[Congressional Record Volume 147, Number 24 (Tuesday, February 27, 2001)]
[Senate]
[Pages S1618-S1638]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. SARBANES (for himself, Mr. Warner, Mrs. Murray, and Mr. 
        Campbell):
  S. 392. A bill to grant a Federal Charter to Korean War Veterans 
Association, Incorporated, and for other purposes; to the Committee on 
the Judiciary.
  Mr. SARBANES. Mr. President, today I am introducing legislation 
together with Senators Warner, Campbell, and Murray, which would grant 
a Federal Charter to the Korean War Veterans Association, Incorporated. 
This legislation recognizes and honors the 5.7 million Americans who 
fought and served during the Korean War for their struggles and 
sacrifices on behalf of freedom and the principles and ideals of our 
nation.
  The year 2000 marked the 50th Anniversary of the Korean War. In June 
1950 when the North Korea People's Army swept across the 38th Parallel 
to occupy Seoul, South Korea, members of our Armed Forces--including 
many from the State of Maryland--immediately answered the call of the 
U.N. to repel this forceful invasion. Without hesitation, these 
soldiers traveled to an unfamiliar corner of the world to join an 
unprecedented multinational force comprised of 22 countries and risked 
their lives to protect freedom. The Americans who led this 
international effort were true patriots who fought with remarkable 
courage.
  In battles such as Pork Chop Hill, the Inchon Landing and the frozen 
Chosin Reservoir, which was fought in temperatures as low as fifty-
seven degrees below zero, they faced some of the most brutal combat in 
history. By the time the fighting had ended, 8,176 Americans were 
listed as missing or prisoners of war--some of whom are still missing--
and over 36,000 Americans had died. One hundred and thirty-one Korean 
War Veterans were awarded the nation's highest commendation for combat 
bravery, the Medal of Honor. Ninety-four of these soldiers gave their 
lives in the process. There is an engraving on the Korean War Veterans 
Memorial which reflects these losses and how brutal a war this was. It 
reads, ``Freedom is not Free.'' Yet, as a Nation, we have done little 
more than establish this memorial to publicly acknowledge the bravery 
of those who fought the Korean War. The Korean War has been termed by 
many as the ``Forgotten War.'' Freedom is not free. We owe our Korean 
War Veterans a debt of gratitude. Granting this Federal charter--at no 
cost to the government--is a small expression of appreciation that we 
as a Nation can offer to these men and women, one which will enable 
them to work as a unified front to ensure that the ``Forgotten War'' is 
forgotten no more.
  The Korean War Veterans Association was originally incorporated on 
June 25, 1985. Since its first annual reunion and memorial service in 
Arlington, Virginia, where its members decided to develop a national 
focus and strong commitment to service, the association has grown 
substantially to a membership of over 17,000. A Federal charter would 
allow the Association to continue and grow its mission and further its 
charitable and benevolent causes. Specifically, it will afford the 
Korean War Veterans' Association the same status as other major 
veterans organizations and allow it to participate as part of select 
committees with other congressionally chartered veterans and military 
groups. A Federal charter will also accelerate the Association's 
``accreditation'' with the Department of Veterans Affairs which will 
enable its members to assist in processing veterans' claims.
  The Korean War Veterans have asked for very little in return for 
their service and sacrifice. I urge my colleagues to join me in 
supporting this legislation and ask that the text of the measure be 
printed in the Record immediately following my comments.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 392

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

     SECTION 1. GRANT OF FEDERAL CHARTER TO KOREAN WAR VETERANS 
                   ASSOCIATION, INCORPORATED.

       (a) Grant of Charter.--Part B of subtitle II of title 36, 
     United States Code, is amended--
       (1) by striking the following:

                   ``CHAPTER 1201--[RESERVED]''; and

       (2) by inserting the following:

     ``CHAPTER 1201--KOREAN WAR VETERANS ASSOCIATION, INCORPORATED

``Sec.
``120101. Organization.
``120102. Purposes.
``120103. Membership.
``120104. Governing body.
``120105. Powers.
``120106. Restrictions.
``120107. Duty to maintain corporate and tax-exempt status.
``120108. Records and inspection.
``120109. Service of process.
``120110. Liability for acts of officers and agents.
``120111. Annual report.

     ``Sec. 120101. Organization

       ``(a) Federal Charter.--Korean War Veterans Association, 
     Incorporated (in this chapter, the `corporation'), 
     incorporated in the State of New York, is a federally 
     chartered corporation.
       ``(b) Expiration of Charter.--If the corporation does not 
     comply with the provisions of this chapter, the charter 
     granted by subsection (a) expires.

     ``Sec. 120102. Purposes

       ``The purposes of the corporation are as provided in its 
     articles of incorporation and include--
       ``(1) organizing, promoting, and maintaining for benevolent 
     and charitable purposes an association of persons who have 
     seen honorable service in the Armed Forces during the Korean 
     War, and of certain other persons;
       ``(2) providing a means of contact and communication among 
     members of the corporation;
       ``(3) promoting the establishment of, and establishing, war 
     and other memorials commemorative of persons who served in 
     the Armed Forces during the Korean War; and
       ``(4) aiding needy members of the corporation, their wives 
     and children, and the widows and children of persons who were 
     members of the corporation at the time of their death.

     ``Sec. 120103. Membership

       ``Eligibility for membership in the corporation, and the 
     rights and privileges of members of the corporation, are as 
     provided in the bylaws of the corporation.

     ``Sec. 120104. Governing body

       ``(a) Board of Directors.--The board of directors of the 
     corporation, and the responsibilities of the board of 
     directors, are as provided in the articles of incorporation 
     of the corporation.

[[Page S1619]]

       ``(b) Officers.--The officers of the corporation, and the 
     election of the officers of the corporation, are as provided 
     in the articles of incorporation.

     ``Sec. 120105. Powers

       ``The corporation has only the powers provided in its 
     bylaws and articles of incorporation filed in each State in 
     which it is incorporated.

     ``Sec. 120106. Restrictions

       ``(a) Stock and Dividends.--The corporation may not issue 
     stock or declare or pay a dividend.
       ``(b) Political Activities.--The corporation, or a director 
     or officer of the corporation as such, may not contribute to, 
     support, or participate in any political activity or in any 
     manner attempt to influence legislation.
       ``(c) Loan.--The corporation may not make a loan to a 
     director, officer, or employee of the corporation.
       ``(d) Claim of Governmental Approval or Authority.--The 
     corporation may not claim congressional approval, or the 
     authority of the United States, for any of its activities.

     ``Sec. 120107. Duty to maintain corporate and tax-exempt 
       status

       ``(a) Corporate Status.--The corporation shall maintain its 
     status as a corporation incorporated under the laws of the 
     State of New York.
       ``(b) Tax-Exempt Status.--The corporation shall maintain 
     its status as an organization exempt from taxation under the 
     Internal Revenue Code of 1986 (26 U.S.C. 1 et seq.).

     ``Sec. 120108. Records and inspection

       ``(a) Records.--The corporation shall keep--
       ``(1) correct and complete records of account;
       ``(2) minutes of the proceedings of its members, board of 
     directors, and committees having any of the authority of its 
     board of directors; and
       ``(3) at its principal office, a record of the names and 
     addresses of its members entitled to vote on matters relating 
     to the corporation.
       ``(b) Inspection.--A member entitled to vote on matters 
     relating to the corporation, or an agent or attorney of the 
     member, may inspect the records of the corporation for any 
     proper purpose, at any reasonable time.

     ``Sec. 120109. Service of process

       ``The corporation shall have a designated agent in the 
     District of Columbia to receive service of process for the 
     corporation. Notice to or service on the agent is notice to 
     or service on the Corporation.

     ``Sec. 120110. Liability for acts of officers and agents

       ``The corporation is liable for the acts of its officers 
     and agents acting within the scope of their authority.

     ``Sec. 120111. Annual report

       ``The corporation shall submit an annual report to Congress 
     on the activities of the corporation during the preceding 
     fiscal year. The report shall be submitted at the same time 
     as the report of the audit required by section 10101 of this 
     title. The report may not be printed as a public document.''.
       (b) Clerical Amendment.--The table of chapters at the 
     beginning of subtitle II of title 36, United States Code, is 
     amended by striking the item relating to chapter 1201 and 
     inserting the following new item:

``1201. Korean War Veterans Association, Incorporated.....120101''.....

                                 ______
                                 
      By Mr. FRIST (for himself and Mr. Torricelli):
  S. 393. A bill to amend the Internal Revenue Code of 1986 to 
encourage charitable contributions to public charities for use in 
medical research, to the Committee on Finance.
  Mr. FRIST. Mr. President, I rise today to introduce bipartisan 
legislation, the Paul Coverdell Medical Research Investment Act.
  Under the current tax code, deductible charitable cash gifts to 
support medical research are limited to 50% of an individual's adjusted 
gross income. This bill would simply increase the deductibility of cash 
gifts for medical research to 80 percent of an individual's adjusted 
gross income. For those individuals who are willing and able to give 
more than 80 percent of their income, the bill also extends the period 
an individual can carry the deduction forward for excess charitable 
gifts from five years to ten years.
  In what is perhaps the most important change for today's economy, the 
bill allows taxpayers to donate stock without being penalized for it. 
Americans regularly donate stock acquired through a stock option plan 
to their favorite charity. And often they make the donation within a 
year of exercising their stock options. But current law penalizes these 
donations by taxing them as ordinary income or as capital gain. These 
taxes can run as high as 40 percent, which acts as a disincentive to 
contribute to charities. How absurd that someone who donates $1,000 to 
a charity has to sell $1,400 of stock to pay for it. The person could 
wait a year and give the stock then, but why delay the contribution 
when that money can be put to work curing disease today. The Paul 
Coverdell MRI Act is premised on a simple truth: people should not be 
penalized for helping others.
  PriceWaterhouseCoopers, relying on IRS data and studies of charitable 
giving, conducted a study on the effects of the Paul Coverdell MRI Act. 
It concluded that if the proposal were in effect last year there would 
have been a 4.0 percent to 4.5 percent increase in individual giving in 
2000. This amounts to $180.4 million additional dollars in charitable 
donations for medical research dollars that would result in tangible 
health benefits to all Americans. If the additional giving grew every 
year over five years at the same rate as national income, a billion 
dollars more would be put to work to cure disease. Over the course of 
ten years, the number jumps to $2.3 billion in new money for medical 
research. For many research efforts, that money could mean the 
difference between finding a cure or not finding a cure.
  The returns from increased funding of medical research not only in 
economic sayings to the country, but in terms of curing disease and 
finding new treatments could be enormous. The amount and impact of 
disease in this country is staggering. Each day more than 1,500 
Americans die of cancer. Sixteen million people have diabetes, their 
lives are shortened by an average of fifteen years. Cardiovascular 
diseases take approximately one million American lives a year. One and 
a half million people have Parkinson's Disease. Countless families 
suffer with the pain of a loved one who has Alzheimer's. And yet these 
diseases go without a cure. We must work towards the day when they are 
cured, prevented, or eliminated--just like polio and smallpox were 
years ago.
  Increased funding of medical research by the private sector is needed 
to save and improve American lives. New discoveries in science and 
technology are creating even greater opportunities than in the past for 
large returns from money invested in medical research. The mapping of 
the human genome is but one example. Dr. Abraham Lieberman, a 
neurologist at the National Parkinson's Foundation, was quoted in 
Newsweek as saying that the medical research community today is 
``standing at the same threshold that we reached with infectious 
disease 100 years ago.''
  The Paul Coverdell MRI Act encourages the financial gifts that will 
enable that threshold to be overcome. I hope you will join me in 
supporting it.
  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. 393

       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 ``Paul Coverdell Medical 
     Research Investment Act of 2001''.

     SEC. 2. INCREASE IN LIMITATION ON CHARITABLE DEDUCTION FOR 
                   CONTRIBUTIONS FOR MEDICAL RESEARCH.

       (a) In General.--Paragraph (1) of section 170(b) of the 
     Internal Revenue Code of 1986 (relating to percentage 
     limitations) is amended by adding at the end the following 
     new subparagraph:
       ``(G) Special limitation with respect to certain 
     contributions for medical research.--
       ``(i) In general.--Any medical research contribution shall 
     be allowed to the extent that the aggregate of such 
     contributions does not exceed the lesser of--

       ``(I) 80 percent of the taxpayer's contribution base for 
     any taxable year, or
       ``(II) the excess of 80 percent of the taxpayer's 
     contribution base for the taxable year over the amount of 
     charitable contributions allowable under subparagraphs (A) 
     and (B) (determined without regard to subparagraph (C)).

       ``(ii) Carryover.--If the aggregate amount of contributions 
     described in clause (i) exceeds the limitation of such 
     clause, such excess shall be treated (in a manner consistent 
     with the rules of subsection (d)(1)) as a medical research 
     contribution in each of the 10 succeeding taxable years in 
     order of time.
       ``(iii) Treatment of capital gain property.--In the case of 
     any medical research contribution of capital gain property 
     (as defined in subparagraph (C)(iv)), subsection (e)(1) shall 
     apply to such contribution.
       ``(iv) Medical research contribution.--For purposes of this 
     subparagraph, the term `medical research contribution' means 
     a charitable contribution--

       ``(I) to an organization described in clauses (ii), (iii), 
     (v), or (vi) of subparagraph (A), and

[[Page S1620]]

       ``(II) which is designated for the use of conducting 
     medical research.

       ``(v) Medical research.--For purposes of this subparagraph, 
     the term `medical research' has the meaning given such term 
     under the regulations promulgated under subparagraph (A)(ii), 
     as in effect on the date of the enactment of this 
     subparagraph.''.
       (b) Conforming Amendments.--
       (1) Section 170(b)(1)(A) of the Internal Revenue Code of 
     1986 is amended in the matter preceding clause (i) by 
     inserting ``(other than a medical research contribution)'' 
     after ``contribution''.
       (2) Section 170(b)(1)(B) of such Code is amended by 
     inserting ``or a medical research contribution'' after 
     ``applies''.
       (3) Section 170(b)(1)(C)(i) of such Code is amended by 
     striking ``subparagraph (D)'' and inserting ``subparagraph 
     (D) or (G)''.
       (4) Section 170(b)(1)(D)(i) of such Code is amended--
       (A) in the matter preceding subclause (I), by inserting 
     ``or a medical research contribution'' after ``applies'', and
       (B) in the second sentence, by inserting ``(other than 
     medical research contributions)'' before the period.
       (5) Section 545(b)(2) of such Code is amended by striking 
     ``and (D)'' and inserting ``(D), and (G)''.
       (6) Section 556(b)(2) of such Code is amended by striking 
     ``and (D)'' and inserting ``(D), and (G)''.
       (c) Effective Date.--The amendments made by this section 
     shall apply--
       (1) to contributions made in taxable years beginning after 
     December 31, 2001, and
       (2) to contributions made on or before December 31, 2001, 
     but only to the extent that a deduction would be allowed 
     under section 170 of the Internal Revenue Code of 1986 for 
     taxable years beginning after December 31, 2000, had section 
     170(b)(1)(G) of such Code (as added by this section) applied 
     to such contributions when made.

     SEC. 3. TREATMENT OF CERTAIN INCENTIVE STOCK OPTIONS.

       (a) AMT Adjustments.--Section 56(b)(3) of the Internal 
     Revenue Code of 1986 (relating to treatment of incentive 
     stock options) is amended--
       (1) by striking ``Section 421'' and inserting the 
     following:
       ``(A) In general.--Except as provided in subparagraph (B), 
     section 421'', and
       (2) by adding at the end the following new subparagraph:
       ``(B) Exception for certain medical research stock.--

       ``(i) In general.--This paragraph shall not apply in the 
     case of a medical research stock transfer.
       ``(ii) Medical research stock transfer.--For purposes of 
     clause (i), the term `medical research stock transfer' means 
     a transfer--

       ``(I) of stock which is traded on an established securities 
     market,
       (II) of stock which is acquired pursuant to the exercise of 
     an incentive stock option within the same taxable year as 
     such transfer occurs, and
       ``(III) which is a medical research contribution (as 
     defined in section 170(b)(1)(G)(iv)).''.
       (b) Nonrecognition of Certain Incentive Stock Options.--
     Section 422(c) of the Internal Revenue Code of 1986 (relating 
     to special rules) is amended by adding at the end the 
     following new paragraph:
       ``(8) Medical research contributions.--For purposes of this 
     section and section 421, the transfer of a share of stock 
     which is a medical research stock transfer (as defined in 
     section 56(b)(3)(B)) shall be treated as meeting the 
     requirements of subsection (a)(1).''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to transfers of stock made after the date of the 
     enactment of this Act.
                                 ______
                                 
      By Mr. DOMENICI:
  S. 394. A bill to make an urgent supplemental appropriation for 
fiscal year 2001 for the Department of Defense for the Defense Health 
Program; to the Committee on Appropriations.
  Mr. DOMENICI. Mr. President, as many Senators know, there has been a 
major problem in funding for health care for military families and 
military retirees since 1993. Budgets for the Defense Health Program 
have been submitted to Congress without requesting enough spending to 
cover all known medical and health care expenses.
  This problem has been recurring year after year because budget 
officials in the Department of Defense had been ``low balling'' their 
predictions of inflation in DoD's Defense Health Program; they have 
projected medical inflation at or below the overall economy's rate. 
Meanwhile, medical care costs have grown well above the national 
inflation rate.
  Since 1996 DoD has projected an average annual inflation rate of 1.8 
percent in the Defense Health Program, but the actual average rate over 
that time period is 4.9 percent.
  Just last year, DoD predicted 2.1 percent inflation for the Defense 
Health Program in 2001; experts are predicting the rate to be 7.9 
percent.
  This unacceptable budgeting practice has resulted in expenses being 
incurred but no funds to pay the bills. Congress has responded by 
funding these gaps with additional spending, usually in emergency 
supplemental appropriations bills.
  While we have addressed the problem when we ultimately learn the size 
of the funding gap, the inappropriate budgeting practices of the past 
have had a major negative impact on military service men and women, 
military retirees, and the dependents of both.
  When military medical personnel and civilian providers do not know if 
or when they will receive full funding, appointments for healthcare can 
be complicated, and the services rendered can be delayed or degraded. A 
system that many already find troublesome can become exasperating.
  This problem is not small; it directly affects an active beneficiary 
population of almost six million, including 1.5 million active duty 
servicemen and women, 1 million retirees, and 3.3 family dependents.
  For several years the problem has been growing, from approximately 
$240 million in 1994 to as much as $1.3 billion in fiscal year 2000. 
Coincident with the enactment of ``Tricare for Life'' and other new 
health care benefits in the Defense Authorization Act for 2001, the 
problem has remained at this all time high level and is currently 
estimated to be $1.2 billion for 2001. Some predict it may ultimately 
be $1.4 billion before the year is over.
  President Bush has already pledged that he will fully fund Tricare 
costs in 2002 at an estimated $3.9 billion, and I have every 
expectation that with the proper advice he will also fully fund all 
2002 Defense Health Program costs. However, the earlier 2001 funding 
gap remains, and I believe Congress can and should act as promptly as 
possible to fully fund all known costs.
  Accordingly, I am introducing legislation to provide a supplemental 
appropriation of the currently estimated $1.2 billion for the Defense 
Health Program for 2001.
  Because the money is needed on an urgent basis, I will discuss how we 
can address this matter with the Chairman of the Senate Appropriations 
Committee when he convenes a meeting of the Defense Subcommittee on 
February 28 to conduct hearings on the Military Health System. I fully 
expect that we will act as promptly as possible and in time to address 
real needs.

