[Congressional Record Volume 146, Number 70 (Thursday, June 8, 2000)]
[Senate]
[Pages S4827-S4834]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. MOYNIHAN (for himself, Mr. Kerry, Mr. Rockefeller, Ms. 
        Snowe, Mr. Allard, Mr. Baucus, Mr. Breaux, Mr. Brownback, Mr. 
        Bryan, Mr. Bunning, Mr. Burns, Mr. Daschle, Mr. Hollings, Mr. 
        Hutchinson, Mr. Johnson, Mr. Kennedy, Mr. Kerrey, Ms. Landrieu, 
        Mrs. Lincoln, Ms. Mikulski, Mr. Reid, Mr. Robb, Mr. Roberts, 
        Mr. Schumer, Mr. Thurmond, Mr. Enzi, Mrs. Boxer, and Mr. 
        DeWine):
  S. 2698. A bill to amend the Internal Revenue Code of 1986 to provide 
an incentive to ensure that all Americans gain timely and equitable 
access to the Internet over current and future generations of broadband 
capability; to the Committee on Finance.


                 broadband internet access act of 2000

  Mr. MOYNIHAN. Mr. President, today, joined by my colleagues Senators 
Kerry, Rockefeller, Snowe, Allard, Baucus, Breaux, Brownback, Bryan, 
Bunning, Burns, Daschle, Durbin, Enzi, Hollings, Hutchinson, Johnson, 
Kennedy, Kerrey, Landrieu, Lincoln, Mikulski, Reid, Robb, Roberts, 
Schumer, and Thurmond, I am introducing the Broadband Internet Access 
Act of 2000. This legislation provides a tax incentive to stimulate 
rapid deployment of high-speed communication services to residential, 
rural, and low-income areas.
  A term of art often used for high-speed communication service is 
``broadband.'' The term is a remnant from the era of analog systems. It 
refers to the size of spectral bandwidth over which signals can be 
transmitted. Even though it is not essential to have wide spectra in 
the digital world to transmit vast amounts of data, ``broadband'' 
remains in our digital society's lexicon for high-speed communication 
or throughput.
  In common use, broadband connotes fast Internet access, and that is 
certainly part of the goal of this legislation. The grander goal, 
however, extends beyond simply expediting traditional Internet use. It 
is to deliver, in the near future, a wide array of voice, video, and 
data communication services, at extremely fast speeds, to all 
Americans.
  The Broadband Internet Access Act of 2000 provides graduated tax 
credits for deployment of high-speed communications to residential and 
rural communities. It gives a 10-percent credit for the deployment of 
at least 1.5 million bits per second downstream and 200,000 bits per 
second upstream to all subscribers--residential, business, and 
institutions--in rural and low income areas. This is essentially 
``current generation'' broadband. The bill gives a 20-percent credit 
for the deployment of at least 22 million bits per second downstream 
and 10 million bits per second upstream to all subscribers in rural and 
low income areas, and to all residential customers in other areas. This 
is what we are calling ``next generation'' broadband.
  The bill does not dictate the technological means by which these 
broadband services are to be delivered. Today, the possibilities 
include telephone lines, cable modems, fiber optics, terrestrial 
wireless, and satellite wireless. In the future there may be others. 
Whether high-speed communications are delivered by electrons or by 
photons, with wires or without wires, by copper or by glass, by 
terrestrial or by extraterrestrial means, is immaterial. With a 
temporary tax credit, it is economically feasible to push national 
communication capabilities forward by ten or perhaps twenty years. The 
bill permits a variety of technological approaches to make under-served 
areas more economically attractive to broadband providers. Yesterday we 
had electronics. Today we have photonics. Tomorrow we will have some 
``future-onics.''
  Mr. President, as I stand before you today, the streets of 
Washington, D.C. and of many other major cities in this country are 
being torn-up to lay cables for high-speed communication. Line-of-sight 
communication ``dishes'' are being installed on office buildings 
permitting business-to-business voice, video, and data transmissions. 
The problem is, market forces are driving deployment of high-speed 
communication capabilities almost exclusively to urban businesses and 
wealthy households. Low-income families, exurban communities, rural 
businesses, and rural families are relegated to the back of the queue. 
The bill gives private industry economic incentives to accelerate high-
speed communication capabilities to Americans who are at the end-of-
the-line.
  Why is this important? Let me offer examples of this technology's 
power and importance. I start with two historical cases.
  During the 1950's the National Institute of Mental Health funded a 
1,278-

[[Page S4828]]

