[Congressional Record Volume 145, Number 39 (Thursday, March 11, 1999)]
[Senate]
[Pages S2576-S2604]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mrs. FEINSTEIN:
  S. 585. A bill to require health insurance coverage for certain 
reconstructive surgery; to the Committee on Health, Education, Labor, 
and Pensions.


                   reconstructive surgery act of 1999

 Mrs. FEINSTEIN. Mr. President, today, I am introducing a bill 
to require health insurance plans to cover medically necessary 
reconstructive surgery for congenital defects, developmental 
abnormalities, trauma, infection, tumors, or disease.
  This bill is modeled on a new California law and responds to the 
growing incidence of denials of coverage by insurance, often managed 
care. Despite physicians' judgment that surgery is often medically 
necessary, too many plans are labeling it ``cosmetic surgery.'' The 
American Medical News calls the HMO's response that these surgeries are 
cosmetic as, ``a classic health plan word game. . . .''
  Testifying before the California Assembly Committee on Insurance, Dr. 
Henry Kawamoto put it well. He said:

       It used to be that if you were born with something 
     deforming, or were in an accident and had bad scars, the 
     surgery performed to fix the problem was considered 
     reconstructive surgery. Now, insurers of many kinds are 
     calling it cosmetic surgery and refusing to pay for it.

  The Los Angeles Times reported on July 9, 1997, ``There has been a 
virtual wipeout of coverage to repair the appearance of children whose 
looks are affected by illness, congenital abnormalities or trauma.''
  Similarly, the New York University Physician reported in their spring 
1998 issue:

       Before the advent of managed care, repairing abnormalites 
     was considered reconstructive surgery and insurance companies 
     reimbursed for the medical, hospital and surgical costs of 
     their rehabilitation. But in today's reconfigured medical 
     reimbursement system, many insurance companies and managed 
     care organizations will not pay for reconstruction of facial 
     deformities because it is deemed a ``cosmetic'' and not a 
     ``functional'' repair.

  This bill is endorsed by the March of Dimes, the American Academy of 
Pediatrics, the National Organization for Rare Disorders, the American 
Society of Plastic and Reconstructive Surgeons, the American College of 
Surgeons, the American Association of Pediatric Plastic Surgeons, the 
American Society of Craniofacial Surgery, the American Society of 
Maxillofacial Surgeons, the American Society of Plastic and 
Reconstructive Surgeons and the National Foundation for Facial 
Reconstruction.
  The children who face refusals to pay for surgery are the true 
evidence that this bill is needed.
  Hanna Gremp, a 6-year old from my own state of California, was born 
with a congenital birth defect, called bilateral microtia, the absence 
of an inner ear. Once the first stage of the surgery was complete, the 
Gremp's HMO denied the next surgery for Hanna. They called the other 
surgeries ``cosmetic'' and not medically necessary.
  Michael Hatfield, a 19-year old from Texas, who has gone through 
similar struggles. He was born with a congenital birth defect, that is 
known as a midline facial cleft. The self-insured plan his parents had 
only paid for a small portion of the surgery which reconstructed his 
nose. The HMO also refused to pay any part of the surgery that 
reconstructed his cheekbones and eye sockets. The HMO considered some 
of these surgeries to be ``cosmetic.''
  Cigna Health Care denied coverage for surgery to construct an ear for 
a little California girl born without an ear and only after adverse 
press coverage reversed its position saying that, ``It was determined 
that studies have show some functional improvement following surgery.''
  Qual-Med, another California HMO, denied coverage for reconstructive 
surgery for a little boy without an ear, a condition called microtia, 
and after only many appeals and two years delay, authorized it.
  The bill uses medically-recognized terms to distinguish between 
medically necessary surgery and cosmetic surgery. It defines medically 
necessary reconstructive surgery as surgery ``performed to correct or 
repair abnormal structures of the body caused by congenital defects, 
developmental abnormalities, trauma, infection, tumors, or disease to 
(1) improve functions; or (2) give the patient a normal appearance, to 
the extent possible, in the judgment of the physician performing the 
surgery.'' The bill specifically excludes cosmetic surgery, defined as 
``surgery that is performed to alter or reshape normal structures of 
the body in order to improve appearance.''
  Examples of conditions for which surgery might be medically necessary 
are the following: cleft lips and palates, burns, skull deformities, 
benign tumors, vascular lesions, missing pectoral muscles that cause 
chest deformities, Crouson's syndrome (failure of the mid-face to 
develop normally), and injuries from accidents.
  The American Society of Plastic and Reconstructive Surgeons has 
released a survey on reconstructive surgery, concluding that 53.5 
percent of surgeons surveyed have had pediatric patients who in the 
last two years were denied coverage for reconstructive surgery. Of 
those same surgeons surveyed whose pediatric patients were totally or 
partially denied coverage, 74 percent had patients denied for initial 
procedures and 53 percent denied for subsequent procedures.
  Another reason for this bill is that only 17 out of 50 states have 
state legislation which requires insurance coverage for children's 
deformities and congenital defects. My own state, California, passed 
legislation in 1998 requiring insurance plans to cover medically 
necessary reconstructive surgery, and on September 23, 1998 it was 
signed by former Governor Pete Wilson. This bill was enacted after many 
sad personal stories, and hours of testimony were presented to the 
state legislators.
  This bill is an effort to address yet one more development in the 
health insurance industry that almost daily is creating new hassles 
when people try to get coverage for the plan they pay for every month.
  We need our body parts to function and fortunately modern medicine 
today often make that happen. We can restore, repair and make whole 
parts which by fate, accident, genes, or whatever, do not perform as 
they should. I hope this bill can make that happen.
                                 ______
                                 
      By Mr. KOHL (for himself, and Mr. Sessions):

[[Page S2577]]

  S. 586. A bill to amend title 11, United States Code, to limit the 
value of certain real property that a debtor may elect to exempt under 
State or local law, and for other purposes to the Committee on the 
Judiciary.


                  bankruptcy abuse reform act of 1999

  Mr. KOHL. Mr. President, I rise today, with Senator Sessions, to 
introduce the bipartisan Bankruptcy Abuse Reform Act of 1999, 
legislation which addresses a serious problem that threatens Americans' 
confidence in our bankruptcy laws. The measure would cap at $100,000 
the State homestead exemption that an individual filing for personal 
bankruptcy can claim. It passed the Senate last year when it was 
included in the Consumer Bankruptcy Reform Act of 1998 (H.R. 3150), and 
I hope that we can all support this measure again this year. The goal 
of our measure is simple but vitally important: to make sure that our 
Bankruptcy Code is more than just a beachball for crooked millionaires 
who want to hide their assets.
  Let me tell you why this legislation is critically needed. In chapter 
7 Federal personal bankruptcy proceedings, the debtor is allowed to 
exempt certain possessions and interests from being used to satisfy his 
outstanding debts. One of the chief things that a debtor seeks to 
protect is his home, and I agree with that in principle. Few question 
that debtors should be able to keep a roof over their heads. But, in 
practice, this homestead exemption has become a source of great abuse.
  Under section 522 of the Code, a debtor may opt to exempt his home 
according to local, State, or Federal bankruptcy provisions. The 
Federal exemption allows the debtor to shield up to $15,000 of value in 
his house. The State exemptions vary tremendously: some States do not 
allow the debtor to exempt any of his home's value, while a handful of 
states set no ceiling and allow an unlimited exemption. The vast 
majority of states have exemptions under $40,000.
  Our proposal would amend Section 522 to cap State exemptions so that 
no debtor could ever exempt more than $100,000 of the value of his 
home.
  Mr. President, in the past few years, the ability of debtors to use 
State homestead exemptions has led to flagrant abuses of the Bankruptcy 
Code. Multimillionaire debtors have moved to one of the states with 
unlimited exemptions--most often Florida or Texas--bought multi-
million-dollar houses, and continued to live like kings even after 
declaring bankruptcy. This shameless manipulation of the Bankruptcy 
Code cheats honest creditors out of compensation and rewards only those 
who can ``game'' the system. Oftentimes, the creditor who is robbed is 
the American taxpayer. In recent years, S&L swindlers, convicted 
insider trader convicts, and others have managed to protect their ill-
gotten gains through this loophole.
  The owner of a failed Ohio S&L, who was convicted of securities 
fraud, wrote off most of $300 million in bankruptcy claims, but still 
held on to the multimillion dollar ranch he bought in Florida. A 
convicted Wall Street financier filed bankruptcy while owing at least 
$50 million in debts and fines, but still kept his $5 million Florida 
mansion with 11 bedrooms and 21 bathrooms. And just last year, movie 
star Burt Reynolds wrote off over $8 million in debt through 
bankruptcy, but still held onto his $2.5 million Florida estate. These 
deadbeats stay wealthy while legitimate creditors--including the U.S. 
Government--get the short end of the stick.
  Simply put, the current practice is grossly unfair and contravenes 
the intent of our laws: People are supposed to get a fresh start, not a 
head start, under the Bankruptcy Code.
  Mr. President, the legislation that I have introduced today is 
simple, effective and straightforward. It caps the homestead exemption 
at $100,000, which is far more than estimated median home equity of 
people in bankruptcy. It is endorsed by the National Bankruptcy Review 
Commission. And it will protect middle class Americans while preventing 
the abuses that are making the middle class question the integrity of 
our laws--the abuses the average American taxpayer is paying for out of 
pocket.
  Indeed, it is even generous to debtors. Less than ten states have a 
homestead exemption that exceeds $100,000. More than two-thirds of 
states cap the exemption at $40,000 or less. My own home state of 
Wisconsin has a $40,000 exemption and that, in my opinion, is more than 
sufficient.
  Mr. President, this proposal is an effort to make our bankruptcy laws 
more equitable. I urge my colleagues to support this important measure.
                                 ______
                                 
      By Mr. ASHCROFT:
  S. 587. A bill to provide for the mandatory suspension of Federal 
benefits to convicted drug traffickers, and for other purposes; to the 
Committee on the Judiciary.


          no federal benefits for drug traffickers act of 1999

  Mr. ASHCROFT. Mr. President, the time for mixed messages in our war 
against drugs has passed. There was a time when our message on illegal 
drugs was crystal clear. ``Just say no.'' The results of that simple 
message were also clear: The decade of the 1980's saw substantial and 
persistent decreases in the level of drug use, and in the level of 
teenage drug use in particular. Sadly, however, the current 
Administration has offered America and its children a mixed message on 
drugs.
  The President himself has shifted the message from ``just say no'' to 
``just don't inhale.'' Even the head of the Drug Enforcement Agency 
candidly has admitted that in the current climate we lack the will to 
win the war against drugs. This is intolerable. We must return to a 
clear message in the war against drugs--a message of zero tolerance for 
those who would attempt to ruin our children's lives through the 
scourge of illegal drugs. The government must speak clearly and 
unequivocally. Trafficking in illegal drugs will not be tolerated.
  However, we will not succeed in convincing either drug dealers or our 
children that we are serious about the war on drugs if we send them 
mixed messages. One mixed message sent by current law is that convicted 
drug dealers remain eligible for federal government benefits. We need 
to change that practice.
  Mr. President, the bill I introduce today, the ``No Federal Benefits 
for Drug Traffickers Act'' requires the suspension of federal benefits 
to convicted drug traffickers. This bill will send a clear message that 
we mean what we say in the war against drugs. Current federal law 
provides for the denial of federal benefits (excluding certain programs 
like food stamps, aid to families with dependent children, and approved 
drug treatment programs) for individuals convicted of drug trafficking 
offenses. Unfortunately, however, the law gives judges unlimited 
discretion to decide whether or not to suspend a convicted drug 
trafficker's federal benefits. For example, under current law a repeat 
offender could retain his full federal benefits.
  The ``No Federal Benefits for Drug Traffickers Act'' addresses this 
loophole in the current law by mandating the suspension of a convicted 
drug trafficker's federal benefits for at least a minimum period of 
time. Specifically, the bill requires the suspension of a convicted 
drug offender's federal benefits for a minimum of one year. The bill 
also mandates suspension of benefits for at least three years upon a 
second conviction.
  In addition, the bill closes a loophole that allowed drug trafficker 
who were supposed to be barred from receiving federal benefits for life 
because of three separate drug trafficking convictions to regain their 
eligibility for federal benefits. Once again we need to make our 
message clear and unmistakable. Under the bill I introduce today, life 
means life and it is truly three strikes and you're out.
  This is what we need in the war against drugs--a clear message. Those 
who choose to traffic in drugs have no legitimate claim to federal 
benefits. This is common sense. There is no need for exceptions or 
discretion. There is a need for clarity, and this bill provides that 
clarity.
                                 ______
                                 
      By Mr. HARKIN:
  S. 589. A bill to require the National Park Service to undertake a 
study of the Loess Hills area in western Iowa to review options for the 
protection and interpretation of the area's natural, cultural, and 
historical resources; to the Committee on Energy and Natural Resources.


                  loess hills preservation act of 1999

  Mr. HARKIN. Mr. President, today, I am introducing legislation 
calling

[[Page S2578]]

upon the National Park Service to conduct a study of the Loess Hills in 
western Iowa. This study would be the first official step towards 
possible national protection for the Loess Hills.
  Specifically, this legislation would require the National Park 
Service to monitor the area between Waubansie State Park and Stone Park 
to study the possibility of a portion of this area to receive National 
Park status.
  Loess Hills is a unique national treasure that was formed by ancient 
glaciers and hundreds of centuries of westerly winds. Only the loess 
soil in China has accumulated as high as Iowa's. Although these hills 
have survived for hundreds of centuries, today they are beginning to 
crumble. Urban sprawl is unfortunately beginning to take its toll on 
Loess Hills. Protecting this area must be given a high priority.
  In 1986, the Loess Hills area was designated as a National Natural 
Landmark by the National Park Service. This gives recognition to this 
area as an area of national significance. Although this designation 
encourages landowners to use conservation practices in use of the area, 
this designation does nothing to control land ownership or to restrict 
land use.
  The only thing holding the loess in place is the roots of the 
vegetation. Today, however, as the human exploitation of the hills 
continues to increase the destruction of the vegetation, loess is left 
once again blowing in the winds as the fragile hills begins to flatten.
  This is of great concern to me. This area which marks one of the only 
remaining natural ecosystems in the state is one of the few areas where 
Iowans can experience nature. Iowa presently ranks 49th among the 50 
states in National Park and Forest space. Iowa is also 400 miles away 
from a sizable national recreation area (the Boundary Waters Canoe 
Area). The Loess Hills, however, is an area of national significance 
and has the potential to be a much needed National Park for the Plains 
States.
  Mr. President, since 1992, I have secured funding through the United 
States Department of Agriculture to design better bridges and other 
structures in the Loess Hills area to reduce soil erosion. But more 
needs to be done.
  One thing I would like to make clear--this study can only be 
successfully implemented with the participation of local governments in 
western Iowa and private property owners.
  The Loess Hills are an Iowa treasure. This legislation would begin 
the process of making Loess Hills a national treasure.
  I invite my colleagues to join me as co-sponsors of this much needed 
legislation. 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. 589

       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 ``Loess Hills Preservation Act 
     of 1999''.

     SEC. 2. FINDINGS.

       The Congress finds that--
       (1) The Loess Hills area in western Iowa, formed by ancient 
     glaciers and hundreds of centuries of westerly winds blowing 
     across the Missouri River, has resulted in the largest loess 
     formation in the United States, and one of the two largest in 
     the world;
       (2) portions of the Loess Hills remain undeveloped and 
     provide an important opportunity to protect an historic and 
     unique natural resource;
       (3) a program to study the Loess Hills can only be 
     successfully implemented with the cooperation and 
     participation of affected local governments and landowners;
       (4) in 1986, the Loess Hills area was designated as a 
     National Natural Landmark in recognition of the area's 
     nationally significant natural resources;
       (5) although significant natural resources remain in the 
     area, increasing development in the area has threatened the 
     future stability and integrity of the Loess Hills area; and
       (6) the Loess Hills area merits further study by the 
     National Park Service, in cooperation with the State of Iowa, 
     local governments, and affected landowners, to determine 
     appropriate means to better protect, preserve, and interpret 
     the significant resources in the area;

     SEC. 3. DEFINITIONS.

       As used in this Act--
       (1) the term ``Loess Hills'' means the area in the State of 
     Iowa located between Waubansie State Park and Stone Park, and 
     which includes Plymouth, Woodbury, Monona, Harrison, 
     Pottawattamie, Mills, and Fremont counties.
       (2) the term ``Secretary'' means the Secretary of the 
     Interior.
       (3) the term ``State'' means the State of Iowa.

     SEC. 4. LOESS HILLS STUDY.

       (a) The Secretary shall undertake a study of the Loess 
     Hills area to review options for the protection and 
     interpretation of the area's natural, cultural, and 
     historical resources. The study shall include, but need not 
     be limited to an analysis of the suitability and feasibility 
     of designating the area as--
       (1) a unit of the National Park System;
       (2) a National Heritage Area or Heritage Corridor; or
       (3) such other designation as may be appropriate.
       (b) The study shall examine the appropriateness and 
     feasibility of cooperative protection and interpretive 
     efforts between the United States, the State, and its 
     political subdivisions.
       (c) The Secretary shall consult in the preparation of the 
     study with State and local governmental entities, affected 
     landowners, and other interested public and private 
     organizations and individuals.
       (d) The study shall be completed within one year after the 
     date funds are made available. Upon its completion, the 
     Secretary shall transmit a report of the study, along with 
     any recommendations, to the Committee on Energy and Natural 
     Resources of the United States Senate and the Committee on 
     Resources of the United States House of Representatives.

     SEC. 5. AUTHORIZATION OF APPROPRIATIONS.

       There is authorized to be appropriated such sums as may be 
     necessary to carry out this Act.
                                 ______
                                 
      By Mr. FEINGOLD (for himself and Mr. Leahy):
  S. 590. A bill to amend the Internal Revenue Code of 1986 to repeal 
the percentage depletion allowance for certain hardrock mines, and for 
other purposes; to the Committee on Finance.


ELIMINATION OF DOUBLE SUBSIDIES FOR THE HARDROCK MINING INDUSTRY ACT OF 
                                  1999

  Mr. FEINGOLD. Mr. President, I am pleased to introduce legislation to 
eliminate from the federal tax code percentage depletion allowances for 
hardrock minerals mined on federal public lands. I am joined in 
introducing this legislation by my colleague from Vermont, Mr. Leahy.

  The President proposes the elimination of the percentage depletion 
allowance on public lands in his FY 2000 budget. The President's FY 
2000 budget estimates that, under this legislation, income to the 
federal treasury from the elimination of percentage depletion 
allowances for hardrock mining on public lands would total $478 million 
over five years, more than $95 million in this year alone. These 
savings are calculated as the excess amount of federal revenues above 
what would be collected if depletion allowances were limited to ``sunk 
costs'' in capital investments. Percentage depletion allowances are 
contained in the tax code for extracted fuel, minerals, metal and other 
mined commodities. These allowances have a combined value, according to 
1994 estimates by the Joint Committee on Taxation, of $4.8 billion.
  Mr. President, these percentage depletion allowances were initiated 
by the Corporation Excise Act of 1909. That's right, 1909. Provisions 
for a depletion allowance based on the value of the mine were made 
under a 1912 Treasury Department regulation, but difficulty in applying 
this accounting principle to mineral production led to the initial 
codification of the mineral depletion allowance in the Tariff Act of 
1913. The Revenue Act of 1926 established percentage depletion much in 
its present form for oil and gas. The percentage depletion allowance 
was then extended to metal mines, coal, and other hardrock minerals by 
the Revenue Act of 1932, and has been adjusted several times since.
  Percentage depletion allowances were historically placed in the tax 
code to reduce the effective tax rates in the mineral and extraction 
industries far below tax rates on other industries, providing 
incentives to increase investment, exploration and output. However, 
percentage depletion also makes it possible to recover many times the 
amount of the original investment.
  There are two methods of calculating a deduction to allow a firm to 
recover the costs of their capital investment: cost depletion, and 
percentage depletion. Cost depletion allows for the recovery of the 
actual capital investment--the costs of discovering, purchasing, and 
developing a mineral reserve--over the period during which the reserve 
produces income. Using

[[Page S2579]]

cost depletion, a company would deduct a portion of its original 
capital investment minus any previous deductions, in an amount that is 
equal to the fraction of the remaining recoverable reserves. Under this 
method, the total deductions cannot exceed the original capital 
investment.
  However, under percentage depletion, the deduction for recovery of a 
company's investment is a fixed percentage of ``gross income''--namely, 
sales revenue--from the sale of the mineral. Under this method, total 
deductions typically exceed, let me be clear on that point, Mr. 
President, exceed the capital that the company invested.
  The rates for percentage depletion are quite significant. Section 613 
of the U.S. Code contains depletion allowances for more than 70 metals 
and minerals, at rates ranging from 10 percent to 22 percent.
  In addition to repealing the percentage depletion allowances for 
minerals mined on public lands, Mr. President, my bill also creates a 
new fund, called the Abandoned Mine Reclamation Fund. One fourth of the 
revenue raised by the bill, or approximately $120 million dollars, will 
be deposited into an interest bearing fund in the Treasury to be used 
to clean up abandoned hardrock mines in states that are subject to the 
1872 Mining Law. Mineral Policy Center estimates that there are 557,650 
hardrock abandoned mine sites nationwide and the cost of cleaning them 
up will range from $32.7 billion to $71.5 billion.
  There are currently no comprehensive federal or state programs to 
address the need to clean up old mine sites. Reclaiming these sites 
requires the enactment of a program with explicit authority to clean up 
abandoned mine sites and the resources to do it. My legislation is a 
first step toward providing the needed authority and resources.
  Mr. President, in today's budget climate we are faced with the 
question of who should bear the costs of exploration, development, and 
production of natural resources: all taxpayers, or the users and 
producers of the resource? For more than a century, the mining industry 
has been paying next to nothing for the privilege of extracting 
minerals from public lands and then abandoning its mines. Now those 
mines are adding to the nation's environmental and financial burdens. 
We face serious budget choices this fiscal year, yet these subsidies 
remain a persistent tax expenditure that raise the deficit for all 
citizens or shift a greater tax burden to other taxpayers to compensate 
for the special tax breaks provided to the mining industry.
  Mr. President, the measure I am introducing is fairly 
straightforward. It eliminates the percentage depletion allowance for 
hardrock minerals mined on public lands while continuing to allow 
companies to recover reasonable cost depletion.
  Though at one time there may have been an appropriate role for a 
government-driven incentive for enhanced mineral production, there is 
now sufficient reason to adopt a more reasonable depletion allowance 
that is consistent with those given to other businesses.
  Mr. President, the time has come for the Federal Government to get 
out of the business of subsidizing business. We can no longer afford 
its costs in dollars or its cost to the health of our citizens. This 
legislation is one step toward the goal of ending these corporate 
welfare subsidies.
  I ask unanimous consent that a copy of the legislation be printed in 
the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 590

       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 ``Elimination of Double 
     Subsidies for the Hardrock Mining Industry Act of 1999''.

     SEC. 2. REPEAL OF PERCENTAGE DEPLETION ALLOWANCE FOR CERTAIN 
                   HARDROCK MINES.

       (a) In General.--Section 613(a) of the Internal Revenue 
     Code of 1986 (relating to percentage depletion) is amended by 
     inserting ``(other than hardrock mines located on lands 
     subject to the general mining laws or on land patented under 
     the general mining laws)'' after ``In the case of the 
     mines''.
       (b) General Mining Laws Defined.--Section 613 of the 
     Internal Revenue Code of 1986 is amended by adding at the end 
     the following:
       ``(f) General Mining Laws.--For purposes of subsection (a), 
     the term `general mining laws' means those Acts which 
     generally comprise chapters 2, 12A, and 16, and sections 161 
     and 162 of title 30 of the United States Code.''
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     1998.

     SEC. 3. ABANDONED MINE RECLAMATION FUND.

       (a) In General.--Subchapter A of chapter 98 of the Internal 
     Revenue Code of 1986 (relating to establishment of trust 
     funds) is amended by adding at the end the following:

     ``SEC. 9511. ABANDONED MINE RECLAMATION FUND.

       ``(a) Creation of Trust Fund.--There is established in the 
     Treasury of the United States a trust fund to be known as the 
     `Abandoned Mine Reclamation Trust Fund' (in this section 
     referred to as `Trust Fund'), consisting of such amounts as 
     may be appropriated or credited to the Trust Fund as provided 
     in this section or section 9602(b).
       ``(b) Transfers to Trust Fund.--There are hereby 
     appropriated to the Trust Fund amounts equivalent to 25 
     percent of the additional revenues received in the Treasury 
     by reason of the amendments made by section 2 of the 
     Elimination of Double Subsidies for the Hardrock Mining 
     Industry Act of 1999.
       ``(c) Expenditures From Trust Fund.--
       ``(1) In general.--Amounts in the Trust Fund shall be 
     available, as provided in appropriation Acts, to the 
     Secretary of the Interior for--
       ``(A) the reclamation and restoration of lands and water 
     resources described in paragraph (2) adversely affected by 
     mineral (other than coal and fluid minerals) and mineral 
     material mining, including--
       ``(i) reclamation and restoration of abandoned surface mine 
     areas and abandoned milling and processing areas,
       ``(ii) sealing, filling, and grading abandoned deep mine 
     entries,
       ``(iii) planting on lands adversely affected by mining to 
     prevent erosion and sedimentation,
       ``(iv) prevention, abatement, treatment, and control of 
     water pollution created by abandoned mine drainage, and
       ``(v) control of surface subsidence due to abandoned deep 
     mines, and
       ``(B) the expenses necessary to accomplish the purposes of 
     this section.
       ``(2) Lands and water resources.--
       ``(A) In general.--The lands and water resources described 
     in this paragraph are lands within States that have land and 
     water resources subject to the general mining laws or lands 
     patented under the general mining laws--
       ``(i) which were mined or processed for minerals and 
     mineral materials or which were affected by such mining or 
     processing, and abandoned or left in an inadequate 
     reclamation status before the date of the enactment of this 
     section,
       ``(ii) for which the Secretary of the Interior makes a 
     determination that there is no continuing reclamation 
     responsibility under State or Federal law, and
       ``(iii) for which it can be established to the satisfaction 
     of the Secretary of the Interior that such lands or resources 
     do not contain minerals which could economically be extracted 
     through remining of such lands or resources.
       ``(B) Certain sites and areas excluded.--The lands and 
     water resources described in this paragraph shall not include 
     sites and areas which are designated for remedial action 
     under the Uranium Mill Tailings Radiation Control Act of 1978 
     (42 U.S.C. 7901 et seq.) or which are listed for remedial 
     action under the Comprehensive Environmental Response 
     Compensation and Liability Act of 1980 (42 U.S.C. 9601 et 
     seq.).
       ``(3) General mining laws.--For purposes of paragraph (2), 
     the term `general mining laws' means those Acts which 
     generally comprise chapters 2, 12A, and 16, and sections 161 
     and 162 of title 30 of the United States Code.''
       (b) Conforming Amendment.--The table of sections for 
     subchapter A of chapter 98 of the Internal Revenue Code of 
     1986 is amended by adding at the end the following:

``Sec. 9511. Abandoned Mine Reclamation Trust Fund.''
                                 ______
                                 
      By Mr. BOND:
  S. 592. A bill to improve the health of children; to the Committee on 
Finance.