  I am also announcing four specific recommendations for the Defense 
Health Program I will make as Chairman of the Senate Budget Committee 
for the 2002 congressional budget resolution:
  Sufficient budget authority and outlays to enable the enactment of 
the 2001 appropriations legislation I am introducing today.
  An additional $1.4 billion in fiscal year 2002 to accommodate actual 
inflation in DoD health care, rather than the unrealistic under-
estimate left by the officials of the outgoing Administration.
  To accommodate future inflation, the budget resolution will also 
provide the requisite amounts of budget authority and outlays to 
accommodate 5 percent inflation for the next ten years. While I have 
every expectation that President Bush and Secretary of Defense Rumsfeld 
will address this underfunding in the 2002 budget, I am adding these 
amounts, totaling $18 billion over 10 years, just in case their review 
of the defense budget has not yet addressed the unacceptable budgeting 
practices of the past.
  In its current estimates, the Congressional Budget Office has not 
included additional discretionary spending in its ``baseline'' for the 
``Tricare for Life'' program. The technical reasons for this are 
esoteric, but the money is substantial, $9.8 billion over 10 years. If 
this money were not also added now, we would just be engaging in 
another form of underfunding.
  Congress and the executive branch have made various promises to both 
active duty and retired military personnel for their healthcare and the 
healthcare of their dependents. It is unacceptable to make these 
promises but not to include in the budget the money required to make 
good on them. The steps I am taking today are the first steps toward 
making that happen.
                                 ______
                                 
      By Mr. BOND (for himself and Mr. Kerry):
  S. 395. A bill to ensure the independence and nonpartisan operation 
of the

[[Page S1621]]

Office of Advocacy of the Small Business Administration; to the 
Committee on Small Business.
  Mr. BOND. Mr. President, I rise in support of the Independent Office 
of Advocacy Act of 2001. This bill is designed to build on the success 
achieved by the Office of Advocacy over the past 24 years. It is 
intended to strengthen that foundation to make the Office of Advocacy a 
stronger, more effective advocate for all small businesses throughout 
the United States. This bill was approved unanimously by the Senate 
during the 106th Congress; however, it was not taken up in the House of 
Representatives prior to the adjournment last month. It is my 
understanding the House Committee on Small Business under its new 
chairman, Don Manzullo, is likely to act on similar legislation this 
year.
  The Office of Advocacy is a unique office within the Federal 
Government. It is part of the Small Business Administration, SBA/
Agency, and its director, the Chief Counsel for Advocacy, is nominated 
by the President and confirmed by the Senate. At the same time, the 
Office is also intended to be the independent voice for small business 
within the Federal Government. It is supposed to develop proposals for 
changing government policies to help small businesses, and it is 
supposed to represent the views and interests of small businesses 
before other Federal agencies.
  As the director of the Office of Advocacy, the Chief Counsel for 
Advocacy has a dual responsibility. On the one hand, he is the 
independent watchdog for small business. On the other hand, he is also 
a part of the President's administration. As you can imagine, those are 
sometimes difficult roles to play simultaneously.
  The Independent Office of Advocacy Act of 2001 would make the Office 
of Advocacy and the Chief Counsel for Advocacy a fully independent 
advocate within the executive branch acting on behalf of the small 
business community. The bill would establish a clear mandate that the 
Office of Advocacy will fight on behalf of small businesses regardless 
of the position taken on critical issues by the President and his 
administration.
  The Independent Office of Advocacy Act of 2001 would direct the Chief 
Counsel to submit an annual report on Federal agency compliance with 
the Regulatory Flexibility Act to the President and the Senate and 
House Committees on Small Business. The Reg Flex Act is a very 
important weapon in the war against the over-regulation of small 
businesses. When the Senate first debated this bill in the 106th 
Congress, I offered an amendment at the request of Senator Fred 
Thompson, chairman of the Government Affairs Committee, that would 
direct the Chief Counsel for Advocacy to send a copy of the report to 
the Senate Government Affairs Committee. In addition, my amendment also 
required that copies of the report be sent to the House Committee on 
Government Reform and the House and Senate Committees on the Judiciary. 
I believe these changes make good sense for each of the committees to 
receive this report on Reg Flex compliance, and I have included them in 
the version of the bill being introduced and debated today.
  The Office of Advocacy as envisioned by the Independent Office of 
Advocacy Act 2001 would be unique within the executive branch. The 
Chief Counsel for Advocacy would be a wide-ranging advocate, who would 
be free to take positions contrary to the administration's policies and 
to advocate change in government programs and attitudes as they impact 
small businesses. During its consideration of the bill in 1999, the 
Committee on Small Business adopted unanimously an amendment I offered, 
which was cosponsored by Senator John Kerry, the committee's ranking 
Democrat, to require the Chief Counsel to be appointed ``from civilian 
life.'' This qualification is intended to emphasize that the person 
nominated to serve in this important role should have a strong small 
business background.
  In 1976, Congress established the Office of Advocacy in the SBA to be 
the eyes, ears and voice for small business within the Federal 
Government. Over time, it has been assumed that the Office of Advocacy 
is the ``independent'' voice for small business. While I strongly 
believe that the Office of Advocacy and the Chief Counsel should be 
independent and free to advocate or support positions that might be 
contrary to the administration's policies, I have come to find that the 
Office has not been as independent as necessary to do the job for small 
business.
  For example, funding for the Office of Advocacy comes from the 
salaries and expense account of the SBA's budget. Staffing is allocated 
by the SBA Administrator to the Office of Advocacy from the overall 
staff allocation for the Agency. In 1990, there were 70 full-time 
employees working on behalf of small businesses in the Office of 
Advocacy. Today's allocation of staff is 49, and fewer are actually on-
board as the result of the longstanding hiring freeze at the SBA. The 
independence of the Office is diminished when the Office of Advocacy 
staff is reduced to allow for increased staffing for new programs and 
additional initiatives in other areas of SBA, at the discretion of the 
Administrator.
  In addition, the General Accounting Office, GAO, undertook a report 
for me on personnel practices at the SBA, GAO/GGD-99-68. I was alarmed 
by the GAO's finding that during the past eight years, the Assistant 
Advocates and Regional Advocates hired by the Office of Advocacy shared 
many of the attributes of schedule C political appointees. In fact 
Regional Advocates are frequently cleared by the White House personnel 
office--the same procedure followed for approving Schedule C political 
appointees.

  The facts discussed in the GAO report cast the Office of Advocacy in 
a whole new light. The report raised questions, concerns and suspicions 
regarding the independence of the Office of Advocacy. Has there been a 
time when the Office did not pursue a matter as vigorously as it might 
have were it not for direct or indirect political influence? Prior to 
receipt of the GAO Report, my response was a resounding ``No.'' But 
since receipt of the GAO report, a question mark arises.
  Let me take a moment and note that I will be unrelenting in my 
efforts to insure the complete independence of the Office of Advocacy 
in all matters, at all times, for the continued benefit of all small 
businesses. However, so long as the administration controls the budget 
allocated to the Office of Advocacy and controls who is hired, the 
independence of the Office may be in jeopardy. We must correct this 
situation, and the sooner we do it, the better it will be for the small 
business community. As our government is changing over to President 
Bush's administration, this would be a opportune time to establish, 
once and for all, the actual independence of the Office of Advocacy.
  The Independent Office of Advocacy Act of 2001 builds a firewall to 
prevent the political intrusion into the management of day-to-day 
operations of the Office of Advocacy. The bill would require that the 
SBA's budget include a separate account for the Office of Advocacy. No 
longer would its funds come from the general operating account of the 
Agency. The separate account would also provide for the number of full-
time employees who would work within the Office of Advocacy. No longer 
would the Chief Counsel for Advocacy have to seek approval from the SBA 
Administrator to hire staff for the Office of Advocacy.
  The bill would also continue the practice of allowing the Chief 
Counsel to hire individuals critical to the mission of the Office of 
Advocacy without going through the normal competitive procedures 
directed by federal law and the Office of Personnel Management, (OPM). 
I believe this special hiring authority, which is limited only to 
employees within the Office of Advocacy, is beneficial because it 
allows the Chief Council to hire quickly those persons who can best 
asset the Office in responding to changing issues and problems 
confronting small businesses.
  Mr. President, the Independent Office of Advocacy Act is a sound 
bill. It is the product of a great deal of thoughtful, objective review 
and consideration by me, the staff of the Committee on Small Business, 
representatives of the small business community, former Chief Counsels 
for Advocacy and others. These individuals have also devoted much time 
and effort in actively participating in a committee roundtable 
discussion on the Office of Advocacy, which my committee held on April 
21, 1999. As I stated earlier, the

[[Page S1622]]

Committee on Small Business approved this bill by a unanimous 17-0 
vote, and it was later approved unanimously by the Senate. I urge each 
of my colleagues to review this legislation closely.
  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. 395

       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 ``Independent Office of 
     Advocacy Act of 2001''.

     SEC. 2. FINDINGS.

       The Congress finds that--
       (1) excessive regulations continue to burden United States 
     small businesses;
       (2) Federal agencies are reluctant to comply with the 
     requirements of chapter 6 of title 5, United States Code, and 
     continue to propose regulations that impose disproportionate 
     burdens on small businesses;
       (3) the Office of Advocacy of the Small Business 
     Administration (referred to in this Act as the ``Office'') is 
     an effective advocate for small businesses that can help to 
     ensure that agencies are responsive to small businesses and 
     that agencies comply with their statutory obligations under 
     chapter 6 of title 5, United States Code, and under the Small 
     Business Regulatory Enforcement Fairness Act of 1996 (Public 
     Law 104-121; 106 Stat. 4249 et seq.);
       (4) the independence of the Office is essential to ensure 
     that it can serve as an effective advocate for small 
     businesses without being restricted by the views or policies 
     of the Small Business Administration or any other executive 
     branch agency;
       (5) the Office needs sufficient resources to conduct the 
     research required to assess effectively the impact of 
     regulations on small businesses; and
       (6) the research, information, and expertise of the Office 
     make it a valuable adviser to Congress as well as the 
     executive branch agencies with which the Office works on 
     behalf of small businesses.

     SEC. 3. PURPOSES.

       The purposes of this Act are--
       (1) to ensure that the Office has the statutory 
     independence and adequate financial resources to advocate for 
     and on behalf of small business;
       (2) to require that the Office report to the Chairmen and 
     Ranking Members of the Committees on Small Business of the 
     Senate and the House of Representatives and the Administrator 
     of the Small Business Administration in order to keep them 
     fully and currently informed about issues and regulations 
     affecting small businesses and the necessity for corrective 
     action by the regulatory agency or the Congress;
       (3) to provide a separate authorization for appropriations 
     for the Office;
       (4) to authorize the Office to report to the President and 
     to the Congress regarding agency compliance with chapter 6 of 
     title 5, United States Code; and
       (5) to enhance the role of the Office pursuant to chapter 6 
     of title 5, United States Code.

     SEC. 4. OFFICE OF ADVOCACY.

       (a) In General.--Title II of Public Law 94-305 (15 U.S.C. 
     634a et seq.) is amended by striking sections 201 through 203 
     and inserting the following:

     ``SEC. 201. SHORT TITLE.

       ``This title may be cited as the `Office of Advocacy Act'.

     ``SEC. 202. DEFINITIONS.

       ``In this title--
       ``(1) the term `Administration' means the Small Business 
     Administration;
       ``(2) the term `Administrator' means the Administrator of 
     the Small Business Administration;
       ``(3) the term `Chief Counsel' means the Chief Counsel for 
     Advocacy appointed under section 203; and
       ``(4) the term `Office' means the Office of Advocacy 
     established under section 203.

     ``SEC. 203. ESTABLISHMENT OF OFFICE OF ADVOCACY.

       ``(a) Establishment.--
       ``(1) In general.--There is established in the 
     Administration an Office of Advocacy.
       ``(2) Appropriation requests.--Each appropriation request 
     prepared and submitted by the Administration under section 
     1108 of title 31, United States Code, shall include a 
     separate request relating to the Office.
       ``(b) Chief Counsel for Advocacy.--
       ``(1) In general.--The management of the Office shall be 
     vested in a Chief Counsel for Advocacy, who shall be 
     appointed from civilian life by the President, by and with 
     the advice and consent of the Senate, without regard to 
     political affiliation and solely on the ground of fitness to 
     perform the duties of the office.
       ``(2) Employment restriction.--The individual appointed to 
     the office of Chief Counsel may not serve as an officer or 
     employee of the Administration during the 5-year period 
     preceding the date of appointment.
       ``(3) Removal.--The Chief Counsel may be removed from 
     office by the President, and the President shall notify the 
     Congress of any such removal not later than 30 days before 
     the date of the removal, except that 30-day prior notice 
     shall not be required in the case of misconduct, neglect of 
     duty, malfeasance, or if there is reasonable cause to believe 
     that the Chief Counsel has committed a crime for which a 
     sentence of imprisonment can be imposed.
       ``(c) Primary Functions.--The Office shall--
       ``(1) examine the role of small business concerns in the 
     economy of the United States and the contribution that small 
     business concerns can make in improving competition, 
     encouraging economic and social mobility for all citizens, 
     restraining inflation, spurring production, expanding 
     employment opportunities, increasing productivity, promoting 
     exports, stimulating innovation and entrepreneurship, and 
     providing the means by which new and untested products and 
     services can be brought to the marketplace;
       ``(2) assess the effectiveness of Federal subsidy and 
     assistance programs for small business concerns and the 
     desirability of reducing the emphasis on those programs and 
     increasing the emphasis on general assistance programs 
     designed to benefit all small business concerns;
       ``(3) measure the direct costs and other effects of 
     government regulation of small business concerns, and make 
     legislative, regulatory, and nonlegislative proposals for 
     eliminating the excessive or unnecessary regulation of small 
     business concerns;
       ``(4) determine the impact of the tax structure on small 
     business concerns and make legislative, regulatory, and other 
     proposals for altering the tax structure to enable all small 
     business concerns to realize their potential for contributing 
     to the improvement of the Nation's economic well-being;
       ``(5) study the ability of financial markets and 
     institutions to meet small business credit needs and 
     determine the impact of government demands on credit for 
     small business concerns;
       ``(6) determine financial resource availability and 
     recommend, with respect to small business concerns, methods 
     for--
       ``(A) delivery of financial assistance to minority and 
     women-owned enterprises, including methods for securing 
     equity capital;
       ``(B) generating markets for goods and services;
       ``(C) providing effective business education, more 
     effective management and technical assistance, and training; 
     and
       ``(D) assistance in complying with Federal, State, and 
     local laws;
       ``(7) evaluate the efforts of Federal agencies and the 
     private sector to assist minority and women-owned small 
     business concerns;
       ``(8) make such recommendations as may be appropriate to 
     assist the development and strengthening of minority, women-
     owned, and other small business concerns;
       ``(9) recommend specific measures for creating an 
     environment in which all businesses will have the 
     opportunity--
       ``(A) to compete effectively and expand to their full 
     potential; and
       ``(B) to ascertain any common reasons for small business 
     successes and failures;
       ``(10) to determine the desirability of developing a set of 
     rational, objective criteria to be used to define small 
     business, and to develop such criteria, if appropriate;
       ``(11) make recommendations and submit reports to the 
     Chairmen and Ranking Members of the Committees on Small 
     Business of the Senate and the House of Representatives and 
     the Administrator with respect to issues and regulations 
     affecting small business concerns and the necessity for 
     corrective action by the Administrator, any Federal 
     department or agency, or the Congress; and
       ``(12) evaluate the efforts of each department and agency 
     of the United States, and of private industry, to assist 
     small business concerns owned and controlled by veterans, as 
     defined in section 3(q) of the Small Business Act (15 U.S.C. 
     632(q)), and small business concerns owned and controlled by 
     serviced-disabled veterans, as defined in such section 3(q), 
     and to provide statistical information on the utilization of 
     such programs by such small business concerns, and to make 
     appropriate recommendations to the Administrator and to the 
     Congress in order to promote the establishment and growth of 
     those small business concerns.
       ``(d) Additional Functions.--The Office shall, on a 
     continuing basis--
       ``(1) serve as a focal point for the receipt of complaints, 
     criticisms, and suggestions concerning the policies and 
     activities of the Administration and any other department or 
     agency of the Federal Government that affects small business 
     concerns;
       ``(2) counsel small business concerns on the means by which 
     to resolve questions and problems concerning the relationship 
     between small business and the Federal Government;
       ``(3) develop proposals for changes in the policies and 
     activities of any agency of the Federal Government that will 
     better fulfill the purposes of this title and communicate 
     such proposals to the appropriate Federal agencies;
       ``(4) represent the views and interests of small business 
     concerns before other Federal agencies whose policies and 
     activities may affect small business;
       ``(5) enlist the cooperation and assistance of public and 
     private agencies, businesses, and other organizations in 
     disseminating information about the programs and services 
     provided by the Federal Government that are of benefit to 
     small business concerns, and information on the means by 
     which small

[[Page S1623]]

     business concerns can participate in or make use of such 
     programs and services; and
       ``(6) carry out the responsibilities of the Office under 
     chapter 6 of title 5, United States Code.
       ``(e) Overhead and Administrative Support.--The 
     Administrator shall provide the Office with appropriate and 
     adequate office space at central and field office locations 
     of the Administration, together with such equipment, office 
     supplies, and communications facilities and services as may 
     be necessary for the operation of such offices, and shall 
     provide necessary maintenance services for such offices and 
     the equipment and facilities located therein.''.
       (b) Reports to Congress.--Title II of Public Law 94-305 (15 
     U.S.C. 634a et seq.) is amended by striking section 206 and 
     inserting the following:

     ``SEC. 206. REPORTS TO CONGRESS.

