of the State or local government in which it 
     is located, including, but not limited to, the licensing of 
     the facility as a child care facility.

     Clause (i) shall not apply to a facility which is the 
     principal residence (within the meaning of section 121) of 
     the operator of the facility.
       ``(B) Special rules with respect to a taxpayer.--A facility 
     shall not be treated as a qualified child care facility with 
     respect to a taxpayer unless--
       ``(i) enrollment in the facility is open to employees of 
     the taxpayer during the taxable year,
       ``(ii) the facility is not the principal trade or business 
     of the taxpayer unless at least 30 percent of the enrollees 
     of such facility are dependents of employees of the taxpayer, 
     and
       ``(iii) the use of such facility (or the eligibility to use 
     such facility) does not discriminate in favor of employees of 
     the taxpayer who are highly compensated employees (within the 
     meaning of section 414(q)).
       ``(d) Recapture of Acquisition and Construction Credit.--
       ``(1) In general.--If, as of the close of any taxable year, 
     there is a recapture event with respect to any qualified 
     child care facility of the taxpayer, then the tax of the 
     taxpayer under this chapter for such taxable year shall be 
     increased by an amount equal to the product of--
       ``(A) the applicable recapture percentage, and
       ``(B) the aggregate decrease in the credits allowed under 
     section 38 for all prior taxable years which would have 
     resulted if the qualified child care expenditures of the 
     taxpayer described in subsection (c)(1)(A) with respect to 
     such facility had been zero.
       ``(2) Applicable recapture percentage.--
       ``(A) In general.--For purposes of this subsection, the 
     applicable recapture percentage shall be determined from the 
     following table:

                                                         The applicable
                                                              recapture
                                    ``If the recapture evpercentage is:
    Years 1-3....................................................100   
    Year 4........................................................85   
    Year 5........................................................70   
    Year 6........................................................55   
    Year 7........................................................40   
    Year 8........................................................25   
    Years 9 and 10................................................10   
    Years 11 and thereafter........................................0.  
       ``(B) Years.--For purposes of subparagraph (A), year 1 
     shall begin on the first day of the taxable year in which the 
     qualified child care facility is placed in service by the 
     taxpayer.
       ``(3) Recapture event defined.--For purposes of this 
     subsection, the term `recapture event' means--
       ``(A) Cessation of operation.--The cessation of the 
     operation of the facility as a qualified child care facility.
       ``(B) Change in ownership.--
       ``(i) In general.--Except as provided in clause (ii), the 
     disposition of a taxpayer's interest in a qualified child 
     care facility with respect to which the credit described in 
     subsection (a) was allowable.
       ``(ii) Agreement to assume recapture liability.--Clause (i) 
     shall not apply if the person acquiring such interest in the 
     facility agrees in writing to assume the recapture liability 
     of the person disposing of such interest in effect 
     immediately before such disposition. In the event of such an 
     assumption, the person acquiring the interest in the facility 
     shall be treated as the taxpayer for purposes of assessing 
     any recapture liability (computed as if there had been no 
     change in ownership).
       ``(4) Special rules.--
       ``(A) Tax benefit rule.--The tax for the taxable year shall 
     be increased under paragraph (1) only with respect to credits 
     allowed by reason of this section which were used to reduce 
     tax liability. In the case of credits not so used to reduce 
     tax liability, the carryforwards and carrybacks under section 
     39 shall be appropriately adjusted.
       ``(B) No credits against tax.--Any increase in tax under 
     this subsection shall not be treated as a tax imposed by this 
     chapter for purposes of determining the amount of any credit 
     under subpart A, B, or D of this part.
       ``(C) No recapture by reason of casualty loss.--The 
     increase in tax under this subsection shall not apply to a 
     cessation of operation of the facility as a qualified child 
     care facility by reason of a casualty loss to the extent such 
     loss is restored by reconstruction or replacement within a 
     reasonable period established by the Secretary.
       ``(e) Special Rules.--For purposes of this section--
       ``(1) Aggregation rules.--All persons which are treated as 
     a single employer under subsections (a) and (b) of section 52 
     shall be treated as a single taxpayer.
       ``(2) Pass-thru in the case of estates and trusts.--Under 
     regulations prescribed by the Secretary, rules similar to the 
     rules of subsection (d) of section 52 shall apply.
       ``(3) Allocation in the case of partnerships.--In the case 
     of partnerships, the credit shall be allocated among partners 
     under regulations prescribed by the Secretary.
       ``(f) No Double Benefit.--
       ``(1) Reduction in basis.--For purposes of this subtitle--
       ``(A) In general.--If a credit is determined under this 
     section with respect to any property by reason of 
     expenditures described in subsection (c)(1)(A), the basis of 
     such property shall be reduced by the amount of the credit so 
     determined.
       ``(B) Certain dispositions.--If during any taxable year 
     there is a recapture amount determined with respect to any 
     property the basis of which was reduced under subparagraph 
     (A), the basis of such property (immediately before the event 
     resulting in such recapture) shall be increased by an amount 
     equal to such recapture amount. For purposes of the preceding 
     sentence, the term `recapture amount' means any increase in 
     tax (or adjustment in carrybacks or carryovers) determined 
     under subsection (d).
       ``(2) Other deductions and credits.--No deduction or credit 
     shall be allowed under any other provision of this chapter 
     with respect to the amount of the credit determined under 
     this section.''
       (b) Conforming Amendments.--
       (1) Section 38(b) of the Internal Revenue Code of 1986 is 
     amended--
       (A) by striking ``plus'' at the end of paragraph (11),
       (B) by striking the period at the end of paragraph (12), 
     and inserting a comma and ``plus'', and
       (C) by adding at the end the following:
       ``(13) the employer-provided child care credit determined 
     under section 45D.''
       (2) The table of sections for subpart D of part IV of 
     subchapter A of chapter 1 of such Code is amended by adding 
     at the end the following:

``Sec. 45D. Employer-provided child care credit.''
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     1999.
                                 ______
                                 
      By Mr. MOYNIHAN (for himself and Mr. Schumer):
  S. 66. A bill to establish the Kate Mullany National Historic Site in 
the State of New York, and for other purposes; to the Committee on 
Energy and Natural Resources.

                          ____________________