                         Healthy Kids 2000 Act

  Mr. BOND. Mr. President, one year ago today, the Birth Defects 
Prevention Act passed the House of Representatives, clearing its way 
for the President's signature.
  With this new funding, the Centers for Disease Control has 
implemented a national strategy, in conjunction with the States and 
local organizations such as the March of Dimes, to prevent the 
devastating incidence of birth defects.
  Building upon that success, today I rise to introduce the Healthy 
Kids 2000 Act--comprehensive approach which addresses the broad 
spectrum of health issues affecting our nation's children.
  And I want to thank the March of Dimes and the National Association 
of Children's Hospitals for supporting me in this effort to improve the 
health of our nation's children and pregnant women as we move into the 
new millennium.

[[Page S2580]]

  I also want to thank my colleague from Ohio, Mike DeWine, for his 
work on children's health issues, and for allowing me to adopt some of 
his ideas for inclusion in this bill. Senator DeWine has been a 
dedicated leader on children's health, and has been essential to the 
development of the sections of this bill that focus on poison control 
centers and pediatric research within the National Institutes of 
Health.
  I am struck, every time I go into the neonatal wards across my home 
state of Missouri, at the tiny one and two pound babies, hooked up to 
monitors and tubes and looking so helpless. Many of them will survive; 
a few may not. My first thought is always one of thanks that I have 
been blessed with a very healthy son.
  The good news is that we are making progress in preventing diseases 
and in making sick and injured children well. Healing never thought 
possible a few years ago for those who are burn victims, or born with 
birth defects, or trauma victims, or even cancer patients, now occurs 
on a daily basis around our country.
  The question about how to finance health care and how to improve 
access to and the quality of health care, however, are the hottest 
challenges we face as a nation.
  There are some things we can all agree on: that the care and well-
being of our children should come first, particularly those who are 
ill. Prenatal care is also paramount, because a great deal of child 
health is determined in the womb.
  Thus as a nation, we must stand up and speak for those who cannot 
speak for themselves.
  That is why I am introducing the ``Healthy Kids 2000 Act.'' The idea 
behind it is simple: we want pregnant women to be healthy, and we want 
children to be healthy. So we are going to remove some of the barriers 
they encounter in receiving good, appropriate health care.
  This bill will give States the flexibility to enroll eligible 
pregnant women in the State Children's Health Insurance Program (CHIP) 
and to coordinate essential outreach efforts to enroll qualified 
children. This program has already been funded by Congress to assist 10 
million children whose families lack health insurance. These children 
are eligible to receive basic health care services like immunizations 
and antibiotics for ear infections, but pregnant women are not now 
eligible. Since so much of a child's health is determined in the womb, 
it is imperative that low-income pregnant women receive quality 
prenatal care.
  Similarly, we need to ensure that the National Institutes of Health 
research machine is focusing on diseases and conditions which afflict 
our nation's children, such as birth defects, SIDS, cystic fibrosis, 
juvenile diabetes, and arthritis, just to name a few. A simple 
statistic will highlight this need: 80% of prescription medications 
marketed in the U.S. today are not approved by the FDA for use by 
children under 12 because studies have not been conducted to document 
their safety or whether or not they work for children. That is a 
terrible disservice to the young people of our country who may need the 
relief of a particular prescription drug.
  This bill will also consolidate programs and provide more funds for 
local initiatives to prevent birth defects and maternal mortality.
  150,000 infants are born each year with a serious birth defect, and 
birth defects are still the leading cause of infant death. During the 
1990s we have witnessed an increase in maternal death during pregnancy 
and childbirth. There is no question that we need better approaches to 
ensure that women have healthier, safe pregnancies, and healthier 
babies. And my bill will help fund these vital prevention strategies.
  This bill will also ensure direct access to obstetric care, and 
direct access to pediatric care. Children have health needs that are 
very different than those of the adult population. Diseases and 
medications behave differently than in adults, and when children are 
treated, it should be by those who understand those differences.
  Finally, this initiative will assist children's hospitals in 
educating the next generation of pediatricians. Even with strapped 
budgets, teaching children's hospitals offer the more egalitarian 
health care in this country. These hospitals turn no one away. And it 
is essential that we support this noble mission by equipping children's 
hospitals with the tools to continue their educational and research 
efforts.
  So much of the most important work in our society goes unnoticed, and 
unrewarded. Saving the lives of our children, improving the health of 
our children, even caring for our children on a daily basis is not 
glamorous work, or sometimes even all that much fun. Doctors, nurses, 
mothers, fathers, child-care workers and teachers are performing the 
most difficult, and the most important, work of our society: raising up 
the next generation to be happy, healthy, and productive citizens.
  We must assist them in their efforts, and we can take a positive step 
by debating and enacting Healthy Kids 2000.
  Mr. President, I ask unanimous consent that letters of support be 
printed in the Record.
  There being no objection, the letters were ordered to be printed in 
the Record, as follows:

                                           National Association of


                                         Children's Hospitals,

                                    Alexandria, VA, March 9, 1999.
     Hon. Christopher ``Kit'' Bond,
     U.S. Senate, Russell Senate Office Building, Washington, DC.
       Dear Senator Bond: The National Association of Children's 
     Hospitals (N.A.C.H.), which represents more than 100 
     children's hospitals across the country, strongly supports 
     your efforts to address the full spectrum of children's 
     health care needs through your new ``Healthy Kids 200 Act,'' 
     legislation that knits together several important individual 
     initiatives to improve the health and well-being of our 
     nation's children.
       This legislation takes a comprehensive approach to 
     addressing barriers and obstacles, both health system and 
     governmental, that families and pediatric providers encounter 
     in improving the health care of children. Its focus on 
     strengthening health coverage, graduate medical education, 
     research, and public health protections for children clearly 
     reflects the children's hospitals' own four-fold missions of 
     clinical care, education, research, and public health 
     advocacy for child health. Together, they are essential to 
     the ability of communities to meet the unique health care 
     needs of their children.


                       children's health coverage

       This legislation recognizes that the prescription for good, 
     comprehensive health care for children is not only health 
     insurance coverage but also quality and access to care. The 
     ``Healthy Kids 200 Act'' would provide important health care 
     protections for children as well as enable providers, 
     professionals, systems, and workers to assure improved 
     quality of health care for children.
       By providing families access to providers that specialize 
     in pediatrics for the care delivered to their children, the 
     legislation takes the important step of ensuring that 
     children receive health care in the most appropriate setting 
     and condition possible.
       The legislation recognizes that, as the President's 
     Advisory Commission on Consumer Protection and Quality in the 
     Health Care Industry writes, ``[c]hildren have health and 
     development needs that are markedly different from adults and 
     require age-appropriate care. Developmental changes, 
     dependency on others, and different patterns of illness, 
     disability and injury require that attention be paid to the 
     unique needs of children in the health system.''
       In addition, the legislation improves upon the State 
     Children's Health Insurance Program (SCHIP) by allowing 
     states the option to use SCHIP to provide health insurance 
     coverage for pregnant women. The linkages between prenatal 
     care and healthy children have long been understood in 
     American social policy, including Medicaid, the Maternal and 
     Child Health Block Grant and WIC. As the GAO found in its 
     report Health Insurance; Coverage Leads to Increased Health 
     Care Access for Children, Medicaid coverage of maternal and 
     child health improves health care access but also decreases 
     infant and child mortality.
       For these reasons, N.A.C.H. supports giving states the 
     option of covering low income, uninsured pregnant women 
     through SCHIP, as well as the bill's provision to establish 
     automatic enrollment of their infants upon birth through that 
     critical first year of life.


                          Pediatric Education

       N.A.C.H. applauds you for including in the ``Healthy Kids 
     2000 Act'' the commitment to commensurate federal graduate 
     medical education support for independent children's 
     hospitals proposed by the ``Children's Hospitals Education 
     and Research Act,'' which you have twice co-sponsored with 
     Senator Bob Kerrey (D-MO). Through the establishment of a 
     capped time-limited fund, the legislation would go a long way 
     toward providing a more equitable competitive playing field 
     for independent children's hospitals.
       Like all teaching hospitals, children's hospitals receive 
     less and less support for their graduate medical education 
     (GME) programs from most insurers. Unlike other teaching 
     hospitals, independent children's hospitals receive virtually 
     no support for GME from the one remaining, stable source of 
     GME support--the Medicare program--because

[[Page S2581]]

     they serve children, not the elderly. Yet, these hospitals 
     play a critical role in training the next generation of 
     health care providers for children. Although they represent 
     less than one percent of all hospitals, they train nearly 30 
     percent of all pediatricians and nearly half of all pediatric 
     subspecialists.


                           pediatric research

       As centers of research devoted to improving the prevention, 
     diagnosis, treatment, and evaluation of children's illnesses 
     and conditions, children's hospitals very much appreciate 
     your efforts to bring new visibility the need for increased 
     NIH investment in pediatric biomedical research overall and 
     in pediatric research training in particular. While there are 
     a variety of ways to structure this increased investment in 
     NIH, we know that you share our conviction that in the end, 
     the result must be a real increase in total support for 
     pediatric research. Its purpose should be to stimulate 
     significant additional pediatric research investment and 
     growth in the number of researchers focusing on children's 
     health, not to cause a shift in funding that comes at the 
     expense of any current NIH research efforts for children.


                   pediatric public health promotion

       With so many children's hospitals serving as their states' 
     or regions' poison control centers, N.A.C.H. especially 
     appreciates the provisions of your legislation to stabilize 
     and improve our nation's poison control system. Over half of 
     the two million poisonings reported in 1996 were by parents 
     of children under age 6. Almost 2 out of 3 poison calls are 
     on behalf of children under age 18. Legislation that serves 
     to improve and stabilize this critical system will 
     undoubtedly improve the lives and health of children as well.
       N.A.C.H. also supports the bill's provisions to improve 
     prenatal care and birth defects research through the Centers 
     for Disease Control and Prevention, which are important to 
     reduce morbidity and mortality from birth, improving health, 
     and preventing life-long health care costs for children and 
     adults.
       In conclusion, Senator Bond, we commend you for the breadth 
     and depth that this bill undertakes to improve the health of 
     our nation's children. This legislation certainly sets the 
     standard for what the 106th Congress should consider and pass 
     with respect to child health.
       If you have any questions or need additional information, 
     call Peters Willson or Bruce Lesley at 703-684-1355.
           Sincerely,
     Lawrence A. McAndrews.
                                  ____

                                                   March of Dimes,


                                     Birth Defects Foundation,

                                    Washington, DC, March 8, 1999.
     Hon. Christopher Bond,
     U.S. Senate, Russell Senate Office Building, Washington, DC.
       Dear Senator Bond: On behalf of more than 3 million 
     volunteers and 1500 staff members of the March of Dimes, I 
     want to commend you for introducing the ``Healthy Kids 2000 
     Act.'' We are particularly pleased that you have included in 
     this legislation three specific initiatives important to the 
     Foundation and to the health of mothers, infants and 
     children.
       The first section of the bill, ``Health Care Accessibility 
     and Accountability for Mothers and Newborns,'' includes a 
     much needed initiative to improve access to health care for 
     pregnant women. Numerous studies have shown that prenatal 
     care improves the likelihood that a child will be born 
     healthy. Your proposal that states be given the flexibility 
     to cover prenatal care for income-eligible pregnant women 
     through the new State Children's Health Insurance Program (S-
     CHIP) is an important step to take. If enacted, this 
     provision would help provide women the prenatal and maternity 
     care they need to have healthy, full term babies. The March 
     of Dimes strongly supports access to prenatal care. Because 
     of the Foundation's concern that more than 350,000 women do 
     not have access to these needed services, the Foundation has 
     identified the expansion of S-CHIP to cover pregnant women as 
     one of its highest federal legislative priorities for 1999.
       The Foundation is also pleased to support the ``Pediatric 
     Public Health Promotion'' provision that would establish a 
     National Center for Birth Defects Research and Prevention at 
     the Centers for Disease Control and Prevention. This change 
     in law would elevate the visibility of the birth defects 
     activities of the CDC, authorized by the Birth Defects 
     Prevention Act (P.L. 105-168), which you guided to enactment 
     in 1998. As you know, for many years the March of Dimes has 
     been a strong supporter of federal birth defects research and 
     prevention activities. We applaud you for proposing to 
     integrate the activities of various programs to further 
     promote the prevention of birth defects.
       In addition, the March of Dimes commends you on including 
     the ``Pediatric Research Initiative'' in the ``Healthy Kids 
     2000 Act.'' If enacted, this initiative would establish the 
     authorization needed to obtain additional funding for 
     pediatric biomedical research within the National Institutes 
     of Health. The Foundation believes that a partnership between 
     the public and private sectors is the more effective way to 
     raise the level of investment in clinical research pertaining 
     to children. The March of Dimes urges Congress to strengthen 
     the national commitment to all children.
       We thank you for your leadership and are eager to work with 
     you on this and other legislative initiatives important to 
     the health of the nation's mothers, infants and children.
           Sincerely,
                                            Dr. Jennifer L. Howse,
                                                        President.
                                 ______
                                 
      By Mr. COVERDELL (for himself, Mr. Torricelli, and Mr. Abraham):
  S. 593. A bill to amend the Internal Revenue Code of 1986 to increase 
maximum taxable income for the 15 percent rate bracket, to provide a 
partial exclusion from gross income for dividends and interest received 
by individuals, to provide a long-term capital gains deduction for 
individuals, to increase the traditional IRA contribution limit, and 
for other purposes; to the Committee on Finance.


                          the small savers act

  Mr. COVERDELL. Mr. President, I rise today, joined by my good friends 
Senator Torricelli and Senator Abraham, to introduce legislation whose 
time I believe has clearly come. We are faced with a real crisis. That 
crisis is the state of personal savings, savings by families that let 
them prepare for the bumps in the road.
  Families are not saving, and I believe it is not happening because 
our government takes too much from them. A recent report by the 
Congressional Budget Office showed that taxes on the American public 
are at their highest level since World War II. Too many middle-class 
families have been squeezed to the point where they live paycheck to 
paycheck without the option of saving for the future.
  Today, the Nation's economy remains the envy of the world. The United 
States has the first federal budget surplus in thirty years, 
unemployment is down and the stock market is up, but there are 
troubling signs on the horizon. Manufacturing activity slowed in 
December for the seventh straight month, dropping to its lowest level 
in almost eight years as global economic problems continued to hinder 
exports. At the same time, personal savings are at Depression-era lows.
  In 1982, families saved nine percent of their personal income. In 
1992, it was between five and six percent. Last year, it was one-half 
of one percent and headed into the red. Personal savings is so 
important because it helps prepare families for any crisis that could 
occur, such as a health emergency or job loss.
  Having said that, I believe we would all do well to remember the 
lessons from the biblical parable of Joseph. Recall that Joseph warned 
Pharaoh his kingdom would experience seven years of plenty followed by 
seven years of famine. His message to Pharaoh was to build reserves 
during the years of plenty in preparation for the years of famine, so 
that his people would not suffer. To ensure the longevity of our recent 
economic gains, it is important to remember the lessons of Joseph and 
heed the words of President Kennedy who, in his second State of the 
Union address said: ``Pleasant as it is to bask in the warmth of 
recovery . . . the time to repair the roof is when the sun is 
shining.''
  One-third of Americans have no savings at all, and the next third 
have less than $3,000 in savings. Although the baby-boom generation has 
contributed to the explosion of people investing in the equities, only 
two in five baby boomers will have enough savings to maintain their 
current standard of living when they begin to retire in 2011.
  The Small Savers Act would help to reverse these troubling trends. 
First, our proposal returns middle class taxpayers to the lowest 
Federal income tax bracket. Under our legislation, 7 million taxpayers 
would no longer find themselves taxed at 28%. Instead, they would be 
taxed at the 15% bracket.
  Second, it would encourage modest savings and investment. We propose 
to enable savers to earn $500, or $250 for singles, in interest and 
dividends without paying a tax. According to the Joint Economic 
Committee, 30 million low and middle income taxpayers would be able to 
save tax free. Our proposal also would wipe out capital gains taxes for 
10 million low and middle income investors by exempting the first 
$5,000 of long-term capital gains. For those committed to ending the 
taxation of capital gains, this would be an opportunity to take that 
first step while encouraging lower and middle class workers to invest 
for their future.

[[Page S2582]]

  Finally, we provide for a modest $1,000 increase in the contribution 
limit for deductible IRA contributions, from $2,000 to $3,000, and 
index for inflation after 2009. These contribution limits have not been 
raised since 1981.
  The Nation faces many challenges in the years ahead. None is more 
important than sustaining economic growth and ensuring our retirement 
security. The Small Savers Act is a modest and progressive step to 
begin shoring up personal savings and to keep the Nation on the path to 
long-term economic health.
                                 ______
                                 
      By Mrs. FEINSTEIN:
  S. 594. A bill to ban the importation of large capacity ammunition 
feeding devices; to the Committee on the Judiciary.


         large-capacity ammunition magazine import ban of 1999

  Mr. FEINSTEIN. Mr. President, I rise today to introduce legislation 
that will plug a gaping loophole in our gun laws and protect us all 
from the deadly, tragic violence of assault weapons.
  This bill is not about gun control. This bill is not about politics. 
And this bill is not about partisanship. But this bill is about 
stopping foreign manufacturers from skirting the laws that already 
apply to companies within our borders.
  The bill we introduce today will address, finally, the loophole in 
the law that allows foreign manufacturers to flood our shores with high 
capacity ammunition clips, while domestic manufacturers are prohibited 
from selling those very clips.
  Our bill bans future importation of all ammunition clips with a 
capacity of greater than 10 rounds.
  Mr. President, this legislation would not ban the sale or possession 
of clips already in circulation. And the domestic manufacture of these 
clips is already illegal for most purposes. Under current law, U.S. 
manufacturers are already prohibited from manufacturing large capacity 
clips for sale to the general public, but foreign companies continue to 
do so.
  As the author of the 1994 provision, I can assure you that this was 
not our intent. We intended to ban the future manufacture of all high 
capacity clips, leaving only a narrow clause allowing for the 
importation of clips already on their way to this country. Instead, the 
Bureau of Alcohol, Tobacco and Firearms has allowed millions of foreign 
clips into this country, with no true method of determining date of 
manufacture.
  In fact, between March and August of last year alone, BATF approved 
more than 8 million large-capacity clips for importation into America.
  Many of these clips were surely manufactured after 1994, but ATF has 
no way to determining whether or not this is true. As a result, they 
simply must take the word of the exporting company or country.
  The clips come from at least 20 different countries, from Austria to 
Zimbabwe.
  The clips approved during this one short period accounted for almost 
128 million rounds of ammunition--and every round represents the 
potential for taking one human life.
  These clips come in sizes ranging from 15 rounds per clip to 30, 75, 
90, or even 250 rounds per clip.
  Twenty thousand clips of 250-rounds came from England;
  Two million 15-round magazines came from Italy;
  Five thousand clips of 70-rounds came from the Czech Republic.
  And the list goes on, and on.
  Mr. President, 250-round clips have no sporting purpose. They are not 
used for self defense. They have only one use--the purposeful killing 
of other men, women and children.
  It is both illogical and irresponsible to permit foreign companies to 
sell items to the American public--particularly items that are so often 
used for deadly purposes--that U.S. companies are prohibited from 
selling. It is time to plug this loophole and close our borders to 
these tools of death and destruction. Our domestic manufacturers are 
complying with the law, and we must now force foreign manufacturers to 
comply as well.
  In April of last year, President Clinton and Treasury Secretary Rubin 
closed one loophole in the 1994 ban on assault weapons by blocking 
further imports of modified semiautomatic assault weapons. However, the 
Department of Justice advises me that the President lacks the legal 
authority to take the same action regarding large-capacity clips. As a 
result, we must take legislative action to stop further imports of 
these killer clips.
  In closing our borders to these high capacity clips, we will not put 
an end to all incidents of gun violence. But we will limit the 
destructive power of that violence. We will not stop every troubled 
child who decides to commit an act of violence from doing so, but we 
can limit the tools that a child can find to carry out the act.
  Each of us has been touched in some way by the devastating effects of 
gun violence. Each of our states has faced unnecessary tragedy and 
senseless destruction as a result of the high-powered, high-capacity 
weapons falling into the hands of gangs, drive-by shooters, cop 
killers, grievance killers, and yes, even children. My own state of 
California has too often been the subject of national attention due to 
incidents of gun violence.
  Just a few short months ago in Oakland, California, officer James 
Williams became yet another example of what can happen when a troubled 
teenager gets hold of a high-capacity weapon. Soon after midnight on a 
Sunday early this New Year, Officer Williams and two colleagues found 
themselves searching the side of the road for a gun that had reportedly 
been thrown by suspects involved in a recent chase. Officer Williams 
had been out of the police academy for only eleven weeks, and was 
undoubtedly looking forward to getting home to see his three children.
  But tragically, James Williams never made it home that night. While 
Williams searched for the lost gun, a 19-year-old man stood on the 
freeway overpass above and fired the shots that would change Williams' 
family forever. Using a Hungarian made AK-47 with a Chinese made high-
capacity ammunition clip, the teenager fired many shots--too many.

  One Telfon-coated bullet from this high capacity clip fatally wounded 
officer Williams, tearing through his bulletproof vest and leaving his 
three children without a father. And that lone bullet tore through more 
than just James Williams' body armor. It tore through the very fabric 
of his entire family, and its damage cannot be repaired.
  To many, Officer Williams has now become just another statistic in 
the fight against gun violence. But he is more than that to his family, 
and he must mean more than that to us, as well. We must fight to end 
the tragedies faced by so many families across this nation. We must 
fight to give meaning to the countless lives that have been 
extinguished before their time.
  One phenomenon which has most tragically revealed the problems 
presented by these high capacity clips has been the use of these clips 
by youngsters to kill other youngsters.
  In Springfield, Oregon, a 15-year-old boy used a 30-round clip to 
kill two of his fellow students and wound 22 others.
  In Jonesboro, Arkansas, one of two boys carried a Universal carbine 
equipped with a 15-round killer clip. Firing every one of those 15 
bullets, the boy helped his partner kill five people and wound 10 more.
  And just last December in Los Angeles, 27 year old LAPD officer Bryan 
Brown was shot and killed by an assailant with a rifle and double 
magazine. Following the tragic shooting, Officer Brown's 7 year old son 
asked, ``Why did my daddy have to die?''
  Mr. President, Officer Brown and Officer Williams gave their lives to 
protect the lives of so many others, and their children have now been 
left without a father. We must do what we can to make the lives of our 
law enforcement officers more safe.
  And we must also do what we can to bring foreign companies into 
compliance with the same laws we impose on companies here at home. The 
only way we can accomplish these goals is to pass this simple bill.
  In 1994, we fired a first shot in the fight against assault weapons 
and killer clips by banning the assault weapons most commonly used in 
crime and to kill police officers. I am proud to have authored that 
legislation, and many of my colleagues who joined me in that fight 
remember how hard we worked to make a difference. Our opponents told

[[Page S2583]]

us our efforts would accomplish nothing--but they were wrong. They told 
us our efforts would infringe upon the rights of innocent gun owners--
again, they were wrong.
  In fact, recent statistics prove that the assault weapons ban is 
working to reduce crime and to save the lives of law enforcement 
officers and countless others.
  A recent study by the Bureau of Alcohol, Tobacco and Firearms showed 
that compared to other guns, the use of assault weapons in crimes is 
rapidly falling. In fact, while assault weapons accounted for more than 
6% of the guns traced in crimes before the 1994 crime bill went into 
effect, these guns now account for less than 2.4% of those traces.
  But it has now become apparent that the 1994 ban on assault weapons 
left open certain loopholes. Through those loopholes fall the lives of 
courageous police officers like Officer James Williams.
  There is no convincing reason to allow foreign manufacturers to 
circumvent the ban on assault weapons while domestic manufacturers 
comply. And there is no convincing reason to keep an unlimited supply 
of these clips flowing onto our shores and into the hands of American 
criminals.
  The ban on assault weapons is working to save lives and to keep us 
safe. But we must act to fix those loopholes which still remain. Last 
year we came close--we offered this bill as an amendment on short 
notice and lost by only a few votes. I am confident that once my 
colleagues understand what this bill does--and more importantly what it 
does not do--we will win our fight.
  I urge my colleagues to support this bill, and I look forward to 
voting on this issue in the near future.
  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. 594

       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 ``Large Capacity Ammunition 
     Magazine Import Ban Act of 1999''.

     SEC. 2. BAN ON IMPORTING LARGE CAPACITY AMMUNITION FEEDING 
                   DEVICES.

       Section 922(w) of title 18, United States Code, is 
     amended--
       (1) in paragraph (1), by striking ``(1) Except as provided 
     in paragraph (2)'' and inserting ``(1)(A) Except as provided 
     in subparagraph (B)'';
       (2) in paragraph (2), by striking ``(2) Paragraph (1)'' and 
     inserting ``(B) Subparagraph (A)'';
       (3) by inserting before paragraph (3) the following:
       ``(2) It shall be unlawful for any person to import a large 
     capacity ammunition feeding device.''; and
       (4) in paragraph (4)--
       (A) by striking ``(1)'' each place it appears and inserting 
     ``(1)(A)''; and
       (B) by striking ``(2)'' and inserting ``(1)(B)''.

     SEC. 3. CONFORMING AMENDMENT.

       Section 921(a)(31) of title 18, United States Code, is 
     amended by striking ``manufactured after the date of 
     enactment of the Violent Crime Control and Law Enforcement 
     Act of 1994''.
                                 ______
                                 
      By Mr. DOMENICI (for himself and Mr. Inhofe):
  S. 595. A bill to amend the Internal Revenue Code of 1986 to 
establish a graduated response to shrinking domestic oil and gas 
production and surging foreign oil imports, and for other purposes; to 
the Committee on Finance.