       ``(a) Annual Reports.--Not less than annually, the Chief 
     Counsel shall submit to the President and to the Committees 
     on Small Business of the Senate and the House of 
     Representatives, the Committee on Governmental Affairs of the 
     Senate, the Committee on Government Reform of the House of 
     Representatives, and the Committees on the Judiciary of the 
     Senate and the House of Representatives a report on agency 
     compliance with chapter 6 of title 5, United States Code.
       ``(b) Additional Reports.--In addition to the reports 
     required under subsection (a) of this section and section 
     203(c)(11), the Chief Counsel may prepare and publish such 
     reports as the Chief Counsel determines to be appropriate.
       ``(c) Prohibition.--No report under this title shall be 
     submitted to the Office of Management and Budget or to any 
     other department or agency of the Federal Government for any 
     purpose before submission of the report to the President and 
     to the Congress.''.
       (c) Authorization of Appropriations.--Title II of Public 
     Law 94-305 (15 U.S.C. 634a et seq.) is amended by striking 
     section 207 and inserting the following:

     ``SEC. 207. AUTHORIZATION OF APPROPRIATIONS.

       ``(a) In General.--There are authorized to be appropriated 
     to the Office to carry out this title such sums as may be 
     necessary for each fiscal year.
       ``(b) Availability.--Any amount appropriated under 
     subsection (a) shall remain available, without fiscal year 
     limitation, until expended.''.
       (d) Incumbent Chief Counsel for Advocacy.--The individual 
     serving as the Chief Counsel for Advocacy of the Small 
     Business Administration on the date of enactment of this Act 
     shall continue to serve in that position after such date in 
     accordance with section 203 of the Office of Advocacy Act, as 
     amended by this section.

  Mr. KERRY. Mr. President, I am pleased to join with my friend and 
colleague, Chairman of the Senate Committee on Small Business, Kit 
Bond, in introducing the ``Independent Office of Advocacy Act.'' This 
legislation will help ensure the Small Business Administration's (SBA) 
Office of Advocacy has the necessary autonomy to remain an independent 
voice for America's small businesses. I would like to thank the 
Chairman and his staff for working with me and my staff to make the 
necessary changes to this legislation to garner bipartisan support.
  This legislation is similar to a bill introduced by Chairman Bond, 
which I supported, during the 106th Congress. While this legislation 
received strong support in the Senate Committee on Small Business and 
on the floor of the Senate, the House did not take any action. I am 
hopeful that this legislation will be enacted during the 107th 
Congress.
  The Independent Office of Advocacy Act rewrites the law that created 
the Small Business Administration's Office of Advocacy to allow for 
increased autonomy. It reaffirms the Office's statutory and financial 
independence by preventing the President from firing the advocate 
without 30 days prior notice to Congress and by creating a separate 
authorization for the Office from that of SBA's. It also states that 
the Chief Counsel shall be appointed without regard to political 
affiliation, and shall not have served in the Administration for a 
period of 5 years prior to the date of appointment.
  The legislation also makes women-owned businesses an equal priority 
of the Office of Advocacy by adding women-owned business to the primary 
functions of the Office of Advocacy, wherever minority owned business 
appears. It also adds new reporting requirements and additional 
functions to the Office of Advocacy with regard to enforcement of the 
Small Business Regulatory Enforcement Fairness Act, SBREFA. The 
provisions regarding SBREFA are already a part of existing law in 
Chapter 6 Title 5 of US Code, and will now, rightly, be added to the 
statute establishing the Office of Advocacy.
  But at its heart, this legislation will allow the Office of Advocacy 
to better represent small business interests before Congress, Federal 
agencies, and the Federal Government without fear of reprisal for 
disagreeing with the position of the current Administration.
  For those of my colleagues without an intimate knowledge of the 
important role the Office of Advocacy and its Chief Counsel play in 
protecting and promoting America's small businesses, I will briefly 
elaborate its important functions and achievements. From studying the 
role of small business in the U.S. economy, to promoting small business 
exports, to lightening the regulatory burden of small businesses 
through the Regulatory Flexibility Act (RFA) and the Small Business 
Regulatory Enforcement Fairness Act, SBREFA, the Office of Advocacy has 
a wide scope of authority and responsibility.
  The U.S. Congress created the Office of Advocacy, headed by a Chief 
Counsel to be appointed by the President from the private sector and 
confirmed by the Senate, in June of 1976. The rationale was to give 
small businesses a louder voice in the councils of government.
  Each year, the Office of Advocacy works to facilitate meetings for 
small business people with congressional staff and executive branch 
officials, and convenes ad hoc issue-specific meetings to discuss small 
business concerns. It has published numerous reports, compiled vast 
amounts of data and successfully lightened the regulatory burden on 
America's small businesses. In the area of contracting, the Office of 
Advocacy developed PRO- Net, a database of small businesses used by 
contracting officers to find small businesses interested in selling to 
the Federal government.
  The U.S. Congress, the Administration and of course, small 
businesses, have all benefitted from the work of the Office of 
Advocacy. For example, between 1998 and 2000, regulatory changes 
supported by the Office of Advocacy saved small businesses around $20 
billion in annual and one-time compliance costs.
  Mr. President, small businesses remain the backbone of the U.S. 
economy, accounting for 99 percent of all employers, providing 75 
percent of all net new jobs, and accounting for 51 percent of private-
sector output. In fact, and this may surprise some of my colleagues, 
small businesses employ 38 percent of high-tech workers, an 
increasingly important sector in our economy.
  Small businesses have also taken the lead in moving people from 
welfare to work and an increasing number of women and minorities are 
turning to small business ownership as a means to gain economic self-
sufficiency. Put simply, small businesses represent what is best in the 
United States economy, providing innovation, competition and 
entrepreneurship.
  Their interests are vast, their activities divergent, and the 
difficulties they face to stay in business are numerous. To provide the 
necessary support to help them, SBA's Office of Advocacy needs our 
support.
  The responsibility and authority given the Office of Advocacy and the 
Chief Counsel are crucial to their ability to be an effective 
independent voice in the Federal Government for small businesses. When 
the Senate Committee on Small Business held a Roundtable meeting about 
the Office of Advocacy with small business concerns on April 21, 1999, 
every person in the room was concerned about the present and future 
state of affairs for the Office of Advocacy. These small businesses 
asked us to do everything we could to protect and strengthen this 
important office. I believe this legislation accomplishes this 
important goal.
  I have always been a strong supporter of the Office of Advocacy and I 
am pleased to join with Chairman Bond in introducing this legislation, 
which will ensure that it remains an independent and effective voice 
representing America's small businesses.
                                 ______
                                 
      By Mr. BOND (for himself and Mr. Kerry):
  S. 396. A bill to provide for national quadrennial summits on small 
business and State summits on small business, to establish the White 
House Quadrennial Commission on Small Business, and for other purposes; 
to the Committee on Small Business.
  Mr. BOND. Mr. President, it is with great pleasure that I am 
introducing

[[Page S1624]]

the White House Quadrennial Small Business Summit Act of 2001. This 
bill is designed to create a permanent independent commission that will 
carry-on the extraordinary work that has been accomplished by three 
White House Conferences on Small Business. The Small Business 
Commission will direct national and state Small business summits, and 
small business delegates from every state will attend the summits.
  Last year, representatives of small businesses and organizers of 
prior White House Conferences on Small Business worked closely with the 
Committee on Small Business to develop legislation similar to the bill 
I am introducing today. The bill passed the Senate last year as part of 
the Small Business Reauthorization Act of 2000, S. 3121; however, it 
was dropped in Conference.
  For the past 15 years, small businesses have been the fastest growing 
sector of the U.S. economy. When large businesses were restructuring 
and laying off significant numbers of workers, small businesses not 
only filled the gap, but their growth actually caused a net increase in 
new jobs. Today, small businesses employ over one-half of all workers 
in the United States, and they generate nearly 55 percent of the gross 
domestic product. Were it not for small businesses, our country could 
not have experienced the sustained economic upsurge that has been 
ongoing since 1992.
  Because small businesses play such a significant role in our economy, 
in both rural towns and bustling inner cities, I believe it is 
important that the Federal government sponsor a national conference 
every four years to highlight the successes of small businesses and to 
focus national attention on the problems that may be hindering the 
ability of small businesses to start up and grow.
  Small business ownership is, has been, and will continue to be the 
dream of millions of Americans. Countries from all over the world send 
delegations to the United states to study why our system of small 
business ownership is so successful, all the while looking for a way to 
duplicate our success in their countries. Because we see and experience 
the successes of small businesses on a daily basis, it is easy to lose 
sight of the very special thing we have going for us in the United 
States, where each of us can have the opportunity to own and run our 
own business.
  The White House Quadrennial Small Business Summit Act of 2001 is 
designed to capture and focus our attention on small business every 
four years. In this way, we will take the opportunity to study what is 
happening throughout the United States to small businesses. In one 
sense, the bill is designed to put small business on a pinnacle so we 
can appreciate what they have accomplished. At the same time, and just 
as important, every four years we will have an opportunity to learn 
from small businesses in each state what is not going well for them, 
such as, actions by the Federal government that hinder small business 
growth or state and local regulations that are a deterrent to starting 
a business.
  My bill creates an independent, bipartisan White House Quadrennial 
Commission on Small Business, which will be made up of 8 small business 
advocates and the Small Business Administration's Chief Counsel for 
Advocacy. Every four years, during the first year following a 
presidential election, the President will name four 
National Commissioners. In the U.S. Senate and the House of 
Representatives, the Majority Leader and Minority Leader of each body 
will each name one National Commissioner.

  Widespread participation from small businesses in each state will 
contribute to the work leading up to the national Small Business 
Summit. Under the bill, the Small Business Summit will take place one 
year after the Quadrennial Commissioners are appointed. The first act 
of the Commissioners will be to request that each Governor and each 
U.S. Senator name a small business delegate and alternate delegate from 
their respective states to the National Convention. Each U.S. 
Representative will be asked to name a small business delegate and 
alternative from his or her Congressional district. And the President 
will name a delegate and alternate from each state.
  The delegates to the Small Business Summit must be owners or officers 
of small businesses. Prior to the national Small Business Summit, there 
will be individual State Summits at which additional delegates will be 
elected to attend the national Summit. Three delegates and three 
alternates will be elected from each Congressional district within the 
state.
  The small busines delegates will play a major role leading up to the 
Small Business Summit. We will be looking to the small business 
delegates to develop and highlight issues of critical concern to small 
businesses. The work at the state level by the small business delegates 
will need to be thorough and thoughtful to make the Small Business 
Summit a success.
  My goal will be for the small business delegates to think broadly, 
that is, to think ``out of the box.'' Their attention should include 
but not be restricted to the traditional issues associated with small 
business concerns, such as access to capital, tax reform and regulatory 
reform. In my role as Chairman of the Committee on Small Business, I 
will urge the delegates to focus on a wide array of issues that impact 
significantly on small businesses, including the importance of a solid 
education and the need for skilled, trained workers.
  Once the small business delegates are selected, the Small Business 
Commission will serve as a resource to the delegates for issue 
development and for planning the State Conferences. The Small Business 
Commission will have a modest staff, including an Executive Director, 
that will work full time to make the State and National Summits 
successes. A major resource to the Small Business Commission and its 
staff will be the Chief Counsel for Advocacy from the SBA. The Chief 
Counsel and the Office of Advocacy will serve as a major resource to 
the Small Business Commission, and in turn, to the small business 
delegates, by providing them with both substantive background 
informaiton and other administrative materials in support of the State 
and National Summits.
  Mr. President, small businesses generally do not have the resources 
to maintain full time representatives to lobby our Federal government. 
They are too busy running their businesses to devote much attention to 
educating government officials as to what is going well, what is going 
poorly, and what needs improvement for the small business community. 
The White House Quadrennial Small Business Summit will give small 
businesses an opportunity every four years to make its mark on the 
Congress and the Executive Branch. I urge each of my colleagues to 
review their proposal, and I hope they will agree to join me as 
cosponsors of the ``White House Quadrennial Small Busines Summit Act of 
2001.''
  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. 396

       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 ``White House Quadrennial 
     Small Business Summit Act of 2001''.

     SEC. 2. DEFINITIONS.

       In this Act--
       (1) the term ``Administrator'' means the Administrator of 
     the Small Business Administration;
       (2) the term ``Chief Counsel'' means the Chief Counsel for 
     Advocacy of the Small Business Administration;
       (3) the term ``Small Business Commission'' means the 
     national White House Quadrennial Commission on Small Business 
     established under section 6;
       (4) the term ``Small Business Summit''--
       (A) means the White House Quadrennial Summit on Small 
     Business conducted under section 3(a); and
       (B) includes the last White House Conference on Small 
     Business occurring before 2002;
       (5) the term ``small business'' has the meaning given the 
     term ``small business concern'' in section 3 of the Small 
     Business Act;
       (6) the term ``State'' means any of the 50 States of the 
     United States, the District of Columbia, the Commonwealth of 
     Puerto Rico, and the United States Virgin Islands; and
       (7) the term ``State Summit'' means a State Summit on Small 
     Business conducted under section 3(b).

     SEC. 3. NATIONAL AND STATE QUADRENNIAL SUMMITS ON SMALL 
                   BUSINESS.

       (a) Quadrennial Summits.--There shall be a national White 
     House Quadrennial Summit

[[Page S1625]]

     on Small Business once every 4 years, to be held during the 
     second year following each Presidential election, to carry 
     out the purposes set forth in section 4.
       (b) State Summits.--Each Small Business Summit referred to 
     in subsection (a) shall be preceded by a State Summit on 
     Small Business, with not fewer than 1 such summit held in 
     each State, and with not fewer than 2 such summits held in 
     any State having a population of more than 10,000,000.

     SEC. 4. PURPOSES OF SMALL BUSINESS SUMMITS.

       The purposes of each Small Business Summit shall be--
       (1) to increase public awareness of the contribution of 
     small business to the national economy;
       (2) to identify the problems of small business;
       (3) to examine the status of minorities and women as small 
     business owners;
       (4) to assist small business in carrying out its role as 
     the Nation's job creator;
       (5) to assemble small businesses to develop such specific 
     and comprehensive recommendations for legislative and 
     regulatory action as may be appropriate for maintaining and 
     encouraging the economic viability of small business and 
     thereby, the Nation; and
       (6) to review the status of recommendations adopted at the 
     immediately preceding Small Business Summit.

     SEC. 5. SUMMIT PARTICIPANTS.