mile closed-circuit telephone system between seven state hospitals in 
Nebraska, Iowa, North Dakota, and South Dakota. Health care providers 
at the hospitals held weekly teleconferencing lectures via this system. 
By 1961, the system included both audio and video, and psychiatrists 
successfully used it to care for patients under a program called 
``telepsychiatry.''
  At about the same time, radiologists in Montreal had a coaxial cable 
laid between two hospitals three miles apart, thus connecting them for 
audio and video communications. Doctors were regularly transmitting 
radiographic images to each other to consult on difficult cases and to 
conduct educational conferences.
  As a result of these two projects, patients were treated by 
physicians who were, in some cases, hundreds of miles away. The medical 
profession was able to share information and ideas, which improved 
healthcare in this country and Canada.
  Unfortunately, such ``telemedicine'' links are very few, even though 
our ability to transmit data has increased. Why? Because there is no 
nationwide high-speed data-transfer infrastructure. Instead, the 
standard business Internet speed in rural areas is 56,000 bits per 
second. What can be done at that speed? Printed matter can be sent and 
received reasonably quickly. But photographs or graphics, require long 
waits, and then often with poor image quality. More advanced uses, such 
as video conferencing, are out of the question. At faster Internet 
speeds of, say, 200,000 to 300,000 bits per second, information can be 
sent much faster. Photographs and graphics leap to the screen, instead 
of crawling. Video conferencing also is possible, although jittery 
images and low image resolution make it impractical. Music and movies 
can be downloaded slowly to a compact disk.
  At higher data transfer speeds--about 1.5 million bits per second--
the amount and quality of information that can be transmitted becomes 
quite good. Very good video conferencing is possible. Two or more 
people in different places can see and talk to each other as if in the 
same room, at a crisp image resolution and without image jitter.
  And at even higher speeds, extraordinarily rich images of movement, 
color, and detail can be transmitted as if one were looking at them in 
person. Complex medical images can be sent and received. At twenty 
million bits per second, a digitized mammography image can be 
transmitted in about fifteen seconds, and a standard chest x-ray in 
about four seconds.
  Twenty million bits per second is about 360 times faster than the 
fastest speeds available on a conventional modem attached to a Plain 
Old Telephone Service, or, as I am told, POTS. Is it really possible to 
do this? Indeed, it is. The technology exists now. Over ordinary copper 
wire, some of our communication companies are now offering data speeds 
of 26 million bits per second.
  Imagine the tremendous personal and economic benefits our nation will 
reap with universal high-speed communication access, including 
telemedicine; telecommuting; distance learning at all education levels; 
electronic commerce in low-income and rural communities; digital 
photography; and entertainment video. As a result, we will enjoy 
greater educational opportunities, greater geographic freedom, 
increased wealth in low-income areas, and even decreased urban 
congestion.
  So if the benefits are so great and the capability exists, why are 
these technologies not widely available? Simple economics. It is much 
more lucrative to provide services to business customers. Although a 
few affluent individuals in urban areas have high speed Internet 
access, the great majority of Americans are limited to extremely slow 
communication or to none at all.
  That is why it is appropriate for government to step in at this time 
and provide an incentive to stimulate deployment of high-speed 
communication service to residential areas and small businesses, 
especially in rural and low-income areas of the country. Our country 
has a proud history of supporting critical services in rural and under-
served communities.
  Three major examples are utilities, interstate highways, and the 
airline industries.
  The Rural Utilities Service is a federal credit agency within the 
Department of Agriculture that helps rural areas finance electric, 
telecommunications, water, and waste water projects. Its lending 
creates public-private partnerships to finance the construction of 
infrastructure in rural areas. Working in partnership with rural 
telephone cooperatives and companies, the Department of Agriculture 
helped boost the number of rural Americans with telephone service from 
38 percent in 1950 to more than 95 percent in 1999.
  The federal government funded 90 to 100 percent of the cost of 
building the interstate highway system. The Federal Aid Highway Act of 
1956 initiated a nationwide program that aimed to be completed within 
20 years. The bulk of the program was completed within this time 
period, although full implementation was not achieved until the early 
1990s.
  In the 1930s, the airline industry--much like today's Internet start-
ups--was operating at a loss. Believing airline service to be both 
unique and necessary, the federal government stepped-in with an airmail 
subsidy in 1938, and this federal funding made the industry instantly 
profitable. The airline industry then flourished, and the subsidy was 
removed in the mid 1950s.
  In a 1979 speech titled, ``Technology and Human Freedom,'' I stated, 
``I believe that government can and should seek to advance technology--
as a condition of social progress.'' I still believe that. In 1979, I 
went on to say, ``In my view, only a person of what St. Augustine would 
have termed `indomitable ignorance' could deny that technology has 
greatly enhanced human freedom. . . . Freedom is choice, and technology 
vastly enhances choice. . . . The relation between technology and 
democracy is intimate. . . . Experimentation, variety, optimism: these 
are the ingredients of both technology and democracy.''
  In 1978, the late Mancur Olson, an esteemed economist, cautioned that 
the very liberty of societies such as ours may be the source of 
developments that make innovation considerably more difficult. We 
should guard against the prospect of our government retarding 
technology as Professor Olson hypothesized. The bill I introduce today 
encourages technology, and extends its range to those residential and 
business areas it otherwise would not reach until much later.
  We need this legislation now to maintain our technological 
leadership. As the press has recently reported, Sweden, Japan, 
Singapore, and Canada are deploying broadband at levels higher than 
those called for in this bill. We cannot afford to fall behind in this 
critical area. History indicates that, if we do not act aggressively, 
it will take a very long time to deploy broadband services on a 
widespread basis. The first regular, sustained commercial telephone 
services were offered in 1876, but it took more than 90 years to make 
the service available to 90 percent of residences in the United States. 
It would be deplorable if it takes even half as long to bring existing 
broadband technology to the same number of Americans.
  If the Internet is the information superhighway, broadband 
communication is the information super sonic transport. I want to 
encourage the communications industry to accelerate deployment of the 
this super sonic transport to every community in the country.
  I want to thank my colleagues for their support and collaboration on 
this bill. Senator John Kerry and his staff have been involved in every 
aspect of this legislation, and we could not have formulated the bill 
without their detailed knowledge of the communications industry. And 
Senators Rockefeller and Snowe recently introduced a similar bill 
focusing on the deployment of broadband in rural areas, and the 
legislation we introduce today incorporates and expands upon their 
work.
  This bill is meant to be a proposal. As we consider this measure, 
Congress may decide to modify it. Moreover, we have not yet received a 
revenue estimate on the bill, and if it proves to be too expensive, we 
will have to scale it back. It is time, however, to focus on this 
issue. Let us begin the discussion of how we can provide the stimulus 
necessary to ensure the availability of high-speed communication to 
every

[[Page S4829]]

American. I urge the Senate to support this important legislation.
  Mr. President, I ask unanimous consent that a copy of the bill and 
letters of support from a number of organizations appear in the Record. 

  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                S. 2698

       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 ``Broadband Internet Access 
     Act of 2000''.

     SEC. 2. FINDINGS AND PURPOSE.

       (a) Findings.--The Congress finds the following:
       (1) The Internet has been the single greatest contributor 
     to the unprecedented economic expansion experienced by the 
     United States over the last 8 years.
       (2) Increasing the speed that Americans can access the 
     Internet is necessary to ensure the continued expansion.
       (3) Today, most residential Internet users, especially 
     those located in low income and rural areas, are extremely 
     limited in the type of information they can send and receive 
     over the Internet because their means of access is limited to 
     ``narrowband'' communications media, typically conventional 
     phone lines at a maximum speed of 56,000 bits per second.
       (4) Similarly, small businesses in low income and rural 
     areas are also deprived of full information access because of 
     their dependence on narrowband facilities.
       (5) By contrast, many residential users located in higher 
     income urban and suburban areas and urban business users can 
     access the Internet from a variety of carriers at current 
     generation broadband speeds in excess of 1,500,000 bits per 
     second, giving them a choice among carriers and high-speed 
     access to a wide array of audio and data applications.
       (6) The result is a growing disparity in the speed of 
     access to the Internet and the opportunities it creates 
     between subscribers located in low income and rural areas and 
     subscribers located in higher income urban and suburban 
     areas.
       (7) At the same time, experts project that, under current 
     financial and regulatory conditions, the facilities needed to 
     transmit next generation broadband services over the Internet 
     to residential users at speeds in excess of 10,000,000 bits 
     per second will not be as ubiquitously available as is 
     telephone service until sometime between the years 2030 and 
     2040.
       (8) Experts also believe that, under current financial and 
     regulatory conditions, the disparity in access will be 
     exacerbated with the deployment of next generation broadband 
     capability.
       (9) The disparity in current broadband access to the 
     Internet, the slow pace of deployment of next generation 
     broadband capability, and the projected disparity in access 
     to such capability will likely prove detrimental to the on-
     going economic expansion.
       (10) It is, therefore, appropriate for Congress to take 
     action to narrow the current and future disparity in the 
     level of broadband access to the Internet, and to accelerate 
     deployment of next generation broadband capability.
       (b) Purpose.--The purpose of this Act is to accelerate 
     deployment of current generation broadband access to the 
     Internet for users located in certain low income and rural 
     areas and to accelerate deployment of next generation 
     broadband access for all Americans.

     SEC. 3. BROADBAND CREDIT.

       (a) In General.--Subpart E of part IV of chapter 1 of the 
     Internal Revenue Code of 1986 (relating to rules for 
     computing investment credit) is amended by inserting after 
     section 48 the following new section:

     ``SEC. 48A. BROADBAND CREDIT.