  THE DOMESTIC OIL AND GAS CRISIS TAX RELIEF AND FOREIGN OIL RELIANCE 
                          REVERSAL ACT OF 1999

  Mr. DOMENICI. Mr. President, I rise today to introduce the Domestic 
Oil and Gas Crisis Tax Relief and Foreign Oil Reliance Reversal Act of 
1999.
  It is a comprehensive, graduated approach to ensure that the United 
States retains control of its foreign policy and its economic destiny.
  I believe that oil is essential to our way of life. Oil is power.
  It has been pointed out by numerous commentators that major oil 
reserves and political volatility go together. The Middle East has the 
world's most abundant and cheapest oil, unfortunately, the U.S. does 
not.
  Saudi Arabia, United Arab Emirates and Kuwait are our current allies, 
but Iran and Iraq are not. Russia is a major natural gas producer, but 
reliable Russia is not.
  Our dependence on foreign oil is reaching 57 percent, projected to 
reach 68 percent by 2010 if current prices prevail.
  This isn't the usual boom and bust that the oil and gas industry goes 
through. The price has dropped by half in the past two years. In real 
terms, oil now costs roughly what it did before 1973. And prices could 
stay low or drop lower according to the March 6th, Economist magazine.
  Chairman Greenspan, thus, far has been more cautious.
  At a Budget Committee hearing recently, I asked Chairman Greenspan 
about the oil and gas depressed prices. For the first time that I can 
remember, Greenspan blessed Independent Petroleum Association of 
America (IPAA) numbers.
  Greenspan said, ``In the short term, profits for the oil and gas 
industry are likely to come under pressure. According to industry 
surveys, exploration and production spending in the U.S. is projected 
to decline 21 percent this year to $22.6 billion from $28.2 billion in 
1998. A recent survey by the Independent Petroleum Association of 
America (IPAA) estimates that over 36 thousand crude oil wells and more 
than 56 thousand natural gas wells have been shut down since November 
1997. During the same period, the IPAA estimates that 24 thousand jobs 
in the industry have been eliminated * * * The financial pressures are 
most serious among small producers in the United States.''
  Let me describe the financial pressures facing New Mexico.
  One of the city officials told me that oil and gas revenues were so 
low that the town of Eunice has to decide which it will keep open--the 
school or the hospital. There isn't enough tax revenue in the coffers 
to do both! In New Mexico, the oil and gas industry is a major source 
of revenue. For some communities it is the only significant source.
  The bill I am introducing today is a comprehensive, graduated 
response to the problem of the shrinking domestic oil and gas industry. 
It builds upon, and includes all of the provisions included in S. 325 
introduced by Senator Kay Bailey Hutchison and cosponsored by Senators 
Nickles, Murkowski, Breaux and Landreu and myself.
  The Hutchison bill focuses on helping our independent producers and 
maintaining marginal wells. These are wells that produce less than 15 
barrels a day by IRS definition, but in reality, on average produce 
about 2.2 barrels of oil a day. There are a lot of marginal wells in 
the United States, and together they produce as much oil as the United 
States imports from Saudi Arabia.
  I am also told if prices stay where they are the state could lose 
half of those wells by the end of the year.
  Title I of the bill I am introducing today is part of S. 325. It 
includes a marginal well tax credit designed to prolong marginal 
domestic oil and gas well production. The credit is equal to $3.00 a 
barrel.
  The bill also provides a Federal income tax exclusion for income 
earned from inactive wells. It is an incentive for producers to keep 
pumping and not to plug the wells because low prices make them 
uneconomic. Once a well is plugged, the oil from that well is lost for 
ever.
  The bill expands the Enhanced Oil Recovery credit (EOR) that was 
enacted in 1990.
  Enhanced oil recovery techniques can recover the other seventy-five 
percent of the oil left behind when regular techniques have pumped as 
much oil as they can from a well. The EOR credit is expanded to cover 
additional techniques and to be used by AMT taxpayers.
  The oil and gas industry is a capital intensive industry.
  When the price of oil drops, the cash flow for small producers dries 
up. There are countless producers who haven't been able to make an 
interest payment on their operating loans in months and as loans come 
due, the banks haven't been willing to renew them.
  The world is feasting on cheap oil, and yet the oil patch is starving 
for capital. This credit crunch is made all the more painful because 
producers know that they have accumulated tax

[[Page S2584]]

benefits and credits that they have not been able to use, first, 
because they were Alternative Minimum Tax (AMT) taxpayers, and more 
recently, because low prices have devastated their bottomline.
  The AMT was intended to make sure that profitable companies paid 
their fair share of taxes. It has not worked as it was intended. In 
practice, the AMT imposes four penalties on investments made by U.S.-
based taxpayers who explore for and produce oil and natural gas. 
Penalties are imposed on drilling investment and asset depreciation. 
These penalties significantly increase the after-tax costs and the 
business risks of drilling new wells. This is a very imprudent policy 
at a time when the U.S. is experiencing historically low drilling 
activity and growing import dependency.
  The AMT increases the cost of capital of AMT taxpayers by 
approximately 15 to 20 percent over what it would be under the regular 
corporate income tax according to testimony given before the Senate 
Finance Committee.
  TITLE II of the bill tries to correct the past imprudence of the AMT 
and other tax cod provisions by providing domestic oil and gas industry 
crisis tax relief triggered when the price of oil is below $15 a 
barrel.
  This title of the bill creates what I call a ``credits to cash'' 
program.
  The purpose is to transform earned tax credits and other accumulated 
tax benefits into working capital for the cash-strapped domestic oil 
and gas producers and service companies.
  This is accomplished by creating a ten year carry-back for unused AMT 
credits, and unused percentage depletion for oil and gas producers. The 
bill would also eliminate one of the most restrictive limitations on an 
oil and gas producer's ability to claim his intangible drilling costs--
the so-called 65 percent net income limitation. The bill repeals it so 
that producers can finally recover their out of pocket costs.

  The bill also includes a provision similar to a bill introduced by 
Congressman Thomas. My bill allows both producers and the oil and gas 
service industry to go back ten years and use up their Net operating 
losses (NOL)s.


   Hard times tax relief when price of oil is less than $14 a barrel

  The National Energy Policy Act partially eliminated Intangible 
Drilling Costs as a preference item under the AMT. This bill finishes 
the job for any year when the price of oil is less than $14 a barrel 
(phased out when oil prices hit $17)
  IDCs are up front, out of pocket costs that have to be paid before a 
producer even knows whether there will be any oil produced.
  IDCs are one of the principal ordinary and necessary business costs 
of the oil and gas industry. IDCs can comprise up to 80 percent of the 
total costs incurred in developing a well.
  IDCs are comparable to research and development costs because they 
are incurred before a capital asset is known to exist. Examples of IDCs 
include amounts paid to negotiate and finalize drilling contracts; 
costs to prepare the drill site, costs of transporting and setting up 
the rigs and costs of cementing casing in place; costs for wages, fuel, 
repairs, supplies, and other costs in the drilling, shooting and 
cleaning of wells, onsite preparation for the drilling of wells, and 
the construction of the physical structures that are necessary for the 
drilling of wells. IDCs are funded with cold, hard cash and typically 
cannot be financed by a bank or financial institution, and must be paid 
through an operator's internal cash flow or outside equity money 
supplied by an investor.
  Under the regular corporate tax, IDCs are generally allowed to be 
expensed.
  If they were the expenses of any other business they would not be 
included as add-back preference items for purposes of the AMT. We took 
the first step to correcting this injustice in the National Energy 
Policy Act. It is time to finish the job now.
  Percentage depletion is also an ordinary and necessary business cost. 
It recognizes that the economic profit from successful wells must 
compensate for economic losses from dry holes and marginal wells that 
do not recover their investment. Percentage depletion also recognizes 
that oil and gas properties are wasting assets with no residual value. 
These expenses correspond to ordinary business expenses that are 
deductible for every other business without limitations.
  The bill would also eliminate the depreciation adjustment under the 
AMT for oil and gas assets so that the depreciation schedules for the 
regular tax are also used for AMT.
  The oil and gas industry must spend significant amounts of capital to 
acquire, find, develop and produce oil and gas resources The regular 
tax system's modified accelerated cost recovery system (MACRS) is 
designed to encourage such investments. The incentive of accelerated 
tax depreciation is especially important in periods when oil is cheap 
and companies are under economic pressure to reduce capital investment 
and jobs. Yet, the depreciation adjustment required under the AMT 
results in removing much of the regular tax incentive precisely when it 
is needed most. This occurs because companies in the industry are more 
likely to be subject to AMT in periods of low commodity prices.
  While the AMT is the second tax system imbedded in our Internal 
Revenue code, the Accumulated Current Earnings (ACE) effectively acts 
as a third system of taxation, in addition to the regular tax system 
and the AMT. ACE generally acts to measure income in the same manner 
``earnings and profits'' which is a measure of income used by ``C'' 
corporations to determine whether their dividends will be taxable. 
Under ACE, a corporate taxpayer must compute the deductions for 
equipment depreciation (pre-1994), and intangible drilling cost 
recovery in a third manner in addition to that mandated under the 
regular tax system and the AMT.
  Congress has nibbled at fixing the ACE several times in the 1990's. 
It is time to get rid of it and its complexity. The bill eliminates the 
Adjusted Current Earnings adjustment (ACE) as it applies to IDCs.
  The bill would also permit the EOR credit and the Section 29 credit 
to reduce the Alternative Minimum Tax.
  The Alternative Minimum Tax (AMT) imposes tax penalties on the oil 
and gas industry. It taxes investment, not income, and it is more 
punitive the less profitable a company is. The longer prices are low 
and profits thin, the harsher is the AMT's impact.
  The bill recognizes that the Oil for Food program is contributing to 
the depressed oil and gas prices and is causing economic hardship for 
our domestic oil and gas producers. To compensate our domestic industry 
for the economic loss that is being caused by this UN policy, the bill 
would restore percentage depletion to 27.5 percent. It also would 
include the remaining tax provisions included in S. 325 e.g., Allows 
expensing geological and geophysical expenditures Allows producers to 
make an election to Expense Delay Rentals payments; and provides an 
Extension of Spudding rule
  Title III of the bill would be triggered whenever foreign oil 
reliance exceeds 50 percent. The purpose of this title is to reverse 
the trend of increased foreign dependence of oil and gas by encouraging 
exploration and development of oil and gas reserves here at home in the 
U.S. Our goal should be to double current domestic oil and gas 
production.
  The bill provides a 20 percent exploration and development credit.
  Title IV recognizes that 60 percent foreign oil dependence is a 
national security risk and provides for an emergency procedure. When 
foreign imports exceed 60 percent the President is required to 
implement an energy security strategic plan designed to prevent crude 
oil and product imports from exceeding 60 percent. I will remind my 
colleagues that when we experienced the economic disruption of the 1973 
oil embargo our dependence on foreign oil was only 36 percent.
  Mr. President, we need a comprehensive response to foreign oil 
dependence. We need to have a healthy domestic oil and gas industry. 
This bill along with measures to help the industry through the current 
credit crunch are essential. I ask that my colleagues join me in 
developing a comprehensive plan to insure our energy and foreign policy 
independence.
  Mr. President, I ask unanimous consent that the text of the bill and 
a summary be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

[[Page S2585]]

                                 S. 595

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

     SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE.

       (a) Short Title.--This Act may be cited as the ``Domestic 
     Oil and Gas Crisis Tax Relief and Foreign Oil Reliance 
     Reversal Act of 1999.''
       (b) Amendment of 1986 Code.--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. PURPOSES.

       The purposes of this Act are--
       (1) to establish a graduated response to shrinking domestic 
     oil and gas production and surging foreign oil imports;
       (2) to prevent the abandonment of marginal oil and gas 
     wells responsible for half of the domestic oil and gas 
     production of the United States;
       (3) to transform earned tax credits and other tax benefits 
     into working capital for the cash-strapped domestic oil and 
     gas producers and service companies;
       (4) to reverse the trend of increased dependence on foreign 
     oil and gas by encouraging exploration and development of oil 
     and gas reserves in the United States to achieve the goal of 
     doubling current domestic oil and gas production; and
       (5) to provide an emergency procedure for times when 
     foreign imports exceed 60 percent of the total United States 
     crude and oil product consumption, thereby recognizing that 
     when imports exceed a statutory level a national security 
     threat exists that demands Presidential action.

     SEC. 3. FINDINGS.

       Congress finds the following:
       (1) Foreign oil consumption in the United States is 
     estimated to be equal to 56 percent of total oil consumption 
     and could reach 68 percent by the year 2010 if current prices 
     prevail.
       (2) The number of oil and gas rigs operating in the United 
     States is at the lowest count since 1944, when records of 
     this number began to be recorded.
       (3) If oil prices do not increase soon, the United States 
     could lose at least half of its marginal wells which, in the 
     aggregate, produce as much oil as the amount of oil the 
     United States imports from Saudi Arabia.
       (4) Oil and gas prices are unlikely to increase for the 
     next several years.
       (5) Declining production, well abandonment, and the lack of 
     exploration and development are shrinking the domestic oil 
     and gas industry.
       (6) It is essential in order for the United States to have 
     a vibrant economy to have a healthy domestic oil and gas 
     industry.
       (7) The world's richest oil producing regions in the Middle 
     East are experiencing great political stability.
       (8) The policy of the United Nations may make Iraq the 
     swing oil producing nation, thereby granting an enemy of the 
     United States a tremendous amount of power.
       (9) Reliance on foreign oil for more than 60 percent of the 
     daily oil and gas consumption in the United States is a 
     national security threat.
       (10) The United States is the leader of the free world and 
     has a worldwide responsibility to promote economic and 
     political security.
       (11) The exercise of traditional responsibilities in the 
     United States and abroad in foreign policy requires that the 
     United States be free of the risk of energy blackmail in 
     times of gas and oil shortages.
       (12) The level of the United States security is directly 
     related to the level of domestic production of oil, natural 
     gas liquids, and natural gas.
       (13) A national energy policy should be developed which 
     ensures that adequate supplies of oil are available at all 
     times free of the threat of embargo or other foreign hostile 
     acts.

     SEC. 4. TABLE OF CONTENTS.

       The table of contents of this Act is as follows:

Sec. 1. Short title; amendment of 1986 Code.
Sec. 2. Purposes.
Sec. 3. Findings.
Sec. 4. Table of contents.

    TITLE I--DOMESTIC OIL AND GAS PRODUCTION PRESERVATION PROVISIONS

Sec. 101. Tax credit for marginal domestic oil and natural gas well 
              production.
Sec. 102. Exclusion of certain amounts received from recovered inactive 
              wells.
Sec. 103. Enhanced oil recovery credit extended to certain nontertiary 
              recovery methods.

       TITLE II--DOMESTIC OIL AND GAS INDUSTRY CRISIS TAX RELIEF

Sec. 200. Purpose.

                 Subtitle A--Credits to Cash Provisions

Sec. 201. 10-year carryback for unused minimum tax credit.
Sec. 202. 10-year carryback for percentage depletion for oil and gas 
              property.
Sec. 203. 10-year net operating loss carryback for losses attributable 
              to oil servicing companies and mineral interests of oil 
              and gas producers.
Sec. 204. Waiver of limitations.

                   Subtitle B--Hard Times Tax Relief

Sec. 211. Phase-out of certain minimum tax preferences relating to 
              energy production.
Sec. 212. Depreciation adjustment not to apply to oil and gas assets.
Sec. 213. Repeal certain adjustments based on adjusted current earnings 
              relating to oil and gas assets.
Sec. 214. Enhanced oil recovery credit and credit for producing fuel 
              from a nonconventional source allowed against minimum 
              tax.

       Subtitle C--Oil-for-Food Program Compensating Tax Benefits

Sec. 220. Purpose.
Sec. 221. Increase in percentage depletion for stripper wells.
Sec. 222. Net income limitation on percentage depletion repealed for 
              oil and gas properties.
Sec. 223. Election to expense geological and geophysical expenditures 
              and delay rental payments.
Sec. 224. Extension of Spudding rule.

           TITLE II--FOREIGN OIL RELIANCE REVERSAL PROVISIONS

Sec. 300. Purpose.
Sec. 301. Crude oil and natural gas exploration and development credit.

                TITLE IV--NATIONAL EMERGENCY PROVISIONS

Sec. 400. Purpose.
Sec. 401. Duties of the President.
Sec. 402. Congressional review.
Sec. 403. National security and oil production actions.

    TITLE I--DOMESTIC OIL AND GAS PRODUCTION PRESERVATION PROVISIONS

     SEC. 101. TAX CREDIT FOR MARGINAL DOMESTIC OIL AND NATURAL 
                   GAS WELL PRODUCTION.

       (a) Purpose.--The purpose of this section is to prevent the 
     abandonment of marginal oil and gas wells responsible for 
     half of the domestic production of oil and gas in the United 
     States.
       (b) Credit for Producing Oil and Gas From Marginal Wells.--
     Subpart D of part IV of subchapter A of chapter 1 (relating 
     to business credits) is amended by adding at the end the 
     following new section:

     ``SEC. 45D. CREDIT FOR PRODUCING OIL AND GAS FROM MARGINAL 
                   WELLS.

       ``(a) General Rule.--For purposes of section 38, the 
     marginal well production credit for any taxable year is an 
     amount equal to the product of--
       ``(1) the credit amount, and
       ``(2) the qualified crude oil production and the qualified 
     natural gas production which is attributable to the taxpayer.
       ``(b) Credit Amount.--For purposes of this section--
       ``(1) In general.--The credit amount is--
       ``(A) $3 per barrel of qualified crude oil production, and
       ``(B) 50 cents per 1,000 cubic feet of qualified natural 
     gas production.
       ``(2) Reduction as oil and gas prices increase.--
       ``(A) In general.--The $3 and 50 cents amounts under 
     paragraph (1) shall each be reduced (but not below zero) by 
     an amount which bears the same ratio to such amount 
     (determined without regard to this paragraph) as--
       ``(i) the excess (if any) of the applicable reference price 
     over $14 ($1.56 for qualified natural gas production), bears 
     to
       ``(ii) $3 ($0.33 for qualified natural gas production).

     The applicable reference price for a taxable year is the 
     reference price for the calendar year preceding the calendar 
     year in which the taxable year begins.
       ``(B) Inflation adjustment.--In the case of any taxable 
     year beginning in a calendar year after 2000, each of the 
     dollar amounts contained in subparagraph (A) shall be 
     increased to an amount equal to such dollar amount multiplied 
     by the inflation adjustment factor for such calendar year 
     (determined under section 43(b)(3)(B) by substituting `1999' 
     for `1990').
       ``(C) Reference price.--For purposes of this paragraph, the 
     term `reference price' means, with respect to any calendar 
     year--
       ``(i) in the case of qualified crude oil production, the 
     reference price determined under section 29(d)(2)(C), and
       ``(ii) in the case of qualified natural gas production, the 
     Secretary's estimate of the annual average wellhead price per 
     1,000 cubic feet for all domestic natural gas.
       ``(c) Qualified Crude Oil and Natural Gas Production.--For 
     purposes of this section--
       ``(1) In general.--The terms `qualified crude oil 
     production' and `qualified natural gas production' mean 
     domestic crude oil or natural gas which is produced from a 
     marginal well.
       ``(2) Limitation on amount of production which may 
     qualify.--
       ``(A) In general.--Crude oil or natural gas produced during 
     any taxable year from any well shall not be treated as 
     qualified crude oil production or qualified natural gas 
     production to the extent production from the well during the 
     taxable year exceeds 1,095 barrels or barrel equivalents.
       ``(B) Proportionate reductions.--
       ``(i) Short taxable years.--In the case of a short taxable 
     year, the limitations under this paragraph shall be 
     proportionately reduced to reflect the ratio which the number 
     of days in such taxable year bears to 365.
       ``(ii) Wells not in production entire year.--In the case of 
     a well which is not capable of production during each day of 
     a taxable year, the limitations under this paragraph 
     applicable to the well shall be proportionately reduced to 
     reflect the ratio which

[[Page S2586]]

     the number of days of production bears to the total number of 
     days in the taxable year.
       ``(3) Definitions.--
       ``(A) Marginal well.--The term `marginal well' means a 
     domestic well--
       ``(i) the production from which during the taxable year is 
     treated as marginal production under section 613A(c)(6), or
       ``(ii) which, during the taxable year--
       ``(I) has average daily production of not more than 25 
     barrel equivalents, and
       ``(II) produces water at a rate not less than 95 percent of 
     total well effluent.
       ``(B) Crude oil, etc.--The terms `crude oil', `natural 
     gas', `domestic', and `barrel' have the meanings given such 
     terms by section 613A(e).
       ``(C) Barrel equivalent.--The term `barrel equivalent' 
     means, with respect to natural gas, a conversion ratio of 
     6,000 cubic feet of natural gas to 1 barrel of crude oil.
       ``(d) Other Rules.--
       ``(1) Production attributable to the taxpayer.--In the case 
     of a marginal well in which there is more than one owner of 
     operating interests in the well and the crude oil or natural 
     gas production exceeds the limitation under subsection 
     (c)(2), qualifying crude oil production or qualifying natural 
     gas production attributable to the taxpayer shall be 
     determined on the basis of the ratio which taxpayer's revenue 
     interest in the production bears to the aggregate of the 
     revenue interests of all operating interest owners in the 
     production.
       ``(2) Operating interest required.--Any credit under this 
     section may be claimed only on production which is 
     attributable to the holder of an operating interest.
       ``(3) Production from nonconventional sources excluded.--In 
     the case of production from a marginal well which is eligible 
     for the credit allowed under section 29 for the taxable year, 
     no credit shall be allowable under this section unless the 
     taxpayer elects not to claim the credit under section 29 with 
     respect to the well.''.
       ``(c) Credit Treated as Business Credit.--Section 38(b) is 
     amended by striking ``plus'' at the end of paragraph (11), by 
     striking the period at the end of paragraph (12) and 
     inserting ``, plus'', and by adding at the end the following 
     new paragraph:
       ``(13) the marginal oil and gas well production credit 
     determined under section 45D(a).''.
       (d) Credit Allowed Against Regular and Minimum Tax.--
       (1) In general.--Subsection (c) of section 38 (relating to 
     limitation based on amount of tax) is amended by 
     redesignating paragraph (3) as paragraph (4) and by inserting 
     after paragraph (2) the following new paragraph:
       ``(3) Special rules for marginal oil and gas well 
     production credit.--
       ``(A) In general.--In the case of the marginal oil and gas 
     well production credit--
       ``(i) this section and section 39 shall be applied 
     separately with respect to the credit, and
       ``(ii) in applying paragraph (1) to the credit--
       ``(I) subparagraphs (A) and (B) thereof shall not apply, 
     and
       ``(II) the limitation under paragraph (1) (as modified by 
     subclause (I)) shall be reduced by the credit allowed under 
     subsection (a) for the taxable year (other than the marginal 
     oil and gas well production credit).
       ``(B) Marginal oil and gas well production credit.--For 
     purposes of this subsection, the term `marginal oil and gas 
     well production credit' means the credit allowable under 
     subsection (a) by reason of section 45D(a).''.
       (2) Conforming amendment.--Subclause (II) of section 
     38(c)(2)(A)(ii) is amended by inserting ``or the marginal oil 
     and gas well production credit'' after ``employment credit''.
       (e) Carryback.--Subsection (a) of section 39 (relating to 
     carryback and carryforward of unused credits generally) is 
     amended by adding at the end the following new paragraph:
       ``(3) 10-year carryback for marginal oil and gas well 
     production credit.--In the case of the marginal oil and gas 
     well production credit--
       ``(A) this section shall be applied separately from the 
     business credit (other than the marginal oil and gas well 
     production credit),
       ``(B) paragraph (1) shall be applied by substituting `10 
     taxable years' for `1 taxable years' in subparagraph (A) 
     thereof, and
       ``(C) paragraph (2) shall be applied--
       ``(i) by substituting `31 taxable years' for `21 taxable 
     years' in subparagraph (A) thereof, and
       ``(ii) by substituting `30 taxable years' for `20 taxable 
     years' in subparagraph (B) thereof.''
       (f) Coordination With Section 29.--Section 29(a) is amended 
     by striking ``There'' and inserting ``At the election of the 
     taxpayer, there''.
       (g) Clerical Amendment.--The table of sections for subpart 
     D of part IV of subchapter A of chapter 1 is amended by 
     adding at the end the following item:

``45D. Credit for producing oil and gas from marginal wells.''

       (h) Effective Date.--The amendments made by this section 
     shall apply to production after the date of the enactment of 
     this Act.

     SEC. 102. EXCLUSION OF CERTAIN AMOUNTS RECEIVED FROM 
                   RECOVERED INACTIVE WELLS.

       (a) Purpose.--The purpose of this section is to encourage 
     producers to reopen wells that have not been producing oil 
     and gas because the wells have been plugged or abandoned.
       (b) In General.--Part III of subchapter B of chapter 1 
     (relating to items specifically excluded from gross income) 
     is amended by redesignating section 139 as section 140 and by 
     inserting after section 138 the following new section:

     ``SEC. 139. OIL OR GAS PRODUCED FROM A RECOVERED INACTIVE 
                   WELL.

       ``(a) In General.--Gross income does not include income 
     attributable to independent producer oil from a recovered 
     inactive well.
       ``(b) Definitions.--For purposes of this section--
       ``(1) Independent producer oil.--The term `independent 
     producer oil' means crude oil or natural gas in which the 
     economic interest of the independent producer is attributable 
     to an operating mineral interest (within the meaning of 
     section 614(d)), overriding royalty interest, production 
     payment, net profits interest, or similar interest.
       ``(2) Crude oil and natural gas.--The terms `crude oil' and 
     `natural gas' have the meanings given such terms by section 
     613A(e).
       ``(3) Recovered inactive well.--The term `recovered 
     inactive well' means a well if--
       ``(A) throughout the time period beginning any time prior 
     to January 15, 1999, and ending on such date, such well is 
     inactive or has been plugged and abandoned, as determined by 
     the agency of the State in which such well is located that is 
     responsible for regulating such wells, and
       ``(B) during the 5-year period beginning on the date of the 
     enactment of this section, such well resumes producing crude 
     oil or natural gas.
       ``(4) Independent producer.--The term `independent 
     producer' means a producer of crude oil or natural gas whose 
     allowance for depletion is determined under section 613A(c).
       ``(c) Deductions.--No deductions directly connected with 
     amounts excluded from gross income by subsection (a) shall be 
     allowed.
       ``(d) Election.--
       ``(1) In general.--This section shall apply for any taxable 
     year only at the election of the taxpayer.
       ``(2) Manner.--Such election shall be made, in accordance 
     with regulations prescribed by the Secretary, not later than 
     the time prescribed for filing the return (including 
     extensions thereof) and shall be made annually on a property-
     by-property basis.''
       (c) Minimum Tax.--Section 56(g)(4)(B) is amended by adding 
     at the end the following new clause:
       ``(iii) Inactive wells.--In the case of income attributable 
     to independent producers of oil recovered from an 
     inactive well, clause (i) shall not apply to any amount 
     allowable as an exclusion under section 139.''
       (d) Clerical Amendment.--The table of sections for part III 
     of subchapter B of chapter 1 is amended by striking the item 
     relating to section 139 and inserting the following:

``Sec. 139. Oil or gas produced from a recovered inactive well.
``Sec. 140. Cross references to other Acts.;;

       (e) Effective Date.--The amendments made by this section 
     shall apply to taxable years ending after the date of the 
     enactment of this Act.

     SEC. 103. ENHANCED OIL RECOVERY CREDIT EXTENDED TO CERTAIN 
                   NONTERTIARY RECOVERY METHODS.

       (A) Purpose.--The propose of section is to extend the 
     productive lives of existing domestic oil and gas wells in 
     order to recover the 75 percent of the oil and gas that is 
     not recoverable using primary oil and gas recovery 
     techniques.
       (b) In General.--Clause (i) of section 43(c)(2)(A) 
     (defining qualified enhanced oil recovery project) is amended 
     to read as follows:
       ``(i) which involves the application (in accordance with 
     sound engineering principles) of--
       ``(I) one or more tertiary recovery methods (as defined in 
     section 193(b)(3)) which can reasonably be expected to result 
     in more than an insignificant increase in the amount of crude 
     oil which will ultimately be recovered, or
       ``(II) one or more qualified nontertiary recovery methods 
     which are required to recover oil with traditionally immobile 
     characteristics or from formations which have proven to be 
     uneconomical or noncommercial under conventional recovery 
     methods,''
       (c) Qualified Nontertiary Recovery Methods.--Section 
     43(c)(2) is amended by adding at the end the following new 
     subparagraphs:
       ``(C) Qualified nontertiary recovery method.--For purposes 
     of this paragraph--
       ``(i) In General.--The term `qualified nontertiary recovery 
     method' means any recovery method described in clause (ii), 
     (iii), or (iv), or any combination there of.
       ``(ii) Enhanced gravity drainage (egd) methods.--The 
     methods described in this clause are as follows:
       ``(I) Horizontal drilling.--The drilling of horizontal, 
     rather than vertical, wells to penetrate any hydrocarbon-
     bearing formation which has an average in situ calculated 
     permeability to fluid flow of less than or equal to 12 or 
     less millidarcies and which has been demonstrated by use of a 
     vertical wellbore to be uneconomical unless drilled with 
     lateral horizontal lengths in excess of 1,000 feet.