       (a) In General.--To carry out the purposes set forth in 
     section 4, the Small Business Commission shall conduct Small 
     Business Summits and State Summits to bring together 
     individuals concerned with issues relating to small business.
       (b) Summit Delegates.--
       (1) Qualification.--Only individuals who are owners or 
     officers of a small business shall be eligible for 
     appointment or election as delegates (or alternates) to the 
     Small Business Summit, or be eligible to vote in the 
     selection of delegates at the State Summits pursuant to this 
     subsection.
       (2) Appointed delegates.--Two months before the date of the 
     first State Summit, there shall be--
       (A) 1 delegate (and 1 alternate) appointed by the Governor 
     of each State;
       (B) 1 delegate (and 1 alternate) appointed by each Member 
     of the House of Representatives, from the congressional 
     district of that Member;
       (C) 1 delegate (and 1 alternate) appointed by each Member 
     of the Senate from the home State of that Member; and
       (D) 53 delegates (and 53 alternates) appointed by the 
     President, 1 from each State.
       (3) Elected delegates.--The participants at each State 
     Summit shall elect 3 delegates and 3 alternates to the Small 
     Business Summit for each congressional district within the 
     State, or part of the State represented at the Summit, or not 
     fewer than 9 delegates, pursuant to rules developed by the 
     Small Business Commission.
       (4) Powers and duties.--Delegates to each Small Business 
     Summit shall--
       (A) attend the State summits in his or her respective 
     State;
       (B) elect a delegation chairperson, vice chairperson, and 
     other leadership as may be necessary;
       (C) conduct meetings and other activities at the State 
     level before the date of the Small Business Summit, subject 
     to the approval of the Small Business Commission; and
       (D) direct such State level summits, meetings, and 
     activities toward the consideration of the purposes set forth 
     in section 4, in order to prepare for the next Small Business 
     Summit.
       (5) Alternates.--Alternates shall serve during the absence 
     or unavailability of the delegate.
       (c) Role of the Chief Counsel.--The Chief Counsel shall, 
     after consultation and in coordination with the Small 
     Business Commission, assist in carrying out the Small 
     Business Summits and State Summits required by this Act by--
       (1) preparing and providing background information and 
     administrative materials for use by participants in the 
     summits;
       (2) distributing issue information and administrative 
     communications, electronically where possible through an 
     Internet web site and e-mail, and in printed form if 
     requested;
       (3) maintaining an Internet web site and regular e-mail 
     communications after each Small Business Summit to inform 
     delegates and the public of the status of recommendations and 
     related governmental activity; and
       (4) maintaining, between summits, an active interim 
     organization of delegate representatives from each region of 
     the Administration, to advise the Chief Counsel on each of 
     the major small business issue areas, and monitor the 
     progress of the Summits' recommendations.
       (d) Expenses.--Each delegate (and alternate) to each Small 
     Business Summit and State Summit--
       (1) shall be responsible for the expenses of that delegate 
     related to attending the summits; and
       (2) shall not be reimbursed either from funds made 
     available pursuant to this section or the Small Business Act.
       (e) Advisory Committee.--
       (1) In general.--The Small Business Commission shall 
     appoint a Summit Advisory Committee, which shall be composed 
     of 10 individuals who were participants at the most recently 
     preceding Small Business Summit, to advise the Small Business 
     Commission on the organization, rules, and processes of the 
     Summits.
       (2) Preference.--Preference for appointment under this 
     subsection shall be given to individuals who have been active 
     participants in the implementation process following the most 
     recently preceding Small Business Summit.
       (f) Public Participation.--Small Business Summits and State 
     Summits shall be open to the public, and no fee or charge may 
     be imposed on any attendee, other than an amount necessary to 
     cover the cost of any meal provided, plus, with respect to 
     State Summits, a registration fee to defray the expense of 
     meeting rooms and materials of not to exceed $20 per person.

     SEC. 6. WHITE HOUSE QUADRENNIAL COMMISSION ON SMALL BUSINESS.

       (a) Establishment.--There is established the White House 
     Quadrennial Commission on Small Business.
       (b) Membership.--
       (1) Appointment.--The Small Business Commission shall be 
     composed of 9 members, including--
       (A) the Chief Counsel;
       (B) 4 members appointed by the President;
       (C) 1 member appointed by the Majority Leader of the 
     Senate;
       (D) 1 member appointed by the Minority Leader of the 
     Senate;
       (E) 1 member appointed by the Majority Leader of the House 
     of Representatives; and
       (F) 1 member appointed by the Minority Leader of the House 
     of Representatives.
       (2) Selection.--Members of the Small Business Commission 
     described in subparagraphs (B) through (F) of paragraph (1) 
     shall be selected from among distinguished individuals noted 
     for their knowledge and experience in fields relevant to the 
     issue of small business and the purposes set forth in section 
     4.
       (3) Time of appointment.--The appointments required by 
     paragraph (1)--
       (A) shall be made not later than 18 months before the 
     opening date of each Small Business Summit; and
       (B) shall expire 6 months after the date on which each 
     Small Business Summit is convened.
       (c) Election of Chairperson.--At the first meeting of the 
     Small Business Commission, a majority of the members present 
     and voting shall elect a member of the Small Business 
     Commission to serve as the Chairperson.
       (d) Powers and Duties of Commission.--The Small Business 
     Commission--
       (1) may enter into contracts with public agencies, private 
     organizations, and academic institutions to carry out this 
     Act;
       (2) shall consult, coordinate, and contract with an 
     independent, nonpartisan organization that--
       (A) has both substantive and logistical experience in 
     developing and organizing conferences and forums throughout 
     the Nation with elected officials and other government and 
     business leaders;
       (B) has experience in generating private resources from 
     multiple States in the form of event sponsorships; and
       (C) can demonstrate evidence of a working relationship with 
     Members of Congress from the majority and minority parties, 
     and at least 1 Federal agency; and
       (3) shall prescribe such financial controls and accounting 
     procedures as needed for the handling of funds from fees and 
     charges and the payment of authorized meal, facility, travel, 
     and other related expenses.
       (e) Planning and Administration of Summits.--In carrying 
     out the Small Business Summits and State Summits, the Small 
     Business Commission shall consult with--
       (1) the Chief Counsel;
       (2) Congress; and
       (3) such other Federal agencies as the Small Business 
     Commission determines to be appropriate.
       (f) Reports Required.--Not later than 6 months after the 
     date on which each Small Business Summit is convened, the 
     Small Business Commission shall submit to the President and 
     to the Chairpersons and Ranking Members of the Committees on 
     Small Business of the Senate and the House of Representatives 
     a final report, which shall--
       (1) include the findings and recommendations of the Small 
     Business Summit and any proposals for legislative action 
     necessary to implement those recommendations; and
       (2) be made available to the public.
       (g) Quorum.--Four voting members of the Small Business 
     Commission shall constitute a quorum for purposes of 
     transacting business.
       (h) Meetings.--The Small Business Commission shall meet not 
     later than 20 calendar days after the appointment of the 
     initial members of the Small Business Commission, and not 
     less frequently than every 30 calendar days thereafter.
       (i) Vacancies.--Any vacancy on the Small Business 
     Commission shall not affect its powers, but shall be filled 
     in the manner in which the original appointment was made.
       (j) Executive Director and Staff.--The Small Business 
     Commission may appoint and compensate an Executive Director 
     and such other personnel to conduct the Small Business 
     Summits and State Summits as the Small Business Commission 
     may determine to be advisable, without regard to title 5, 
     United States Code, governing appointments in the competitive 
     service, and without regard to chapter 51 and subchapter III 
     of chapter 53 of such title, relating to classification and 
     General Schedule pay rates, except that the rate of pay for 
     the Executive

[[Page S1626]]

     Director and other personnel may not exceed the rate payable 
     for level V of the Executive Schedule under section 5316 of 
     such title.
       (k) Funding.--Members of the Small Business Commission 
     shall be allowed travel expenses, including per diem in lieu 
     of subsistence at rates authorized for employees of agencies 
     under subchapter I of chapter 57 of title 5, United States 
     Code, while away from their homes or regular places of 
     business in the performance of services for the Small 
     Business Commission.

     SEC. 7. AUTHORIZATION OF APPROPRIATIONS; AVAILABILITY OF 
                   FUNDS.

       (a) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out each Small Business Summit 
     and the State Summits required by this Act, $5,000,000, which 
     shall remain available until expended. New spending authority 
     or authority to enter contracts as provided in this title 
     shall be effective only to such extent and in such amounts as 
     are provided in advance in appropriations Acts.
       (b) Specific Earmark.--No amount made available to the 
     Small Business Administration may be made available to carry 
     out this title, other than amounts made available 
     specifically for the purpose of conducting the Small Business 
     Summits and State Summits.
                                 ______
                                 
      By Mr. McCAIN (for himself, Mr. Levin, Mr. Hagel, Mr. Lieberman, 
        Mr. Kyl, Mr. Reed, Mr. Voinovich, Mr. Feingold, Mr. Jeffords, 
        Mr. DeWine, and Mr. Kohl):
  S. 397. A bill to amend the Defense Base Closure and Realignment Act 
of 1990 to authorize additional rounds of base closures and 
realignments under the Act in 2003 and 2005, to modify certain 
authorities relating to closures and realignments under that Act; to 
the Committee on Armed Services.
  Mr. McCAIN. Mr. President, I rise today to introduce legislation that 
would authorize two rounds of U.S. military installation realignment 
and closures to occur in 2003 and 2005. I am pleased to have Senators 
Levin, Hagel, Lieberman, Kyl, Reed, Kohl, Voinovich, Feingold, Jeffords 
and DeWine as co-sponsors of this bill.
  Although I would prefer to say that this is a new idea--it isn't. In 
1970, the Blue Ribbon Defense Panel, ``Fithugh Commission'') made 
reference to ``consolidation of military activities at fewer 
installations would contribute to more efficient operations and would 
produce substantial savings.'' In 1983, the President's Private Sector 
Survey on Cost Control, ``Grace Commission'' made strong 
recommendations for military base closures. In 1997, the Quadrennial 
Defense Review recommended that, even after four base closure rounds in 
1988, 1991, 1993 and 1995, the Armed Forces ``must shed excess 
infrastructure.'' Likewise, the 1997 Defense Reform Initiative and the 
National Defense Panel ``strongly urged Congress and the Department of 
Defense to move quickly to restore the base realignment and closure, 
BRAC, process.''
  Mr. President, we have too many military bases. The cold war is over. 
We will never have a requirement for as many bases as we have today. 
Clearly we could save, according to most conservative estimates, 
somewhere between $3 and $4 billion a year of taxpayer dollars that are 
now expended unnecessarily on keeping military bases open.
  The Congressional Budget Office, former Secretaries Dick Cheney and 
William Cohen, nearly all the Service Chiefs and other respected 
defense experts have been consistent in their plea that the Pentagon be 
permitted to divest themselves of excess infrastructure beyond what was 
eliminated during the prior rounds of base closings. Through the end of 
1998, the Pentagon had closed 97 major bases in the United States after 
four previous rounds of BRAC. Since then, it has closed none. Moreover, 
the savings from closing additional unneeded bases should be used for 
force modernization purposes.
  We have heard over the last several years of the dire situation of 
our military forces. We have heard testimony of plunging readiness, 
modernization programs that are decades behind schedule, and quality of 
life deficiencies that are so great we cannot retain or recruit the 
personnel we need. As a result of this realization, there has been a 
groundswell of support in Congress for the Armed Forces, including a 
number of pay, retirement and medical benefit initiatives and the 
promise of a significant increase in defense spending.
  All of these proposals are excellent starting points to help rebuild 
our military, but we must not forget that much of it will be in vain if 
the Department of Defense is obligated to maintain 23 percent excess 
capacity in infrastructure. When we actually look for the dollars to 
pay for these initiatives, it is unconscionable that some would not 
look to the billions of dollars to be saved by base realignment and 
closure. Only 30 percent of the defense budget funds combat forces, 
while the remaining 70 percent is devoted to support functions such as 
bases. Continuing to squander precious dollars in this manner will make 
it impossible for us to adequately modernize our forces for the future. 
The Joint Chiefs of Staff have stated repeatedly that they desire more 
opportunities to streamline the military's infrastructure. We cannot 
sit idly by and throw money and ideas at the problem when part of the 
solution is staring us in the face.

  This proposed legislation offers a significant change to present law. 
Under this legislation, privatization in-place would be permitted only 
when explicitly recommended by the Commission. Additionally, the 
Secretary of Defense must consider local government input in preparing 
his list of desired base closures.
  Total BRAC savings realized from the four previous closure rounds 
exceed total costs to date. Department of Defense figures suggest 
previous base closures will save, after one-time closing costs, $15 
billion through fiscal year 2001, $25 billion through fiscal year 2003 
and $6.1 billion a year thereafter. Additional needed closures can save 
$20 billion by 2015, and $3 billion a year thereafter. Sooner or later 
these surplus bases will be closed anyway. The sooner the issue is 
addressed, the greater will be the savings that will ultimately go 
toward defense modernization and greater pay raises for service 
members.
  Previous base closure rounds have had many success stories. For 
example, after England Air Force Base closed in 1992, Alexandria, 
Louisiana benefitted from the creation of over 1,400 jobs--nearly 
double the number of jobs lost. Across the U.S. about 60,000 new jobs 
have been created at closing military bases. At bases closed more than 
2 years, nearly 75 percent of the civilian jobs have been replaced.
  In Charleston, South Carolina, where the number of defense job 
losses, as a percentage of the work force, was greater than at any 
other base closure location, 23 major entities are reusing the former 
Navy facilities and providing more than 3,300 jobs and another 13 more 
civilian industrial applications are pending adding soon even more 
newly created jobs to that number. Additionally, roughly 75 percent of 
the 6 million square feet of leasable space on the base is occupied. 
This is comparable to the successes in my home state of Arizona with 
the closure of Williams Air Force Base in the Phoenix East Valley. This 
is not to say that base closures are easy for any community, but it 
does suggest that communities can and will continue to thrive.
  We can continue to maintain a military infrastructure that we do not 
need, or we can provide the necessary funds to ensure our military can 
fight and win future wars. Every dollar we spend on bases we do not 
need is a dollar we cannot spend on training our troops, keeping 
personnel quality of life at an appropriate level, maintaining force 
structure, replacing old weapons systems, and advancing our military 
technology.
  We must finish the job we started by authorizing these two final 
rounds of base realignment and closure. I urge my colleagues to join us 
in support of this critical bill and to work diligently throughout the 
year to put aside local politics for what is clearly in the best 
interest of our military forces.
  Mr. President, I believe this measure is long overdue. I believe the 
additional $3 to $4 billion a year we could save by closing unnecessary 
bases could be used for the betterment of the quality of life of our 
men and women in the military. I believe it is hard to understand why, 
when the overwhelming majority of outside opinion, whether it be 
liberal or conservative organizations that are watchdogs of our defense 
policies and programs, all agree we have too many bases. We needed 
these bases during the cold war and we needed them very badly. They 
obviously contributed enormously to our ability to win the cold war. No 
one envisions future threats that would require the

[[Page S1627]]

number of bases that are part of our military establishment today.
  I hope that the chairmen of the Armed Services Committee in past 
years who have strongly opposed base closing rounds will now join with 
me and others in seeing this legislation through the Armed Services 
Committee and to the floor of the Senate.
  It makes sense. I believe that the record is replete with examples of 
bases that have been closed which ultimately after a period of a few 
years have ended up of greater benefit to the surrounding communities 
than when the bases were military bases. But more importantly than 
that, we simply can't afford some of them as we make the tough 
decisions and follow the President's guidance on the fundamental 
reevaluation of our systems technology and weapons systems that we need 
to make in order to meet the challenges of the post-cold-war era. A 
part of that is to make available as much funding as possible not only 
for the quality of life of the men and women in the military but for 
our ability to develop a viable missile defense system, and to bring to 
our military the best equipment that this Nation's technology can 
provide.
  I hope we will move on this issue. I anticipate, hopefully, that the 
administration will also, again as past administrations have, support 
another round of base closings.
  I ask unanimous consent the bill be referred to the Committee on 
Armed Services.
  The PRESIDING OFFICER. Without objection, it is so ordered. The bill 
will be appropriately referred.
  Mr. McCAIN. Mr. President, I ask unanimous consent that the bill to 
authorize two additional base realignment and closure rounds be printed 
in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 397

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

     SECTION 1. AUTHORITY TO CARRY OUT BASE CLOSURE ROUNDS IN 2003 
                   AND 2005.

