[Congressional Record Volume 146, Number 100 (Thursday, July 27, 2000)]
[Senate]
[Pages S7849-S7850]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. WYDEN:
  S. 2960. A bill to provide for qualified withdrawals from the Capital 
Construction Fund (CCF) for fishermen leaving the industry and for the 
rollover of Capital Construction Funds to

[[Page S7850]]

individual retirement plans; to the Committee on Finance.


                the capital construction fund reform act

  Mr. WYDEN. Mr. President, I am pleased today to introduce the Capital 
Construction Fund Reform Act of 2000.
  The Capital Construction Fund (CCF) was originally created by the 
Merchant Marine Act as a way to encourage the construction and use of 
American-owned vessels in U.S. waters. For fishermen, the Capital 
Construction Fund authorizes the accumulation of funds, free from 
taxes, for the purpose of buying or refitting commercial fishing 
vessels. The program has been a success in promoting the domestic 
fishing industry. However, the usefulness of the CCF has not kept up 
with the times. Today it is actually exacerbating the problems facing 
U.S. fisheries by forcing fishermen to keep their money in fishing 
vessels, rather than allowing them to retire from fishing and pursue 
other interests.
  Our nation's fisheries are collapsing. Over the past year, fisheries 
in New England, Alaska and the West Coast have been officially declared 
disasters by the Secretary of Commerce. Plainly speaking, there are too 
many boats and not enough fish. Along the West Coast, a mere 200 of the 
1400 boats currently fishing could catch the entire allowable harvest 
of groundfish. That means we could buyout 85 percent of the boats and 
still not reduce capacity in our fisheries. Since 1995, Congress has 
appropriated $140 million to buy fishing vessels and permits back from 
fishermen. Clearly, more needs to be done. This legislation empowers 
the fisherman to make his own choices to stay or leave the fishery with 
his own money.
  In these times when we ought to be reducing the number of boats in 
our fisheries, it does not make sense for federal policy to encourage 
fishermen to build more of them. Yet current law prohibits fishermen 
from getting their own money out of CCF accounts for any purpose other 
than building boats. If they do, they lose up to 70 percent of their 
money in taxes and penalties. When fishermen have already been hit with 
increasingly severe harvest restrictions over the past few years, it is 
just not fair to hold their own money hostage.
  That is why I'm introducing a bill that makes it easier for fishermen 
to withdraw their funds from the Capital Construction Fund if they 
retire from the fishery. My bill would allow fund holders to roll their 
funds over into an Individual Retirement Account (IRA) or other 
retirement fund. It would also allow them to use their own money to 
participate in buyback programs. This bill also eliminates the tax-
penalty for withdrawals for those folks wishing to leave the industry.
  Mr. President, this bill enjoys wide support from a variety of 
organizations with an interest in our nation's fisheries. Environmental 
groups, trawlers, small boat operators and processors alike have 
expressed their enthusiasm for this legislation. I urge my colleagues 
to support the swift adoption of this bill so that our fisherman can 
start making their own choices about their businesses and lives.
  I ask unanimous consent that my statement and the bill be printed in 
the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2960

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

     SECTION 1. SHORT TITLE

       The Act may be cited as ``The Capital Construction Fund 
     (CCF) Qualified Withdrawal Act of 2000''.

     SECTION 2. EXPANSION OF PURPOSES OF THE CAPITAL CONSTRUCTION 
                   FUND BY AMENDING THE MERCHANT MARINE ACT OF 
                   1936

       Section 607(a) of the Merchant Marine Act, 1936 (46 U.S.C. 
     App. 1177(a)) is amended by striking ``of this section.'' and 
     inserting ``of this section. Any agreement entered into under 
     this section may be modified for the purpose of encouraging 
     the sustainability of the fisheries of the United States by 
     making the termination and withdrawal of a capital 
     construction fund account a qualified withdrawal if done in 
     exchange for the retirement of the related commercial fishing 
     vessels and related commercial fishing permits.''

     SECTION 3. NEW QUALIFIED WITHDRAWALS

       (a) Amendments to Merchant Marine Act of 1936.--Section 
     607(f)(1) of the Merchant Marine Act of 1936 (46 U.S.C. App. 
     1177(f)(1)) is amended:
       (1) in subparagraph (B) by striking ``vessel, or'' and 
     inserting ``vessel,''
       (2) in subparagraph (C) by striking ``vessel.'' and 
     inserting ``vessel,''
       (3) by inserting after subparagraph (C) the following new 
     subparagraphs:
       ``(D) the payment of an industry fee authorized by the 
     fishing capacity reduction program, 16 U.S.C. 1861,
       ``(E) in the case of any such person or shareholder for 
     whose benefit such fund was established, a rollover 
     contribution (within the meaning of section 408(d)(3) of the 
     Internal Revenue Code of 1986) to such person's individual 
     retirement plan (as defined in section 7701(a)(37) of such 
     Code), or
       ``(F) (i) for the payment to a corporation or person 
     terminating a capital construction fund and retiring related 
     commercial fishing vessels and permits.
       (ii) The Secretary by regulation shall establish procedures 
     to ensure that any person making a qualified withdrawal 
     authorized by (F)(i) retires the related commercial use of 
     fishing vessels and commercial fishery permits.''
       (b) Amendments to Internal Revenue Code of 1986.--Section 
     7518(e)(1) of the Internal Revenue Code of 1986 (relating to 
     purposes of qualified withdrawals) is amended by inserting 
     after subparagraph (C) the following new subparagraphs:
       ``(D) the payment of an industry fee authorized by the 
     fishing capacity reduction program, 16 U.S.C. 1861.
       ``(E) in the case of any such person or shareholder for 
     whose benefit such fund was established, a rollover 
     contribution (within the meaning of section 408(d)(3) of the 
     Internal Revenue Code of 1986) to such person's individual 
     retirement plan (as defined in section 7701(a)(37) of such 
     Code), or
       ``(F)(i) for the payment to a corporation or person 
     terminating a capital construction fund and retiring related 
     commercial fishing vessels and permits.
       (ii) The Secretary by regulation shall establish procedures 
     to ensure that any person making a qualified withdrawal 
     authorized by (F)(i) retires the related commercial use of 
     fishing vessels and commercial fishery permits.''
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