[[Page S2587]]

       ``(II) Gravity drainage.--The production of oil by gravity 
     flow from drainholes that are drilled from a shaft or tunnel 
     dug within or below the oil-bearing zone.
       ``(iii) Marginally economic reservoir repressurization 
     (merr) methods.--The methods described in this clause are as 
     follows, except that this clause shall only apply to the 
     first 1,000,000 barrels produced in any project:
       ``(I) Cyclic gas injection.--The increase or maintenance of 
     pressure by injection of hydrocarbon gas into the reservoir 
     from which it was originally produced.
       ``(II) Flooding.--The injection of water into an oil 
     reservoir to displace oil from the reservoir rock and into 
     the bore of a producing well.
       ``(iv) Other methods.--Any method used to recover oil 
     having an average laboratory measured air permeability less 
     than or equal to 100 millidarcies when averaged over the 
     productive interval being completed, or an in situ calculated 
     permeability to fluid flow less than or equal to 12 
     millidarcies or oil defined by the Department of Energy as 
     being immobile.
       ``(D) Authority to add other nontertiary recovery 
     methods.--The Secretary shall provide procedures under 
     which--
       ``(i) the Secretary may treat methods not described in 
     clause (ii), (iii), or (iv) of subparagraph (C) as qualified 
     nontertiary recovery methods, and
       ``(ii) a taxpayer may request the Secretary to treat any 
     method not so described as a qualified nontertiary recovery 
     method.

     The Secretary may only specify methods as qualified 
     nontertiary recovery methods under this subparagraph if the 
     Secretary determines that such specification is consistent 
     with the purposes of subparagraph (C) and will result in 
     greater production of oil and natural gas.''
       (d) Conforming Amendment.--Clause (iii) of section 
     43(c)(2)(A) is amended to read as follows:
       ``(iii) with respect to which--
       ``(I) in the case of a tertiary recovery method, the first 
     injection of liquids, gases, or other matter commences after 
     December 31, 1990, and
       ``(II) in the case of a qualified nontertiary recovery 
     method, the implementation of the method begins after 
     December 31, 1998.''
       (e) Effective Date.--The amendments made by this section 
     shall apply to taxable years ending after December 31, 1998.

       TITLE II--DOMESTIC OIL AND GAS INDUSTRY CRISIS TAX RELIEF

     SEC. 200. PURPOSE.

       The purpose of this title is to transform earned tax 
     credits and other accumulated tax benefits into working 
     capital for the cash-strapped domestic oil and gas producers 
     and service companies.

                 Subtitle A--Credits to Cash Provisions

     SEC. 201. 10-YEAR CARRYBACK FOR UNUSED MINIMUM TAX CREDIT.

       (a) In General.--Section 53(c) of the Internal Revenue Code 
     of 1986 (relating to limitation) is amended by adding at the 
     end the following new paragraph:
       ``(2) Special rule for taxpayers with unused energy minimum 
     tax credits.--
       ``(A) In general.--If, during the 10-taxable year period 
     ending with the current taxable year, a taxpayer has an 
     unused energy minimum tax credit for any taxable year in such 
     period (determined without regard to the application of this 
     paragraph to the current taxable year)--
       ``(i) paragraph (1) shall not apply to each of the taxable 
     years in such period for which the taxpayer has an unused 
     energy minimum tax credit (as so determined), and
       ``(ii) the credit allowable under subsection (a) for each 
     of such taxable years shall be equal to the excess (if any) 
     of--
       ``(II) the sum of the regular tax liability and the net 
     minimum tax for such taxable year, over
       ``(II) the sum of the credits allowable under subparts A, 
     B, D, E, and F of this part.
       ``(B) Energy minimum tax credit.--For purposes of this 
     paragraph, the term `energy minimum tax credit' means the 
     minimum tax credit which would be computed with respect to 
     any taxable year if the adjusted net minimum tax were 
     computed by only taking into account items attributable to--
       ``(i) the taxpayer's mineral interests in oil and gas 
     property, and
       ``(ii) the taxpayer's active conduct of a trade or business 
     of providing tools, products, personnel, and technical 
     solutions on a contractural basis to persons engaged in oil 
     and gas exploration and production.''
       (b) Conforming Amendments.--Section 53(c) of such Code (as 
     in effect before the amendment made by subsection (a)) is 
     amended--
       (1) by striking ``The'' and inserting:
       ``(1) In general.--Except as provided in paragraph (2), the 
     '', and
       (2) by redesignating paragraphs (1) and (2) as 
     subparagraphs (A) and (B).
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     1998, and to any taxable year beginning on or before such 
     date to the extent necessary to apply section 53(c)(2) of the 
     Internal Revenue Code of 1986 (as added by subsection (a)).

     SEC. 202. 10-YEAR CARRYBACK FOR PERCENTAGE DEPLETION FOR OIL 
                   AND GAS PROPERTY.

       (a) In General.--Subsection (d)(1) of section 613A 
     (relating to limitations on percentage depletion in case of 
     oil and gas wells) is amended to read as follows:
       ``(1) Limitation based on taxable income.--
       ``(A) In general.--The deduction for the taxable year 
     attributable to the application of subsection (c) shall not 
     exceed the taxpayer's taxable income for the year computed 
     without regard to--
       ``(i) any depletion on production from an oil or gas 
     property which is subject to the provisions of subsection 
     (c),
       ``(ii) any net operating loss carryback to the taxable year 
     under section 172,
       ``(iii) any capital loss carryback to the taxable year 
     under section 1212, and
       ``(iv) in the case of a trust, any distributions to its 
     beneficiary, except in the case of any trust where any 
     beneficiary of such trust is a member of the family (as 
     defined in section 267(c)(4)) of a settlor who created inter 
     vivos and testamentary trusts for members of the family and 
     such settlor died within the last six days of the fifth month 
     in 1970, and the law in the jurisdiction in which such trust 
     was created requires all or a portion of the gross or net 
     proceeds of any royalty or other interest in oil, gas, or 
     other mineral representing any percentage depletion allowance 
     to be allocated to the principal of the trust.
       ``(B) Carrybacks and carryforwards.--
       ``(i) In general.--If any amount is disallowed as a 
     deduction for the taxable year (in this subparagraph referred 
     to as the `unused depletion year') by reason of application 
     of subparagraph (A), the disallowed amount shall be treated 
     as an amount allowable as a deduction under subsection (c) 
     for--
       ``(I) each of the 10 taxable years preceding the unused 
     depletion year, and
       ``(II) the taxable year following the unused depletion 
     year,

     subject to the application of subparagraph (A) to such 
     taxable year.
       ``(ii) Applicable rules.--Rules similar to the rules of 
     section 39 shall apply for purposes of this subparagraph.
       ``(C) Allocation of disallowed amounts.--For purposes of 
     basis adjustments and determining whether cost depletion 
     exceeds percentage depletion with respect to the production 
     from a property, any amount disallowed as a deduction on the 
     application of this paragraph shall be allocated to the 
     respective properties from which the oil or gas was produced 
     in proportion to the percentage depletion otherwise allowable 
     to such properties under subsection (c).''
       ``(b) Effective Date.--The amendment made by this section 
     shall apply to taxable years beginning after December 31, 
     1998, and to any taxable year beginning on or before such 
     date to the extent necessary to apply section 613A(d)(1)(B) 
     of the Internal Revenue Code of 1986 (as added by subsection 
     (a)).

     SEC. 203. 10-YEAR NET OPERATING LOSS CARRYBACK FOR LOSSES 
                   ATTRIBUTABLE TO OIL SERVICING COMPANIES AND 
                   MINERAL INTERESTS OF OIL AND GAS PRODUCERS.

       ``(a) In General.--Paragraph (1) of section 172(b) 
     (relating to years to which loss may be carried) is amended 
     by adding at the end the following new subparagraph:
       ``(H) Losses on operating mineral interests of oil and gas 
     producers and oilfield servicing companies.--In the case of a 
     taxpayer which has an eligible oil and gas loss (as defined 
     in subsection (j)) for a taxable year, such eligible oil 
     and gas loss shall be a net operating loss carryback to 
     each of the 10 taxable years preceding the taxable year of 
     such loss.''
       (b) Eligible Oil and Gas Loss.--Section 172 is amended by 
     redesignating subsection (j) as subsection (k) and by 
     inserting after subsection (i) the following new subsection:
       ``(j) Eligible Oil and Gas Loss.--For purposes of this 
     section--
       ``(1) In general.--The term `eligible oil and gas loss' 
     means the lesser of--
       ``(A) the amount which would be the net operating loss for 
     the taxable year if only income and deductions attributable 
     to--
       ``(i) mineral interests in oil and gas wells, and
       ``(ii) the active conduct of a trade or business of 
     providing tools, products, personnel, and technical solutions 
     on a contractual basis to persons engaged in oil and gas 
     exploration and production,

     are taken into account, and
       ``(B) the amount of the net operating loss for such taxable 
     year.
       ``(2) Coordination with subsection (b)(2).--For purposes of 
     applying subsection (b)(2), an eligible oil and gas loss for 
     any taxable year shall be treated in a manner similar to the 
     manner in which a specified liability loss is treated.
       ``(3) Election.--Any taxpayer entitled to a 10-year 
     carryback under subsection (b)(1)(H) from any loss year may 
     elect to have the carryback period with respect to such loss 
     year determined without regard to subsection (b)(1)(H). Such 
     election shall be made in such manner as may be prescribed by 
     the Secretary and shall be made by the due date (including 
     extensions of time) for filing the taxpayer's return for the 
     taxable year of the net operating loss. Such election, once 
     made for any taxable year, shall be irrevocable for such 
     taxable year.''
       (c) Effective Date.--The amendments made by this section 
     shall apply to net operating losses for taxable years 
     beginning after December 31, 1998, and to any taxable year 
     beginning on or before such date to the extent necessary to 
     apply section 172(b)(1)(H) of the Internal Revenue Code of 
     1986 (as added by subsection (a)).

     SEC. 204. WAIVER OF LIMITATIONS.

       If refund or credit of any overpayment of tax resulting 
     from the application of the

[[Page S2588]]

     amendments made by this subtitle is prevented at any time 
     before the close of the 1-year period beginning on the date 
     of the enactment of this Act by the operation of any law or 
     rule of law (including res judicata), such refund or credit 
     may nevertheless be made or allowed if claim therefor is 
     filed before the close of such period.

                   Subtitle B--Hard Times Tax Relief

     SEC. 211. PHASE-OUT OF CERTAIN MINIMUM TAX PREFERENCES 
                   RELATING TO ENERGY PRODUCTION.

       (a) Energy Preferences for Integrated Oil Companies.--
     Section 56 (relating to alternative minimum taxable income) 
     is amended by adding at the end the following new subsection:
       ``(h) Adjustment Based on Energy Preference.--
       ``(1) In general.--In computing the alternative minimum 
     taxable income of any taxpayer which is an integrated oil 
     company (as defined in section 291(b)(4)) for any taxable 
     year beginning after 1998, there shall be allowed as a 
     deduction an amount equal to the alternative tax energy 
     preference deduction.
       ``(2) Phase-out of deduction as oil prices increases.--The 
     amount of the deduction under paragraph (1) (determined 
     without regard to this paragraph) shall be reduced (but not 
     below zero) by the amount which bears the same ratio to such 
     amount as--
       ``(A) the amount by which the reference price for the 
     calendar year preceding the calendar year in which the 
     taxable year begins exceeds $14, bears to
       ``(B) $3.

     For purposes of this paragraph, the reference price for any 
     calendar year shall be determined under section 29(d)(2)(C) 
     and the $14 amount under subparagraph (A) shall be adjusted 
     at the same time and in the same manner as under section 
     43(b)(3).
       ``(3) Alternative tax energy preference deduction.--For 
     purposes of paragraph (1), the term `alternative tax energy 
     preference deduction' means an amount equal to the sum of--
       ``(A) the intangible drilling cost preference, and
       ``(B) the depletion preference.
       ``(4) Intangible drilling cost preference.--For purposes of 
     this subsection, the term `intangible drilling cost 
     preference' means the amount by which alternative minimum 
     taxable income would be reduced if it were computed without 
     regard to section 57(a)(2).
       ``(5) Depletion preference.--For purposes of this 
     subsection, the term `depletion preference' means the amount 
     by which alternative minimum taxable income would be reduced 
     if it were computed without regard to section 57(a)(1).
       ``(6) Alternative minimum taxable income.--For purposes of 
     paragraphs (1), (4), and (5), alternative minimum taxable 
     income shall be determined without regard to the deduction 
     allowable under this subsection and the alternative tax net 
     operating loss deduction under subsection (a)(4).
       ``(7) Regulations.--The Secretary may by regulation provide 
     for appropriate adjustments in computing alternative minimum 
     taxable income or adjusted current earnings for any taxable 
     year following a taxable year for which a deduction was 
     allowed under this subsection to ensure that no double 
     benefit is allowed by reason of such deduction.''
       (b) Repeal of Limit on Reduction for Independent 
     Producers.--Subparagraphs (E) of section 57(a)(2) (relating 
     to exception for independent producers) is amended to read as 
     follows:
       ``(E) Exception for independent producers.--In the case of 
     any oil or gas well, this paragraph shall not apply to any 
     taxpayer which is not an integrated oil company (as defined 
     in section 291(b)(4)).''
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after, and amounts 
     paid or incurred in taxable years after, December 31, 1998.

     SEC. 212. DEPRECIATION ADJUSTMENT NOT TO APPLY TO OIL AND GAS 
                   ASSETS.

       (a) In General.--Subparagraph (B) of section 56(a)(1) 
     (relating to depreciation adjustments) is amended to read as 
     follows:
       ``(B) Exceptions.--This paragraph shall not apply to--
       ``(i) property described in paragraph (1), (2), (3), or (4) 
     of section 168(f), or
       ``(ii) property used in the active conduct of the trade or 
     business of exploring for, extracting, developing, or 
     gathering crude oil or natural gas.''
       (b) Conforming Amendment.--Paragraph (4)(A) of section 
     56(g) (relating to adjustments based on adjusted current 
     earnings) is amended by adding at the end the following new 
     clause:
       ``(vi) Oil and gas property.--In the case of property used 
     in the active conduct of the trade or business of exploring 
     for, extracting, developing, or gathering crude oil or 
     natural gas, the amount allowable as depreciation or 
     amortization with respect to such property shall be 
     determined in the same manner as for purposes of computing 
     the regular tax.''
       (c) Effective Date.--The amendment made by this section 
     shall apply to property placed in service in taxable years 
     beginning after December 31, 1998.

     SEC. 213. REPEAL CERTAIN ADJUSTMENTS BASED ON ADJUSTED 
                   CURRENT EARNINGS RELATING TO OIL AND GAS 
                   ASSETS.

       (a) Depreciation.--Clause (vi) of section 56(g)(4)(A), as 
     added by section 212(b), is amended to read as follows:
       ``(vi) Oil and gas property.--This subparagraph shall not 
     apply to property used in the active conduct of the trade or 
     business of exploring for, extracting, developing, or 
     gathering crude oil or natural gas.''
       (b) Intangible Drilling Costs.--Clause (i) of section 
     56(g)(4)(D) is amended by striking the second sentence and 
     inserting ``In the case of any oil or gas well, this clause 
     shall not apply in the case of amounts paid or incurred in 
     taxable years beginning after December 31, 1998.''.
       (c) Depletion.--Clause (ii) of section 56(g)(4)(F) is 
     amended to read as follows:
       ``(ii) Exception for oil and gas wells.--In the case of any 
     taxable year beginning after December 31, 1998, clause (i) 
     (and subparagraph (C)(i)) shall not apply to any deduction 
     for depletion computed in accordance with section 613A.''
       (d) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     1998.

     SEC. 214. ENHANCED OIL RECOVERY CREDIT AND CREDIT FOR 
                   PRODUCING FUEL FROM A NONCONVENTIONAL SOURCE 
                   ALLOWED AGAINST MINIMUM TAX.

       (a) Enhanced Oil Recovery Credit Allowed Against Regular 
     and Minimum Tax.--
       (1) Allowing credit against minimum tax.--Subsection (c) of 
     section 38 (relating to limitation based on amount of tax), 
     as amended by section 101(d), is amended by redesignating 
     paragraph (4) as paragraph (5) and by inserting after 
     paragraph (3) the following new paragraph:
       ``(4) Special rules for enhanced oil recovery credit.--
       ``(A) In general.--In the case of the enhanced oil recovery 
     credit--
       ``(i) this section and section 39 shall be applied 
     separately with respect to the credit, and
       ``(ii) in applying paragraph (1) to the credit--
       ``(I) subparagraphs (A) and (B) thereof shall not apply, 
     and
       ``(II) the limitation under paragraph (1) (as modified by 
     subclause (I)) shall be reduced by the credit allowed under 
     subsection (a) for the taxable year (other than the enhanced 
     oil recovery credit).
       ``(B) Enhanced oil recovery credit.--For purposes of this 
     subsection, the term `enhanced oil recovery credit' means the 
     credit allowable under subsection (a) by reason of section 
     43(a).''.
       (2) Conforming amendments.--
       (A) Subclause (II) of section 38(c)(2)(A)(ii), as amended 
     by section 101(d), is amended by striking ``or the marginal 
     oil and gas well production credit'' and inserting ``, the 
     marginal oil and gas well production credit, or the enhanced 
     oil recovery credit''.
       (B) Subclause (II) of section 38(c)(3)(A)(ii), as added by 
     section 101(d), is amended by inserting ``or the enhanced oil 
     recovery credit'' after ``recovery credit''.
       (b) Credit for Producing Fuel From a Non-conventional 
     Source.--
       (1) Allowing credit against minimum tax.--Section 29(b)(6) 
     is amended to read as follows:
       ``(6) Application with other credits.--The credit allowed 
     by subsection (a) for any taxable year shall not exceed--
       ``(A) the regular tax for the taxable year and the tax 
     imposed by section 55, reduced by
       ``(B) the sum of the credits allowable under subpart A and 
     section 27.''
       (2) Conforming amendments.--
       (A) Section 53(d)(1)(B)(iii) is amended by inserting ``as 
     in effect on the date of the enactment of the Domestic Oil 
     and Gas Crisis Tax Reliance Reversal Act of 1999,'' after 
     ``29(b)(6)(B),''.
       (B) Section 55(c)(2) is amended by striking ``29(b)(6),''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     1998.

       Subtitle C--Oil-for-Food Program Compensating Tax Benefits

     SEC. 220. PURPOSE.

       The purpose of this subtitle is to provide compensation to 
     the domestic oil and gas industry in the form of tax benefits 
     to offset the depressing impact that the Oil-for-Food Program 
     is having on the world market.

     SEC. 221. INCREASE IN PERCENTAGE DEPLETION FOR STRIPPER 
                   WELLS.

       (a) In General.--Subparagraph (C) of section 613A(c)(6) 
     (relating to oil and natural gas produced from marginal 
     properties) is amended--
       (1) by striking ``25 percent'' and inserting ``27.5 
     percent'' in the matter preceding clause (i); and
       (2) by striking ``$20'' and inserting ``$28'' in clause 
     (ii).
       (b) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     1998.

     SEC. 222. NET INCOME LIMITATION ON PERCENTAGE DEPLETION 
                   REPEALED FOR OIL AND GAS PROPERTIES.

       (a) In General.--Section 613(a) (relating to percentage 
     depletion) is amended by striking the second sentence and 
     inserting: ``Except in the case of oil and gas properties, 
     such allowance shall not exceed 50 percent of the taxpayer's 
     taxable income from the property (computed without allowances 
     for depletion).''
       (b) Conforming Amendments.--
       (1) Section 613A(c)(7) (relating to special rules) is 
     amended by striking subparagraph (C) and redesignating 
     subparagraph (D) as subparagraph (C).

[[Page S2589]]

       (2) Section 613A(c)(6) (relating to oil and natural gas 
     produced from marginal properties) is amended by striking 
     subparagraph (H).
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     1998.

     SEC. 223. ELECTION TO EXPENSE GEOLOGICAL AND GEOPHYSICAL 
                   EXPENDITURES AND DELAY RENTAL PAYMENTS.

       (a) Purpose.--The purpose of this section is to recognize 
     that geological and geophysical expenditures and delay 
     rentals are ordinary and necessary business expenses that 
     should be deducted in the year the expense is incurred.
       (b) Election To Expense Geological and Geophysical 
     Expenditures.--
       (1) In general.--Section 263 (relating to capital 
     expenditures) is amended by adding at the end the following 
     new subsection:
       ``(j) Geological and Geophysical Expenditures for Domestic 
     Oil and Gas Wells.--Notwithstanding subsection (a), a 
     taxpayer may elect to treat geological and geophysical 
     expenses incurred in connection with the exploration for, or 
     development of, oil or gas within the United States (as 
     defined in section 638) as expenses which are not chargeable 
     to capital account. Any expenses so treated shall be allowed 
     as a deduction in the taxable year in which paid or 
     incurred.''
       (2) Conforming amendment.--Section 263A(c)(3) is amended by 
     inserting by inserting ``263(j),'' after ``263(i),''.
       (3) Effective date.--
       (A) In general.--The amendments made by this subsection 
     shall apply to expenses paid or incurred after the date of 
     the enactment of this Act.
       (B) Transition rule.--In the case of any expenses described 
     in section 263(j) of the Internal Revenue Code of 1986, as 
     added by this subsection, which were paid or incurred on or 
     before the date of the enactment of this Act, the taxpayer 
     may elect, at such time and in such manner as the Secretary 
     of the Treasury may prescribe, to amortize the unamortized 
     portion of such expenses over the 36-month period beginning 
     with the month in which the date of the enactment of this Act 
     occurs. For purposes of this subparagraph, the unamortized 
     portion of any expense is the amount remaining unamortized 
     as of the first day of the 36-month period.
       (c) Election To Expense Delay Rental Payments.--
       (1) In general.--Section 263 (relating to capital 
     expenditures), as amended by subsection (b)(1), is amended by 
     adding at the end the following new subsection:
       ``(k) Delay Rental Payments for Domestic Oil and Gas 
     Wells.--
       ``(1) In general.--Notwithstanding subsection (a), a 
     taxpayer may elect to treat delay rental payments incurred in 
     connection with the development of oil or gas within the 
     United States (as defined in section 638) as payments which 
     are not chargeable to capital account. Any payments so 
     treated shall be allowed as a deduction in the taxable year 
     in which paid or incurred.
       ``(2) Delay rental payments.--For purposes of paragraph 
     (1), the term `delay rental payment' means an amount paid for 
     the privilege of deferring development of an oil or gas 
     well.''
       (2) Conforming amendment.--Section 263A(c)(3), as amended 
     by subsection (b)(2), is amended by inserting ``263(k),'' 
     after ``263(j),''.
       (3) Effective date.--
       (A) In general.--The amendments made by this subsection 
     shall apply to payments made or incurred after the date of 
     the enactment of this Act.
       (B) Transition rule.--In the case of any payments described 
     in section 263(k) of the Internal Revenue Code of 1986, as 
     added by this subsection, which were made or incurred on or 
     before the date of the enactment of this Act, the taxpayer 
     may elect, at such time and in such manner as the Secretary 
     of the Treasury may prescribe, to amortize the unamortized 
     portion of such payments over the 36-month period beginning 
     with the month in which the date of the enactment of this Act 
     occurs. For purposes of this subparagraph, the unamortized 
     portion of any payment is the amount remaining unamortized as 
     of the first day of the 36-month period.

     SEC. 224. EXTENSION OF SPUDDING RULE.

       (a) In General.--Section 461(i)(2)(A) (relating to special 
     rule for spudding of oil or gas wells) is amended by striking 
     ``90th day'' and inserting ``180th day''.
       (b) Effective Date--The amendment made by this section 
     shall apply to taxable years beginning after December 31, 
     1998.

          TITLE III--FOREIGN OIL RELIANCE REVERSAL PROVISIONS

     SEC. 300. PURPOSE.

       The purpose of this title is to reverse the trend of 
     increased foreign dependence of oil and gas by encouraging 
     exploration and development of oil and gas reserves in the 
     United States to achieve the goal of doubling current 
     domestic oil and gas production.

     ``SEC. 301. CRUDE OIL AND NATURAL GAS EXPLORATION AND 
                   DEVELOPMENT CREDIT.

       (a) Crude Oil and Natural Gas Exploration and Development 
     Credit.--Subpart B of part IV of subchapter A of chapter 1 is 
     amended by adding at the end the following new section:

     ``SEC. 30B. CRUDE OIL AND NATURAL GAS EXPLORATION AND 
                   DEVELOPMENT CREDIT.