       (a) Commission Matters.--
       (1) Appointment.--Subsection (c)(1) of section 2902 of the 
     Defense Base Closure and Realignment Act of 1990 (part A of 
     title XXIX of Public Law 101-510; 10 U.S.C. 2687 note) is 
     amended--
       (A) in subparagraph (B)--
       (i) by striking ``and'' at the end of clause (ii);
       (ii) by striking the period at the end of clause (iii) and 
     inserting a semicolon; and
       (iii) by adding at the end the following new clauses (iv) 
     and (v):
       ``(iv) by no later than January 24, 2003, in the case of 
     members of the Commission whose terms will expire at the end 
     of the first session of the 108th Congress; and
       ``(v) by no later than March 15, 2005, in the case of 
     members of the Commission whose terms will expire at the end 
     of the first session of the 109th Congress.''; and
       (B) in subparagraph (C), by striking ``or for 1995 in 
     clause (iii) of such subparagraph'' and inserting ``, for 
     1995 in clause (iii) of that subparagraph, for 2003 in clause 
     (iv) of that subparagraph, or for 2005 in clause (v) of that 
     subparagraph''.
       (2) Meetings.--Subsection (e) of that section is amended by 
     striking ``and 1995'' and inserting ``1995, 2003, and 2005''.
       (3) Staff.--Subsection (i)(6) of that section is amended in 
     the matter preceding subparagraph (A) by striking ``and 
     1994'' and inserting ``, 1994, and 2004''.
       (4) Funding.--Subsection (k) of that section is amended by 
     adding at the end the following new paragraph (4):
       ``(4) If no funds are appropriated to the Commission by the 
     end of the second session of the 107th Congress for the 
     activities of the Commission in 2003 or 2005, the Secretary 
     may transfer to the Commission for purposes of its activities 
     under this part in either of those years such funds as the 
     Commission may require to carry out such activities. The 
     Secretary may transfer funds under the preceding sentence 
     from any funds available to the Secretary. Funds so 
     transferred shall remain available to the Commission for such 
     purposes until expended.''.
       (5) Termination.--Subsection (l) of that section is amended 
     by striking ``December 31, 1995'' and inserting ``December 
     31, 2005''.
       (b) Procedures.--
       (1) Force-structure plan.--Subsection (a)(1) of section 
     2903 of that Act is amended by striking ``and 1996,'' and 
     inserting ``1996, 2004, and 2006,''.
       (2) Selection criteria.--Subsection (b) of such section 
     2903 is amended--
       (A) in paragraph (1), by inserting ``and by no later than 
     December 31, 2001, for purposes of activities of the 
     Commission under this part in 2003 and 2005,'' after 
     ``December 31, 1990,''; and
       (B) in paragraph (2)(A)--
       (i) in the first sentence, by inserting ``and by no later 
     than February 15, 2002, for purposes of activities of the 
     Commission under this part in 2003 and 2005,'' after 
     ``February 15, 1991,''; and
       (ii) in the second sentence, by inserting ``, or enacted on 
     or before March 31, 2002, in the case of criteria published 
     and transmitted under the preceding sentence in 2001'' after 
     ``March 15, 1991''.
       (3) Department of defense recommendations.--Subsection 
     (c)(1) of such section 2903 is amended by striking ``and 
     March 1, 1995,'' and inserting ``March 1, 1995, March 14, 
     2003, and May 16, 2005,''.
       (4) Commission review and recommendations.--Subsection (d) 
     of such section 2903 is amended--
       (A) in paragraph (2)(A), by inserting ``or by no later than 
     July 7 in the case of recommendations in 2003, or no later 
     than September 8 in the case of recommendations in 2005,'' 
     after ``pursuant to subsection (c),'';
       (B) in paragraph (4), by inserting ``or after July 7 in the 
     case of recommendations in 2003, or after September 8 in the 
     case of recommendations in 2005,'' after ``under this 
     subsection,''; and
       (C) in paragraph (5)(B), by inserting ``or by no later than 
     May 1 in the case of such recommendations in 2003, or no 
     later than July 1 in the case of such recommendations in 
     2005,'' after ``such recommendations,''.
       (5) Review by president.--Subsection (e) of such section 
     2903 is amended--
       (A) in paragraph (1), by inserting ``or by no later than 
     July 22 in the case of recommendations in 2003, or no later 
     than September 23 in the case of recommendations in 2005,'' 
     after ``under subsection (d),'';
       (B) in the second sentence of paragraph (3), by inserting 
     ``or by no later than August 18 in the case of 2003, or no 
     later than October 20 in the case of 2005,'' after ``the year 
     concerned,''; and
       (C) in paragraph (5), by inserting ``or by September 3 in 
     the case of recommendations in 2003, or November 7 in the 
     case of recommendations in 2005,'' after ``under this 
     part,''.
       (c) Relationship to Other Base Closure Authority.--Section 
     2909(a) of that Act is amended by striking ``December 31, 
     1995,'' and inserting ``December 31, 2005,''.

     SEC. 2. MODIFICATION OF BASE CLOSURE AUTHORITIES UNDER 1990 
                   BASE CLOSURE LAW.

       (a) Cost Savings and Return on Investment under Secretary 
     of Defense Selection Criteria.--Subsection (b) of section 
     2903 of the Defense Base Closure and Realignment Act of 1990 
     (part A of title XXIX of Public Law 101-510; 10 U.S.C. 2867 
     note) is amended by adding at the end the following:
       ``(3) Any selection criteria proposed by the Secretary 
     relating to the cost savings or return on investment from the 
     proposed closure or realignment of a military installation 
     shall be based on the total cost and savings to the Federal 
     Government that would result from the proposed closure or 
     realignment of such military installation.''.
       (b) Department of Defense Recommendations to Commission.--
     Subsection (c) of such section 2903 is amended--
       (1) by redesignating paragraphs (4), (5), and (6) as 
     paragraphs (5), (6), and (7), respectively;
       (2) by inserting after paragraph (3) the following new 
     paragraph (4):
       ``(4)(A) In making recommendations to the Commission under 
     this subsection in any year after 2000, the Secretary shall 
     consider any notice received from a local government in the 
     vicinity of a military installation that the government would 
     approve of the closure or realignment of the installation.
       ``(B) Notwithstanding the requirement in subparagraph (A), 
     the Secretary shall make the recommendations referred to in 
     that subparagraph based on the force-structure plan and final 
     criteria otherwise applicable to such recommendations under 
     this section.
       ``(C) The recommendations made by the Secretary under this 
     subsection in any year after 2000 shall include a statement 
     of the result of the consideration of any notice described in 
     subparagraph (A) that is received with respect to an 
     installation covered by such recommendations. The statement 
     shall set forth the reasons for the result.''; and
       (3) in paragraph (7), as so redesignated--
       (A) in the first sentence, by striking ``paragraph (5)(B)'' 
     and inserting ``paragraph (6)(B)''; and
       (B) in the second sentence, by striking ``24 hours'' and 
     inserting ``48 hours''.
       (c) Privatization in Place.--Section 2904(a) of that Act is 
     amended--
       (1) by redesignating paragraphs (3) and (4) as paragraphs 
     (4) and (5), respectively; and
       (2) by inserting after paragraph (2) the following new 
     paragraph (3):
       ``(3) carry out the privatization in place of a military 
     installation recommended for closure or realignment by the 
     Commission in each such report after 2000 only if 
     privatization in place is a method of closure or realignment 
     of the installation specified in the recommendation of the 
     Commission in such report and is determined to be the most-
     cost effective method of implementation of the 
     recommendation;''.

     SEC. 3. TECHNICAL AND CLARIFYING AMENDMENTS.

       (a) Commencement of Period for Notice of Interest in 
     Property for Homeless.--Section 2905(b)(7)(D)(ii)(I) of the 
     Defense Base Closure and Realignment Act of 1990 (part A of 
     title XXIX of Public Law 101-510; 10 U.S.C. 2867 note) is 
     amended by striking ``that date'' and inserting ``the date of 
     publication of such determination in a newspaper

[[Page S1628]]

     of general circulation in the communities in the vicinity of 
     the installation under subparagraph (B)(i)(IV)''.
       (b) Other Clarifying Amendments.--
       (1) That Act is further amended by inserting ``or 
     realignment'' after ``closure'' each place it appears in the 
     following provisions:
       (A) Section 2905(b)(3).
       (B) Section 2905(b)(5).
       (C) Section 2905(b)(7)(B)(iv).
       (D) Section 2905(b)(7)(N).
       (E) Section 2910(10)(B).
       (2) That Act is further amended by inserting ``or 
     realigned'' after ``closed'' each place in appears in the 
     following provisions:
       (A) Section 2905(b)(3)(C)(ii).
       (B) Section 2905(b)(3)(D).
       (C) Section 2905(b)(3)(E).
       (D) Section 2905(b)(4)(A).
       (E) Section 2905(b)(5)(A).
       (F) Section 2910(9).
       (G) Section 2910(10).
       (3) Section 2905(e)(1)(B) of that Act is amended by 
     inserting ``, or realigned or to be realigned,'' after 
     ``closed or to be closed''.

  Mr. LEVIN. Mr. President, I am pleased to once again join my 
colleague from the Armed Services Committee, Senator McCain, along with 
our cosponsors Senators Lieberman, Voinovich, Reed, Kyl, Hagel, Kohl, 
Feingold, DeWine, and Jeffords in introducing legislation that allows 
the Department of Defense to close excess, unneeded military bases.
  For the past four years, former Secretary of Defense Bill Cohen asked 
the Congress to authorize two additional base closure rounds. But 
Congress did not act.
  We have a new Congress, a new President, and a new Secretary of 
Defense, but we also have some unfinished business to attend to. Base 
closure is one of the most important examples. And as we promised we 
would be, Senator McCain and I and our cosponsors are back.
  General Shelton, the Chairman of the Joint Chiefs of Staff, and the 
other chiefs have repeatedly said we need to close more military bases, 
and I expect they will once again tell us we need to realign or close 
more bases when the President's budget is submitted later this year.
  The legislation we are introducing today is intended to start the 
debate, and I hope the administration will make a similar legislative 
proposal to the Congress.
  This legislation calls for two additional base closure rounds, in 
2003 and 2005, that would basically follow the same procedures that 
were used in 1991, 1993 and 1995, with two notable exceptions.
  First, the whole process would start and finish two months later in 
2005 than it would in 2003 and did in previous rounds, to give a new 
President, if there is one in 2005, sufficient time to nominate 
commissioners.
  Second, under our legislation, privatization in place would not be 
permitted at closing installation unless the Base Closure Commission 
expressly recommends it.
  In a November 1998 report, the General Accounting Office listed five 
key elements of the base closure process that ``contributed to the 
success of prior rounds''. Our legislation retains all of those key 
elements. GAO also stated that they ``have not identified any long-term 
readiness problems that were related to domestic base realignments and 
closures, that ``DOD continues to retain excess capacity'' and that 
``substantial savings are expected'' from base closures.
  Mr. President, every expert and every study agrees on the basic 
facts--the Defense Department has more bases than it needs, and closing 
bases saves substantial money over time, usually within a few years.
  The April 1998 report the Department of Defense provided to the 
Congress clearly demonstrated that we have excess capacity. For 
example, the report showed that by 2003:
  The Army will have reduced its classroom training personnel by 43 
percent, while classroom space will have been reduced by only 7 
percent.
  The Air Force will have reduced the number of fighters and other 
small aircraft by 53 percent since 1989, while the base structure for 
those aircraft will be only 35 percent smaller.
  The Navy will have 33 percent more hangars for its aircraft than it 
requires.
  Experts inside and outside of Government agree with the Defense 
Department on this issue. As the Congressional Budget Office stated in 
a letter to me, ``the [DoD] report's basic message is consistent with 
CBO's own conclusions: past and future BRAC rounds will lead to 
significant savings for DoD.''
  Every year we delay another base closure round, we waste about $1.5 
billion in annual savings that we can never recoup. And every dollar we 
waste on bases we do not need is a dollar we cannot spend on things we 
do need.
  The new administration is now undertaking several strategy reviews. 
It is possible that those reviews will conclude that the military we 
want for the future needs exactly the base structure we have today and 
that all our forces are in exactly the right place and none of them 
need to be realigned to different locations. It is possible that they 
will conclude Secretary Cohen and General Shelton didn't know what they 
were talking about and we really don't have any excess infrastructure.
  I will be astounded if any serious defense review reaches such a 
conclusion. But even if it did, it is important to understand that this 
legislation does not prejudge or pre-empt these reviews. What it does 
is prepare us to act whatever the result of those reviews.
  Should the new administration decide they don't want to propose any 
closures or realignments, this bill would not force them to. It 
authorizes two more rounds; it does not require them. And the Defense 
Department would have ample time to conclude their reviews before the 
first round would start in 2003, so the results of their strategy 
reviews could be fully incorporated into the force structure plan the 
new rounds would be based on.
  I urge my colleagues to support this legislation.
                                 ______
                                 
      By Mr. KERRY (for himself, Mr. Grassley, Mr. Sarbanes, Mr. Levin, 
        and Mr. Rockefeller):
  S. 398. A bill to combat international money laundering and to 
protect the United States financial system, and for other purposes; to 
the Committee on Banking, Housing, and Urban Affairs.
  Mr. KERRY. Mr. President, I believe the United States must do more to 
stop international criminals from legitimizing their profits from the 
sale of drugs, from terror or from organized crime by laundering money 
into the United States financial system.
  That is why today, along with Senators Grassley, Sarbanes, Levin and 
Rockefeller, I am introducing the International Counter-Money 
Laundering and Foreign Anticorruption Act of 2001, which will give the 
Secretary of the Treasury the tools to crack down on international 
money laundering havens and protect the integrity of the U.S. financial 
system from the influx of tainted money from abroad. During the 106th 
Congress, the House Banking Committee reported out this legislation 
with a bipartisan 33-1 vote.
  Money laundering is the financial side of international crime. It 
occurs when criminals seek to disguise money that was illegally 
obtained. It allows terrorists, drug cartels, organized crime groups, 
corrupt foreign government officials and others to preserve the profit 
from their illegal activities and to finance new crimes. Money 
laundering provides the fuel that allows criminal organizations to 
conduct their ongoing affairs. It has a corrosive effect on 
international markets and financial institutions. Money launderers rely 
upon the existence of jurisdictions outside the United States that 
offer bank secrecy and special tax or regulatory advantages to non 
residents, and often complement those advantages with weak financial 
supervision and regulatory regimes.
  Today, the global volume of laundered money is estimated to be 2-5 
percent of global Gross Domestic Product, between $600 billion and $1.5 
trillion. The effects of money laundering extend far beyond the 
parameters of law enforcement, creating international political issues 
while generating domestic political crises.
  International criminals have taken advantage of the advances in 
technology and the weak financial supervision in some jurisdictions to 
smuggle their illicit funds into the United States financial system. 
Globalization and advances in communications and technologies allow 
criminals to move their illicit gains faster and farther than ever 
before. The ability to launder money into the United States through 
these jurisdictions has allowed corrupt

[[Page S1629]]

foreign officials to systematically divert public assets for their 
personal use, which in turn undermines U.S. efforts to promote stable 
democratic institutions and vibrant economies abroad.
  In December 2000, a federal interagency working group in support of 
the President's International Crime Control Strategy released an 
International Crime Threat Assessment. This report states that 
international banking and financial systems are currently being used to 
legitimize and transfer criminal proceeds and that huge sums of money 
are laundered in the world's largest financial markets including the 
United States. The report warns that international criminal groups will 
use changes in technology and the world economy to enhance their 
capability to launder and move money and may be able to cause 
significant disruption to international financial systems.
  In October 2000, the General Accounting Office determined that Euro-
American Corporate Services, Inc. had formed more than 2,000 
corporations for Russian brokers. From 1991 through January 2000, more 
than $1.4 billion in wire transfer transactions was deposited into 236 
accounts for these corporations opened at two United States banks. More 
than half of these funds were then transferred out of the U.S. banking 
system. The GAO believes that these banking activities raise questions 
about whether the U.S. banks were used to launder money.
  In February 2000, State and Federal regulators formally sanctioned 
the Bank of New York for ``deficiencies'' in its anti-money laundering 
practices including lax auditing and risk management procedures 
involving their international banking business. The sanctions were 
based on the Bank of New York's involvement in an alleged money 
laundering scheme where more than $7 billion in funds were transmitted 
from Russia into the bank. Federal investigators are currently 
attempting to tie the $7 billion to criminal activities in Russia such 
as corporate theft, political graft or racketeering.
  In November 1999, the minority staff of the Senate Governmental 
Affairs Subcommittee on Investigations released a report on private 
banking and money laundering. The report describes a number of 
incidences where high level government officials have used private 
banking accounts with U.S. financial institutions to launder millions 
of dollars from foreign governments. The report details how Raul 
Salinas, brother of former President of Mexico, Carlos Salinas, used 
private bank accounts to launder money out of Mexico. Representatives 
from Citigroup testified at a Subcommittee hearing that the bank had 
been slow to correct controls over their private banking accounts.
  Earlier this month, the Minority Staff of the U.S. Senate Permanent 
Subcommittee on Investigations, headed by Senator Carl Levin, released 
a report that reveals that most U.S. banks lack appropriate anti-money 
laundering safeguards on their correspondent accounts. This report 
proves that high risk foreign banks that are denied their own 
correspondent accounts at U.S. banks can get the same access by opening 
correspondent accounts at other foreign banks that have U.S. accounts. 
The report recommends that U.S. regulators and law enforcement offer 
increased assistance to help banks identify high-risk foreign banks.
  During the 1980s, as Chairman of the Senate Permanent Subcommittee on 
Investigations, I began an investigation of the Bank of Credit and 
Commerce International (BCCI), and uncovered a complex money laundering 
scheme. Unlike any ordinary bank, BCCI was from its earliest days made 
up of multiplying layers of entities, related to one another through an 
impenetrable series of holding companies, affiliates, subsidiaries, 
banks-within-banks, insider dealings and nominee relationships.
  By fracturing corporate structure, record keeping, regulatory review, 
and audits, the complex BCCI family of entities was able to evade 
ordinary legal restrictions on the movement of capital and goods as a 
matter of daily practice and routine. In designing BCCI as a vehicle 
fundamentally free of government control, its creators developed an 
ideal mechanism for facilitating illicit activity by others.
  BCCI's used this complex corporate structure to commit fraud 
involving billions of dollars; and launder money for their clients in 
Europe, Africa, Asia and the Americas. Fortunately, we were able to 
bring many of those involved in BCCI to justice. However, my 
investigation clearly showed that rogue financial institutions have the 
ability to circumvent the laws designed to stop financial crimes.
  In recent years, the U.S. and other well-developed financial centers 
have been working together to improve their anti-money laundering 
regimes and to set international anti-money laundering standards. Back 
in 1988, I included a provision in the State Department Reauthorization 
bill that requires major money laundering countries to adopt laws 
similar to our own on reporting currency or face sanctions. This 
provision led to Panama and Venezuela negotiating what were called 
Kerry agreements with the United States decreasing their vulnerability 
to the placement of U.S. currency by drug traffickers in the process.
  Unfortunately, other nations--some small, remote islands--have moved 
in the other direction. Many have passed laws that provide for 
excessive bank secrecy, anonymous company incorporation, economic 
citizenship, and other provisions that directly conflict with well-
established international anti-money laundering standards. In doing so, 
they have become money laundering havens for international criminal 
networks. Some even blatantly advertise the fact that their laws 
protect anyone doing business from U.S. law enforcement.