       ``(a) General Rule.--For purposes of section 46, the 
     broadband credit for any taxable year is the sum of--
       ``(1) the current generation broadband credit, plus
       ``(2) the next generation broadband credit.
       ``(b) Current Generation Broadband Credit; Next Generation 
     Broadband Credit.--For purposes of this section--
       ``(1) Current generation broadband credit.--The current 
     generation broadband credit for any taxable year is equal to 
     10 percent of the qualified expenditures incurred with 
     respect to qualified equipment offering current generation 
     broadband services to rural subscribers or underserved 
     subscribers and taken into account with respect to such 
     taxable year.
       ``(2) Next generation broadband credit.--The next 
     generation broadband credit for any taxable year is equal to 
     20 percent of the qualified expenditures incurred with 
     respect to qualified equipment offering next generation 
     broadband services to all rural subscribers, all underserved 
     subscribers, or any other residential subscribers and taken 
     into account with respect to such taxable year.
       ``(c) When Expenditures Taken Into Account.--For purposes 
     of this section--
       ``(1) In general.--Qualified expenditures with respect to 
     qualified equipment shall be taken into account with respect 
     to the first taxable year in which current generation 
     broadband services or next generation broadband services are 
     offered by the taxpayer through such equipment to 
     subscribers.
       ``(2) Offer of services.--For purposes of paragraph (1), 
     the offer of current generation broadband services or next 
     generation broadband services through qualified equipment 
     occurs when such class of service is purchased by and 
     provided to at least 10 percent of the subscribers described 
     in subsection (b) which such equipment is capable of serving 
     through the legal or contractual area access rights or 
     obligations of the taxpayer.
       ``(d) Special Allocation Rules.--
       ``(1) Current generation broadband services.--For purposes 
     of determining the current generation broadband credit under 
     subsection (a)(1), if the qualified equipment is capable of 
     serving both the subscribers described under subsection 
     (b)(1) and other subscribers, the qualified expenditures 
     shall be multiplied by a fraction--
       ``(A) the numerator of which is the sum of the total 
     potential subscriber populations within the rural areas and 
     the underserved areas which the equipment is capable of 
     serving, and
       ``(B) the denominator of which is the total potential 
     subscriber population of the area which the equipment is 
     capable of serving.
       ``(2) Next generation broadband services.--For purposes of 
     determining the next generation broadband credit under 
     subsection (a)(2), if the qualified equipment is capable of 
     serving both the subscribers described under subsection 
     (b)(2) and other subscribers, the qualified expenditures 
     shall be multiplied by a fraction--
       ``(A) the numerator of which is the sum of--
       ``(i) the total potential subscriber populations within the 
     rural areas and underserved areas, plus
       ``(ii) the total potential subscriber population of the 
     area consisting only of residential subscribers not described 
     in clause (i),
     which the equipment is capable of serving, and
       ``(B) the denominator of which is the total potential 
     subscriber population of the area which the equipment is 
     capable of serving.
       ``(e) Definitions.--For purposes of this section--
       ``(1) Antenna.--The term `antenna' means any device used to 
     transmit or receive signals through the electromagnetic 
     spectrum, including satellite equipment.
       ``(2) Cable operator.--The term `cable operator' has the 
     meaning given such term by section 602(5) of the 
     Communications Act of 1934 (47 U.S.C. 522(5)).
       ``(3) Commercial mobile service carrier.--The term 
     `commercial mobile service carrier' means any person 
     authorized to provide commercial mobile radio service as 
     defined in section 20.3 of title 47, Code of Federal 
     Regulations.
       ``(4) Current generation broadband service.--The term 
     `current generation broadband service' means the transmission 
     of signals at a rate of at least 1,500,000 bits per second to 
     the subscriber and at least 200,000 bits per second from the 
     subscriber.
       ``(5) Next generation broadband service.--The term `next 
     generation broadband service' means the transmission of 
     signals at a rate of at least 22,000,000 bits per second to 
     the subscriber and at least 10,000,000 bits per second from 
     the subscriber.
       ``(6) Nonresidential subscriber.--The term `nonresidential 
     subscriber' means a person or entity who purchases broadband 
     services which are delivered to the permanent place of 
     business of such person or entity.
       ``(7) Open video system operator.--The term `open video 
     system operator' means any person authorized to provide 
     service under section 653 of the Communications Act of 1934 
     (47 U.S.C. 573).
       ``(8) Other wireless carrier.--The term `other wireless 
     carrier' means any person (other than a telecommunications 
     carrier, commercial mobile service carrier, cable operator, 
     open video system operator, or satellite carrier) providing 
     current generation broadband services or next generation 
     broadband service to subscribers through the radio 
     transmission of energy.
       ``(9) Packet switching.--The term `packet switching' means 
     controlling or routing the path of a digitized transmission 
     signal which is assembled into packets or cells.
       ``(10) Qualified equipment.--
       ``(A) In general.--The term `qualified equipment' means 
     equipment capable of providing current generation broadband 
     services or next generation broadband services at any time to 
     each subscriber who is utilizing such services.
       ``(B) Only certain investment taken into account.--Except 
     as provided in subparagraph (C), equipment shall be taken 
     into account under subparagraph (A) only to the extent it--
       ``(i) extends from the last point of switching to the 
     outside of the unit, building, dwelling, or office owned or 
     leased by a subscriber in the case of a telecommunications 
     carrier,
       ``(ii) extends from the customer side of the mobile 
     telephone switching office to a transmission/receive antenna 
     (including such antenna) on the outside of the unit, 
     building, dwelling, or office owned or leased by a subscriber 
     in the case of a commercial mobile service carrier,
       ``(iii) extends from the customer side of the headend to 
     the outside of the unit, building, dwelling, or office owned 
     or leased by a subscriber in the case of a cable operator or 
     open video system operator, or
       ``(iv) extends from a transmission/receive antenna 
     (including such antenna) which transmits and receives signals 
     to or from