       ``(a) General Rule.--The crude oil and natural gas 
     exploration and development credit determined under 
     this section for any applicable taxable year shall be an 
     amount equal to the sum of--
       ``(1) 20 percent of so much of the taxpayer's qualified 
     investment for the taxable year as does not exceed 
     $1,000,000, plus
       ``(2) 10 percent of so much of such qualified investment 
     for the taxable year as exceeds $1,000,000.
       ``(b) Applicale Taxable Year.--For purposes of subsection 
     (a)--
       ``(1) In general.--The term `applicable taxable year' means 
     any taxable year beginning in a calendar year during which 
     the imports of foreign crude and oil product are determined 
     by the Secretary of Energy to exceed 50 percent of the amount 
     of United States crude and oil product consumption for such 
     year.
       ``(2) Determination.--A determination under paragraph (1) 
     shall be made not later than March 1 of each year with 
     respect to the preceding calendar year.
       ``(c) Qualified Investment.--For purposes of this section, 
     the term `qualified investment' means amounts paid or 
     incurred by a taxpayer--
       ``(1) for the purpose of ascertaining the existence, 
     location, extent, or quality of any crude oil or natural gas 
     deposit, including core testing and drilling test wells 
     located in the United States or in a possession of the United 
     States as defined in section 638, or
       ``(2) for the purpose of developing a property (located in 
     the United States or in a possession of the United States as 
     defined in section 638) on which there is a reservoir capable 
     of commercial production and such amounts are paid or 
     incurred in connection with activities which are intended to 
     result in the recovery of crude oil or natural gas on such 
     property.
       ``(d) Limitation Based on Amount of Tax.--
       ``(1) Liability for tax.--The credit allowable under 
     subsection (a) for any taxable year shall not exceed the 
     excess (if any) of--
       ``(A) the sum of--
       ``(i) the taxpayer's tentative minimum tax liability under 
     section 55(b) for such taxable year determined without regard 
     to this section, plus
       ``(ii) the taxpayer's regular tax liability for such 
     taxable year (as defined in section 26(b)), over
       ``(B) the sum of the credits allowable against the 
     taxpayer's regular tax liability under part IV (other than 
     section 43 of this section).
       ``(2) Application of the credit.--Each of the following 
     amounts shall be reduced by the full amount of the credit 
     determined under paragraph (1):
       ``(A) the taxpayer's tentative minimum tax under section 
     55(b) for the taxable year, and
       ``(B) the taxpayer's regular tax liability (as defined in 
     section 26(b)) reduced by the sum of the credits allowable 
     under part IV (other than section 43 of this section).
     If the amount of the credit determined under paragraph (1) 
     exceeds the amount described in subparagraph (B) of paragraph 
     (2), then the excess shall be deemed to be the adjusted net 
     minimum tax for such taxable year for purposes of section 53.
       ``(3) Carryback and carryforward of un-used credit.--
       ``(A) In general.--If the amount of the credit allowed 
     under subsection (a) for any taxable year exceeds the 
     limitation under paragraph (1) for such taxable year 
     (hereafter in this paragraph referred to as the `unused 
     credit year'), such excess shall be--
       ``(i) an oil and gas exploration and development credit 
     carryback to each of the 3 taxable years preceding the unused 
     credit year, and
       ``(ii) an oil and gas exploration and development credit 
     carryforward to each of the 15 taxable years following the 
     unused credit year,

     and shall be added to the amount allowable as a credit under 
     subsection (a) for such years, except that no portion of the 
     unused oil and gas exploration and development credit for any 
     taxable year may be carried to a taxable year ending before 
     the date of the enactment of this section.
       ``(B) Limitations.--The amount of the unused credit which 
     may be taken into account under subparagraph (A) for any 
     succeeding taxable year shall not exceed the amount by which 
     the limitation provided by paragraph (1) for such taxable 
     year exceeds the sum of--
       ``(i) the credit allowable under subsection (a) for such 
     taxable year, and
       ``(ii) the amounts which, by reason of this paragraph, are 
     added to the amount allowable for such taxable year and which 
     are attributable to taxable years preceding the unused credit 
     year.
       ``(e) Special Rules.--For purposes of this section--
       ``(1) Aggregation of qualified investment expenses.--
       ``(A) Controlled groups; common control.--In determining 
     the amount of the credit under this section, all members of 
     the same controlled group of corporations (within the meaning 
     of section 52(a)) and all persons under common control 
     (within the meaning of section 52(b)) shall be treated as a 
     single taxpayer for purposes of this section.
       ``(B) Apportionment of credit.--The credit (if any) 
     allowable by this section to members of any group (or to any 
     person) described in subparagraph (A) shall be such member's 
     or person's proportionate share of

[[Page S2590]]

     the qualified investment expenses giving rise to the credit 
     determined under regulations prescribed by the Secretary.
       ``(2) Partnerships, s corporations, estates and trusts.--
       ``(A) Partnerships and s corporations.--In the case of a 
     partnership, the credit shall be allocated among partners 
     under regulations prescribed by the Secretary. A similar rule 
     shall apply in the case of an S corporation and its 
     shareholders.
       ``(B) 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) Adjustments for certain acquisitions and 
     dispositions.--Under regulations prescribed by the Secretary, 
     rules similar to the rules contained in section 41(f)(3) 
     shall apply with respect to the acquisition or disposition of 
     a taxpayer.
       ``(4) Short taxable years.--In the case of any short 
     taxable year, qualified investment expenses shall be 
     annualized in such circumstances and under such methods as 
     the Secretary may prescribe by regulation.
       ``(5) Denial of double benefit.--
       ``(A) Disallowance of deduction.--Any deduction allowable 
     under this chapter for  any costs taken into account in 
     computing the amount of the credit determined under 
     subsection (a) shall be reduced by the amount of such 
     credit attributable to such costs.
       ``(B) Basis adjustments.--For purposes of this subtitle, if 
     a credit is determined under this section for any expenditure 
     with respect to any property, the increase in the basis of 
     such property which would (but for this subsection) result 
     from such expenditures shall be reduced by the amount of the 
     credit so allowed.''
       (b) Clerical Amendment.--The table of sections for subpart 
     B of part IV of subchapter A of chapter 1 is amended by 
     adding at the end thereof the following new item:

``Sec. 30B. Crude oil and natural gas exploration and development 
              credit.''

       (c) Effective Date.--The amendments made by this section 
     shall apply to expenses paid or incurred in taxable years 
     beginning after December 31, 1998.

            TITLE IV--NATIONAL SECURITY EMERGENCY PROVISIONS

     SEC. 400. PURPOSE.

       The purpose of this title is to recognize that a national 
     security threat exists when foreign crude oil, oil product, 
     and natural gas imports exceed 60 percent of United States 
     oil and gas consumption and to create an emergency procedure 
     to address that threat.

     SEC. 401. DUTIES OF THE PRESIDENT.

       (a) Establishment of Ceiling.--The President shall 
     establish a National Security Energy Independence Ceiling 
     (Referred to in this title as the ``ceiling level'') which 
     shall represent a ceiling level beyond which foreign crude 
     oil, oil product, and natural gas imports as a share of 
     United States crude and oil product consumption shall not 
     rise.
       (b) Level of Ceiling.--The ceiling level established under 
     subsection (a) shall not exceed 60 percent of United States 
     crude oil, oil product, and natural gas consumption for any 
     annual period.
       (c) Report.--
       (1) Contents.--
       (A) In general.--The President shall prepare and submit an 
     annual report to Congress containing a national security 
     projection for energy independence (in this title referred to 
     as the ``projection''), which shall contain a forecast of 
     domestic oil and liquid natural gas (commonly known as 
     ``NGL'') demand and production, and imports of crude oil, oil 
     product, and natural gas, for the subsequent 3 years.
       (B) Required adjustments.--The projection shall contain 
     appropriate adjustments for expected price and production 
     changes.
       (2) Presentation.--The projection prepared under paragraph 
     (1) shall be presented to Congress with the Budget.
       (3) Certification.--The President shall certify in the 
     report whether foreign crude oil, oil product, and natural 
     gas imports will exceed the ceiling level for any year during 
     the 3 years succeeding the date of the report.

     SEC. 402. CONGRESSIONAL REVIEW.

       (a) Review.--Congress shall have 10 continuous session days 
     after submission of each projection under section 401 to 
     review the projection and make a determination whether the 
     ceiling level will be violated within 3 years.
       (b) Certification Binding.--Unless disapproved or modified 
     by joint resolution, the Presidential certification shall be 
     binding 10 session days after submitted to Congress.

     SEC. 403. NATIONAL SECURITY AND OIL AND GAS PRODUCTION 
                   ACTIONS.

       (a) National Security and Oil and Gas Production Policy.--
       (1) Submission.--Upon certification under section 401(c)(3) 
     that the ceiling level will be exceeded, the President shall, 
     within 90 days, submit a National Security and Oil and Gas 
     Production Policy (in this section referred to as the 
     ``policy'') to Congress. The policy shall prevent crude oil, 
     oil product, and natural gas imports from exceeding the 
     ceiling level.
       (2) Approval.--Unless disapproved or modified by joint 
     resolution, the policy shall be effective 90 session days 
     after submitted to Congress.
       (b) Contents of Policy.--The National Security and Oil 
     Production Policy may include--
       (1) energy conservation actions, including improved fuel 
     efficiency for automobiles;
       (2) expansion of the Strategic Petroleum Reserves to 
     maintain a larger cushion against projected oil import 
     blockages;
       (3) additional production incentives for domestic oil and 
     gas, including tax and other incentives for stripper well 
     production, offshore, frontier, and other oil produced with 
     tertiary recovery techniques;
       (4) regulatory burden relief; and
       (5) other policy initiatives designed to lower foreign 
     import reliance.
                                  ____


    Domestic Oil and Gas Crisis Tax Relief and Foreign Oil Reliance 
                          Reversal Act of 1999

     SEC. 2. PURPOSES.

       To establish a graduated response to shrinking domestic oil 
     and gas production and surging foreign oil imports;
       To prevent the abandonment of marginal oil and gas wells 
     responsible for half of U.S. domestic production;
       To transform earned tax credits and other benefits into 
     working capital for the cash-strapped domestic oil and gas 
     producers and service companies;
       To compensate U.S. producers for the hardship the Oil for 
     Food program is causing them;
       To reverse the trend of increased foreign oil and gas 
     dependence by encouraging exploration and development of oil 
     and gas reserves in the U.S. to achieve the goal of doubling 
     current domestic oil and gas production;
       To provide an emergency procedure when foreign imports 
     exceed 60 percent, thereby recognizing that when imports 
     exceed a Congressionally legislated peril point, a national 
     security threat exists that demands Presidential action.

     SEC. 3. FINDINGS.

       (a) Findings.--The Congress finds that--
       (1) U.S. foreign oil consumption is estimated at 56 percent 
     and could reach 68 percent by 2010 if current prices prevail.
       (2) The number of oil and gas rigs operating in the United 
     States is at the lowest count since 1944, when records of 
     this tally began.
       (3) If prices do not increase soon, the U.S. could lose at 
     least half of its marginal wells which in aggregate produce 
     as much oil as we import from Saudi Arabia;
       (4) Oil and gas prices are unlikely to increase for at 
     least several years;
       (5) Declining production, well abandonment and greatly 
     reduced exploration and development are shrinking the 
     domestic oil and gas industry;
       (6) The world's richest oil producing regions in the Middle 
     East are experiencing greater political instability;
       (7) U.N. policy may make Iraq the swing oil producing 
     nation, thereby granting Saddem Hussein a tremendous amount 
     of power;
       (8) Reliance on foreign oil for more than 60 percent of our 
     daily oil and gas consumption is a national security threat;
       (9) the level of the United States energy security is 
     directly related to the level of domestic production of oil, 
     natural gas liquids, and natural gas; and
       (10) a national security policy should be developed which 
     ensures that adequate supplies of oil shall be available at 
     all times free of the threat of embargo or other foreign 
     hostile acts.

     SEC. 4. TABLE OF CONTENTS.

    TITLE I--DOMESTIC OIL AND GAS PRODUCTION PRESERVATION PROVISIONS

       (101(a)) Purpose: To prevent the abandonment of marginal 
     oil and gas wells responsible for half of U.S. Domestic 
     production
       (101) Tax credit to prolong marginal domestic oil and gas 
     well production.
       (  ) Expand definition of marginal well to include high 
     water content wells.
       (102) Exclusion of certain amounts received from the 
     production of wells reopened after they have been plugged or 
     abandoned.
       (103) Tax credits to prolong domestic oil and gas well 
     production through secondary and other nontertiary recovery 
     methods in order to produce the remaining 75 percent of oil 
     and gas that is not recoverable using primary methods.

  TITLE II--DOMESTIC OIL AND GAS INDUSTRY CRISIS TAX RELIEF TRIGGERED 
                WHEN PRICE OF OIL IS BELOW $15 A BARREL

     A. Credits to cash provisions
       (200) Purpose: To transform earned tax credits and other 
     accumulated tax benefits into working capital for the cash-
     strapped domestic oil and gas producers and service 
     companies.
       (201) Ten year carry-back for unused AMT credits for oil 
     and gas producers and servicing firms.
       (202) Ten year carry-back for unused percentage depletion 
     for oil and gas producers.
       (  ) Repeal 65 percent of net rule.
       (203) Ten year carry-back for NOLs for producers and 
     servicing firms.
     B. Hard times tax relief when price of oil is less than $14 a 
         barrel
       (211) Remove IDCs as AMT tax preference in any year when 
     price of oil is less than $14 a barrel (Phased out when oil 
     prices hit $17).
       (212) Eliminate the depreciation adjustment under the AMT 
     for oil and gas assets so that the depreciation schedules for 
     the regular tax is also used for AMT.
       (213) Eliminate the Adjusted Current Earnings adjustment 
     (ACE) as it applies to IDCs.

[[Page S2591]]

       (214) Permit EOR credit and Section 29 credit to reduce the 
     Alternative Minimum Tax.
     C. Tax benefits to offset the depressing impact on oil prices 
         that the Food for Oil Program is having
       (221) Restore percentage depletion to 27.5 percent.
       (222) Repeal net income limitation on percentage depletion.
       (223) Allow Expensing geological and geophysical 
     expenditures.
       (223) Allow Election to Expense Delay Rentals payments.
       (224) Extension of Spudding rule.

  TITLE III--FOREIGN OIL RELIANCE REVERSAL PROVISIONS TRIGGERED WHEN 
                       IMPORTS EXCEED 50 PERCENT

       (300) Purpose: To reverse the trend of increased foreign 
     dependence of oil and gas by encouraging exploration and 
     development of oil and gas reserves in the U.S. to achieve 
     the goal of doubling current domestic oil and gas production.
       (301) 20 percent exploration and development credit when 
     imports exceed 50 percent.

  TITLE IV--NATIONAL SECURITY EMERGENCY WHEN IMPORTS EXCEED 60 PERCENT

       (400) Purpose: To provide an emergency procedure when 
     foreign imports exceed 60 percent to require the President to 
     implement an energy security strategic plan to designed to 
     prevent crude and product imports from exceeding 60 percent.
       (401) Duties of the President.
       (402) Congressional Review of the Strategic plan proposed 
     by the President.
       (403) Energy Security strategic plan and course of action.
                                 ______
                                 
      By Mr. SMITH of New Hampshire (for himself, Mr. Inhofe, Mr. 
        Burns, Mr. Enzi, and Mr. Murkowski):
  S. 597. A bill to amend section 922 of chapter 44 of title 28, United 
States Code, to protect the right of citizens under the Second 
Amendment to the Constitution of the United States; to the Committee on 
the Judiciary.


             second amendment rights protection act of 1999

  Mr. SMITH of New Hampshire. Mr. President, I rise to introduce the 
``Second Anendment Rights Protection Act of 1999.'' I am pleased and 
honored that Senators Inhofe, Burns, Enzi, and Murkowski are joining me 
as original cosponsors.
  Mr. President, the Second Amendment Rights Protection Act of 1999 
encompasses all of the provisions of the Smith Amendment, which passed 
the Senate by a vote of 69-31 on July 21, 1998, during consideration of 
the Commerce, Justice, State appropriations bill for fiscal year 1999. 
Only a substantially modified version of the Smith amendment was 
included in the final omnibus appropriations measure.
  The National Instant Criminal Background Check System (NICS) went 
into effect on December 1, 1998. My bill would require the immediate 
destruction of all information submitted by any person who has been 
cleared by the NICS to purchase a firearm. There is no reason why such 
private information on law-abiding gun owners should be retained. I 
continue to be troubled by the Clinton administration's insistence upon 
doing so.
  In addition, Mr. President, my bill would prohibit the imposition of 
any tax or fee in connection with the NICS. Once again, in his budget 
submission for fiscal year 2000, President Clinton is seeking to fund 
NICS with a gun tax.
  With the Smith amendment last year, we told President Clinton ``no'' 
to the gun tax. Let us tell him ``no'' again, once and for all, by 
enacting the Second Amendment Rights Protection Act.
  Finally, Mr. President, my bill would create a private cause of 
action for any individual who is aggrieved by a violation of its 
provisions.
  Mr. President, I ask unanimous consent for the printing of the text 
of my bill, the Second Amendment Rights Protection Act of 1999, in the 
Record.
  There being no objection, the bill was ordered to the printed in the 
Record, as follows:

                                 S. 597

       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 ``Second Amendment Rights 
     Protection Act of 1999.''

     SEC. 2. PROTECTION OF SECOND AMENDMENT RIGHTS.

       Subsection (t) of section 922 of chapter 44 of Title 18, 
     United States Code, is amended by inserting at the end 
     thereof the following new paragraph:
       ``(7) None of the funds appropriated pursuant to any 
     provision of law may be used for (1) any system to implement 
     this subsection that does not require and result in the 
     immediate destruction of all information, in any form 
     whatsoever, submitted by or on behalf of any person who has 
     been determined not be prohibited from owning a firearm; (2) 
     the implementation or collection of any tax or fee by any 
     officer, agent, or employee of the United States, or by any 
     state or local officer or agent acting on behalf of the 
     United States, in connection with the implementation of this 
     subsection, provided, that any person aggrieved by a 
     violation of this provision may bring an action in the 
     Federal district court for the district in which the person 
     resides; provided further, that any person who is successful 
     with respect to any such action shall receive damages, 
     punitive damages, and such other remedies as the court may 
     determine to be appropriate, including a reasonable 
     attorney's fee.''
                                 ______
                                 
      By Mr. SANTORUM:
  S. 598. A bill to amend the Federal Agriculture Improvement and 
Reform Act of 1996 to improve the farmland protection program; to the 
Committee on Agriculture, Nutrition, and Forestry.

                    FARMLAND PROTECTION ACT OF 1999

  Mr. SANTORUM. Mr. President, I rise today to introduce legislation 
that would reauthorize the Farmland Protection Program that was 
originally authorized with passage of the 1996 Farm Bill.
  Every year more than one million acres of our nation's most 
productive farmland is lost to urbanization. This is land that produces 
three-quarters of America's fruits and vegetables, and more than half 
of our dairy products. While state and local governments have taken the 
lead in preservation efforts, the demand for assistance continues to 
grow.
  Considering the importance of agriculture to our nation, and to 
generations of families throughout our country, I was proud to take a 
lead role in the United States Senate to assist farmers and communities 
in confronting the obstacle of growing pressure on the use of farmland. 
As such, I, with the support of many Senate colleagues, established the 
Federal Farmland Protection Program to stem the loss of valuable 
farmland, and to provide states with adequate tools to accomplish that 
goal. Those efforts resulted in a $35 million authorization in the 1996 
Farm Bill.
  This money has been used to help states leverage dollars in order to 
purchase development rights, and keep productive farmland in use--all 
through voluntary efforts. In just three short years, the funds were 
exhausted due to the overwhelming response by farmers and state 
governments. In fact, by the end of fiscal year 1997 the original $35 
million authorization had been spent, and the demand outstripped 
funding availability by 900 percent.
  The legislation that I'm introducing today, the Farmland Protection 
Act of 1999, would provide a $50 million per year authorization for the 
much-needed funds to carry out the important work of farmland 
preservation. In addition, my bill would allow non-profit organizations 
to participate in the program--where there is no established government 
program--as they are currently precluded from doing so in certain 
states.
  Mr. President, I am proud to introduce this legislation that will 
enable us to take another giant step forward in protecting a valuable 
resource to many Americans. To date, nineteen states have capitalized 
on this opportunity to augment their preservation efforts, and 
hopefully, the Farmland Protection Act of 1999 will give more states 
the tools to assist their local farming community.
  Mr. President, I ask unanimous consent that a copy 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. 598

       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 ``Farmland Protection Act of 
     1999''.

     SEC. 2. FARMLAND PROTECTION PROGRAM.

       Section 388 of the Federal Agriculture Improvement and 
     Reform Act of 1996 (16 U.S.C. 3830 note; Public Law 104-127) 
     is amended to read as follows:

[[Page S2592]]

     ``SEC. 388. FARMLAND PROTECTION PROGRAM.

       ``(a) Definition of Eligible Entity.--In this section, the 
     term `eligible entity' means--
       ``(1) any agency of any State or local government, or 
     federally recognized Indian tribe; and
       ``(2) any organization that--
       ``(A) is organized for, and at all times since its 
     formation has been operated principally for, 1 or more of the 
     conservation purposes specified in clause (i), (ii), or (iii) 
     of section 170(h)(4)(A) of the Internal Revenue Code of 1986;
       ``(B) is an organization described in section 501(c)(3) of 
     the Code that is exempt from taxation under section 501(a) of 
     the Code; and
       ``(C)(i) is described in section 509(a)(2) of the Code; or
       ``(ii) is described in section 509(a)(3) of the Code and is 
     controlled by an organization described in section 509(a)(2) 
     of the Code.
       ``(b) Authority.--The Secretary of Agriculture shall 
     establish and carry out a farmland protection program under 
     which the Secretary shall provide grants to eligible 
     entities, to provide the Federal share of the cost of 
     purchasing conservation easements or other interests in land 
     with prime, unique, or other productive soil for the purpose 
     of protecting topsoil by limiting nonagricultural uses of the 
     land.
       ``(c) Eligible Entities.--The Secretary may provide a grant 
     to an eligible entity described in subsection (a)(2) for the 
     purchase of a conservation easement or other interest in land 
     within the jurisdiction of a State or local government or 
     federally recognized Indian tribe only if the appropriate 
     agency of the State or local government or the federally 
     recognized Indian tribe does not operate a farmland 
     protection program.
       ``(d) Federal Share.--The Federal share of the cost of 
     purchasing a conservation easement or other interest 
     described in subsection (b) shall be not more than 50 
     percent.
       ``(e) Conservation Plan.--Any land for which a conservation 
     easement or other interest is purchased under this section 
     shall be subject to the requirements of a conservation plan 
     that requires, at the option of the Secretary, the conversion 
     of the land to less intensive uses.
       ``(f) Ranking Criteria.--The Secretary shall consult with 
     appropriate agencies of States and local governments and 
     federally recognized Indian tribes in developing criteria for 
     ranking applications for grants under this section.
       ``(g) Funding.--For each fiscal year, the Secretary shall 
     use not more than $50,000,000 of the funds of the Commodity 
     Credit Corporation to carry out this section.''.
                                 ______
                                 
      By Mr. CHAFEE (for himself, Mr. Hatch, Mr. Cochran, Ms. Snowe, 
        Mr. Roberts, Mr. Specter, and Ms. Collins):
  S. 599. A bill to amend the Internal Revenue Code of 1986 to provide 
additional tax relief to families to increase the affordability of 
child care, and for other purposes; to the Committee on Finance.


                      THE CARING FOR CHILDREN ACT

  Mr. CHAFEE. Mr. President, I am pleased today to introduce the Caring 
for Children Act, legislation to help all families with their child 
care needs.
  I want to thank my colleagues who have worked so hard to put this 
bill together. Senator Hatch, who was a leader in the development of 
the child care block grant, and is always a stalwart supporter of 
children. Senator Snowe, who has worked on this issue for many years. 
Senator Roberts, who has taken an active interest in this issue. 
Senator Specter, who made an enormous contribution to the development 
of this bill. And Senators Susan Collins and Thad Cochran, who we are 
very fortunate to have on our child care proposal.
  Our proposal is straightforward and far-reaching. It makes the 
current child care credit more equitable for lower and middle income 
families. And, for the first time, makes the credit available to 
families where one parent stays at home to care for the children. That 
is a critical step and an important change for families across America.
  Raising children in today's world is a true challenge. In many 
families, both parents must work in order to support the family. Often, 
the child care expenses consume all or most of one parent's income. How 
often do we hear the refrain, particularly from women, that after they 
pay for day care, there is little or nothing left of their wages.
  Another common complaint is from parents who desperately want to stay 
home and raise their children themselves--especially in those very 
critical, early years of childhood--but who simply cannot afford to 
forgo that second income.
  The legislation we are introducing today responds to both of these 
concerns. We believe that parents should make their own decisions about 
who is going to care for their children. The government and the Tax 
Code should not be promoting one choice over another.
  By making more of the existing child care tax credit available to 
lower and middle income families, and making it available also to 
families where one parent stays at home, we are sending the message 
that the choice is yours, and we support your choice.
  Our bill makes several changes to the existing dependent care tax 
credit. First, the maximum credit percentage is increased from 30 
percent to 50 percent to provide more benefits to those most in need. 
Second, the income level at which the maximum credit begins to be 
reduced is moved from $10,000 to $30,000, so that more lower-income 
families will qualify for the maximum amount of assistance. Third, we 
propose to completely phase out the credit for wealthier families. 
Finally, families where one spouse stays at home to care for the 
children will be eligible for a credit similar to the one they would 
receive if both parents were working outside the home and the child was 
in daycare.
  We also acknowledge that we cannot solve the entire child care 
problem through the Tax Code alone. Many low-income families do not 
have taxable income, and therefore cannot benefit from a tax credit. 
The Child Care and Development Block Grant (CCDBG) provides critical 
funding to help these lower-income families--and I have been a strong 
supporter of the program. Recognizing the critical role CCDBG plays in 
subsidizing daycare for low-income families in the states, our proposal 
doubles the block grant over a five-year period.
  Of course, the problem with child care is not limited to just 
affordability. Many parents cannot find an available child care slot. 
Our proposal addresses this issue of accessibility by providing a tax 
credit to businesses to build or renovate on or near-site child care 
centers for their employees.
  Finally, there is the issue of quality daycare. Parents cannot be 
productive in the workplace if they are constantly worrying about the 
health and safety of their children in daycare. We have all read the 
horrifying stories in the newspapers about daycare facilities that are 
unsafe or unsanitary, about the poor record of enforcement of standards 
in many states.
  While we acknowledge that the federal government should not be 
setting standards for daycare providers, we do believe the states 
should set at least minimum health and safety standards and enforce 
them rigorously. Our legislation beefs up this enforcement by rewarding 
states with a good enforcement record and penalizing those with poor 
records.
  I am very proud of this legislation, and proud that this group was 
able to come together and produce this initiative. Child care is a 
problem that must be solved, and we are committed to doing that. I look 
forward to working with my colleagues in the Congress to find workable, 
affordable solutions for all families. I ask unanimous consent that the 
legislation be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 599

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Caring for 
     Children Act''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents.

        TITLE I--TAX RELIEF TO INCREASE CHILD CARE AFFORDABILITY

Sec. 101. Expansion of dependent care tax credit.
Sec. 102. Promotion of dependent care assistance programs.
Sec. 103. Allowance of credit for employer expenses for child care 
              assistance.

                TITLE II--ENCOURAGING QUALITY CHILD CARE

   Subtitle A--Dissemination of Information About Quality Child Care

Sec. 201. Collection and dissemination of information.
Sec. 202. Grants for the development of a child care training 
              infrastructure.
Sec. 203. Authorization of appropriations.

 Subtitle B--Increased Enforcement of State Health and Safety Standards

Sec. 211. Enforcement of State health and safety standards.

[[Page S2593]]

  Subtitle C--Removal of Barriers to Increasing the Supply of Quality 
                               Child Care

Sec. 221. Increased authorization of appropriations for the Child Care 
              and Development Block Grant Act.
Sec. 222. Small business child care grant program.
Sec. 223. GAO report regarding the relationship between legal liability 
              concerns and the availability and affordability of child 
              care.

 Subtitle D--Quality Child Care Through Federal Facilities and Programs

Sec. 231. Providing quality child care in Federal facilities.

        TITLE I--TAX RELIEF TO INCREASE CHILD CARE AFFORDABILITY

     SEC. 101. EXPANSION OF DEPENDENT CARE TAX CREDIT.

       (a) Percentage of Employment-Related Expenses Determined by 
     Taxpayer Status.--Section 21(a)(2) of the Internal Revenue 
     Code of 1986 (defining applicable percentage) is amended to 
     read as follows:
       ``(2) Applicable percentage defined.--For purposes of 
     paragraph (1), the term `applicable percentage' means 50 
     percent reduced (but not below zero) by 1 percentage point 
     for each $1,500, or fraction thereof, by which the 
     taxpayers's adjusted gross income for the taxable year 
     exceeds $30,000.''.
       (b) Minimum Credit Allowed for Stay-at-Home Parents.--
     Section 21(e) of the Internal Revenue Code of 1986 (relating 
     to special rules) is amended by adding at the end the 
     following:
       ``(11) Minimum credit allowed for stay-at-home parents.--
     Notwithstanding subsection (d), in the case of any taxpayer 
     with one or more qualifying individuals described in 
     subsection (b)(1)(A) under the age of 4 at any time during 
     the taxable year, such taxpayer shall be deemed to have 
     employment-related expenses with respect to such qualifying 
     individuals in an amount equal to the greater of--
       ``(A) the amount of employment-related expenses incurred 
     for such qualifying individuals for the taxable year 
     (determined under this section without regard to this 
     paragraph), or
       ``(B) $150 for each month in such taxable year during which 
     such qualifying individual is under the age of 4.''.
       (c) Effective Date.--The amendments made by this section 
     apply to taxable years beginning after December 31, 1998.

     SEC. 102. PROMOTION OF DEPENDENT CARE ASSISTANCE PROGRAMS.

       (a) Promotion of Dependent Care Assistance Programs.--The 
     Secretary of Labor shall establish a program to promote 
     awareness of the use of dependent care assistance programs 
     (as described in section 129(d) of the Internal Revenue Code 
     of 1986) by employers.
       (b) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out the program under paragraph 
     (1) $1,000,000 for each of fiscal years 2000, 2001, 2002, and 
     2003.