  Last year, the Financial Action Task Force, an intergovernmental body 
established to develop and promote policies to combat financial crime, 
released a report naming fifteen jurisdictions--including the Bahamas, 
The Cayman Islands, Russia, Israel, and the Philippines--that have 
failed to take adequate measures to combat international money 
laundering. This is a clear warning to financial institutions in the 
United States that they must begin to scrutinize many of their 
financial transactions with customers in these countries. Soon, the 
Financial Action Task Force will develop bank advisories and criminal 
sanctions that effectively drive legitimate financial business from 
these nations, depriving them of a lucrative source of tax revenue. 
This report has provided important information that governments and 
financial institutions around the world should learn from in developing 
their own anti-money laundering laws and policies.
  Last year, the Financial Stability Forum released a report that 
categorizes offshore financial centers according to their perceived 
quality of supervision and degree of regulatory cooperation. The 
Organization of Economic Cooperation and Development (OECD) began a new 
crackdown on harmful tax competition. Members of the European Union 
reached an agreement in principle on sweeping changes to bank secrecy 
laws, intended to bring cross-border investment income within the net 
of tax authorities.
  The actions by the Financial Action Task Force, the European Union 
and others show a renewed international focus and commitment to curbing 
financial abuse around the world. I believe the United States has a 
similar obligation to use this new information to update our anti-money 
laundering statutes.
  The International Counter-Money Laundering and Anticorruption Act of 
2001, which I am introducing today, would provide the tools the U.S. 
needs to crack down on international money laundering havens and 
protect the integrity of the U.S. financial system from the influx of 
tainted money from abroad. The bill provides for actions that will be 
graduated, discretionary, and targeted, in order to focus actions on 
international transactions involving criminal proceeds, while allowing 
legitimate international commerce to continue to flow unimpeded. It 
will give the Secretary of the Treasury--acting in consultation with 
other senior government officials and the Congress--the authority to 
designate a specific foreign jurisdiction, foreign financial 
institution, or class of international transactions as being of 
``primary money laundering concern.''

[[Page S1630]]

 Then, on a case-by-case basis, the Secretary will have the option to 
use a series of new tools to combat the specific type of foreign money 
laundering threat we face. In some cases, the Secretary will have the 
option to require banks to pierce the veil of secrecy behind which 
foreign criminals hide. In other cases, the Secretary will have the 
option to require the identification those using a foreign bank's 
correspondent or payable-through accounts. If these transparency 
provisions were deemed to be inadequate to address the specific problem 
identified, the Secretary would have the option to restrict or prohibit 
U.S. banks from continuing correspondent or payable-through banking 
relationships with money laundering havens and rogue foreign banks. 
Through these steps, the Secretary will help prevent laundered money 
from slipping undetected into the U.S. financial system and, as a 
result, increase the pressure on foreign money laundering havens to 
bring their laws and practices into line with international anti-money 
laundering standards. The passage of this legislation will make it much 
more difficult for international criminal organizations to launder the 
proceeds of their crimes into the United States.
  This bill fills in the current gap between bank advisories and 
International Emergency Economic Powers Act, IEEPA, sanctions by 
providing five new intermediate measures. Under current law, the only 
counter-money laundering tools available to the federal government are 
advisories, an important but relatively limited measure instructing 
banks to pay close attention to transactions that involve a given 
country, and full-blown economic sanctions under the IEEPA. This 
legislation gives five additional measures to increase the government's 
ability to apply pressure effectively against targeted jurisdictions or 
institutions.
  This legislation will in no way jeopardize the privacy of the 
American public. The focus is on foreign jurisdictions, financial 
institutions and classes of transactions that present a threat to the 
United States, not on American citizens. The actions that the Secretary 
of the Treasury is authorized to take are designated solely to combat 
the abuse of our banks by specifically identified foreign money 
laundering threats. This legislation is in no way similar to the Know-
Your-Customer regulations that were proposed by bank regulators in 
1999. Further, the intent of this legislation is not to add additional 
regulatory burdens on financial institutions, but, to give the 
Secretary of the Treasury the ability to take action against existing 
money laundering threats.
  Let me repeat, this legislation only gives the discretion to use 
these tools to the Secretary of the Treasury. There is no automatic 
trigger that forces action whenever evidence of money laundering is 
determined. Before any action is taken, the Secretary of the Treasury, 
in consultation with other key government officials, must first 
determine whether a specific country, financial institution or type of 
transaction is of primary money laundering concern. The Treasury 
Secretary will develop a calibrated response that will consider the 
effectiveness of the measure to address the threat, whether other 
countries are taking similar steps, and whether the response will cause 
harm to U.S. financial institutions and other firms.
  This legislation will strengthen the ability of the Secretary to 
combat international money laundering and help protect the integrity of 
the U.S. financial system. This bill has been supported by the heads of 
all the major federal law enforcement agencies.
  Today, advances in technology are bringing the world closer together 
than ever before and opening up new opportunities for economic growth. 
However, with these new advantages come equally important obligations. 
We must do everything possible to insure that the changes in technology 
do not give comfort to international criminals by giving them new ways 
to hide the financial proceeds of their crimes. This legislation is a 
first step toward limiting the scourge of money laundering and will 
help stop the development of international criminal organizations. I 
believe this legislation deserves consideration by the Senate during 
the 107th Congress.
  Mr. SARBANES. Mr. President, I am pleased to join Senators Kerry, 
Grassley, and Levin in introducing the International Counter-Money 
Laundering and Foreign Anti-Corruption Act of 2001, ``ICMLA''. This 
legislation is identical to a bill I co-sponsored last year.
  Money laundering poses an ongoing threat to the financial stability 
of the U.S. It is estimated by the Department of the Treasury that the 
global volume of laundered money accounts for between 2-5 percent of 
the global GDP. Although serious efforts to combat international money 
laundering began in the mid-1980's, recent scandals about the 
involvement of some the most prominent U.S. banks in money laundering 
schemes have highlighted key weaknesses in current laws.
  The ICMLA is designed to bolster the United States' ability to 
counter the laundering of the proceeds of drug trafficking, organized 
crime, terrorism and official corruption from abroad. The bill broadens 
the authority of the Secretary of the Treasury, ensures that banking 
transactions and financial relationship do not contravene the purposes 
of current anti-money laundering statutes, provides a clear mandate for 
subjecting foreign jurisdictions that facilitate money laundering to 
special scrutiny, and enhances reporting of suspicious activities. The 
bill similarly strengthens current measures to prevent the use of the 
U.S. financial system for personal gain by corrupt foreign officials 
and to facilitate the repatriation of any stolen assets to the citizens 
of countries to whom such assets belong.
  First, Section 101 of the ICMLA gives the Secretary of the Treasury, 
in consultation with other key government officials, discretionary 
authority to impose five new ``special measures'' against foreign 
jurisdictions and entities that are of ``primary money laundering 
concern'' to the United States. Under current law, the only counter-
money laundering tools available to the federal government are 
advisories, an important but relatively limited measure instructing 
banks to pay close attention to transactions that involve a given 
country, and full-blown economic sanctions under the International 
Emergency Economic Powers Act, ``IEEPA''. The five new intermediate 
measures will increase the government's ability to apply well-
calibrated pressure against targeted jurisdictions or institutions. 
These new measures include: 1. requiring additional record keeping/
reporting on particular transactions, 2. requiring the identification 
of the beneficial foreign owner of a U.S. bank account, 3. requiring 
the identification of those individuals using a U.S. bank account 
opened by a foreign bank to engage in banking transactions a ``payable-
through account'', 4. requiring the identification of those using a 
U.S. bank account established to receive deposits and make payments on 
behalf of a foreign financial institution, a ``correspondent account'', 
and 5. restricting or prohibiting the opening or maintaining of certain 
correspondent accounts. The Democratic staff of the Permanent 
Subcommittee on Investigations of the Senate Governmental Affairs 
Committee recently completed an investigation and published results 
critical of certain correspondent banking activities.
  Second, the bill seeks to enhance oversight into illegal activities 
by clarifying that the ``safe harbor'' from civil liability for filing 
a Suspicious Activity Report, ``SAR'', applies in any litigation, 
including suit for breach of contract or in an arbitration proceeding. 
Under the Bank Secrecy Act, ``BSA'', any financial institution or 
officer, director, employee, or agent of a financial institution is 
protected against private civil liability for filing a SAR. Section 201 
of the bill amends the BSA to clarify the prohibition on disclosing 
that a SAR has been filed. These reports are the cornerstone of our 
nation's money-laundering efforts because they provide the information 
necessary to alert law enforcement to illegal activity.
  Third, the bill enhances enforcement of Geographic Targeting Orders, 
``GTO''. These orders lower the dollar thresholds for reporting 
transactions within a defined geographic area. Section 202 of the bill 
clarifies that civil and criminal penalties for violations of the Bank 
Secrecy Act and its regulations also apply to reports required by

[[Page S1631]]

GTO's. In addition, the section clarifies that structuring a 
transaction to avoid a reporting requirement by a GTO is a criminal 
offense and extends the presumptive GTO period from 60 to 180 days.
  Fourth, Section 203 of the bill permits a bank, upon request of 
another bank, to include suspicious illegal activity in written 
employment references. Under this provision, banks would be permitted 
to share information concerning the possible involvement of a current 
or former officer or employee in potentially unlawful activity without 
fear of civil liability for sharing the information.
  Finally, Title III of the bill addresses corruption by foreign 
officials and ruling elites. Earlier this year, the Secretary of the 
Treasury, in consultation with the Attorney General and the financial 
services regulators, issued guidelines to financial institutions 
operating in the U.S. on appropriate practices and procedures to reduce 
the likelihood that such institutions could facilitate proceeds 
expropriated by or on behalf of foreign senior government officials. 
Title III would help build upon efforts to combat corruption by foreign 
officials and ruling elites. It provides that the U.S. government 
should make clear that it will take all steps necessary to identify the 
proceeds of foreign government corruption which have been deposited in 
U.S. financial institutions and return such proceeds to the citizens of 
the country to whom such assets belong. It also encourages the U.S. to 
continue to actively and publicly support the objectives of the 
Financial Action Task Force on Money Laundering with regard to 
combating international money laundering.
  The ICMLA addresses many of the shortcomings of current law. the 
Secretary of Treasury is granted additional authority to require 
greater transparency of transactions and accounts as well as to 
narrowly target penalties and sanctions. The reporting and collection 
of additional information on suspected illegal activity will greatly 
enhance the ability of bank regulators and law enforcement to combat 
the laundering of drug money, proceeds from corrupt regimes, and other 
illegal activities.
  The House Banking Committee passed the identical anti-money 
laundering bill by a vote of 31 to 1 on June 8, 2000. I hope that we 
can move this legislation expeditiously in the Senate.
                                 ______
                                 
      By Mr. EDWARDS (for himself and Mr. Dodd):
  S. 399. A bill to provide for fire sprinkler systems, or other fire 
suppression or prevention technologies, in public and private college 
and university housing and dormitories, including fraternity and 
sorority housing and dormitories; to the Committee on Health, 
Education, Labor, and Pensions.
  Mr. EDWARDS. Mr. President, I rise today along with my colleague 
Senator Dodd to re-introduce the College Fire Prevention Act. This 
measure would provide federal matching grants for the installation of 
fire sprinkler systems in college and university dormitories and 
fraternity and sorority houses. I believe the time is now to address 
the sad situation of deadly fires that occur in our children's college 
living facilities.
  The tragic fire that occurred at Seton Hall University on Wednesday 
January 19th, 2000 will not be long forgotten. Sadly, three freshman, 
all 18 years old, died. Fifty-four students, two South Orange 
firefighters and two South Orange police officers were injured. The 
dormitory, Boland Hall, was a six-story, 350 room structure built in 
1952 that housed approximately 600 students. Astonishingly, the fire 
was contained to the third floor lounge of Boland Hall. This dormitory 
was equipped with smoke alarms but no sprinkler system.
  Unfortunately, the Boland Hall fire was not the first of its kind. 
And it reminded many people in North Carolina of their own tragic 
experience with dorm fires. In 1996, on Mother's Day and Graduation 
Day, a fire in the Phi Gamma Delta fraternity house at the University 
of North Carolina at Chapel Hill killed five college juniors and 
injured three others. The 3-story plus basement fraternity house was 70 
years old. The National Fire Protection Association identified several 
factors that contributed to the tragic fire, including the lack of fire 
sprinkler protection.
  Sadly, there have been countless other dorm fires. On December 9, 
1997, a student died in a dormitory fire at Greenville College in 
Greenville, Illinois. The dormitory, Kinney Hall, was built in the 
1960s and had no fire sprinkler system. On January 10, 1997, a student 
died at the University of Tennessee at Martin. The dormitory, Ellington 
Hall, had no fire sprinkler system. On January 3, 1997 a student died 
in a dormitory fire at Central Missouri State University in 
Warrensburg, Missouri. On October 21, 1994, five students died in a 
fraternity house fire in Bloomsburg, Pennsylvania. The list goes on and 
on. In a typical year between 1980 and 1998, the National Fire 
Protection Association estimates there were an average of 1,800 fires 
at dormitories, fraternities, and sororities, involving 1 death, 70 
injuries, and 8 million dollars in property damage.
  So now we must ask, what can be done? What can we do to curtail these 
tragic fires from taking the lives of our children, our young adults? 
We should focus our attention on the lack of fire sprinklers in college 
dormitories and fraternity and sorority houses. Sprinklers save lives. 
Indeed, the National Fire Protection Association has never recorded a 
fire that killed more than 2 people in a public assembly, educational, 
institutional, or residential building where a sprinkler system was 
operating properly.
  Despite the clear benefits of sprinklers, many college dorms do not 
have them. New dormitories are generally required to have advanced 
safety systems such as fire sprinklers. But such requirements are 
rarely imposed retroactively on existing buildings. In 1998, 93 percent 
of the campus building fires reported to fire departments occurred in 
buildings where there were smoke alarms present. However, only 34 
percent of them had fire sprinklers present.
  At my state's flagship university at Chapel Hill, for example, only 
six of the 29 residence halls have sprinklers. A report published by 
The Raleigh News & Observer in the wake of the Seton Hall fire also 
noted that only seven of 19 dorms at North Carolina State University 
are equipped with the life-saving devices, and there are sprinklers in 
two of the 10 dorms at North Carolina Central University. At Duke 
University, only five of 26 dorms have sprinklers.
  The legislation I introduce today authorizes the Secretary of 
Education, in consultation with the United States Fire Administration, 
to award grants to States, private or public colleges or universities, 
fraternities, or sororities to assist them in providing fire sprinkler 
systems for their student housing and dormitories. These entities would 
be required to produce matching funds equal to one-half of the cost. 
This legislation authorizes $100 million for fiscal years 2002 through 
2006.
  In North Carolina, we decided to initiate a drive to install 
sprinklers in our public college and university dorms. The overall cost 
is estimated at 57.5 million dollars. Given how much it is going to 
cost North Carolina's public colleges and universities to install 
sprinklers, I think it's clear that the $100 million that this measure 
authorizes is just a drop in the bucket. But my hope is that by 
providing this small incentive we can encourage more colleges to 
institute a comprehensive review of their dorm's fire safety and to 
install sprinklers. All they need is a helping hand. With this modest 
measure of prevention, we can help prevent the needless and tragic loss 
of young lives.
  Parents should not have to worry about their children living in fire 
traps. When we send our children away to college, we are sending them 
to a home away from home where hundreds of other students eat, sleep, 
burn candles, use electric appliances and smoke. We must not compromise 
on their safety. In short, the best way to ensure the protection of our 
college students is to install fire sprinklers in our college 
dormitories and fraternity and sorority houses. I ask all of my 
colleagues to join me in supporting this important legislation. Thank 
you.
  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:

[[Page S1632]]

                                 S. 399

       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 ``College Fire Prevention 
     Act''.

     SEC 2. FINDINGS.

       Congress makes the following findings:
       (1) On Wednesday, January 19, 2000, a fire occurred at a 
     Seton Hall University dormitory. Three male freshmen, all 18 
     years of age, died. Fifty-four students, 2 South Orange 
     firefighters, and 2 South Orange police officers were 
     injured. The dormitory was a 6-story, 350-room structure 
     built in 1952, that housed approximately 600 students. It was 
     equipped with smoke alarms but no fire sprinkler system.
       (2) On Mother's Day 1996 in Chapel Hill, North Carolina, a 
     fire in the Phi Gamma Delta Fraternity House killed 5 college 
     juniors and injured 3. The 3-story plus basement fraternity 
     house was 70 years old. The National Fire Protection 
     Association identified several factors that contributed to 
     the tragic fire, including the lack of fire sprinkler 
     protection.
       (3) It is estimated that between 1980 and 1998, an average 
     of 1,800 fires at dormitories, fraternities, and sororities, 
     involving 1 death, 70 injuries, and $8,000,000 in property 
     damage were reported to public fire departments.
       (4) Within dormitories, fraternities, and sororities the 
     number 1 cause of fires is arson or suspected arson. The 
     second leading cause of college building fires is cooking, 
     while the third leading cause is smoking.
       (5) The National Fire Protection Association has no record 
     of a fire killing more than 2 people in a completely fire 
     sprinklered public assembly, educational, institutional, or 
     residential building where the sprinkler system was operating 
     properly.
       (6) New dormitories are generally required to have advanced 
     safety systems such as fire sprinklers. But such requirements 
     are rarely imposed retroactively on existing buildings.
       (7) In 1998, 93 percent of the campus building fires 
     reported to fire departments occurred in buildings where 
     there were smoke alarms present. However, only 34 percent had 
     fire sprinklers present.