[[Page S4830]]

     multiple subscribers to a transmission/receive antenna 
     (including such antenna) on the outside of the unit, 
     building, dwelling, or office owned or leased by a subscriber 
     in the case of a satellite carrier or other wireless carrier, 
     unless such other wireless carrier is also a 
     telecommunications carrier.
       ``(C) Packet switching equipment.--Packet switching 
     equipment, regardless of location, shall be taken into 
     account under subparagraph (A) only if it is deployed in 
     connection with equipment described in subparagraph (B) and 
     it is uniquely designed to perform the function of packet 
     switching for current generation broadband services or next 
     generation broadband services, but only if such packet 
     switching is the last in a series of such functions performed 
     in the transmission of a signal to a subscriber or the first 
     in a series of such functions performed in the transmission 
     of a signal from a subscriber.
       ``(11) Qualified expenditure.--
       ``(A) In general.--The term `qualified expenditure' means 
     any amount chargeable to capital account with respect to the 
     purchase and installation of qualified equipment (including 
     any upgrades thereto) for which depreciation is allowable 
     under section 168.
       ``(B) Certain satellite expenditures excluded.--Such term 
     shall not include any expenditure with respect to the 
     launching of any satellite equipment.
       ``(12) Residential subscriber.--The term `residential 
     subscriber' means an individual who purchases broadband 
     services which are delivered to such individual's dwelling.
       ``(13) Rural subscriber.--
       ``(A) In general.--The term `rural subscriber' means a 
     residential subscriber residing in a dwelling located in a 
     rural area or nonresidential subscriber maintaining a 
     permanent place of business located in a rural area.
       ``(B) Rural area.--The term `rural area' means any census 
     tract which--
       ``(i) is not within 10 miles of any incorporated or census 
     designated place containing more than 25,000 people, and
       ``(ii) is not within a county or county equivalent which 
     has an overall population density of more than 500 people per 
     square mile of land.
       ``(14) Satellite carrier.--The term `satellite carrier' 
     means any person using the facilities of a satellite or 
     satellite service licensed by the Federal Communications 
     Commission and operating in the Fixed-Satellite Service under 
     part 25 of title 47 of the Code of Federal Regulations or the 
     Direct Broadcast Satellite Service under part 100 of title 47 
     of such Code to establish and operate a channel of 
     communications for point-to-multipoint distribution of 
     signals, and owning or leasing a capacity or service on a 
     satellite in order to provide such point-to-multipoint 
     distribution.
       ``(15) Subscriber.--The term `subscriber' means a person 
     who purchases current generation broadband services or next 
     generation broadband services.
       ``(16) Telecommunications carrier.--The term 
     `telecommunications carrier' has the meaning given such term 
     by section 3(44) of the Communications Act of 1934 (47 U.S.C. 
     153 (44)), but--
       ``(A) includes all members of an affiliated group of which 
     a telecommunications carrier is a member, and
       ``(B) does not include a commercial mobile service carrier.
       ``(17) Total potential subscriber population.--The term 
     `total potential subscriber population' means, with respect 
     to any area and based on the most recent census data, the 
     total number of potential residential subscribers residing in 
     dwellings located in such area and potential nonresidential 
     subscribers maintaining permanent places of business located 
     in such area.
       ``(18) Underserved subscriber.--
       ``(A) In general.--The term `underserved subscriber' means 
     a residential subscriber residing in a dwelling located in an 
     underserved area or nonresidential subscriber maintaining a 
     permanent place of business located in an underserved area.
       ``(B) Underserved area.--The term `underserved area' means 
     any census tract--
       ``(i) the poverty level of which is at least 30 percent 
     (based on the most recent census data),
       ``(ii) the median family income of which does not exceed--

       ``(I) in the case of a census tract located in a 
     metropolitan statistical area, 70 percent of the greater of 
     the metropolitan area median family income or the statewide 
     median family income, and
       ``(II) in the case of a census tract located in a 
     nonmetropolitan statistical area, 70 percent of the 
     nonmetropolitan statewide median family income, or

       ``(iii) which is located in an empowerment zone or 
     enterprise community designated under section 1391.
       ``(f) Designation of Census Tracts.--The Secretary shall, 
     not later than 90 days after the date of the enactment of 
     this section, designate and publish those census tracts 
     meeting the criteria described in paragraphs (13)(B) and 
     (18)(B) of subsection (e), and such tracts shall remain so 
     designated for the period ending with the termination date 
     described in subsection (g).
       ``(g) Termination.--This section shall not apply to 
     expenditures incurred after December 31, 2005.''
       (b) Credit To Be Part of Investment Credit.--Section 46 of 
     the Internal Revenue Code of 1986 (relating to the amount of 
     investment credit) is amended by striking ``and'' at the end 
     of paragraph (2), by striking the period at the end of 
     paragraph (3) and inserting ``, and'', and by adding at the 
     end the following new paragraph:
       ``(4) the broadband credit.''
       (c) Special Rule for Mutual or Cooperative Telephone 
     Companies.--Section 501(c)(12)(B) of the Internal Revenue 
     Code of 1986 (relating to list of exempt organizations) is 
     amended by striking ``or'' at the end of clause (iii), by 
     striking the period at the end of clause (iv) and inserting 
     ``, or'', and by adding at the end the following new clause:
       ``(v) from sources not described in subparagraph (A), but 
     only to the extent such income does not in any year exceed an 
     amount equal to the credit for qualified expenditures which 
     would be determined under section 48A for such year if the 
     mutual or cooperative telephone company was not exempt from 
     taxation.''
       (d) Conforming Amendment.--The table of sections for 
     subpart E of part IV of subchapter A of chapter 1 of the 
     Internal Revenue Code of 1986 is amended by inserting after 
     the item relating to section 48 the following new item:

  ``Sec. 48A. Broadband credit.''
       (e) Effective Dates.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall apply to expenditures 
     incurred after December 31, 2000.
       (2) Special rule.--The amendments made by subsection (c) 
     shall apply to amounts received after December 31, 2000.

     SEC. 4. REGULATORY MATTERS.

       No Federal or State agency or instrumentality shall adopt 
     regulations or ratemaking procedures that would have the 
     effect of confiscating any credit or portion thereof allowed 
     under section 48A of the Internal Revenue Code of 1986 (as 
     added by section 3) or otherwise subverting the purpose of 
     this Act.

     SEC. 5. STUDY AND REPORT.

       (a) Sense of Congress.--It is the sense of Congress that in 
     order to maintain competitive neutrality, the credit allowed 
     under section 48A of the Internal Revenue Code of 1986 (as 
     added by section 3) should be administered in such a manner 
     so as to ensure that each class of carrier receives the same 
     level of financial incentive to deploy current generation 
     broadband services and next generation broadband services.
       (b) Study and Report.--The Secretary of the Treasury shall, 
     within 180 days after the effective date of section 3, study 
     the impact of the credit allowed under section 48A of the 
     Internal Revenue Code of 1986 (as added by section 3) on the 
     relative competitiveness of potential classes of carriers of 
     current generation broadband services and next generation 
     broadband services, and shall report to Congress the findings 
     of such study, together with any legislative or regulatory 
     proposals determined to be necessary to ensure that the 
     purposes of such credit can be furthered without impacting 
     competitive neutrality among such classes of carriers.
                                  ____