     SEC. 103. 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) Allowance of Credit.--For purposes of section 38, the 
     employer-provided child care credit determined under this 
     section for the taxable year is an amount equal to 20 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 
     $100,000.
       ``(c) Definitions.--For purposes of this section--
       ``(1) Qualified child care expenditure.--
       ``(A) In general.--The term `qualified child care 
     expenditure' means any amount paid or incurred--
       ``(i) 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 1034) of the 
     taxpayer or any employee of the taxpayer,

       ``(ii) for the operating costs of a qualified child care 
     facility of the taxpayer, including costs related to the 
     training of employees,
       ``(iii) under a contract with a qualified child care 
     facility to provide child care services to employees of the 
     taxpayer, or
       ``(iv) under a contract to provide child care resource and 
     referral services to employees of the taxpayer.
       ``(2) Exclusion for amounts funded by grants, etc.--The 
     term `qualified child care expenditure' shall not include any 
     amount to the extent such amount is funded by any grant, 
     contract, or otherwise by another person (or any governmental 
     entity).
       ``(3) 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 1034) 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.

[[Page S2594]]

       ``(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.
       ``(g) Termination.--This section shall not apply to taxable 
     years beginning after December 31, 2003.''.
       (b) Conforming Amendments.--
       (1) Section 38(b) of the Internal Revenue Code of 1986 is 
     amended--
       (A) by striking out ``plus'' at the end of paragraph (11),
       (B) by striking out the period at the end of paragraph 
     (12), and inserting a comma and ``plus'', and
       (C) by adding at the end the following new paragraph:
       ``(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 new item:

``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, 
     1998.

                TITLE II--ENCOURAGING QUALITY CHILD CARE

   Subtitle A--Dissemination of Information About Quality Child Care

     SEC. 201. COLLECTION AND DISSEMINATION OF INFORMATION.

       (a) Collection and Dissemination of Information.--The 
     Secretary of Health and Human Services shall, directly or 
     through a contract awarded on a competitive basis to a 
     qualified entity, collect and disseminate--
       (1) information concerning health and safety in various 
     child care settings that would assist--
       (A) the provision of safe and healthful environments by 
     child care providers; and
       (B) the evaluation of child care providers by parents; and
       (2) relevant findings in the field of early childhood 
     learning and development.
       (b) Information and Findings To Be Generally Available.--
       (1) Secretarial responsibility.--The Secretary of Health 
     and Human Services shall make the information and findings 
     described in subsection (a) generally available to States, 
     units of local governments, private nonprofit child care 
     organizations (including resource and referral agencies), 
     employers, child care providers, and parents.
       (2) Definition of generally available.--For purposes of 
     paragraph (1), the term ``generally available'' means that 
     the information and findings shall be distributed through 
     resources that are used by, and available to, the public, 
     including such resources as brochures, Internet web sites, 
     toll-free telephone information lines, and public and private 
     resource and referral organizations.

     SEC. 202. GRANTS FOR THE DEVELOPMENT OF A CHILD CARE TRAINING 
                   INFRASTRUCTURE.

       (a) Authority To Award Grants.--The Secretary of Health and 
     Human Services shall award grants to eligible entities to 
     develop distance learning child care training technology 
     infrastructures and to develop model technology-based 
     training courses for child care providers and child care 
     workers. The Secretary shall, to the maximum extent possible, 
     ensure that grants for the development of distance learning 
     child care training technology infrastructures are awarded in 
     those regions of the United States with the fewest training 
     opportunities for child care providers.
       (b) Eligibility Requirements.--To be eligible to receive a 
     grant under subsection (a), an entity shall--
       (1) develop the technological and logistical aspects of the 
     infrastructure described in this section and have the 
     capability of implementing and maintaining the 
     infrastructure;
       (2) to the maximum extent possible, develop partnerships 
     with secondary schools, institutions of higher education, 
     State and local government agencies, and private child care 
     organizations for the purpose of sharing equipment, technical 
     assistance, and other technological resources, including--
       (A) sites from which individuals may access the training;
       (B) conversion of standard child care training courses to 
     programs for distance learning; and
       (C) ongoing networking among program participants; and
       (3) develop a mechanism for participants to--
       (A) evaluate the effectiveness of the infrastructure, 
     including the availability and affordability of the 
     infrastructure, and the training offered the infrastructure; 
     and
       (B) make recommendations for improvements to the 
     infrastructure.
       (c) Application.--To be eligible to receive a grant under 
     subsection (a), an entity shall submit an application to the 
     Secretary at such time and in such manner as the Secretary 
     may require, and that includes--
       (1) a description of the partnership organizations through 
     which the distance learning programs will be disseminated and 
     made available;
       (2) the capacity of the infrastructure in terms of the 
     number and type of distance learning programs that will be 
     made available;
       (3) the expected number of individuals to participate in 
     the distance learning programs; and
       (4) such additional information as the Secretary may 
     require.
       (d) Limitation On Fees.--No entity receiving a grant under 
     this section may collect fees from an individual for 
     participation in a distance learning child care training 
     program funded in whole or in part by this section that 
     exceed the pro rata share of the amount expended by the 
     entity to provide materials for the training program and to 
     develop, implement, and maintain the infrastructure (minus 
     the amount of the grant awarded by this section).
       (e) Rule of Construction.--Nothing in this section shall be 
     construed as requiring a child care provider to subscribe to 
     or complete a distance learning child care training program 
     made available by this section.

     SEC. 203. AUTHORIZATION OF APPROPRIATIONS.

       There is authorized to be appropriated to carry out this 
     subtitle $50,000,000 for each of fiscal years 2000 through 
     2004.

 Subtitle B--Increased Enforcement of State Health and Safety Standards

     SEC. 211. ENFORCEMENT OF STATE HEALTH AND SAFETY STANDARDS.

       (a) Identification of State Inspection Rate.--
       (1) In general.--Section 658E(c)(2)(G) of the Child Care 
     and Development Block Grant Act of 1990 (42 U.S.C. 
     9858c(2)(G)) is amended by striking the period and inserting 
     ``, and provide the percentage of completed child care 
     provider inspections that were required under State law for 
     each of the 2 preceding fiscal years.''.
       (2) Effective date.--The amendment made by paragraph (1) 
     applies to State plans under the Child Care and Development 
     Block Grant Act of 1990 (42 U.S.C. 9858 et seq.) on and after 
     September 1, 1999.
       (b) Increased or Decreased Allotments.--Section 658O(b) of 
     the Child Care and Development Block Grant Act of 1990 (42 
     U.S.C. 9858m(b)) is amended--
       (1) in paragraph (1), in the matter preceding subparagraph 
     (A), by inserting ``, subject to paragraph (5),'' after 
     ``shall''; and
       (2) by adding at the end the following:
       ``(5) Increased or decreased allotment based on state 
     inspection rate.--
       ``(A) Increased allotment for fiscal years 2000, 2001, and 
     2002.--
       ``(i) In general.--Subject to clause (iii), for fiscal 
     years 2000, 2001, and 2002, the allotment determined for a 
     State under paragraph (1) for each such fiscal year shall be 
     increased by an amount equal to 10 percent of such allotment 
     for the fiscal year involved with respect to any State--

       ``(I) that certifies to the Secretary that the State has 
     not reduced the scope of any State child care health or 
     safety standards or requirements that were in effect as of 
     December 31, 1998; and
       ``(II) that, with respect to the preceding fiscal year, had 
     a percentage of completed child care provider inspections (as 
     required to be reported under section 658E(c)(2)(G)), that 
     equaled or exceeded the target inspection and enforcement 
     percentage specified under clause (ii) for the fiscal year 
     for which the allotment is to be paid.

       ``(ii) Target inspection and enforcement percentage.--For 
     purposes of clause (i)(II), the target inspection and 
     enforcement percentage is--

       ``(I) for fiscal year 2000, 75 percent;
       ``(II) for fiscal year 2001, 80 percent; and
       ``(III) for fiscal year 2002, 100 percent.

       ``(iii) Pro rata reductions if insufficient 
     appropriations.--The Secretary shall make pro rata reductions 
     in the percentage increase otherwise required under clause 
     (i) for a State allotment for a fiscal year as necessary so 
     that the aggregate of all the allotments made under this 
     section do not exceed the amount appropriated for that fiscal 
     year under section 658B.
       ``(B) Decreased allotment for fiscal years 2001 and 2002.--
       ``(i) In general.--The allotment determined for a State 
     under paragraph (1) for each of fiscal years 2001 and 2002 
     shall be decreased by an amount equal to 10 percent of such 
     allotment for the fiscal year involved with respect to any 
     State that, with respect to the preceding fiscal year, had a 
     percentage of completed child care provider inspections (as 
     required to be reported under section 658E(c)(2)(G)) that was 
     below the minimum inspection and enforcement percentage 
     specified under clause (ii) for the fiscal year for which the 
     allotment is to be paid.
       ``(ii) Minimum inspection and enforcement percentage.--For 
     purposes of clause (i), the minimum inspection and 
     enforcement percentage is--

       ``(I) for fiscal year 2001, 50 percent; and
       ``(II) for fiscal year 2002, 75 percent.

       ``(iii) Requirement to expend State funds to replace 
     reduction.--If the allotment determined for a State for a 
     fiscal year is reduced by reason of clause (i), the State 
     shall, during the immediately succeeding fiscal year, expend 
     additional State funds

[[Page S2595]]

     under the State plan funded under this subchapter by an 
     amount equal to the amount of such reduction.''.

  Subtitle C--Removal of Barriers to Increasing the Supply of Quality 
                               Child Care

     SEC. 221. INCREASED AUTHORIZATION OF APPROPRIATIONS FOR THE 
                   CHILD CARE AND DEVELOPMENT BLOCK GRANT ACT.

       Section 658B of the Child Care and Development Block Grant 
     Act of 1990 (42 U.S.C. 9858) is amended to read as follows:

     ``SEC. 658B. AUTHORIZATION OF APPROPRIATIONS.

       ``There is authorized to be appropriated to carry out this 
     subchapter--
       ``(1) for fiscal year 1999, $1,182,672,000;
       ``(2) for fiscal year 2000, $1,500,000,000;
       ``(3) for fiscal year 2001, $1,750,000,000;
       ``(4) for fiscal year 2002, $2,000,000,000;
       ``(5) for fiscal year 2003, $2,250,000,000; and
       ``(6) for fiscal year 2004, $2,500,000,000.''.

     SEC. 222. SMALL BUSINESS CHILD CARE GRANT PROGRAM.

       (a) Establishment.--The Secretary of Health and Human 
     Services (in this section referred to as the ``Secretary'') 
     shall establish a program to award grants to States to assist 
     States in providing funds to encourage the establishment and 
     operation of employer operated child care programs.
       (b) Application.--To be eligible to receive a grant under 
     this section, a State shall prepare and submit to the 
     Secretary an application at such time, in such manner, and 
     containing such information as the Secretary may require, 
     including an assurance that the funds required under 
     subsection (e) will be provided.
       (c) Amount of Grant.--The Secretary shall determine the 
     amount of a grant to a State under this section based on the 
     population of the State as compared to the population of all 
     States.
       (d) Use of Funds.--
       (1) In general.--A State shall use amounts provided under a 
     grant awarded under this section to provide assistance to 
     small businesses located in the State to enable the small 
     businesses to establish and operate child care programs. Such 
     assistance may include--
       (A) technical assistance in the establishment of a child 
     care program;
       (B) assistance for the start up costs related to a child 
     care program;
       (C) assistance for the training of child care providers;
       (D) scholarships for low-income wage earners;
       (E) the provision of services to care for sick children or 
     to provide care to school aged children;
       (F) the entering into of contracts with local resource and 
     referral or local health departments;
       (G) care for children with disabilities; or
       (H) assistance for any other activity determined 
     appropriate by the State.
       (2) Application.--To be eligible to receive assistance from 
     a State under this section, a small business shall prepare 
     and submit to the State an application at such time, in such 
     manner, and containing such information as the State may 
     require.
       (3) Preference.--
       (A) In general.--In providing assistance under this 
     section, a State shall give priority to applicants that 
     desire to form a consortium to provide child care in 
     geographic areas within the State where such care is not 
     generally available or accessible.
       (B) Consortium.--For purposes of subparagraph (A), a 
     consortium shall be made up of 2 or more entities which may 
     include businesses, nonprofit agencies or organizations, 
     local governments, or other appropriate entities.
       (4) Limitation.--With respect to grant funds received under 
     this section, a State may not provide in excess of $100,000 
     in assistance from such funds to any single applicant.
       (e) Matching Requirement.--To be eligible to receive a 
     grant under this section a State shall provide assurances to 
     the Secretary that, with respect to the costs to be incurred 
     by an entity receiving assistance in carrying out activities 
     under this section, the entity will make available (directly 
     or through donations from public or private entities) non-
     Federal contributions to such costs in an amount equal to--
       (1) for the first fiscal year in which the entity receives 
     such assistance, not less than 50 percent of such costs ($1 
     for each $1 of assistance provided to the entity under the 
     grant);
       (2) for the second fiscal year in which an entity receives 
     such assistance, not less than 66\2/3\ percent of such costs 
     ($2 for each $1 of assistance provided to the entity under 
     the grant); and
       (3) for the third fiscal year in which an entity receives 
     such assistance, not less than 75 percent of such costs ($3 
     for each $1 of assistance provided to the entity under the 
     grant).
       (f) Requirements of Providers.--To be eligible to receive 
     assistance under a grant awarded under this section a child 
     care provider shall comply with all applicable State and 
     local licensing and regulatory requirements and all 
     applicable health and safety standards in effect in the 
     State.
       (g) Administration.--
       (1) State responsibility.--A State shall have 
     responsibility for administering the grant awarded under this 
     section and for monitoring entities that receive assistance 
     under such grant.
       (2) Audits.--A State shall require each entity receiving 
     assistance under a grant awarded under this section to 
     conduct an annual audit with respect to the activities of the 
     entity. Such audits shall be submitted to the State.
       (3) Misuse of funds.--
       (A) Repayment.--If the State determines, through an audit 
     or otherwise, that an entity receiving assistance under a 
     grant awarded under this section has misused the assistance, 
     the State shall notify the Secretary of the misuse. The 
     Secretary, upon such a notification, may seek from such an 
     entity the repayment of an amount equal to the amount of any 
     misused assistance plus interest.
       (B) Appeals process.--The Secretary shall by regulation 
     provide for an appeals process with respect to repayments 
     under this paragraph.
       (h) Reporting Requirements.--
       (1) 2-year study.--
       (A) In general.--Not later than 2 years after the date on 
     which the Secretary first provides grants under this section, 
     the Secretary shall conduct a study to determine--
       (i) the capacity of entities to meet the child care needs 
     of communities within a State;
       (ii) the kinds of partnerships that are being formed with 
     respect to child care at the local level; and
       (iii) who is using the programs funded under this section 
     and the income levels of such individuals.
       (B) Report.--Not later than 28 months after the date of 
     enactment of this Act, the Secretary shall prepare and submit 
     to the appropriate committees of Congress a report on the 
     results of the study conducted in accordance with 
     subparagraph (A).
       (2) 4-year study.--
       (A) In general.--Not later than 4 years after the date on 
     which the Secretary first provides grants under this section, 
     the Secretary shall conduct a study to determine the number 
     of child care facilities funded through entities that 
     received assistance through a grant made under this section 
     that remain in operation and the extent to which such 
     facilities are meeting the child care needs of the 
     individuals served by such facilities.
       (B) Report.--Not later than 52 months after the date of 
     enactment of this Act, the Secretary shall prepare and submit 
     to the appropriate committees of Congress a report on the 
     results of the study conducted in accordance with 
     subparagraph (A).
       (i) Definition.--As used in this section, the term ``small 
     business'' means an employer who employed an average of at 
     least 2 but not more than 50 employees on business days 
     during the preceding calendar year.
       (j) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section, $60,000,000 for 
     the period of fiscal years 2000 through 2002. With respect to 
     the total amount appropriated for such period in accordance 
     with this subsection, not more than $5,000,000 of that amount 
     may be used for expenditures related to conducting 
     evaluations required under, and the administration of, this 
     section.
       (k) Termination of Program.--The program established under 
     subsection (a) shall terminate on September 30, 2003.

     SEC. 223. GAO REPORT REGARDING THE RELATIONSHIP BETWEEN LEGAL 
                   LIABILITY CONCERNS AND THE AVAILABILITY AND 
                   AFFORDABILITY OF CHILD CARE.

       Not later than 6 months after the date of enactment of this 
     Act, the Comptroller General of the United States shall 
     report to Congress regarding whether and, if so, the extent 
     to which, concerns regarding potential legal liability 
     exposure inhibit the availability and affordability of child 
     care. The report shall include an assessment of whether such 
     concerns prevent--
       (1) employers from establishing on or near-site child care 
     for their employees;
       (2) schools or community centers from allowing their 
     facilities to be used for on-site child care; and
       (3) individuals from providing professional, licensed child 
     care services in their homes.

 Subtitle D--Quality Child Care Through Federal Facilities and Programs

     SEC. 231. PROVIDING QUALITY CHILD CARE IN FEDERAL FACILITIES.

       (a) Definitions.--In this section:
       (1) Administrator.--The term ``Administrator'' means the 
     Administrator of General Services.
       (2) Executive agency.--The term ``Executive agency'' has 
     the meaning given the term in section 105 of title 5, United 
     States Code, but does not include the Department of Defense.
       (3) Executive facility.--The term ``executive facility'' 
     means a facility that is owned or leased by an Executive 
     agency.
       (4) Federal agency.--The term ``Federal agency'' means an 
     Executive agency, a judicial office, or a legislative office.
       (5) Judicial facility.--The term ``judicial facility'' 
     means a facility that is owned or leased by a judicial 
     office.
       (6) Judicial office.--The term ``judicial office'' means an 
     entity of the judicial branch of the Federal Government.
       (7) Legislative facility.--The term ``legislative 
     facility'' means a facility that is owned or leased by a 
     legislative office.
       (8) Legislative office.--The term ``legislative office'' 
     means an entity of the legislative branch of the Federal 
     Government.
       (b) Executive Branch Standards and Enforcement.--
       (1) State and local licensing requirements.--

[[Page S2596]]

       (A) In general.--The Administrator shall issue regulations 
     requiring any entity operating a child care center in an 
     executive facility to comply with applicable State and local 
     licensing requirements related to the provision of child 
     care.
       (B) Compliance.--The regulations shall require that, not 
     later than 6 months after the date of enactment of this Act--
       (i) the entity shall comply, or make substantial progress 
     (as determined by the Administrator) toward complying, with 
     the requirements; and
       (ii) any contract for the operation of such a child care 
     center shall include a condition that the child care be 
     provided in accordance with the requirements.
       (2) Evaluation and enforcement.--The Administrator shall 
     evaluate the compliance of the entities described in 
     paragraph (1) with the regulations issued under that 
     paragraph. The Administrator may conduct the evaluation of 
     such an entity directly, or through an agreement with another 
     Federal agency, other than the Federal agency for which the 
     entity is providing child care. If the Administrator 
     determines, on the basis of such an evaluation, that the 
     entity is not in compliance with the regulations, the 
     Administrator shall notify the Executive agency.
       (c) Legislative Branch Standards and Enforcement.--
       (1) State and local licensing requirements and 
     accreditation standards.--The Architect of the Capitol shall 
     issue regulations for entities operating child care centers 
     in legislative facilities, which shall be the same as the 
     regulations issued by the Administrator under subsection 
     (b)(1), except to the extent that the Architect may 
     determine, for good cause shown and stated together with the 
     regulations, that a modification of such regulations would be 
     more effective for the implementation of the requirements and 
     standards described in such paragraphs.
       (2) Evaluation and enforcement.--Subsection (b)(2) shall 
     apply to the Architect of the Capitol, entities operating 
     child care centers in legislative facilities, and legislative 
     offices. For purposes of that application, references in 
     subsection (b)(2) to regulations shall be considered to be 
     references to regulations issued under this subsection.
       (d) Judicial Branch Standards and Enforcement.--
       (1) State and local licensing requirements and 
     accreditation standards.--The Director of the Administrative 
     Office of the United States Courts shall issue regulations 
     for entities operating child care centers in judicial 
     facilities, which shall be the same as the regulations issued 
     by the Administrator under subsection (b)(1), except to the 
     extent that the Director may determine, for good cause shown 
     and stated together with the regulations, that a modification 
     of such regulations would be more effective for the 
     implementation of the requirements and standards described in 
     such paragraphs.
       (2) Evaluation and enforcement.--Subsection (b)(2) shall 
     apply to the Director described in paragraph (1), entities 
     operating child care centers in judicial facilities, and 
     judicial offices. For purposes of that application, 
     references in subsection (b)(2) to regulations shall be 
     considered to be references to regulations issued under this 
     subsection.
       (e) Application.--Notwithstanding any other provision of 
     this section, if 3 or more child care centers are operated in 
     facilities owned or leased by a Federal agency, the head of 
     the Federal agency may carry out the responsibilities 
     assigned to the Administrator under subsection (b)(2), the 
     Architect of the Capitol under subsection (c)(2), or the 
     Director described in subsection (d)(2) under such 
     subsection, as appropriate.

  Mr. HATCH. Mr. President, as this decade nears a close, and as our 
Nation has enjoyed an unprecedented period of economic growth, there 
remains an issue that affects many American families. I am referring to 
child care.
  It has been nearly 9 years since the passage of the bipartisan Child 
Care and Development Block Grant Act. I was proud to have been a 
sponsor of this legislation, and I remain committed to its goals, 
structure, and principles.
  Though the CCDBG has led to great improvements in the child care 
situation facing low-income families in every State, it has become 
clear that more needs to be done to help the family. In my home State 
of Utah, an extraordinary 57 percent of mothers with children under the 
age of 6 are in the labor force, and 134,000 children under the age of 
6 in Utah will be cared for by someone other than their parents.
  I am pleased to again join my colleagues--Senators Chafee, Snowe, 
Roberts, Specter, Collins, and Cochran--each of whom has a long record 
of concern and involvement in child care issues--in sponsoring this 
measure. The Caring for Children Act is a comprehensive, realistic 
child care proposal, which we believe will benefit middle- and lower-
income American families who struggle to get ahead or struggle to keep 
up.
  First, the Caring for Children Act will, by expanding the Dependent 
Care Tax Credit, cut taxes for many middle- and lower-income families. 
Under the current system, the maximum credit of 30 percent is available 
only to families with incomes of $10,000 or less. Our proposal 
increases the Dependent Care Tax Credit (DCTC) from 30 percent to 50 
percent. The maximum income is also increased to $30,000. The maximum 
allowable expenses of $2,400 for one child and $4,800 for two or more 
children will remain the same.
  For example, a working family in Vernal, UT, earning $30,000 with two 
children, could receive a tax credit of $2,400 (50 percent of $4,800), 
instead of $960 under the current law.
  Our bill also lowers the maximum credit more gradually than current 
law. This provides a form of tax relief for DCTC-eligible families 
earning between $30,000 and $75,000. This change is intended to benefit 
an often forgotten group--taxpayers who earn too much for Federal 
breaks but not enough for child care expenses not to be a big bite out 
of their budget.
  This proposal also breaks new ground. It recognizes, for the first 
time, as a matter of Federal child care policy, that many families 
elect to have one parent remain at home to serve as the primary are 
giver. We understand the value of a parent at home to care for a child, 
both in terms of quality of care and monetary sacrifice. Such families 
pay for their child care by forfeiting a second income. The Caring for 
Children Act would expand eligibility for the Dependent Care Tax Credit 
(DCTC) to families with young children in which one parent remained at 
home.
  Our bill assumes child care expenses for such a family of $150 per 
month. Thus, a family earning $30,000 with two children, ages 3 and 1, 
in Farmington, UT, in which one parent remains at home, would receive a 
tax credit of $900 (50 percent of $15012 months).
  Some have criticized our bill for not giving the same tax benefits to 
families with a stay-at-home parent. Frankly, I support such parity in 
the DCTC. I would like our bill to be able to provide a larger credit. 
But, expanding eligibility for this credit is an expensive proposition. 
While we may not be able to propose DCTC parity in one fell swoop, we 
should establish the concept in this bill and increase the level of 
benefit as quickly as we can. But, we should not fail to do something 
just because we cannot do it all.
  Many families across America elect to forego a second income in order 
to have a parent remain at home with children. Federal policy has so 
far failed to recognize parental care as child care, even if many 
people, myself included, consider it the best possible care. I happen 
to believe that parental care is the best care there is.
  And, let me offer a word of praise and gratitude for my wife, Elaine. 
Elaine could have had a successful career as a professional educator. 
Instead, she chose to stay home with our children--all of whom are now 
married with children of their own.
  Of course, my daughters and daughters-in-law will make their own 
choices about balancing career and family. Different families make 
different choices and face different circumstances that drive their 
choices. Our bill asserts that the Dependent Care Tax Credit should be 
available to families regardless of their choice. The DCTC should be a 
tax credit to help families care for children, not just a credit for 
employment expenses. We should not minimize the significance of this 
change in the federal child care paradigm.