     SEC. 3. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated to carry out this 
     Act $100,000,000 for each of the fiscal years 2002 through 
     2006.

     SEC. 4. GRANTS AUTHORIZED.

       (a) Program Authority.--The Secretary of Education, in 
     consultation with the United States Fire Administration, is 
     authorized to award grants to States, private or public 
     colleges or universities, fraternities, and sororities to 
     assist them in providing fire sprinkler systems, or other 
     fire suppression or prevention technologies, for their 
     student housing and dormitories.
       (b) Matching Funds Requirement.--The Secretary of Education 
     may not award a grant under this section unless the entity 
     receiving the grant provides, from State, local, or private 
     sources, matching funds in an amount equal to not less than 
     one-half of the cost of the activities for which assistance 
     is sought.

     SEC. 5. PROGRAM REQUIREMENTS.

       (a) Application.--Each entity desiring a grant under this 
     Act shall submit to the Secretary of Education an application 
     at such time and in such manner as the Secretary may require.
       (b) Priority.--In awarding grants under this Act, the 
     Secretary shall give priority to applicants that demonstrate 
     in the application submitted under subsection (a) the 
     inability to fund the sprinkler system, or other fire 
     suppression or prevention technology, from sources other than 
     funds provided under this Act.
       (c) Limitation on Administrative Expenses.--An entity that 
     receives a grant under this Act shall not use more than 4 
     percent of the grant funds for administrative expenses.

     SEC. 6. DATA AND REPORT.

       The Comptroller General shall--
       (1) gather data on the number of college and university 
     housing facilities and dormitories that have and do not have 
     fire sprinkler systems and other fire suppression or 
     prevention technologies; and
       (2) report such data to Congress.

     SEC. 7. ADMISSIBILITY.

       Notwithstanding any other provision of law, any application 
     for assistance under this Act, any negative determination on 
     the part of the Secretary of Education with respect to such 
     application, or any statement of reasons for the 
     determination, shall not be admissible as evidence in any 
     proceeding of any court, agency, board, or other entity.
                                 ______
                                 
      By Mr. BAUCUS (for himself, Mr. Roberts, Mrs. Lincoln, and Mr. 
        Dorgan):
  S. 400. A bill to lift the trade embargo on Cuba, and for other 
purposes; to the Committee on Finance.
                                 ______
                                 
      By Mr. BAUCUS (for himself, Mr. Roberts, and Mrs. Lincoln):
  S. 401. A bill to normalize trade relations with Cuba, and for other 
purposes; to the Committee on Finance.
  S. 402. A bill to make an exception to the United States embargo on 
trade with Cuba for the export of agricultural commodities, medicines, 
medical supplies, medical instruments, or medical equipment and for 
other purposes; to the Committee on Finance.
  Mr. BAUCUS. Mr. President, I am introducing today a series of bills 
that would end the embargo on trade with Cuba and normalize our 
economic relations with this country that is a mere ninety miles off 
our shore. I should add that Congressman Charles Rangel is offering a 
set of companion bills in the House today.
  Last July, I led a small group of Senators to Havana. During our 
brief visit, we met with Fidel Castro. But we also spent three hours 
with a group of six dissidents who had spent years in prison, yet have 
chosen heroically to continue their dissent from within Cuba. We met 
with the leader of Cuba's largest independent NGO. It was clear to me 
that our Cuba policy was outdated and needed fundamental change.
  I have long fought against unilateral economic sanctions, unless our 
national security was at stake. The Cuba embargo is a unilateral 
sanction, but our national security is not at stake. The Defense 
Department has concluded that Cuba does not represent any security 
threat to this nation. None of our closest allies supports the embargo. 
Nor do any of our trading partners in the Americas.
  Unilateral sanctions do not work. The embargo has not changed the 
behavior of the Cuban government and its leadership. It has not changed 
the behavior of Fidel Castro. But the embargo has hurt the people of 
Cuba. And the embargo has hurt American farmers and businesses, as our 
Asian, European, and Canadian competitors have rushed in to fill the 
gap in the Cuban market.
  The U.S. International Trade Commission released a report on the 
economic impact of U.S. sanctions on Cuba. The ITC found that the 
embargo costs US exporters, farmers, manufacturers, and service 
providers between $650 million and one billion dollars a year in lost 
sales. This is intolerable.
  We should lift the embargo. We should engage Cuba economically. We 
should engage the people of Cuba.
  The bills I am introducing today do just that. The first bill, on 
which I am joined by Senators Roberts, Lincoln, and Dorgan, is the 
``Free Trade with Cuba Act'', that would lift the embargo completely. 
The second bill, on which I am joined by Senators Roberts and Lincoln, 
is the ``United States-Cuba Trade Act of 2001'', that would remove Cuba 
from Jackson-Vanik treatment and provide normal trade relations status 
on a permanent basis. The third bill, on which I am also joined by 
Senators Roberts and Lincoln, is the ``Cuban Humanitarian Trade Act of 
2001'', that removes the restrictions on food and medicine exports 
imposed in the last Congress, repeals the codification of travel 
restrictions, and removes limitations on remittances to individual 
Cuban citizens.
  I am not suggesting that we embrace Fidel Castro. Far from it! His 
leadership, his treatment of his own people, his failed economic, 
political, and social policies--these are unacceptable to all 
Americans. But the world has changed since the United States initiated 
the embargo forty years and ten Presidents ago. It does us no good to 
wait until Castro is gone from the scene before we begin to develop 
normal relations with the Cuban people and with Cuba's future leaders. 
If we fail to develop those relationships now, the inevitable 
transition to democracy and a market economy will be much harder on all 
of the Cuban people. And events in Cuba could easily escalate out of 
control and put the United States in the middle of a dangerous domestic 
crisis on the island.
  Jim Hoagland, in a recent Washington Post column, wrote about his 
concern ``when sanctions linger too long and become a political 
football and a substitute for policy, as is the case today in Cuba.'' 
This accurately describes where we are today.
  To help further edify my colleagues on this issue, I would like to 
enter into the record a column from the February 9 Wall Street Journal 
by Philip Peters, Vice President of the Lexington Institute, who 
explains how changes in U.S. policy can help the Cuban people who 
continue to suffer under Castro's policies of political and economic 
repression.
  The three bills that I am offering today serve our national interest, 
will

[[Page S1633]]

help us move toward a peaceful transition in the post-Castro era, and 
will help the Cuban people now. I urge support from all my colleagues.
  Mr. President, I ask unanimous consent that additional material be 
printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

            [From the Wall Street Journal, February 9, 2001]

          ``Let Yankee Tourists Shower Dollars on Cuba's Poor"

                           (By Philip Peters)

       In her final press conference as Secretary of State, 
     Madeleine Albright's message to the Cuban people was 
     succinct. In reference to the aging Fidel Castro she said, 
     ``I wish them the actuarial tables.'' It was an odd statement 
     on behalf of a superpower that could have used the previous 
     eight years to exercise considerable influence on its small 
     island neighbor.
       It was also a fitting end to the Clinton administration's 
     passive approach to Cuba policy, where the impulse to 
     reassess strategy was nearly always trumped by the imperative 
     of avoiding political risk in Florida. Even in 1998, when 
     Republican leaders such as Sen. John Warner and former 
     Secretary of State George Shultz urged the creation of a 
     presidential bipartisan commission--a golden opportunity to 
     conduct a long overdue post-Cold War review that could have 
     included the full range of Cuban-American voices--politics 
     held the Clinton White House back.
       President Bush has an opportunity to make a fresh start. 
     Today's strict embargo policy, based on the goal of denying 
     hard currency to the Cuban government, made sense during the 
     Cold War when Cuba was a genuine security threat and 
     Washington had reason to make Cuba an expensive satellite for 
     the Soviet Union to maintain.
       Today, with sanctions twice tightened during the 1990s, 
     Fidel Castro remains firmly in power. With the Soviet-era 
     security threat gone, it is time to recognize that isolating 
     Cuba from commerce and contact with Americans is 
     counterproductive because it reduces American influence in 
     Cuba. President Bush's Cuba policy is not yet defined, but 
     Secretary of State Colin Powell has said that ``We will only 
     participate in those activities with Cuba that benefit the 
     people directly and not the government.''
       This standard sounds good in theory, but in practice it is 
     impossible to achieve. Virtually every form of economic 
     activity with Cuba benefits both the people and the 
     government. Today, European and Canadian trade, investment 
     and tourism benefit Cuban state enterprises. But they also 
     increase the earnings of Cuban workers, expose Cubans to 
     foreigners and non-socialist ideas, bring capitalist business 
     practices, and reshape the Cuban economy to fit its 
     comparative advantages in the global system. This adds up to 
     humanitarian benefits for the Cuban people, and a head start 
     on a future transition to a more market-oriented economy.
       U.S. economic activity also benefits both the state and the 
     people of Cuba. Family remittances, estimated by the United 
     Nations at over $700 million annually, bring more foreign 
     exchange than sugar exports. Many of these dollars land in 
     the Cuban treasury when Cubans spend them in state retail 
     stores. U.S.-Cuba phone connections allow families to 
     communicate, but generate over $70 million a year for the 
     state phone company. A strict application of Secretary 
     Powell's own standard would cut off these valuable benefits.
       The trick, then, for an administration that seems to want 
     to end unilateral trade sanctions everywhere but Cuba, will 
     not be to reach for Secretary Powell's unattainable standard. 
     Rather, it will be to choose among forms of engagement that 
     serve America's humanitarian interest in helping Cubans to 
     prosper, our long-term economic interest of nudging Cuba 
     toward a market economy, and our political interest in 
     exposing Cubans to Americans and American ideas.
       President Bush could begin by supporting the congressional 
     consensus, expressed last year by greater than three-to-one 
     majorities in the House and Senate, to lift all restrictions 
     on food and medicine sales. This step would begin to reverse 
     the implicit assumption in U.S. policy that American 
     interests are somehow served if products such as rice, 
     powdered milk, and drugs are more scarce or expensive for 
     Cubans to acquire. It would also support the calls by Cuban 
     dissidents such as Elizardo Sanchez and the Christian 
     Liberation Movement for an end to this part of the embargo. 
     It ``hurts the people, not the regime,'' Mr. Sanchez says, 
     and is ``an odd way of demonstrating support for human 
     rights.''
       President Bush could then end all restrictions on Cuban-
     American remittances, now limited to $1,200 a year, and on 
     family visits, which are permitted only in cases of 
     ``humanitarian emergency'' a cruel regulation that forces 
     families to lie by the thousands each December when they 
     visit relatives at Christmas.
       Finally, the president could support an end to the travel 
     ban imposed on Americans--a mistaken policy that treats free 
     contact between American and Cuban societies as a detriment 
     rather than an opportunity. ``If we have a million Americans 
     walking on the streets of Havana, you will have something 
     like the pope's visit multiplied by 10,'' independent 
     journalist Manuel David Orrio told the Chicago Tribune in 
     1999. A Havana clergyman told me last month that visiting 
     Americans ``would permeate this place with the idea of a free 
     society.''
       Like other international travelers, Americans' spending 
     would boost Cubans' earnings in hotels and restaurants and 
     expand Cuba's incipient private sector. An influx of U.S. 
     travelers would immediately create a shortage of lodging that 
     would be filled partially by Cubans who legally rent rooms in 
     their homes. Demand for the services of artisans, taxis and 
     private restaurants would also increase, adding to the 
     disposable income that sustains other entrepreneurs, from 
     carpenters and repairmen to food vendors and tutors.
       As this sector, now 150,000 strong, gains income and 
     expands, demand would increase for the freely priced, 
     privately sold produce in Cuba's 300 farmers markets, 
     benefitting farmers across Cuba who have no contact with 
     tourists. Americans would experience ``the interface between 
     the entrepreneurial folks'' that President Bush lauds as a 
     virtue of open trade with communist China, to say nothing of 
     the value of their personal contact with Cubans. This may be 
     why a Florida International University poll shows a slim 
     majority of Cuban-Americans, and three fourths of the most 
     recent Cuban immigrants, supporting an end to the travel ban.
       A policy opening of this type would leave the trade embargo 
     largely intact for future review, and it would do nothing to 
     diminish America's stark opposition to Cuban human rights 
     practices. However, it would increase concrete support to the 
     Cuban people, and it would spur the development of free-
     market activity in the post-Castro Cuba that is now taking 
     shape.
                                 ______
                                 
      By Mr. COCHRAN:
  S. 403. A bill to improve the National Writing Project; to the 
Committee on Health, Education, Labor, and Pensions.
  Mr. COCHRAN. Mr President, today, I am introducing legislation 
reauthorizing the National Writing Project, the only Federal program to 
improve the teaching of writing in America's classrooms.
  Literacy is at the foundation of school and workplace success, of 
citizenship in a democracy, and of learning in all disciplines. The 
National Writing Project has been instrumental in helping teachers 
develop better teaching skills so they can help our children improve 
their ability to read, write, and think.
  The National Writing Project is a twenty-seven-year old national 
network of university-based teacher training programs designed to 
improve the teaching of writing and student achievement in writing and 
has had federal support since 1991. Successful writing teachers attend 
Invitational Summer Institutes at their local universities. During the 
school year these teachers provide workshops for other teachers in the 
schools. At 167 sites in 49 states, the National Writing Project trains 
over 100,000 teachers every year.
  The program has become a national model for other disciplines and is 
now recognized by the Department of Education as an important part of 
national education policy. The program also generates an average of 
$6.32 in private, state, and local funds for every federal dollar 
appropriated. The National Writing Project is making teachers better at 
their jobs.
  I introduced the National Writing Project Act for the first time in 
1990. Since then, I have worked with other Senators to ensure that it 
has remained a program that supports states and local schools in their 
efforts to have better teachers. Last Congress when I introduced this 
bill, it was cosponsored by 52 Senators. I hope it will receive even 
greater support in the 107th Congress. I invite other Senators to join 
me in sponsoring this legislation.
                                 ______
                                 
      By Mr. McCAIN:
  S. 404. A bill to provide for the technical integrity of the FM radio 
band, and for other purposes; to the Committee on Commerce, Science, 
and Transportation.
  Mr. McCAIN. Mr. President, I rise today to introduce a bill that will 
allow our communities and churches to benefit from low-power radio 
service.
  Mr. President, low-power FM radio service provides community based 
organizations, churches, and other non-profit groups with a new, 
affordable opportunity to reach out to the public, helping to promote a 
greater awareness of local issues important to our communities. As 
such, low-power FM is supported by many national and local 
organizations who seek to provide the public with increased sources of 
news

[[Page S1634]]

and perspectives in an otherwise increasingly consolidated medium.
  Last Congress, special interests forces opposed to low-power FM 
radio, most notably the National Association of Broadcasters and 
National Public Radio, mounted a vigorous behind-the-scenes campaign to 
kill low-power FM radio. And unfortunately, these special interests 
succeeded in attaching an appropriations rider in the dead of the 
night--without a single debate on the floor of the Senate--that 
effectively did just that.
  Mr. President, the Low Power Radio Act of 2001 seeks to remedy this 
derailment of the democratic process. The Low Power Radio Act of 2001 
will allow the FCC to license low-power FM radio service, while at the 
same time protecting existing full-power stations from interference. 
Specifically, the legislation directs the FCC--the expert agency with 
the experience and engineering resources to make such a determination--
to determine which, if any, low-power radio stations are causing 
interference to existing full-power stations, and determine what the 
low-power FM station must do to alleviate it. Thus, this legislation 
strikes a fair balance by allowing non-interfering low-power FM 
stations to operate without further delay, while affecting only those 
low-power stations that the FCC finds to be causing harmful 
interference in their actual, everyday operations. This is totally 
consistent with the fact that low-power FM is a secondary service 
which, by law, must cure any interference caused to any primary, full-
power service.
  This legislation will provide an efficient and effective means to 
detect and resolve harmful interference. By providing a procedural 
remedy that authorizes the FCC to impose damages on frivolous 
complaints, the bill will discourage the creation of low-power stations 
most likely to cause harmful interference while at the same time 
discouraging full-power broadcasters from making unwarranted 
interference claims.
  In the interests of would-be new broadcasters, existing broadcasters, 
but, most of all, the listening public, I urge the enactment of the Low 
Power Radio Act of 2001.
  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. 404

       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 ``Low Power Radio Act of 
     2001''.

     SEC. 2. PURPOSE.

       It is the purpose of this Act to ensure the technical 
     integrity of the FM radio band, while permitting the 
     introduction of low power FM transmitters into such band 
     without causing harmful interference.

     SEC. 3. HARMFUL INTERFERENCE PROHIBITED.