                                                 MCI WorldCom,

                                     Washington, DC, June 8, 2000.
     Hon. Daniel Patrick Moynihan,
     Senate Finance Committee,
     Washington, DC.
       Dear Senator Moynihan: Thank you for your leadership in 
     advancing the deployment of broadband technology to rural and 
     underserved areas of the country. WorldCom, a leading 
     Internet backbone provider, believes broadband technology 
     will improve the quality of life for millions of Americans 
     and assist in maintaining this country's leadership in the 
     worldwide information technology marketplace. Your support of 
     our efforts to modernize communications infrastructure dates 
     at least to the Tax Reform Act of 1986, when you supported 
     legislation designed to enhance advanced telecommunications 
     investment.
       Electronic commerce and its Internet medium is a thriving 
     environment. More jobs, more gross domestic product, and more 
     wealth have been created by the Internet than any other 
     single innovation in recent memory. Electronic commerce 
     continues to grow apace, creating increased need for 
     continuing development and deployment of communications 
     technology.
       Your proposal, Senator Moynihan, is designed to support 
     that deployment and development at an advanced level. It is 
     designed not only to accelerate deployment of existing 
     technology, but also to encourage development and deployment 
     of next generation broadband technologies as well. 
     Acceleration is important. Persons needing distance education 
     cannot wait while job opportunities pass them by; businesses 
     facing competitive pressure cannot wait to engage in the 
     latest Internet based inventory planning; rural residents 
     with a great idea for a new dot.com need high speed 
     connectivity now; and persons suffering from serious disease 
     far from the right medical experts cannot wait for a 
     telemedicine connection.
       WorldCom appreciates your effort to support this critical 
     technology and supports your efforts through the Broadband 
     Internet Access Act of 2000. While we would like to see a 
     proposal broader than the ``last mile'', your bill initiates 
     this all-important process.
           Sincerely,
                                               Catherine R. Sloan,
                                        Chief Legislative Counsel.

[[Page S4831]]

     
                                  ____
                                                Bell Atlantic,

                                     Washington, DC, June 5, 2000.
     Re: Broadband Internet Access Act of 2000

     Hon. Daniel Patrick Moynihan,
     Russell Senate Office Building,
     Washington, DC.
       Dear Senator Moynihan: Congratulations on your leadership 
     in developing and introducing the ``Broadband Internet Access 
     Act of 2000.'' I am writing to provide you with Bell 
     Atlantic's support and views regarding this important tax 
     legislation.
       As you know, Bell Atlantic is a leader in the deployment of 
     broadband capability, particularly in the state of New York. 
     As such, we are extremely familiar with the regulatory and 
     financial hurdles associated with deploying broadband to all 
     our business and residential customers. We believe that rapid 
     deployment of this capability will provide the basis for 
     sustained long-run economic growth in the economy. Our 
     experience with the Internet has taught us that the 
     convergence of communications and computing yields tremendous 
     benefits for the economy in terms of productivity growth.
       Unfortunately, other carriers and we face tremendous 
     government hurdles as we roll out this capability. These 
     hurdles arise from the unintended adverse effects of 
     regulation on investment that, in turn, increase the degree 
     of financial uncertainty associated with such investments. In 
     other words, we face a regulatory problem and a financial 
     problem in deploying broadband capability to our customers. 
     The Broadband Internet Access Act helps to overcome these 
     problems by encouraging Bell Atlantic and other carriers 
     through financial incentives to proceed with these 
     investments. More importantly, the targeted nature of the 
     incentives will help us reach customers in rural areas and 
     low-income areas that are otherwise difficult to serve 
     because of the high cost of deployment and other factors.
       The bill does not address the overwhelming regulatory 
     issues, which Bell Atlantic continues to face. We encourage 
     you to support legislation to address these problems as well 
     as the financial issues that are addressed in the Broadband 
     Act.
       We encourage you to enact the Broadband Internet Access Act 
     this year. We appreciate your leadership on this important 
     issue.
           Sincerely,

                                              Thomas J. Tauke,

                                           Senior Vice President--
     Government Relations.
                                  ____



                                                         NTCA,

                                      Arlington, VA, June 5, 2000.

     Re Broadband Internet Access Act of 2000.

     Hon. Daniel Patrick Moynihan,
     Ranking Minority Member, Senate Committee on Finance, 
         Washington, DC.
       Dear Senator Moynihan: During the course of the past year, 
     the term ``digital divide'' has quickly become the buzzword 
     of choice among policymakers. Coined ostensibly to describe 
     the absence of communications availability to certain 
     segments of the nation's population, the term has been 
     twisted to imply the issue of communications ``haves'' and 
     ``have-nots'' is merely a rural vs. urban matter.
       NTCA has vigorously moved to redirect the discussion to 
     fully recognize the achievements of small rural incumbent 
     local exchange carriers (ILECs) in deploying advanced 
     communications infrastructure and services. The facts bear 
     witness to the success of small rural ILECs in stepping up to 
     what we feel is better described as the ``Digital 
     Challenge.'' Recent surveys show that in many cases, markets 
     served by such entities are more technologically advanced 
     than their larger, urban counterparts. Likewise, they are 
     significantly more advanced than the rural markets served by 
     the nation's large ILECs. Other reports show that urban areas 
     in general are not the ``digital Mecca'' many would have us 
     believe. The reality is that the markets of the nation's 
     small rural ILECs are anything but communications technology 
     wastelands as many are portraying them to be.
       Nevertheless, there remains a substantial amount of costly 
     work to be done for all markets to be fully advanced service-
     capable. For this reason, we commend your effort, vis-a-vis 
     the Broadband Internet Access Act of 2000, to further 
     stimulate deployment of broadband services by granting tax 
     credits to telecommunications providers deploying advanced 
     technologies. Furthermore, we sincerely appreciate your 
     effort to recognize the special circumstances, with regard to 
     tax credits, of the nation's rural telecommunications 
     cooperatives by the inclusion of the Special Rule for Mutual 
     or Cooperative Telephone Companies.
       In addition, there are several existing tools such as the 
     universal service support program that, if allowed to 
     function appropriately, could help offset the tremendous 
     costs associated with the deployment of advanced services. We 
     continue to work with several of your colleagues to advance 
     legislation that will ensure the universal service program is 
     allowed to function as the Congress envisioned in helping 
     lead the deployment of new communications technologies and 
     services.
       It must be reiterated that small rural ILECs have long led 
     the way in meeting the Digitial Challenge by deploying new 
     technologies--not just to their most profitable customers, 
     but to every individual within their market that wishes to 
     receive service. With your assistance, the rural ILEC 
     industry will continue to maintain its unparalleled record of 
     service.
           Sincerely,

                                           Shirley Bloomfield,

                                        Vice President, Government
     Affairs & Association Services.
                                  ____

                                                  Bristol Bay Area


                                           Health Corporation,

                                     Dillingham, AK, May 31, 2000.

     Re Broadband Internet Access Act of 2000.

     Hon. Patrick Daniel Moynihan,
     Ranking Minority Member, Committee on Finance, U.S. Senate, 
         Washington, DC.
       Dear Senator Moynihan: We are writing to indicate our 
     support for your continued effort to pass the Broadband 
     Internet Access Act of 2000. If passed, this legislation 
     could significantly improve access of millions of Americans 
     to the Internet and its valuable resources, including 
     residents of rural Alaska communities.
       We provide health care services to 34 remote Alaska 
     communities, most of which can only be reached by small 
     airplane. The availability of affordable advanced 
     telecommunications including telemedicine and improved 
     Internet access would be beneficial in providing health 
     education to villagers; would help reduce feelings of 
     isolation of health care providers, teachers and other 
     professionals; and provide access to health care resources 
     for everyone. It would also provide faster and less expensive 
     access to all communication mediums.
       We believe that remote, rural areas such as those that make 
     up a large part of Alaska need and deserve the availability 
     of affordable high-speed Internet services like urban 
     communities currently enjoy. Without this availability, rural 
     communities will continue to be left behind and 
     technologically outdated as the rest of the U.S. moves 
     forward.
       Thank you for the opportunity to comment on this important 
     legislation. Please contact me at (907) 842-5201 if I can be 
     of further assistance.
           Sincerely,
                                                  Robert J. Clark,
     President/CEO.
                                  ____

                                             Georgetown University


                                               Medical Center,

                                                     May 25, 2000.