  Yet, many working but low-income families have no tax liability and 
will not benefit from our proposed changes to the DCTC. These families, 
many of which may be headed by single parents or headed by individuals 
moving from welfare to work, are struggling to make ends meet.
  One of the family's biggest expenses is child care.
  The cost of child care, like almost everything else, has increase in 
the 9 years since the implementation of the Child Care and Development 
Block Grant. When the CCDBG was enacted, the average cost of care per 
child was $3,000. Today, it is estimated to be more than $4,000 per 
child.
  I invite senators to do the math: If a parent is making $10 an hour 
($20,800 per year before taxes) and has just one child, child care 
expenses claim almost

[[Page S2597]]

one-fifth of the family budget. It is no wonder that the Utah Child 
Protective Services told me some years ago about a mother who was 
forced to choose between groceries and child care.
  The Caring for Children Act proposes to increase the authorization of 
appropriations for the Child Care and Development Block grant Act 
(CCDBG), which states use to subsidize child care for low-income 
parents and to develop new capacity in areas--both geographic and 
functional--where there are shortages.
  In Utah, as in other states as well, smaller and more rural 
communities often have shortages of child care. And, nearly every 
community suffers shortages of infant care, after school care, and care 
for special needs children.
  The CCDBG is the only federal program we have for assisting low-
income working families with child care expenses. We are not proposing 
to create another one. We are not expanding the statutory eligibility 
or entitlement for this program. The Caring for Children Act merely 
makes it possible for states to serve more eligible people and to 
address more of the problem of shortages under the provisions of the 
CCDBG.
  I have said many times in this body that I do not support federal 
assistance for those who are able but do not help themselves. But, I 
likewise believe that some help is warranted when people are working 
and doing all they can to provide for their families. This is why I 
joined as a sponsor of the Child Care and Development Block Grant 10 
years ago. I do not want Utah families to have to choose between child 
care and food.
  We still face issues of quality of care. Our bill affirms state 
prerogatives to set their own standards for child care. My colleagues 
are well aware of my strong opposition to any federal effort to set or 
imply federal standards. States must be allowed discretion in this. 
But, our bill also recognizes that standards are worthless if they are 
not enforced.
  To encourage states to make a stronger commitment to enforce their 
own standards for child care, the Caring for Children Act provides a 
system of bonuses for states who exceed a threshold of inspections or, 
conversely, penalties for those who fail to conduct a minimum number of 
inspections. In my view, the most stringent standards in the world do 
not provide any assurance of quality care if providers do not believe 
standards will be enforced.
  I also believe that the best assurance of quality is a parent's own 
good judgment. The Caring for Children Act takes the very inexpensive, 
but potentially very productive step of providing funds for beefed up 
consumer information to parents.
  There are other important provisions in our bill that are designed to 
encourage private sector initiatives in child care as well as to 
enhance training opportunities for child care providers.
  All together, the Caring for Children Act attempts to address all 
three of the major issues in child care: affordability, availability, 
and quality. I believe the bill we are introducing today is measured 
and responsible.
  In no way is this a government knows best model of social problem 
solving; rather, it builds on what we already know works and what we 
already know that parents want. They want resources and information to 
make their own decisions and to care for their own children. They want 
input into the plans developed by states. They want control over child 
care.
  The bill we are introducing today endeavors to put government on the 
side of parents by returning resources to them through tax credits, by 
enabling states to do more under the CCDBG, by increasing available 
child care information, and, finally by respecting the choices they 
make.
  I am again pleased to join my colleagues in this legislation and hope 
other Senators will support this measure as well.
  Mr. ROBERTS. Mr. President, I am pleased to join with my colleagues 
to reintroduce legislation to help meet the child care challenges 
facing families in Kansas and around the nation.
  Child care, in the home when possible and outside the home when 
parents work, goes right to the heart of keeping families strong.
  Unfortunately, just being able to afford child care is a major issue 
for most families. Some child care can cost as much as college tuition 
and consume up to 40 percent of a family's income. Finding quality care 
is another challenge.
  Welfare reforms have cut Kansas welfare rolls in half since 1996. As 
more and more of these families come off the rolls, child care needs 
grow. About half of the 11,000 families that have left welfare rolls in 
Kansas have young children. In order to continue the successful 
transition from welfare to work, parents, especially single parents, 
must have access to affordable, quality child care.
  Only parents can and should decide what child care arrangements work 
best for their children. This includes the decision to stay at home.
  The Caring for Children Act includes provisions to allow a parent who 
is able to stay at home and care for a child to receive a tax credit to 
help cover expenses. This credit applies during the first three years 
of a child's life and amounts to about $900 per year.
  The Caring for Children Act takes steps to assist small businesses 
that want to provide child care. I am pleased that this bill includes a 
short-term flexible grant program to encourage these businesses to work 
together to provide child care services. This program, which provides 
$60 million to the states, allows those closer to home to make 
decisions necessary to improve child care in communities. This funding 
provides the start-up assistance necessary to create self-sustaining 
child care programs.
  I have pledged to work to improve child care. I will continue this 
effort. I look forward to working with my colleagues to expand child 
care options and protect our nation's most valuable resource, our 
children.
  Mr. SPECTER. Mr. President, I have sought recognition to once again 
join my colleagues in introducing the Caring for Children Act, which 
will ease the financial burden of child care for American families--for 
those parents who work, and for those who choose to stay home to raise 
their children for a period of time. This legislation is identical to 
the child care proposal my colleagues and I introduced during the 105th 
Congress, on January 28, 1998. I believe it is vital that the Congress 
recognize the importance of affordable, quality child care to the 
successful development of our children.
  The Caring for Children Act is a middle-ground, targeted response to 
the growing child care needs facing American families. Our bill 
includes tax incentives for employers and parents, and an increase in 
funding for programs that assist the most needy families. Most 
importantly, our bill proposes prudent adjustments to discretionary 
programs rather than implementing new mandatory spending.
  Our bill would expand the Dependent Care tax credit to make it more 
accessible to families who need it, double the authorization for the 
Child Care Development Block Grant, and provide grants to small 
businesses to create or enhance child care facilities for their 
employees. This bill also includes provisions from the proposal I 
introduced during the 105th Congress with my colleagues, Congressman 
Jon Fox, The Affordable Child Care Act, which provides a tax credit for 
employers who provide on-site or site-adjacent child care to their 
employees in order to reduce the child care expenses of the employee.
  Not all families choose the same option for child care. Many families 
rely on relatives, centers operated by churches and other religious 
organizations, centers at or near their workplace, or make other 
arrangements to provide care for their children while they work. In 
light of the diverse needs for child care in America, this bill 
represents a good start toward expanding the choices for American 
parents. And, any such legislation must recognize that there is a need 
to provide some relief to families where one parent stays at home.

  The need for affordable and accessible day care is critical given the 
increasing numbers of working parents and dual-income families in the 
United States. According to the Bureau of the Census, in 1975, 31 
percent of married mothers with a child younger than age one 
participated in the labor force. By 1995, that figure had risen to 59 
percent. Almost 64 percent of married mothers and 53 percent of single 
mothers with children younger than age six participated in the labor 
force in 1995.

[[Page S2598]]

  The cost of child care for families is also significant. Licensed day 
care centers in some urban areas cost as much as $200 per week, and the 
disparity in costs and availability of child care between urban and 
rural grows greater every day. For families which need or choose to 
have both parents work outside the home, the burden of making child 
care decisions is great. These figures serve to underscore the need for 
action on the part of the Federal Government to provide the necessary 
assistance to our Nation's working families.
  As Chairman of the Labor, Health and Human Services, and Education 
Appropriations Subcommittee, I am pleased that this legislation would 
build on an existing Federal child care program by authorizing an 
additional $5 billion over 5 years to the Child Care Development Block 
Grant program, bringing total spending for this program to nearly $2.5 
billion annually by fiscal year 2003. The child care block grant works 
well to assist low-income families acquire child care, and helped over 
93,000 Pennsylvania families last year. Fiscal year 1999 funding for 
this vital assistance program totaled $1.182 billion, $182 billion, 
$182 million above the currently authorized level. By increasing the 
authorization, we can help even more families without creating a new 
entitlement program.
  Our legislation will also require States to create and enforce safety 
and health standards in child care facilities, and provide money for 
the Department of Health and Human Services to disseminate information 
to parents and providers about quality child care, through brochures, 
toll-free hotlines, the Internet, and other technological assistance.
  The Caring for Children Act complements my recent efforts to assist 
working families in the context of welfare reform and children's health 
insurance. When Congress debated welfare reform in 1995 and 1996, I 
worked to ensure that adequate funds were provided for child care, a 
critical component for welfare mothers who would be required to work to 
receive new limited welfare benefits. I am pleased that the welfare 
reform bill that became law provided $20 billion in child care funding 
over a 6-year period. Similarly, I was pleased to participate in the 
bipartisan effort in 1997 to enact legislation to provide $24 billion 
over the next 5 years for States to establish or broaden children's 
health insurance programs. Utilizing these new Federal funds, over 
10,000 previously uninsured children in Pennsylvania have been enrolled 
in this program since May of 1998.
  In conclusion, Mr. President, I believe that it is critical that the 
106th Congress not adjourn without enacting legislation to assist 
families in their ability to afford safe, quality child care for their 
children, either at home with a parent or another arrangement. Our 
legislation will provide peace of mind to millions of American families 
struggling to balance career and child raising. I urge my colleagues to 
join me in cosponsoring this important legislation, and I urge its 
swift adoption.
                                 ______
                                 
      By Mr. WELLSTONE.
  S. 600. A bill to combat the crime of international trafficking and 
to protect the rights of victims; to the Committee on Foreign 
Relations.


 international trafficking of women and children victim protection act 
                                of 1999

  Mr. WELLSTONE. Mr. President, this week across the globe, men and 
women have celebrated International Women's Day, highlighting the 
achievements of women around the world. From Qatar to Indonesia, the 
day was marked by women marching, meeting, and protesting for 
recognition of their inherent dignity and fundamental human rights. I 
believe there is much work yet to be done to ensure that women and 
girls' human rights are protected and respected.
  One of the most horrendous human rights violations of our time is 
trafficking in human beings, particularly among women and children, for 
purposes of sexual exploitation and forced labor. To curb this horrific 
practice, I am introducing the ``International Trafficking of Women and 
Children Victim Protection Act of 1999'' which will put Congress on 
record as opposing trafficking for forced prostitution and domestic 
servitude, and acting to check it before the lives of more women and 
girls are shattered.
  One of the fastest growing international trafficking businesses is 
the trade in women. Women and girls seeking a better life, a good 
marriage, or a lucrative job abroad, unexpectedly find themselves 
forced to work as prostitutes, or in sweat shops. Seeking this better 
life, they are lured by local advertisements for good jobs in foreign 
countries at wages they could never imagine at home.
  Every year, the trafficking of human beings for the sex trade affects 
hundreds of thousands of women throughout the world. Women and children 
whose lives have been disrupted by economic collapse, civil wars, or 
fundamental changes in political geography, such as the disintegration 
of the Soviet Union, have fallen prey to traffickers. The United States 
government estimates that 1-2 million women and girls are trafficked 
annually around the world. According to experts, between 50 and 100 
thousand women are trafficked each year into the United States alone. 
They come from Thailand, Russia, the Ukraine and other countries in 
Asia and the former Soviet Union.
  Upon arrival in countries far from their homes, these women are often 
stripped of their passports, held against their will in slave-like 
conditions, and sexually abused. Rape, intimidation, and violence are 
commonly employed by traffickers to control their victims and to 
prevent them from seeking help. Through physical isolation and 
psychological trauma, traffickers and brothel owners imprison women in 
a world of economic and sexual exploitation that imposes a constant 
fear of arrest and deportation, as well as of violent reprisals by the 
traffickers themselves, to whom the women must pay off ever-growing 
debts. Many brothel owners actually prefer women--women who are far 
from help and home, and who do not speak the language--precisely 
because of the ease of controlling them.
  Most of these women never imagined that they would enter such a 
hellish world, having traveled abroad to find better jobs or to see the 
world. Many in their naivete, believed that nothing bad could happen to 
them in the rich and comfortable countries such as Switzerland, 
Germany, or the United States. Others, who are less naive but desperate 
for money and opportunity, are no less hurt by the trafficker's brutal 
grip.
  Last year, First Lady Hilary Clinton spoke powerfully of this human 
tragedy. She said: ``I have spoken to young girls in northern Thailand 
whose parents were persuaded to sell them as prostitutes, and they 
received a great deal of money by their standards. You could often tell 
the homes of where the girls had been sold because they might even have 
a satellite dish or an addition built on their house. But I met girls 
who had come home after they had been used up, after they had 
contracted HIV or AIDS. If you've ever held the hand of a 13-year-old 
girl dying of AIDS, you can understand how critical it is that we take 
every step possible to prevent this happening to any other girl 
anywhere in the world. I also, in the Ukraine, heard of women who told 
me with tears running down their faces that young women in their 
communities were disappearing. They answered ads that promised a much 
better future in another place and they were never heard from again.''
  These events are occurring not just in far off lands, but here at 
home in the U.S. as well. According to a report in the Washington Post 
in 1997, the FBI raided a massage parlor in downtown Bethesda. The 
massage parlor was involved in the trafficking of Russian women into 
the United States. The eight Russian women who worked there, lived at 
the massage parlor, sleeping on the massage tables at night. They were 
charged a $150 a week for ``housing'' and were not paid any salary, 
only receiving a portion of their tips.

  According to recent reports by the Justice Department, teenage 
Mexican girls were held in slavery in Florida and the Carolinas and 
forced to submit to prostitution. In addition, Russian and Latvian 
women were forced to work in nightclubs in Chicago. According to 
charges filed against the traffickers, the traffickers picked the women 
up upon their arrival at the airport, seized their documents and return 
tickets, locked them in hotels and beat

[[Page S2599]]

them. The women were told that if they refused to dance nude in various 
nightclubs, the Russian mafia would kill their families. Further, over 
three years, hundreds of women from the Czech Republic who answered 
advertisements in Czech newspapers for modeling were ensnared in an 
illegal prostitution ring.
  Trafficking in women and girls is a human rights problem that 
requires a human rights response. Trafficking is condemned by human 
rights treaties as a violation of basic human rights and a slavery-like 
practice. Women who are trafficked are subjected to other abuses--rape, 
beatings, physical confinement--squarely prohibited by human rights 
law. The human abuses continue in the workplace, in the forms of 
physical and sexual abuse, debt bondage and illegal confinement, and 
all are prohibited.
  Fortunately, the global trade in women and children is receiving 
greater attention by governments and NGOs following the UN World 
Conference on Women in Beijing. The United Nations General Assembly has 
called upon all governments to criminalize trafficking, to punish its 
offenders, while not penalizing its victims. The President's 
Interagency Council on Women is working hard to mobilize a response to 
this problem. Churches, synagogues, and NGOs, such as Human Rights 
Watch and the Global Survival Network, are fighting this battle daily. 
But, much, much more must be done.
  My legislation provides a human rights response to the problem. It 
has a comprehensive and integrated approach focused on prevention, 
protection and assistance for victims, and prosecution of traffickers.
  I will highlight a few of its provisions now:
  It sets an international standard for governments to meet in their 
efforts to fight trafficking and assist victims of this human rights 
abuse. It calls on the State Department and Justice Department to 
investigate and take action against international trafficking. In 
addition, it creates an Interagency Task Force to Monitor and Combat 
Trafficking in the Office of the Secretary of State and directs the 
Secretary to submit an annual report to Congress on international 
trafficking.
  The annual report would, among other things, identify states engaged 
in trafficking, the efforts of these states to combat trafficking, and 
whether their government officials are complicit in the practice. 
Corrupt government or law enforcement officials sometimes directly 
participate and benefit in the trade of women and girls. And, 
corruption also prevents prosecution of traffickers. U.S. police 
assistance would be barred to countries found not to have taken 
effective action in ending the participation of their officials in 
trafficking, and in investigating and prosecuting meaningfully their 
officials involved in trafficking. A waiver is provided for the 
President if he finds that provision of such assistance is in the 
national interest.
  On a national level, it ensures that our immigration laws do not 
encourage rapid deportation of trafficked women, a practice which 
effectively insulates traffickers from ever being prosecuted for their 
crimes. Trafficking victims are eligible for a nonimmigrant status 
valid for three months. If the victim pursues criminal or civil actions 
against her trafficker, or if she pursues an asylum claim, she is 
provided with an extension of time. Further, it provides that 
trafficked women should not be detained, but instead receive needed 
services, safe shelter, and the opportunity to seek justice against 
their abusers. Finally, my bill provides much needed resources to 
programs assisting trafficking victims here at home and abroad.
  We must commit ourselves to ending the trafficking of women and girls 
and to building a world in which such exploitation is relegated to the 
dark past. I urge my colleagues to support the International 
Trafficking of Women and Children Protection Act of 1999.
  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. 600

       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 ``International Trafficking of 
     Women and Children Victim Protection Act of 1999''.

     SEC. 2. FINDINGS.

       Congress makes the following findings:
       (1) The worldwide trafficking of persons has a 
     disproportionate impact on women and girls and has been and 
     continues to be condemned by the international community as a 
     violation of fundamental human rights.
       (2) The fastest growing international trafficking business 
     is the trade in women, whereby women and girls seeking a 
     better life, a good marriage, or a lucrative job abroad, 
     unexpectedly find themselves in situations of forced 
     prostitution, sweatshop labor, exploitative domestic 
     servitude, or battering and extreme cruelty.
       (3) Trafficked women and children, girls and boys, are 
     often subjected to rape and other forms of sexual abuse by 
     their traffickers and often held as virtual prisoners by 
     their exploiters, made to work in slavery-like conditions, in 
     debt bondage without pay and against their will.
       (4) The President, the First Lady, the Secretary of State, 
     the President's Interagency Council on Women, and the Agency 
     for International Development have all identified trafficking 
     in women as a significant problem.
       (5) The Fourth World Conference on Women (Beijing 
     Conference) called on all governments to take measures, 
     including legislative measures, to provide better protection 
     of the rights of women and girls in trafficking, to address 
     the root factors that put women and girls at risk to 
     traffickers, and to take measures to dismantle the national, 
     regional, and international networks on trafficking.
       (6) The United Nations General Assembly, noting its concern 
     about the increasing number of women and girls who are being 
     victimized by traffickers, passed a resolution in 1998 
     calling upon all governments to criminalize trafficking in 
     women and girls in all its forms and to penalize all those 
     offenders involved, while ensuring that the victims of these 
     practices are not penalized.
       (7) Numerous treaties to which the United States is a party 
     address government obligations to combat trafficking, 
     including such treaties as the 1956 Supplementary Convention 
     on the Abolition of Slavery, the Slave Trade and Institutions 
     and Practices Similar to Slavery, which calls for the 
     complete abolition of debt bondage and servile forms of 
     marriage, and the 1957 Abolition of Forced Labor Convention, 
     which undertakes to suppress and requires signatories not to 
     make use of any forced or compulsory labor.

     SEC. 3. PURPOSES.

       The purposes of this Act are to condemn and combat the 
     international crime of trafficking in women and children and 
     to assist the victims of this crime by--
       (1) setting a standard by which governments are evaluated 
     for their response to trafficking and their treatment of 
     victims;
       (2) authorizing and funding an interagency task force to 
     carry out such evaluations and to issue an annual report of 
     its findings to include the identification of foreign 
     governments that tolerate or participate in trafficking and 
     fail to cooperate with international efforts to prosecute 
     perpetrators;
       (3) assisting trafficking victims in the United States by 
     providing humanitarian assistance and by providing them 
     temporary nonimmigrant status in the United States;
       (4) assisting trafficking victims abroad by providing 
     humanitarian assistance; and
       (5) denying certain forms of United States foreign 
     assistance to those governments which tolerate or participate 
     in trafficking, abuse victims, and fail to cooperate with 
     international efforts to prosecute perpetrators.

     SEC. 4. DEFINITIONS.

       In this Act:
       (1) Police assistance.--The term ``police assistance''--
       (A) means--
       (i) assistance of any kind, whether in the form of grant, 
     loan, training, or otherwise, provided to or for foreign law 
     enforcement officials, foreign customs officials, or foreign 
     immigration officials;
       (ii) government-to-government sales of any item to or for 
     foreign law enforcement officials, foreign customs officials, 
     or foreign immigration officials; and
       (iii) any license for the export of an item sold under 
     contract to or for the officials described in clause (i); and
       (B) does not include assistance furnished under section 534 
     of the Foreign Assistance Act of 1961 (22 U.S.C. 2346c; 
     relating to the administration of justice) or any other 
     assistance under that Act to promote respect for 
     internationally recognized human rights.
       (2) Trafficking.--The term ``trafficking'' means the use of 
     deception, coercion, debt bondage, the threat of force, or 
     the abuse of authority to recruit, transport within or across 
     borders, purchase, sell, transfer, receive, or harbor a 
     person for the purpose of placing or holding such person, 
     whether for pay or not, in involuntary servitude, or slavery 
     or slavery-like conditions, or in forced, bonded, or coerced 
     labor.
       (3) Victim of trafficking.--The term ``victim of 
     trafficking'' means any person subjected to the treatment 
     described in paragraph (2).

     SEC. 5. INTER-AGENCY TASK FORCE TO MONITOR AND COMBAT 
                   TRAFFICKING.

       (a) Establishment.--

[[Page S2600]]

       (1) In general.--There is established within the Department 
     of State in the Office of the Secretary of State an Inter-
     Agency Task Force to Monitor and Combat Trafficking (in this 
     section referred to as the ``Task Force''). The Task Force 
     shall be co-chaired by the Assistant Secretary of State for 
     Democracy, Human Rights, and Labor Affairs and the Senior 
     Coordinator on International Women's Issues, President's 
     Interagency Council on Women.
       (2) Appointment of members.--The members of the Task Force 
     shall be appointed by the Secretary of State. The Task Force 
     shall consist of no more than twelve members.
       (3) Composition.--The Task Force shall include 
     representatives from the--
       (A) Violence Against Women Office, Office of Justice 
     Programs, Department of Justice;
       (B) Office of Women in Development, United States Agency 
     for International Development; and
       (C) Bureau of International Narcotics and Law Enforcement 
     Affairs, Department of State.
       (4) Staff.--The Task Force shall be authorized to retain up 
     to five staff members within the Bureau of Democracy, Human 
     Rights, and Labor Affairs, and the President's Interagency 
     Council on Women to prepare the annual report described in 
     subsection (b) and to carry out additional tasks which the 
     Task Force may require. The Task Force shall regularly hold 
     meetings on its activities with nongovernmental 
     organizations.
       (b) Annual Report to Congress.--Not later than March 1 of 
     each year, the Secretary of State, with the assistance of the 
     Task Force, shall submit a report to Congress describing the 
     status of international trafficking, including--
       (1) a list of foreign states where trafficking originates, 
     passes through, or is a destination; and
       (2) an assessment of the efforts by the governments 
     described in paragraph (1) to combat trafficking. Such an 
     assessment shall address--
       (A) whether any governmental authorities tolerate or are 
     involved in trafficking activities;
       (B) which governmental authorities are involved in anti-
     trafficking activities;
       (C) what steps the government has taken toward ending the 
     participation of its officials in trafficking;
       (D) what steps the government has taken to prosecute and 
     investigate those officials found to be involved in 
     trafficking;
       (E) what steps the government has taken to prohibit other 
     individuals from participating in trafficking, including the 
     investigation, prosecution, and conviction of individuals 
     involved in trafficking, the criminal and civil penalties for 
     trafficking, and the efficacy of those penalties on reducing 
     or ending trafficking;
       (F) what steps the government has taken to assist 
     trafficking victims, including efforts to prevent victims 
     from being further victimized by police, traffickers, or 
     others, grants of stays of deportation, and provision of 
     humanitarian relief, including provision of mental and 
     physical health care and shelter;
       (G) whether the government is cooperating with governments 
     of other countries to extradite traffickers when requested;
       (H) whether the government is assisting in international 
     investigations of transnational trafficking networks; and
       (I) whether the government--
       (i) refrains from prosecuting trafficking victims or 
     refrains from other discriminatory treatment towards 
     trafficking victims due to such victims having been 
     trafficked, or the nature of their work, or their having left 
     the country illegally; and
       (ii) recognizes the rights of victims and ensures their 
     access to justice.
       (c) Reporting Standards and Investigations.--
       (1) Responsibility of the secretary of state.--The 
     Secretary of State shall ensure that United States missions 
     abroad maintain a consistent reporting standard and 
     thoroughly investigate reports of trafficking.
       (2) Contacts with nongovernmental organizations.--In 
     compiling data and assessing trafficking for the Human Rights 
     Report and the Inter-Agency Task Force to Monitor and Combat 
     Trafficking Annual Report, United States mission personnel 
     shall seek out and maintain contacts with human rights and 
     other nongovernmental organizations, including receiving 
     reports and updates from such organizations, and, when 
     appropriate, investigating such reports.

     SEC. 6. INELIGIBILITY FOR POLICE ASSISTANCE.

       (a) Ineligibility.--Except as provided in subsection (b), 
     any foreign government country identified in the latest 
     report submitted under section 5 as a government that--
       (1) has failed to take effective action towards ending the 
     participation of its officials in trafficking; and
       (2) has failed to investigate and prosecute meaningfully 
     those officials found to be involved in trafficking,

     shall not be eligible for police assistance.
       (b) Waiver of Ineligibility.--The President may waive the 
     application of subsection (a) to a foreign country if the 
     President determines and certifies to Congress that the 
     provision of police assistance to the country is in the 
     national interest of the United States.

     SEC. 7. PROTECTION OF TRAFFICKING VICTIMS.

       (a) Nonimmigrant Classification for Trafficking Victims.--
     Section 101(a)(15) of the Immigration and Nationality Act (8 
     U.S.C. 1101(a)(15)) is amended--
       (1) by striking ``or'' at the end of subparagraph (R);
       (2) by striking the period at the end of subparagraph (S) 
     and inserting ``; or''; and
       (3) by adding at the end the following new subparagraph:
       ``(T) an alien who the Attorney General determines--
       ``(i) is physically present in the United States, and
       ``(ii) is or has been a trafficking victim (as defined in 
     section 4 of the International Trafficking of Women and 
     Children Victim Protection Act of 1999),

     for a stay of not to exceed 3 months in the United States, 
     except that any such alien who has filed a petition seeking 
     asylum or who is pursuing civil or criminal action against 
     traffickers shall have the alien's status extended until the 
     petition or litigation reaches its conclusion.''.
       (b) Waiver of Grounds for Ineligibility for Admission.--
     Section 212(d) of the Immigration and Nationality Act (8 
     U.S.C. 1182(d)) is amended--
       (1) by inserting ``(1)'' after ``(d)''; and
       (2) by adding at the end the following:
       ``(2) The Attorney General shall, in the Attorney General's 
     discretion, waive the application of subsection (a) (other 
     than paragraph (3)(E)) in the case of a nonimmigrant 
     described in section 101(a)(15)(T), if the Attorney General 
     considers it to be in the national interest to do so.''.
       (c) Involuntary Servitude.--Section 1584 of title 18, 
     United States Code, is amended--
       (1) inserting ``(a)'' before ``Whoever'';
       (2) by striking ``or'' after ``servitude'';
       (3) by inserting ``transfers, receives or harbors any 
     person into involuntary servitude, or'' after ``servitude,''; 
     and
       (4) by adding at the end the following:
       ``(b) In this section, the term `involuntary servitude' 
     includes trafficking, slavery-like practices in which persons 
     are forced into labor through non-physical means, such as 
     debt bondage, blackmail, fraud, deceit, isolation, and 
     psychological pressure.''.
       (d) Trafficking Victim Regulations.--Not later than 180 
     days after the date of enactment of this Act, the Attorney 
     General and the Secretary of State shall jointly promulgate 
     regulations for law enforcement personnel, immigration 
     officials, and Foreign Service officers requiring that--
       (1) Federal, State and local law enforcement, immigration 
     officials, and Foreign Service officers shall be trained in 
     identifying and responding to trafficking victims;
       (2) trafficking victims shall not be jailed, fined, or 
     otherwise penalized due to having been trafficked, or nature 
     of work;
       (3) trafficking victims shall have access to legal 
     assistance, information about their rights, and translation 
     services;
       (4) trafficking victims shall be provided protection if, 
     after an assessment of security risk, it is determined the 
     trafficking victim is susceptible to further victimization; 
     and
       (5) prosecutors shall take into consideration the safety 
     and integrity of trafficked persons in investigating and 
     prosecuting traffickers.

     SEC. 8. ASSISTANCE TO TRAFFICKING VICTIMS.

       (a) In the United States.--The Secretary of Health and 
     Human Services is authorized to provide, through the Office 
     of Refugee Resettlement, assistance to trafficking victims 
     and their children in the United States, including mental and 
     physical health services, and shelter.
       (b) In Other Countries.--The President, acting through the 
     Administrator of the United States Agency for International 
     Development, is authorized to provide programs and activities 
     to assist trafficking victims and their children abroad, 
     including provision of mental and physical health services, 
     and shelter. Such assistance should give special priority to 
     programs by nongovernmental organizations which provide 
     direct services and resources for trafficking victims.

     SEC. 9. AUTHORIZATION OF APPROPRIATIONS.

       (a) Authorization of Appropriations for the Inter-Agency 
     Task Force.--To carry out the purposes of section 5, there 
     are authorized to be appropriated to the Secretary of State 
     $2,000,000 for fiscal year 2000 and $2,000,000 for fiscal 
     year 2001.
       (b) Authorization of Appropriations to the Secretary of 
     HHS.--To carry out the purposes of section 8(a), there are 
     authorized to be appropriated to the Secretary of Health and 
     Human Services $20,000,000 for fiscal year 2000 and 
     $20,000,000 for fiscal year 2001.
       (c) Authorization of Appropriations to the President.--To 
     carry out the purposes of section 8(b), there are authorized 
     to be appropriated to the President $20,000,000 for fiscal 
     year 2000 and $20,000,000 for fiscal year 2001.
       (d) Prohibition.--Funds made available to carry out this 
     Act shall not be available for the procurement of weapons or 
     ammunition.
                                 ______
                                 
      By Mr. COCHRAN:
  S. 601. A bill to improve the foreign language assistance program; to 
the Committee on Health, Education, Labor, and Pensions.


       foreign language education improvement amendments of 1999

  Mr. COCHRAN. Mr. President, today I am introducing a bill to amend 
the Foreign Language Assistance Program which is administered under the 
Elementary and Secondary Education Act.