     Re Broadband Internet Access Act of 2000.

     Hon. Patrick Daniel Moynihan,
     Ranking Minority Member, Committee on Finance, U.S. Senate, 
         Washington, DC.
       Dear Senator Moynihan: We are writing to encourage you in 
     your effort to pass the Broadband Internet Access Act of 
     2000. If passed, this important legislation could 
     significantly improve the way millions of Americans gain 
     access to health information and receive health care.
       For many years the Imaging Sciences and Information Systems 
     (ISIS) Center at Georgetown University has been a successful 
     innovator of technologies that are used to improve the 
     quality and lower the cost of health care. This contribution, 
     however, accounts for only two-thirds of the receipt for 
     successful health care reform in America. The third element, 
     improved access to health services, has been one of the most 
     challenging, especially to health care providers and 
     consumers in rural America.
       Access to quality health care cannot be improved through 
     development of more efficient technologies, alone. We, and 
     with us many of our colleagues throughout America, believe 
     financial incentives are necessary to correct current 
     regulatory and market insufficiencies that inhibit assess to 
     emerging health services that increasingly rely on 
     telecommunications and Internet connectivity to reach 
     consumers. The creation of these incentives is outside the 
     purview of the health sector and that is why we look to you 
     and your Senate colleagues. You can help remedy the economic 
     conditions that contribute to the growing ``digital divide'', 
     that made second class citizens out of underserved people 
     throughout the country.
       Specifically, we look to you for a remedy that will improve 
     access and availability of telephone, cable, fiber optic, 
     terrestrial, wireless, and satellite telecommunications 
     services at bandwidth capacities sufficient to carry high 
     resolution images, video and voice over the Internet, 
     increasingly the preferred mode of delivery. We believe your 
     proposed legislation addressed these problems through its 10% 
     tax credit for deployment of ``last-mile'' current generation 
     broadband capability to rural and underserved areas, and its 
     20% credit for ``next generation'' service.
       Therefore we applaud your sponsorship of the Broadband 
     Internet Access Act of 2000. We appreciate your vision and 
     look to you and your colleagues in the Senate to rapidly pass 
     this important legislation so that we can move on to a next 
     generation of health care with improved quality, cost and 
     access.
       Thank you for an opportunity to express our support for 
     your initiative. If you need any additional information, 
     please call us at 202-687-7955 or at 
     M[email protected].
           Sincerely,
     Dukwoo Ro, PhD,
       Associate Professor.
     Seong K. Mun, PhD,
       Professor, Director of ISIS Center.

[[Page S4832]]

     
                                  ____
                                            United States Distance


                                         Learning Association,

                                      Watertown, MA, May 19, 2000.

     Re Broadband Internet Access Act of 2000.

     Hon. Daniel Patrick Moynihan,
     U.S. Senate,
     Washington, DC.
       Dear Senator Moynihan:
       The United States Distance Learning Association supports 
     the Broadband Internet Access Act of 2000 to be introduced by 
     you.
       As Executive Director of the association I want to assure 
     you that our association applauds the initiative. The 
     Congress of the United States has the opportunity to help 
     deliver long needed Telecommunication Services to all 
     Americans. This act will serve two purposes--increasing 
     bandwidth availability and decreasing the well-documented 
     Digital Divide.
           Sincerely,
                                               Dr. John G. Flores,
                                               Executive Director.


                                         Corning Incorporated,

                                        Corning, NY, May 19, 2000.
     Hon. Daniel Patrick Moynihan,
     Ranking Minority Member, Committee on Finance, U.S. Senate, 
         Washington, DC.
       Dear Senator Moynihan: I am writing to endorse with 
     enthusiasm the Broadband Internet Access Act of 2000 and to 
     congratulate you for your leadership for introducing this 
     important legislation.
       As you may know, Corning is a leader in optical 
     communications systems. As such, we have great confidence in 
     the benefits that deployment of broadband to all Americans 
     can confer on the economy and society as a whole. As Alan 
     Greenspan has said many times, the Internet has contributed 
     significantly to the on-going economic expansion. The rapid 
     deployment of broadband access can extend the benefits of the 
     Internet well into the future.
       Unfortunately, broadband is being deployed very slowly in 
     this country. Two specific problems have arisen. First, 
     subscribers in rural and underserved low-income areas are 
     unlikely to gain access to the current generation broadband 
     capability any time soon, giving rise to a ``digital divide'' 
     between information haves and have-nots. Secondly, the 
     deployment of next generation broadband capability will take 
     30 to 40 years in the current regulatory and financial 
     environment. We think America can do better for its citizens 
     by immediate enactment of the Broadband Internet Access Act 
     of 2000.
       We believe your legislation addresses these problems 
     through its 10% tax credit for deployment of last-mile 
     current generation broadband capability to rural and 
     underserved areas, and its 20% credit of next generation 
     technology more generally. These incentives will correct 
     current regulatory and market failures that are inhibiting 
     the investment. Moreover, the credits are temporary, lasting 
     only five years, a sufficient time to kick-start the 
     deployment of the technology and to reduce costs in this very 
     dynamic sector.
       It is important to note that broadband infrastructure is a 
     common good. As such, we believe that a well-designed 
     initiative such as the Broadband Internet Access Act can cost 
     effectively enhance the national welfare.
       Again, I congratulate you for taking the leadership and for 
     developing a creative initiative that will benefit the 
     country for decades to come.
           All the best,
     Roger Ackerman.
                                  ____

                                             Association for Local


                                  Telecommunications Services,

                                     Washington, DC, June 7, 2000.
     Senator Daniel Patrick Moynihan,
     U.S. Senate,
     Washington, DC.
       Dear Senator Moynihan: The Association for Local 
     Telecommunications Services (ALTS) thanks you for your 
     leadership in drafting legislation to create financial 
     incentives for telecommunications companies to offer high-
     speed Internet broadband services. The legislation that you 
     introduce today will help companies expand their businesses 
     into rural and urban communities and will also provide them 
     with incentives to offer broadband service at even higher 
     speeds.
       We are especially grateful of your continuing efforts to 
     support competitive telecommunications companies in local 
     markets. While competitors have made enormous progress in 
     rolling out advanced telecommunications services to consumers 
     across the country, many markets remain uneconomic to serve. 
     Your legislation will help to accelerate the deployment of 
     these broadband services in rural, inner city and other 
     underserved areas. We have seen that the best way to 
     encourage deployment of advanced broadband technologies is to 
     encourage competition for local telecommunications services. 
     ALTS believes your legislation will provide significant 
     financial incentives to competitive companies to roll out 
     high speed broadband services for every consumer who wants to 
     receive the service.
       Your legislation is a realistic effort to close the 
     ``digital divide'' between rural and urban communities and to 
     ensure that all Americans have the fastest and best 
     telecommunications service in the world. We look forward to 
     continuing to work with you on this legislation in the coming 
     weeks.
       Thank you again for your support of competition and the 
     rapid deployment of advanced, broadband services to all 
     Americans.
           Sincerely yours,
                                             John Windhausen, Jr.,
     President.
                                  ____

                                                   Queens College,


                                      Department of Economics,

                                       New York, NY, June 1, 2000.