[[Page S2601]]

  The Foreign Language Education Improvement Amendments of 1999 make 
changes that encourage and make possible the teaching of a second 
language to students in elementary and secondary schools with limited 
resources--in particular, those schools heavily impacted by the unique 
problems of educating a high population of disadvantaged students.
  My bill also provides schools an incentive to initiate foreign 
language programs, promotes technology, distance learning, and other 
innovative activities in the effective instruction of a foreign 
language.
  Recent research about the human brain and language acquisition, which 
we've heard a lot about in connection to the teaching of reading and 
early childhood development, revealed that the ability to learn new 
languages is highest between birth and age six. ``Windows of 
opportunity'' is how a February 3, 1997, Time article described this 
neurological function, which effectively is open and pliable during the 
early years of life and closes by the age of ten.
  We all know, from personal and other practical experience, that of 
course, people learn foreign languages beyond the age of ten. But, the 
enlightening fact of the research is that humans learn languages 
easier, and best at an early age.
  The National School Boards Association publication, School Board 
News, printed an article in July, 1997 that describes early foreign 
language programs, and the benefits of learning languages early:

       According to the Center for Applied Linguistics (CAL) in 
     Washington, D.C., the early study of a second language offers 
     many benefits for students, including gains in academic 
     achievement, positive attitudes toward diversity, increased 
     flexibility in thinking, greater sensitivity to language, and 
     a better ear for listening and pronunciation. Foreign 
     language study also improves children's understanding of 
     their native language, increase creativity, helps students 
     get better SAT scores, and increase their job opportunities.

  The evidence shows that children who learn foreign languages score 
higher in all academic subjects than those who speak only English. Most 
developed countries recognize this and, according to the National 
Foreign Language Center, the United States is alone in not teaching 
foreign languages routinely before the age of twelve. Congress 
recognized the need for foreign language study when it passed Goals 
2000 in 1994, making foreign language acquisition an education 
priority.
  In February of this year, the Center for Applied Linguistics released 
the results of a U.S. Department of Education funded survey of foreign 
language teaching in preschool through 12th grade in the United States. 
The results show a rising awareness and increase in the teaching of 
foreign languages, but in the 31 percent of elementary schools that 
offer foreign language instruction, only 21 percent have proficiency as 
the goal of the program. Among the most frequently cited problems 
facing foreign language programs were inadequate funding, inadequate 
in-service teacher training, teacher shortages and a lack of sequencing 
from elementary to secondary school.
  This survey is a good snapshot of the state of the teaching of 
foreign languages K-12 in our country. It can be read as encouraging: 
that we know we should be teaching languages earlier; that more schools 
are attempting to teach foreign languages; and that more languages are 
being taught. It also clearly shows where we need improvement: that we 
need to show accomplishment in teaching our students foreign languages; 
that more schools need to have the resources to offer the necessary 
course work for attaining this skill; and, that foreign languages 
should be a priority.
  The advantages of having foreign language ability range from greater 
opportunities for college admission to fulfilling national security 
needs. The National Council for Languages and International Studies 
found that the top attainable skill cited as a determining factor for 
likely college admission is foreign language proficiency. There are 
also social and cultural tolerance advantages that the National Council 
for Languages and International Studies and others cite, which most of 
us can appreciate. According to a February 1998, USA Today survey, top 
executives of America's businesses cited a need for and lack of foreign 
language skills twice as great as any other skill in demand.
  The National Foreign Language Center published a 1999 report titled, 
Language and National Security for the 21st Century: The Federal Role 
in Supporting National Language Capacity. This report is very 
compelling in its review of the need for military and civilian 
personnel with foreign language capability, and the lack thereof in our 
current and rising workforces. Here are some quotes from that report:

       For example, the admission of a DEA official in September, 
     1997 that the agency lacks sufficient Russian language 
     expertise to combat organized crime in groups from the former 
     Soviet Union indicates a shortfall in supply of such 
     expertise.

                           *   *   *   *   *

       The Foreign Service reports that only 60% of its billets 
     requiring language are at present filled, with waivers 
     applied to the other 35%.

                           *   *   *   *   *

       Clearly, the academic system falls short in producing 
     speakers minimally qualified to hold jobs requiring the use 
     of foreign language, which is why the federal language 
     programs exist and why the language training business in the 
     private sector is so successful.

  The same report further explains that the language training business 
is estimated to be $20 billion internationally. That is money spent by 
our government, our businesses and individuals to teach adults a skill 
essential in the global relationships of industry, diplomacy, defense, 
and higher education.
  The evidence of need is great, and yet there is a lack of sufficient 
foreign language training at the K-12 level. We have one program in the 
Elementary and Secondary Education Act aimed at providing incentives 
and giving grants to schools for this purpose. It is a program that is 
currently funded at just $5 million for a few matching grants in a 
handful of states. However, the section of this law providing a grant 
for schools that offer foreign language instruction programs has never 
been funded. A frustrating aspect of this good program is that the 
schools in the most need of the assistance can't afford the ante. My 
amendments establish a 50 percent set aside for schools serving the 
most disadvantaged students, and eliminates the matching share 
requirement for those schools. This bill also increases the annual 
authorization for the program from $55,000,000 to $75,000,000.
  I hope that we will give greater attention to this program when we 
make funding decisions, so that schools without the advantages of 
plentiful resources can provide their students with a high quality and 
competitive education.
  My amendments to the ESEA Foreign Language Assistance Program will 
provide new opportunities and encouragement to our school children, 
teachers, and parents, so we can better meet our global business 
challenges and national security needs.
                                 ______
                                 
      By Mr. SHELBY (for himself, Mr. Bond, Mr. Coverdell, Mr. Hagel, 
        Mr. Kyl, Mr. Burns, Mr. Gramm, Mr. Ashcroft, Mr. Thomas, Mr. 
        Abraham, Mr. Grassley, Mr. Helms, Mr. Inhofe, Mr. Sessions, Mr. 
        Grams, Mr. Cochran, Mr. Hutchinson and Ms. Snowe):
  S. 602. A bill to amend chapter 8 of title 5, United States Code, to 
provide for congressional review of any rule promulgated by the 
Internal Revenue Service that increases Federal Revenue, and for other 
purposes; to the Committee on Government Affairs.


                     the stealth tax prevention act

  Mr. SHELBY. Mr. President, I rise today with my colleague Senator 
Bond, to introduce the Stealth Tax Prevention Act. Among the many 
powers given to Congress by the Constitution of the United States, the 
responsibility of taxation is perhaps the most important. The Founding 
Fathers rationale behind bestowing this power to Congress is that 
because, as elected representative, Congress remains accountable to the 
voters when they levy and collect taxes. Politicians are rightly held 
responsible to the public for producing fair and prudent tax 
legislation.
  Three years ago, Mr. President, Congress passed the Congressional 
Review Act, which provides that when a major agency rule takes effect, 
Congress has 60 days to review it. During this time

[[Page S2602]]

period, Congress has the option to pass a disapproval resolution. If no 
such resolution is passed, the rule then goes into effect.
  As you know, Mr. President, the Internal Revenue Service maintains an 
enormous amount of power over the lives and the livelihoods of the 
American taxpayers through their authority to interpret the Tax Code. 
The Stealth Tax Prevention Act, that Senator Bond and I are introducing 
along with Mr. Coverdell, Mr. Hagel, Mr. Kyl, Mr. Burns, Mr. Gramm, Mr. 
Ashcroft, Mr. Thomas, Mr. Abraham, Mr. Grassley, Mr. Helms, Mr. Inhofe, 
Mr. Sessions, Mr. Grams, Mr. Cochran, Mr. Hutchinson, and Ms. Snowe, 
will expand the definition of a major rule to include, Mr. President, 
any IRS regulation which increases Federal revenue. Why? Because we 
need to return the authority of taxation to the United States Congress.
  For example, if the Office of Management and Budget finds that the 
implementation and enforcement of a rule would result in an increase of 
Federal revenues over current practices or revenues anticipated from 
the rule on the date of the enactment of the statute, the Stealth Tax 
Prevention Act would allow Congress to review the regulations and take 
appropriate measures to avoid raising taxes on hard working Americans, 
in most cases, small businesses.
  The discretionary authority of the Internal Revenue Service exposes 
small businesses, farmers, and others to the sometimes arbitrary 
actions of bureaucrats, thus creating an uncertain and, under certain 
cases, hostile environment in which to conduct day-to-day activities. 
Most of these people do not have lobbyists that work for them other 
than their elected Representatives. The Stealth Tax Prevention Act will 
be particularly helpful in lowering the tax burden on small business 
which suffers disproportionately, Mr. President, from IRS regulations. 
This burden discourages the startup of new firms and ultimately the 
creation of new jobs in the economy, which has really made America 
great today.
  Americans are now paying a higher share of their income to the 
Federal government than at any time since the end of World War II. 
They, Mr. President, as you well know, pay State income taxes. They pay 
property taxes. On the way to work in the morning they pay a gasoline 
tax when they fill up their car, and a sales tax when they buy a cup of 
coffee.
  Allowing bureaucrats to increase taxes even further, at their own 
discretion through interpretation of the Tax Code is unconscionable. 
The Stealth Tax Prevention Act will leave tax policy where it belongs, 
to elected Members of the Congress, not unelected and unaccountable IRS 
bureaucrats.
  Mr. BOND. Mr. President, today I join my distinguished colleague from 
Alabama, Senator Shelby, in reintroducing legislation, which we proudly 
offered in the 105th Congress and will work to enact during the 106th 
Congress. Our goal is to ensure that the Treasury Department's Internal 
Revenue Service does not usurp the power to tax--a power solely vested 
in Congress by the U.S. Constitution. ``The Stealth Tax Prevention 
Act'' will ensure that the duly elected representatives of the people, 
who are accountable to the electorate for our actions, will have 
discretion to exercise the power to tax. This legislation is intended 
to curb the ability of the Treasury Department to bypass Congress by 
proposing a tax increase without the authorization or consent of 
Congress.
  The Stealth Tax Prevention Act builds on legislation passed 
unanimously by the Senate in the 104th Congress. As Chairman of the 
Committee on Small Business, I authored the Small Business Regulatory 
Enforcement Fairness Act--better known as the Red Tape Reduction Act--
to ensure that small businesses are treated fairly in agency rulemaking 
and enforcement activities. Subtitle E of the Red Tape Reduction Act 
provides that a final rule issued by a Federal agency and deemed a 
``major rule'' by the Office of Information and Regulatory Affairs of 
the Office of Management and Budget cannot go into effect for at least 
sixty days. This delay is to provide Congress with a window during 
which we can review the rule and its impact, allowing time for Congress 
to consider whether a resolution of disapproval should be enacted to 
strike down the regulation. To become effective, the resolution must 
pass both the House and Senate and be signed into law by the President 
or enacted as the result of a veto override.
  Later this month, I will commemorate the third anniversary of the Red 
Tape Reduction Act's enactment by highlighting the progress made to 
date and the obstacles small businesses continue to face primarily due 
to agency noncompliance. Because of the IRS' significant impact on the 
activities of small businesses, the Service's implementation of the Red 
Tape Reduction Act and the Regulatory Flexibility Act is of utmost 
importance to the Committee on Small Business.
  The bill Senator Shelby and I introduce today amends this law to 
provide that any rule issued by the Treasury Department's Internal 
Revenue Service that will result in a tax increase--any increase--will 
be deemed a major rule by OIRA and, consequently, not go into effect 
for at least 60 days. This procedural safeguard will ensure that the 
Department of the Treasury and its Internal Revenue Service cannot make 
an end-run around Congress, as it attempted with the ``stealth tax'' it 
proposed on January 13, 1997.
  In that case, the IRS issued a proposal that is tantamount to a tax 
increase on businesses structured as limited liability companies. The 
IRS proposed to disqualify a taxpayer from being considered as a 
limited partner if he or she ``participates in the partnership's trade 
or business for more than 500 hours during a taxable year'' or is 
involved in a ``service'' partnership, such as lawyers, accountants, 
engineers, architects, and health-care providers.
  The IRS alleges that its proposal merely interprets section 
1402(a)(13) of the Internal Revenue Code, providing clarification, when 
in actuality it is a tax increase regulatory fiat. Under the IRS 
proposal, disqualification as a limited partner will result in a tax 
increase on income from both capital investments as well as earnings of 
the partnership. The effect will be to add the self-employment tax 
(12.4% for social security and 2.9% for Medicare) to income from 
investments as well as earnings for limited partners who under current 
rules can exclude such income from the self employment tax.
  Under the bill introduced today, this tax increase on limited 
partners, if later issued as a final rule, could not go into effect for 
at least 60 days following its publication in the Federal Register. 
This window, which coincides with issuance of a report by the 
Comptroller General, would allow Congress the opportunity to review the 
rule and vote on a resolution to disapprove the tax increase before it 
is applied to a single taxpayer.
  The Stealth Tax Prevention Act strengthens the Red Tape Reduction Act 
and the vital procedural safeguards it provides to ensure that small 
businesses are not burdened unnecessarily by new Federal regulations. 
Congress enacted the 1996 provisions to strengthen the effectiveness of 
the Regulatory Flexibility Act, a law which had been ignored too often 
by government agencies, especially the Internal Revenue Service. Three 
of the top recommendations of the 1995 White House Conference on Small 
Business sought reforms to the way government regulations are developed 
and enforced, and the Red Tape Reduction Act passed the Senate without 
a single dissenting vote on its way to being signed into law on March 
29, 1996. Despite the inclusion of language in the 1996 amendments that 
expressly addresses coverage of IRS interpretative rules, the IRS 
continues to bypass compliance with the Regulatory Flexibility Act.
  As 18 of my Senate colleagues and I advised Secretary Rubin in an 
April 9, 1997, letter, the proposed IRS regulation on limited-partner 
taxation is precisely the type or rule for which a regulatory 
flexibility analysis should be done. Although, on its face, the 
rulemaking seeks merely to ``define a limited partner'' or to 
``eliminate uncertainty'' in determining net earnings from self-
employment, the real effect of the rule would be to raise taxes by 
executive fiat and expand substantially the spirit and letter of the 
underlying statute. The rule also seeks to impose on small businesses a 
burdensome new recordkeeping and collection of information requirement 
that would affect

[[Page S2603]]

millions of limited partners and members of limited liability 
companies. The IRS proposed this ``stealth'' tax increase with the 
knowledge that Congress declined to adopt a similar tax increase in the 
Health Security Act proposed in 1994--a provision that the 
Congressional Joint Committee on Taxation estimated in 1994 would have 
resulted in a tax increase of approximately $500 million per year.
  The Stealth Tax Prevention Act would remove any incentive for the 
Treasury Department to underestimate the cost imposed by an IRS 
proposed or final rule in an effort to skirt the Administration's 
regulatory review process or its obligations under the Regulatory 
Flexibility Act. By amending the definition of ``major rule'' under the 
Congressional Review Act, which is Subtitle E of the Red Tape Reduction 
Act, we ensure that an IRS rule that imposes a tax increase will be a 
major rule, whether or not it has an estimated annual effect on the 
economy of $100,000,000. Our amendment does not change the trigger for 
a regulatory flexibility analysis, which still will be required if a 
proposed rule would have ``a significant economic impact on a 
substantial number of small entities.'' We believe the heightened 
scrutiny of IRS regulations called for by this legislation will provide 
an additional incentive for the Treasury Department's Internal Revenue 
Service to meet all of its procedural obligations under the Reg Flex 
Act and the Red Tape Reduction Act.
  I urge my colleagues to join us in supporting this important 
legislation to ensure that the IRS neither usurps the proper role of 
Congress--nor skirts its obligations to identify the impact of its 
proposed and final rules. When the Department of the Treasury issues a 
final IRS rule that increases taxes, Congress should have the ability 
to exercise its discretion to enact a resolution of disapproval before 
the rule is applicable to a single taxpayer. The Stealth Tax Prevention 
Act Senator Shelby and I introduce today provides that opportunity.
                                 ______
                                 
      By Mr. SHELBY:
  S. 603. A bill to promote competition and greater efficiency of 
airlines to ensure the rights of airline passengers, to provide for 
full disclosure to those passengers, and for other purposes; to the 
Committee on Commerce, Science, and Transportation.


            airline deregulation and disclosure act of 1999

  Mr. SHELBY. Mr. President, the legislation that abolished the Civil 
Aeronautics Board in 1978 and deregulated the airline industry has been 
a huge success. Americans are flying more, and more Americans are 
flying; at the same time, air fares have dropped and air travel has 
become safer. The average price of an airline ticket has decreased 
approximately 33 percent in real terms since market forces replaced the 
whims of federal bureaucrats in setting fares. The number of passengers 
flying domestic routes has more than doubled to approximately 600 
million annually. It is not surprising, then, that air travel is no 
longer an exclusive privilege of the elite and today is accessible to 
most Americans.
  While deregulation of the airline industry overall has yielded the 
benefits that free markets promise, there are growing pains. As the 
number of air passengers increases, so has the number of consumer 
complaints against air carriers. Some members of Congress have 
concluded that competition does not work for commercial aviation. They 
have stepped forward with proposals to reimpose federal control over 
air fares and carrier routes, to offer taxpayer subsidies to fledgling 
air carriers to compete against industry goliaths, or to levy a variety 
of new fines that would add to the Department of Transportation's duty 
the role of meter maid. We should be wary of any such effort to 
reintroduce the heavy hand of government under the auspices of 
protecting airline passengers.
  Mr. President, lets not rush to throw out the baby with the bath 
water and undo twenty years of unprecedented growth and consumer 
savings under deregulation. Now is the time to reinvigorate competition 
in the air passenger market, even if the air carriers do not welcome 
it. The best way to increase competition is to regulate less, not more. 
Regulations that serve as barriers to the commercial aviation market 
should be removed. Regulations that promote the division of the 
marketplace into regional cartels should be abandoned. Regulations and 
FAA management practices that delay the installation of new technology 
that facilitates competition should be streamlined.
  I believe that we can also increase competition in the airline 
industry by providing the traveling public with more useful information 
and by giving consumers ownership of the commodity they have 
purchased--their seat on an airplane. Today, I am introducing 
legislation that will provide passengers with greater information about 
their air fare and flight and with greater flexibility over unused or 
partially used fares.
  The price of an airline ticket is as much a mystery as the Pyramids 
or the Hanging Gardens. In fact, The New York Times reported that on a 
single flight, passengers paid 27 different fares, ranging from $87 to 
$728. We should not adopt any measure that discourage air carriers from 
discounting fares or that chill the benefits airline consumers are now 
receiving. Air carriers, however, should not be allowed to continue 
bait-and-switch advertising. If an air carrier offers a discounted 
fare, my bill permits all passengers to make a confirmed reservation at 
that same price for a twenty-four hour period.
  Under my bill, consumers will get more ticket and flight information. 
Airlines will be required to notify passengers about flight delays, 
cancellations, or diversions. Air carriers must also disclose if the 
passenger will be traveling on a carrier other than the one from whom 
the consumer purchased the ticket or if the flight will require the 
passenger to change planes.
  At the same time, my bill will ensure that air carriers are penalized 
for canceling flights, bumping passengers, and holding travelers 
hostage on board an aircraft with inpunity. Whenever an airline 
passenger is unable to make a flight, the passenger will have the 
opportunity to board a similar flight on a standby basis. Whenever an 
airline cancels a flight for their convenience, it will have to offer 
to compensate each passenger. Whenever an airline keeps passengers on 
board an aircraft that sits on the tarmac for more than two hours, it 
will have to offer to compensate each passenger.
  The Airline Deregulation Act of 1978 started a revolution in the 
airline industry, a revolution that according to a Brookings 
Institution study has benefitted consumers by $18.4 billion. That 
revolution is unfinished. I want to take the next step and promote new 
competition in the passenger aviation marketplace. My bill does this by 
taking away much of the mystery associated with flying.
  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:
       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 ``Airline Deregulation and 
     Disclosure Act of 1999''.

     SEC. 2. AIRLINE PASSENGER PROTECTION.

       (a) In General.--Subchapter I of chapter 417 of title 49, 
     United States Code, is amended by adding at the end the 
     following:

     ``Sec. 41716. Air carrier passenger protection

       ``(a) Delay, Cancellation, or Diversion.--
       ``(1) Explanation of delay, cancellation, or diversion 
     required.--An announcement by an air carrier of a delay or 
     cancellation of a flight, or a diversion of a flight to an 
     airport other than the airport at which the flight is 
     scheduled to land, shall include an explanation of each 
     reason for the delay, cancellation, or diversion.
       ``(2) Prohibition on false or misleading explanations.--No 
     air carrier shall provide an explanation under paragraph (1) 
     that the air carrier knows or has reason to know is false or 
     misleading.
       ``(3) Delays After Enplaning or Before Deplaning.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     no air carrier may require a passenger on a flight of that 
     air carrier to remain onboard an aircraft for a period longer 
     than 2 hours after--
       ``(i) the passenger enplaned, in any case in which the 
     aircraft has not taken flight from the airport during that 
     period; or
       ``(ii) the aircraft has landed at an airport, if the 
     aircraft remains in that airport without taking flight.
       ``(B) Election.--A passenger described in subparagraph (A) 
     may remain onboard an aircraft described in clause (i) or 
     (ii) of that

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     subparagraph for a period longer than the applicable period 
     described in that subparagraph, if, not later than the end of 
     that 2-hour period--
       ``(i) the air carrier offers the passenger an opportunity 
     to deplane with a full refund of air fare; and
       ``(ii) the passenger declines that offer.''.
       ``(b) Economic Cancellations.--
       ``(1) Nonsafety cancellations.--If, on the date a flight of 
     an air carrier is scheduled, the carrier cancels the flight 
     for any reason other than safety, the carrier shall provide 
     to each passenger that purchased air transportation on the 
     flight a refund of the amount paid for the air 
     transportation.
       ``(2) Cancellations for safety.--A cancellation for safety 
     is a cancellation made by reason of--
       ``(A) an insufficient number of crew members;
       ``(B) weather;
       ``(C) a mechanical problem; or
       ``(D) any other matter that prevents--
       ``(i) the safe operation of the flight; or
       ``(ii) the flight from operating in accordance with 
     applicable regulations of the Federal Aviation 
     Administration.
       ``(c) Code Sharing.--An air carrier, foreign air carrier, 
     or ticket agent may sell air transportation in the United 
     States for a flight that bears a designator code of a carrier 
     other than the carrier that will provide the air 
     transportation, only if the carrier or ticket agent selling 
     the air transportation first informs the person purchasing 
     the air transportation that the carrier providing the air 
     transportation will be a carrier other than the carrier whose 
     designator code is used to identify the flight.
       ``(d) Multiple Flights.--An air carrier, foreign air 
     carrier, or ticket agent that sells air transportation in the 
     United States that requires taking flights on more than 1 
     aircraft shall be required to provide notification on a 
     ticket, receipt, or itinerary provided to the purchaser of 
     that air transportation that the passenger shall be required 
     to change aircraft.
       ``(e) Air Carrier Pricing Policies.--An air carrier may 
     not--
       ``(1) prohibit a person (including a governmental entity) 
     that purchases air transportation from only using a portion 
     of the air transportation purchased (including using the air 
     transportation purchased only for 1-way travel instead of 
     round-trip travel); or
       ``(2) assess an additional fee or charge for using only a 
     portion of that purchased air transportation to be paid by--
       ``(A) that person; or
       ``(B) any ticket agent that sold the air transportation to 
     that person.
       ``(f) Equitable Fares; Frequent Flyer Program Awards.--
       ``(1) Reduced fares.--Subject to paragraph (2), if an air 
     carrier makes seats available on a specific date at a reduced 
     fare, that air carrier shall be required to make available 
     air transportation at that reduced fare for any passenger 
     that requests a seat at that reduced fare during a 24-hour 
     period beginning with the initial offering of that reduced 
     fare.
       ``(2) Limitation.--
       ``(A) In general.--An air carrier shall not be required 
     under paragraph (1) to make a seat available for a route at a 
     reduced fare, if providing that seat at that fare would 
     result in the air carrier being unable to provide, for the 
     24-hour period specified in that paragraph, the applicable 
     historic average number of seats offered at an unreduced fare 
     for the route, as determined under subparagraph (B).
       ``(B) Historic average.--With respect to a route, the 
     historic average number of seats offered at an unreduced fare 
     for the route is the average number of seats offered at an 
     unreduced fare per day by an air carrier for flights 
     scheduled on that route during the 24-month period preceding 
     the 24-hour period specified in paragraph (1).
       ``(3) Standby use of tickets.--An air carrier shall permit 
     an individual to use a ticket (or equivalent electronic 
     record) issued by that air carrier on a standby basis for any 
     flight that has the same origin and destination as are 
     indicated on that ticket (or equivalent electronic record).
       ``(4) Frequent flyer program awards.--
       ``(A) In general.--Subject to subparagraph (C), in a manner 
     consistent with applicable requirements of a frequent flyer 
     program, if an air carrier makes any seat available on a 
     specific date for use by a person redeeming an award under 
     that frequent flyer program on any route in air 
     transportation provided by the air carrier, that air carrier 
     shall, to the extent practicable during the 24-hour period 
     beginning with the redemption of that award--
       ``(i) redeem any other award under that frequent flyer 
     program for air transportation on that route; and
       ``(ii) make a seat available for the person who redeems 
     that other award on a flight on that route.
       ``(B) Standby use of frequent flyer program awards.--An air 
     carrier shall permit an individual to redeem a ticket (or 
     equivalent electronic record) acquired through a frequent 
     flyer award on a standby basis for any flight that has the 
     same origin and destination as are indicated on that ticket 
     (or equivalent electronic record).
       ``(C) Limitation.--
       ``(i) In general.--An air carrier shall not be required 
     under subparagraph (A) to make a seat available for a route 
     for use by a person redeeming a frequent flyer award, if 
     providing that seat to that person would result in the air 
     carrier being unable to provide, for the 24-hour period 
     specified in that paragraph, the applicable historic average 
     number of seats offered at an unreduced fare for the route, 
     as determined under clause (ii).
       ``(ii) Historic average.--With respect to a route, the 
     historic average number of seats offered at an unreduced fare 
     for the route is the average number of seats offered at an 
     unreduced fare per day by an air carrier for flights 
     scheduled on that route during the 24-month period preceding 
     the 24-hour period specified in subparagraph (A).
       ``(g) Access to All Fares.--Each air carrier operating in 
     the United States shall make information concerning all fares 
     for air transportation charged by that air carrier available 
     to the public, through--
       ``(1) computer-based technology; and
       ``(2) means other than computer-based technology.''.
       (b) Penalties.--Section 46301(a)(1)(A) of title 49, United 
     States Code, is amended by striking ``or 41715 of this 
     title'' and inserting ``, 41715, or 41716 of this title''.
       (c) Conforming Amendment.--The table of sections for 
     chapter 417 of title 49, United States Code, is amended by 
     inserting after the item relating to section 41715 the 
     following:

``41716. Air carrier passenger protection.''.



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