     Re The Broadband Internet Access Act of 2000.

     Hon. Daniel Patrick Moynihan,
     Ranking Minority Leader, Committee on Finance, U.S. Senate, 
         Washington, DC.
       Dear Senator Moynihan: I am aware that you and other 
     Senators are co-sponsors of ``The Broadband Internet Access 
     Act of 2000,'' a bill that is intended to alleviate the 
     disparity in high-speed access to the Internet. Preliminary 
     research undertaken by Florence Kwan and myself shows that 
     discrepancies in high-speed access do exist at this time. 
     Further, the study demonstrates the need for policy-makers to 
     examine the degree to which all members of society have high-
     speed access to the Internet.
       The study was based upon a sampling of residential lines in 
     the United States. The results suggest that income and 
     population density are significant predictors of access to 
     cable-modem or DSL service. High-speed access is less likely 
     to be available to Americans in rural and low-income 
     neighborhoods. As preliminary research, the study underscores 
     the need for further research that is comprehensive in scope 
     and that can serve as the basis for regulatory policy.
       I commend your efforts to address an issue that is critical 
     to the ability of all Americans to be part of the Information 
     Society and to participate in our system of democracy.
           Very truly yours,
                                                      David Gabel,
                                                        Professor.

  Mr. KERRY. Mr. President, I am very pleased to join Senator Moynihan 
in introducing the Broadband Internet Access Act of 2000. I commend the 
Senator from New York for his leadership on this issue, and I look 
forward to working with Senator Moynihan, Senator Rockefeller and 
others in this critical effort to ensure the rapid deployment of high-
speed telecommunications services to all Americans.
  Mr. President, throughout the course of history, prosperity has 
flowed to those economies that had ready access to avenues of commerce. 
Throughout the middle ages and up until the mid-19th century, that 
meant ready proximity to a waterway. The great cities of Italy, England 
and France all lay on oceans or rivers. In North America, the early 
trading points on or near the Atlantic thrived and became New York, 
Boston, Philadelphia and Baltimore. Throughout this time, the primary 
way to ship goods was over water, and economies prospered along oceans 
or major inland waterways because of the paramount importance of access 
to commerce. With the industrial revolution came the advent of the 
railroad and this new way of getting goods to market. If your town was 
fortunate to be along one of many rail lines, then good economic times 
often lay ahead. If your town was not along the railroad, then you were 
at a serious economic disadvantage. We read today about the ``ghost 
towns'' of the old West--these were the towns left behind because the 
railroad passed them by. And even then, one hundred seventy years ago, 
we know that Americans did all they could to connect themselves to the 
networks--waterways, railroads--that delivered goods to market: along 
the Panhandle, the entire town of Ivanhoe, Oklahoma literally uprooted 
itself--picked up the church, the school, the buildings--and moved 
across the Texas border to be closer to the railroad lines.
  In many ways, that is precisely the challenge facing thousands of 
communities across the nation today: communities are rushing and 
hurrying--and too many are struggling and finding it enormously 
difficult--to get connected to the networks on which we conduct 
business in the New Economy. And, Mr. President, unless we are willing 
to countenance thousands of ghost towns across the landscape of the 
21st century--ghost towns of inner city and rural America--we must work 
together to empower every community to meet that challenge.
  Mr. President, today, the major product in the United States is 
information. The ability to send and receive vast amounts of 
information, quickly and efficiently, often determines the success or 
failure of a company in our new information age. For this reason, 
companies are locating where they have high-speed access to this new 
avenue of commerce, and they are shying away from areas where such 
excess is either prohibitively expensive or unavailable. High-speed 
access is also

[[Page S4833]]

providing new opportunities in terms of educating our children and 
caring for the sick. However, those opportunities are available only to 
those communities with efficient and affordable access to high-speed 
lines.
  Herein lies the problem. As would be expected, telecommunications 
companies are deploying advanced networks initially in areas where 
there are lots of attractive consumers, but are often taking their time 
to build-out elsewhere, such as in low-income urban and rural areas. 
That's why a downtown business consumer has a myriad of choices for 
high-speed access. And most residential consumers living in reasonable 
well-off urban and suburban areas also have a choice. However, many, 
many regions of our country still have little or no ability to obtain 
high-speed access to the Internet.

  According to the Massachusetts Technology Collaborative, of the 351 
towns in Massachusetts, only 164 are wired to receive high-speed DSL 
Internet service, and only 145 are wired to receive high-speed cable 
modem service. Significantly, 151 towns have no DSL or cable modem 
option, only 56 kilobit dial-up Internet service. Moreover, this 
situation is not expected to change anytime soon. The Legg Mason 
Precursor groups estimates that even three or fours years down the 
road, half of America will have either one or zero broadband providers 
to choose from.
  We need to address this problem in order to ensure that no area is 
left behind--to ensure that all Americans are able to benefit from our 
new high-tech economy. Many telecommunications companies legitimately 
argue that deploying in certain areas makes little sense because the 
opportunity to recoup the investment is so small. It's time we listened 
and offered an economic incentive to change the equation. To this end, 
our bill establishes a generous 10 percent tax credit to all companies 
willing to deploy and offer 1.5 megabit high-speed Internet service in 
rural and low-income urban areas. We are advocating such an approach 
because we have heard from industry that this will provide a needed 
incentive to deploy in areas that are presently neglected. 
Significantly, this credit is open to all companies be they telephone 
or cable, wireline or wireless, MMDS or satellite. The bill is 
concerned only with encouraging widespread deployment, and is 
absolutely technology neutral.
  Mr. President, our legislation addresses not only the digital divide 
that exists today, but also looks to the future and to the next 
generation of high-speed services. The next generation of advanced 
services will require substantially higher transmission speeds like 4 
megabits for one channel of standard television, 20 megabits for one 
channel of HDTV, and 10 to 100 megabits for Ethernet data. These 
transmission speeds can only be achieved with more advanced technology 
such as fiber optics, very high speed digital subscriber line, 50-home-
node cable modems, and next-generation wireless.
  The services available at such speeds will truly revolutionize and 
improve our daily lives. However, according to economists from the 
American Enterprise Institute, at the current rate of deployment, such 
advanced technology will not achieve universal penetration until 
somewhere between 2030 and 2040. Furthermore, such delay may seriously 
undermine our global leadership in technology. Indeed, according to a 
recent report in the Wall Street Journal, the Japanese company NTT will 
start bringing optical fiber lines directly to homes in Tokyo and Osaka 
by the end of this year. Such networks will have capabilities of up to 
10 megabits downstream--several times faster than most of the high-
speed services offered today in America.
  Such Internet capability will transform American life in ways we can 
only imagine today. Children can download educational video in real 
time on nearly any subject. Adults can train for new jobs from their 
homes. Complex medical images such as MRIs and x-rays that today take 
several minutes to download can be transmitted in a matter of seconds. 
Telecommuting, business teleconferencing and personal communication 
will all rise to new levels.
  To accelerate the roll-out of such next-generation systems in the US, 
we propose to establish a 20 percent tax credit for companies that 
deploy systems capable of providing 22 megabit downstream/10 megabit 
upstream service to residential consumers everywhere and business 
consumers in low-income urban and rural areas. Such bits speeds will 
allow for different users in a home to simultaneously watch 3 different 
channels of digital television and utilize high-speed Ethernet-
comparable Internet access.
  Mr. President, this measure is intended to begin the debate in the 
Senate on how best to address the growing digital divide and to 
accelerate the deployment of next-generation technologies across our 
nation. I want to thank Senator Moynihan for his extraordinary 
leadership on this issue and his staff for their continued hard work in 
crafting this bill. I also wish to commend Senators Rockefeller and 
Snowe for their work on tax credit legislation which we incorporate and 
expand on in this bill. Finally, I wish to extend my gratitude to all 
the members of industry who worked with us over these past few months 
in crafting this bill. Clearly, this is a very complex topic and we are 
continuing to work to find the right solution. I look forward to 
continuing our partnership and to passing meaningful legislation this 
year.
  The challenge today is extraordinary--its implications absolutely 
unmistakable for our country. Too often we talk about a digital divide 
in the United States as if it were unchangeable, as if it were a simple 
fact of life in this nation that some communities will be empowered by 
technology while others will be left behind. But this is a false 
choice--and we ought to be doing everything in our power as policy 
makers, working harmoniously with industry, to offer a new choice: 
every community connected to the new technology, every citizen provided 
with the tools to make the most of their own talents in the New 
Economy.
  Mr. President, The Broadband Internet Access Act of 2000 is not a 
panacea for every challenge before us in the New Economy; significant 
questions of education reform workforce development, and technology 
training must be resolved and reinvented before mere access to 
technology will allow full participation for every citizen in the 
Information Age. But Mr. President, I ask that--as we work in a 
bipartisan way to address those other vital areas of public policy-- we 
remember the lessons of our nation's economic history and take this 
absolutely critical first step towards meeting the most basic needs of 
any community--a connection to the New Economy.
  Mr. BAUCUS. Mr. President, I am very pleased today to join with 
Senator Moynihan in introducing the Broadband Internet Access Act of 
2000. This legislation provides a tax incentive to stimulate rapid 
deployment of high-speed communication services to residential, rural, 
and low-income areas.
  Although our nation continues to experience a period of unprecedented 
economic growth, it is important to remember that this growth is not 
shared evenly throughout the country. My State, Montana, is 
unfortunately an example of areas in which the economy continues to lag 
behind the rest of the nation. Montana is ranked last in per-capita 
earned income and first in the number of people holding multiple jobs. 
Our children and grandchildren are constantly faced with a difficult 
dilemma--will they be able to find jobs in Montana, where they can 
continue to enjoy living in ``the last great place'', or will they be 
forced to move elsewhere just to be able to earn a decent wage. More 
and more of them are choosing to leave, costing Montana some of her 
best and brightest young people, and along with them much of our hope 
for the future.
  One of the keys to turning our State's economy around is to make sure 
the appropriate infrastructure is in place so that we can attract the 
kinds of businesses that will provide jobs for ourselves and our 
children. I have worked for years as ranking Member of the Environment 
and Public Works Committee to ensure that Montana and other rural 
states receive our fair share of highway construction funds, so that 
the transportation infrastructure of our great State can support 
economic growth.
  But today's economy is not just about bricks and mortar. Technology 
is

[[Page S4834]]

transforming traditional ways of doing business, as it is creating 
entirely new forms of business that never existed before. And high-
speed Internet access is the key to advancing technological growth.
  The Broadband Internet Access Act of 2000 provides graduated tax 
credits for deployment of high-speed communications to residential and 
rural communities. It gives a 10 percent credit for the deployment of 
at least 1.5 million bits per second downstream and 200,000 bits per 
second upstream to all subscribers--residential, business, and 
institutions--in rural and low income areas. This is what we call the 
``current generation'' broadband. The bill also gives a 20 percent 
credit for the deployment of at least 22 million bits per second 
downstream and 10 million bits per second upstream to all subscribers 
in rural and low income areas, and to all residential customers in 
other areas. This is what we are calling ``next generation'' broadband.
  Mr. President, as we look around us today and see the many streets 
that are being torn-up to lay cables for high-speed communication, and 
the communication dishes that are constantly ``sprouting'' from our 
buildings, we may wonder why we need a tax credit to advance an 
industry that is already growing by leaps and bounds. The reason, 
again, is that this growth is most extensive in selected areas. Market 
forces are driving deployment of high-speed communication capabilities 
almost exclusively to urban businesses and wealthy households. Rural 
businesses and rural families like those in Montana again find 
themselves at the back of the line. And by the time our turn comes for 
this technology, the rest of the country will already be well into the 
next technological generation. The Digital Divide, which is already a 
wedge between our citizens, will be perpetuated and grow into a chasm.
  This bill is designed to even the playing field. By giving private 
industry economic incentives to accelerate high-speed communication 
capabilities to Americans who are at the end of the line, we will help 
people like my constituents in Montana share in our nation's economic 
growth.
  As a member of the Senate Broadband Caucus, which was established to 
develop solutions to the problem of bringing high-speed Internet access 
to rural and underserved areas, I have worked hard on initiatives which 
would help rural areas bridge the Digital Divide. These initiatives 
include: the Rural Broadband Enhancement Act, which provides $5 billion 
in low interest loans for broadband development; the Rural Telework Act 
of 2000, to provide grants to develop National Centers for Distance 
Working which would provide access to technology and training for rural 
residents; the Universal Service Support Act, which lifts the cap on 
the universal service support fund for rural telecommunications 
providers; and the amendment I offered to the Rural Television Bill, to 
give consideration to projects which offer high speed Internet access 
in addition to television programming.
  I believe these initiatives, along with the Broadband Internet Access 
Act we are introducing today, will go a long way toward finally 
bridging the growing Digital Divide and help rural areas grow and 
flourish. With this legislation, I hope to create an economic 
environment that will make sure Montana's children and grandchildren 
will no longer have to sacrifice enjoying the beauty of the ``last 
great place'' in order to earn a living wage.
                                 ______