       (a) In General.--Any low-power FM radio licensee determined 
     by the Federal Communications Commission to be transmitting a 
     signal causing harmful interference to one or more licensed 
     radio services shall, if so ordered by the Commission, cease 
     the transmission of the interfering signal, and may not 
     recommence transmitting such signal until it has taken 
     whatever action the Commission may prescribe in order to 
     assure that the radio licensee that has sustained the 
     interference remains able to serve the public interest, 
     convenience and necessity as required by the Commission's 
     rules.
       (b) Complaint.--Any radio service licensee or subcarrier 
     program provider may file a complaint with the Commission 
     against any low-power FM radio licensee for transmitting a 
     signal that is alleged to cause harmful interference. The 
     complaint shall be filed in a form, and contain such 
     information as, prescribed by the Commission.
       (c) Expedited Consideration.--In any complaint filed 
     pursuant to the provisions of subsection (b), the Commission 
     shall render a final decision no later than 90 calendar days 
     after the date on which the complaint was received by the 
     Commission.
       (d) Punitive Damages.--In any final decision rendered 
     pursuant to this section, the Commission is authorized to 
     impose punitive damages not to exceed 5 times the low-power 
     FM station's costs if the Commission finds that the complaint 
     was frivolous and without any merit or purpose other than to 
     impede the provision of non-interfering low-power FM service.
       (e) Section 316(a)(3) of Communications Act.--Section 
     316(a)(3) of the Communications Act of 1934 (47 U.S.C. 
     316(a)(3)) shall not apply to a complaint filed pursuant to 
     this section.
       (f) Rules.--The Commission shall adopt rules implementing 
     the provisions of this section within 45 days after the date 
     of enactment of this Act.
       (g) Harmful Interference Defined.--For purposes of this 
     section, the term ``harmful interference'' means interference 
     which endangers the functioning of a radio navigation service 
     or of other safety services or that seriously degrades, 
     obstructs, or repeatedly interrupts a radio service operating 
     in accordance with the rules and regulations of the Federal 
     Communications Commission.
       (h) Repeal of Certain Provisions.--
       (1) Restoration of Communications Act.--Section 336 of the 
     Communications Act of 1934 (47 U.S.C. 336) is amended by 
     striking subsection (h) and redesignating subsection (i) as 
     subsection (h).
       (2) Nullification of action under repealed provision.--Any 
     action taken by the Federal Communications Commission under 
     section 336(h) of the Communications Act of 1934 (47 U.S.C. 
     336(h)) as added by section 143(a) of Division B of A Bill 
     Making miscellaneous appropriations for the fiscal year 
     ending September 30, 2001, and for other purposes (106 Pub. 
     L. 554; Appendix-H.R. 5666) before the date of enactment of 
     this Act is null and void.
       (3) Repeal.--The Act entitled A Bill Making miscellaneous 
     appropriations for the fiscal year ending September 30, 2001, 
     and for other purposes (106 Pub. L. 554; Appendix-H.R. 5666) 
     is amended by striking section 143.

     SEC. 4. DIGITAL RADIO TRANSITION.

       The Federal Communications Commission shall complete all 
     rulemakings necessary to implement the transition to digital 
     radio no later than February 23, 2002.
                                 ______
                                 
      By Mr. LEAHY (for himself and Mr. Hatch):
  S. 407. A bill to amend the Trademark Act of 1946 to provide for the 
registration and protection of trademarks used in commerce, in order to 
carry out provisions of certain international conventions, and for 
other purposes; to the Committee on the Judiciary.
  Mr. LEAHY. Mr. President, I am pleased to introduce implementing 
legislation for the Protocol Relating to the Madrid Agreement 
Concerning the International Registration of Marks, Protocol. I have 
introduced identical bills in the last two Congresses, but the Senate 
unfortunately did not consider those bills. Chairman Hatch has joined 
me in introducing this legislation, and I thank him for his leadership 
on this and other intellectual property matters of such critical 
importance to the economy and industry of our country.
  This bill is part of my ongoing effort to update American 
intellectual property law to ensure that it serves to advance and 
protect American interests both here and abroad. The Protocol would 
help American businesses, and especially small and medium-sized 
companies, protect their trademarks as they expand into international 
markets. Specifically, this legislation will conform American trademark 
application procedures to the terms of the Protocol in anticipation of 
the U.S.'s eventual ratification of the treaty. Ratification by the 
United States of this treaty would help create a ``one stop'' 
international trademark registration process, which would be an 
enormous benefit for American businesses. This bill is one of many 
measures I have introduced and supported over the past few years to 
ensure that American trademark holders receive strong protection in 
today's world of changing technology and complex international markets.
  Over the past few years, Senator Hatch and I have worked together 
successfully on a number of initiatives to bolster trademark protection 
and keep our trademark laws up-to-date. For example, in the 104th 
Congress, we supported the Federal Trademark Dilution Act of 1995, 
enacted to provide intellectual property rights holders with the power 
to enjoin another person's commercial use of famous marks that would 
cause dilution of the mark's distinctive quality. In the 105th 
Congress, we introduced legislation, S. 2193, to implement the 
Trademark Law Treaty. S. 2193 simplified trademark registration 
requirements around the world by establishing a list of maximum 
requirements which Treaty member countries can impose on trademark 
applicants. The bill passed the Senate on September 17, 1998, and was 
signed by the President on October 30, 1998. I am proud of this 
legislation since all American businesses, and particularly small 
American businesses, will benefit as a result.
  Also, in the 105th Congress, I introduced S. 1727 to authorize a 
comprehensive study of the effects of adding new generic Top Level 
Domains on trademark and other intellectual property rights. This bill 
became law as part of

[[Page S1635]]

the Next Generation Internet Research Act, S. 1609, which was signed 
into law on October 28, 1998.
  In the 106th Congress, Senator Hatch and I worked together for 
enactment of the Anticybersquatting Consumer Protection Act, which 
protects against the registration, in bad faith with intent to profit, 
as a domain name of another person's trademark or the name of a living 
person. This bill was passed as part of the FY 2000 Omnibus 
Appropriations bill on November 29, 1999.
  Also in the 106th Congress, we worked to pass the Trademark 
Amendments Act, which enhanced protection for trademark owners and 
consumers by making it possible to prevent trademark dilution before it 
occurs, by clarifying the remedies available under the Federal 
trademark dilution statute, by providing recourse against the Federal 
Government for its infringement of others' trademarks, and by creating 
greater certainty and uniformity in the area of trade dress protection. 
The bill passed the Senate on July 1, 1999, and was enacted on August 
5, 1999.
  Together, these measures represent significant steps in our efforts 
to ensure that American trademark law adequately serves and promote 
American interests.
  The legislation I introduce today with Senator Hatch would ease the 
trademark registration burden on small and medium-sized businesses by 
enabling them to obtain trademark protection in all signatory countries 
with a single trademark application filed with the Patent and Trademark 
Office. Currently, in order for American companies to protect their 
trademarks abroad, they must register their trademarks in each and 
every country in which protection is sought. Registering in multiple 
countries is a time-consuming, complicated and expensive process--a 
process which places a disproportionate burden on smaller American 
companies seeking international trademark protection.
  I first introduced the Madrid Protocol Implementation Act in the 
105th Congress as S. 2191, then again in the 106th Congress as S. 671. 
The Judiciary Committee reported S. 671 favorably and unanimously, on 
February 10, 2000. In the House of Representatives, Congressmen Coble 
and Berman sponsored and passed an identical bill, H.R. 769, on April 
13, 1999.
  Since 1891, the Madrid Agreement Concerning the International 
Registration of Marks, Agreement has provided an international 
trademark registration system. However, prior to adoption of the 
Protocol, the U.S. declined to join the Agreement because it contained 
terms deemed inimical to American intellectual property interests. In 
1989, the terms of the Agreement were modified by the Protocol, which 
corrected the objectionable terms of the Agreement and made American 
participation a possibility. For example, under the Protocol, 
applications for international trademark extension can be completed in 
English; formerly, applications were required to be completed in 
French.
  Another stumbling block to the United States joining the Protocol was 
resolved last year. Specifically, the European Community, EC, had taken 
the position that under the Protocol, the EC, as an intergovernmental 
member of the Protocol, received a separate vote in the Assembly 
established by the agreement in addition to the votes of its member 
states. The State Department opposed this position as a contravention 
of the democratic concept of one-vote-per-country.
  On February 2, 2000, the Assembly of the Madrid Protocol expressed 
its intent ``to use their voting rights in such a way as to ensure that 
the number of votes cast by the European Community and its member 
States does not exceed the number of the European Community's Member 
States.'' In short, this letter appeared to resolve differences between 
the Administration and the European Community, EC, regarding the voting 
rights of intergovernmental members of the Protocol in the Assembly 
established by the agreement.
  Shortly after this letter was forwarded by the Assembly, I wrote to 
then Secretary of State Madeleine Albright requesting information on 
the Administration's position in light of the resolution of the voting 
dispute. At a hearing of the Foreign Operations Subcommittee on April 
14, 2000, I further inquired of Secretary Albright about the progress 
the Administration was making on this matter, particularly in light of 
the fact that differences over the voting rights of the European Union 
and participation of intergovernmental organizations in this 
intellectual property treaty were resolved in accordance with the U.S. 
position.
  Subsequently, President Clinton transmitted Treaty Document 106-41, 
the Protocol Relating to the Madrid Agreement to the Senate for 
ratification on September 5, 2000. Shortly after transmittal, on 
September 13, 2000, the Foreign Relations Committee held a hearing to 
consider Protocol. Unfortunately, no further action was taken on the 
Protocol or the implementing legislation before the Congress adjourned.
  United States membership in the Protocol would greatly enhance the 
ability of any U.S. business, whether large or small, to protect its 
trademarks in other countries more quickly, cheaply and easily. That, 
in turn, will make it easier for American businesses to enter foreign 
markets and to protect their trademarks in those markets. The Protocol 
would not require substantive changes to American trademark law, but 
merely to certain procedures for registering trademarks. Passage of 
this implementing legislation will help to ensure timely accession to 
and implementation of the Madrid Protocol, and it will send a clear 
signal to the international community, U.S. businesses, and trademark 
owners that Congress is serious about our Nation becoming part of a 
low-cost, efficient system to promote the international registration of 
marks. I look forward to working with Senator Hatch and my other 
colleagues for ratification of the Protocol and passage of the 
implementing legislation.
  I ask unanimous consent that a copy of the bill and the sectional 
analysis be placed in the RECORD after my statement, as well as any 
additional statements regarding this bill.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                 S. 407

       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 ``Madrid Protocol 
     Implementation Act''.

     SEC. 2. PROVISIONS TO IMPLEMENT THE PROTOCOL RELATING TO THE 
                   MADRID AGREEMENT CONCERNING THE INTERNATIONAL 
                   REGISTRATION OF MARKS.

       The Act entitled ``An Act to provide for the registration 
     and protection of trademarks used in commerce, to carry out 
     the provisions of certain international conventions, and for 
     other purposes'', approved July 5, 1946, as amended (15 
     U.S.C. 1051 and following) (commonly referred to as the 
     ``Trademark Act of 1946'') is amended by adding after section 
     51 the following new title:

                    ``TITLE XII--THE MADRID PROTOCOL

     ``SEC. 60. DEFINITIONS.

       ``For purposes of this title:
       ``(1) Madrid protocol.--The term `Madrid Protocol' means 
     the Protocol Relating to the Madrid Agreement Concerning the 
     International Registration of Marks, adopted at Madrid, 
     Spain, on June 27, 1989.
       ``(2) Basic application.--The term `basic application' 
     means the application for the registration of a mark that has 
     been filed with an Office of a Contracting Party and that 
     constitutes the basis for an application for the 
     international registration of that mark.
       ``(3) Basic registration.--The term `basic registration' 
     means the registration of a mark that has been granted by an 
     Office of a Contracting Party and that constitutes the basis 
     for an application for the international registration of that 
     mark.
       ``(4) Contracting party.--The term `Contracting Party' 
     means any country or inter-governmental organization that is 
     a party to the Madrid Protocol.
       ``(5) Date of recordal.--The term `date of recordal' means 
     the date on which a request for extension of protection that 
     is filed after an international registration is granted is 
     recorded on the International Register.
       ``(6) Declaration of bona fide intention to use the mark in 
     commerce.--The term `declaration of bona fide intention to 
     use the mark in commerce' means a declaration that is signed 
     by the applicant for, or holder of, an international 
     registration who is seeking extension of protection of a mark 
     to the United States and that contains a statement that--
       ``(A) the applicant or holder has a bona fide intention to 
     use the mark in commerce;
       ``(B) the person making the declaration believes himself or 
     herself, or the firm, corporation, or association in whose 
     behalf he or she makes the declaration, to be entitled to use 
     the mark in commerce; and

[[Page S1636]]

       ``(C) no other person, firm, corporation, or association, 
     to the best of his or her knowledge and belief, has the right 
     to use such mark in commerce either in the identical form of 
     the mark or in such near resemblance to the mark as to be 
     likely, when used on or in connection with the goods of such 
     other person, firm, corporation, or association, to cause 
     confusion, or to cause mistake, or to deceive.
       ``(7) Extension of protection.--The term `extension of 
     protection' means the protection resulting from an 
     international registration that extends to a Contracting 
     Party at the request of the holder of the international 
     registration, in accordance with the Madrid Protocol.
       ``(8) Holder of an international registration.--A `holder' 
     of an international registration is the natural or juristic 
     person in whose name the international registration is 
     recorded on the International Register.
       ``(9) International application.--The term `international 
     application' means an application for international 
     registration that is filed under the Madrid Protocol.
       ``(10) International bureau.--The term `International 
     Bureau' means the International Bureau of the World 
     Intellectual Property Organization.
       ``(11) International register.--The term `International 
     Register' means the official collection of such data 
     concerning international registrations maintained by the 
     International Bureau that the Madrid Protocol or its 
     implementing regulations require or permit to be recorded, 
     regardless of the medium which contains such data.
       ``(12) International registration.--The term `international 
     registration' means the registration of a mark granted under 
     the Madrid Protocol.
       ``(13) International registration date.--The term 
     `international registration date' means the date assigned to 
     the international registration by the International Bureau.
       ``(14) Notification of refusal.--The term `notification of 
     refusal' means the notice sent by an Office of a Contracting 
     Party to the International Bureau declaring that an extension 
     of protection cannot be granted.
       ``(15) Office of a contracting party.--The term `Office of 
     a Contracting Party' means--
       ``(A) the office, or governmental entity, of a Contracting 
     Party that is responsible for the registration of marks; or
       ``(B) the common office, or governmental entity, of more 
     than 1 Contracting Party that is responsible for the 
     registration of marks and is so recognized by the 
     International Bureau.
       ``(16) Office of origin.--The term `office of origin' means 
     the Office of a Contracting Party with which a basic 
     application was filed or by which a basic registration was 
     granted.
       ``(17) Opposition period.--The term `opposition period' 
     means the time allowed for filing an opposition in the Patent 
     and Trademark Office, including any extension of time granted 
     under section 13.

     ``SEC. 61. INTERNATIONAL APPLICATIONS BASED ON UNITED STATES 
                   APPLICATIONS OR REGISTRATIONS.

       ``The owner of a basic application pending before the 
     Patent and Trademark Office, or the owner of a basic 
     registration granted by the Patent and Trademark Office, 
     who--
       ``(1) is a national of the United States;
       ``(2) is domiciled in the United States; or
       ``(3) has a real and effective industrial or commercial 
     establishment in the United States,

     may file an international application by submitting to the 
     Patent and Trademark Office a written application in such 
     form, together with such fees, as may be prescribed by the 
     Director.

     ``SEC. 62. CERTIFICATION OF THE INTERNATIONAL APPLICATION.

       ``Upon the filing of an application for international 
     registration and payment of the prescribed fees, the Director 
     shall examine the international application for the purpose 
     of certifying that the information contained in the 
     international application corresponds to the information 
     contained in the basic application or basic registration at 
     the time of the certification. Upon examination and 
     certification of the international application, the Director 
     shall transmit the international application to the 
     International Bureau.

     ``SEC. 63. RESTRICTION, ABANDONMENT, CANCELLATION, OR 
                   EXPIRATION OF A BASIC APPLICATION OR BASIC 
                   REGISTRATION.

       ``With respect to an international application transmitted 
     to the International Bureau under section 62, the Director 
     shall notify the International Bureau whenever the basic 
     application or basic registration which is the basis for the 
     international application has been restricted, abandoned, or 
     canceled, or has expired, with respect to some or all of the 
     goods and services listed in the international registration--
       ``(1) within 5 years after the international registration 
     date; or
       ``(2) more than 5 years after the international 
     registration date if the restriction, abandonment, or 
     cancellation of the basic application or basic registration 
     resulted from an action that began before the end of that 5-
     year period.

     ``SEC. 64. REQUEST FOR EXTENSION OF PROTECTION SUBSEQUENT TO 
                   INTERNATIONAL REGISTRATION.

       ``The holder of an international registration that is based 
     upon a basic application filed with the Patent and Trademark 
     Office or a basic registration granted by the Patent and 
     Trademark Office may request an extension of protection of 
     its international registration by filing such a request--
       ``(1) directly with the International Bureau; or
       ``(2) with the Patent and Trademark Office for transmittal 
     to the International Bureau, if the request is in such form, 
     and contains such transmittal fee, as may be prescribed by 
     the Director.

     ``SEC. 65. EXTENSION OF PROTECTION OF AN INTERNATIONAL 
                   REGISTRATION TO THE UNITED STATES UNDER THE 
                   MADRID PROTOCOL.

       ``(a) In General.--Subject to the provisions of section 68, 
     the holder of an international registration shall be entitled 
     to the benefits of extension of protection of that 
     international registration to the United States to the extent 
     necessary to give effect to any provision of the Madrid 
     Protocol.
       ``(b) If United States Is Office of Origin.--An extension 
     of protection resulting from an international registration of 
     a mark shall not apply to the United States if the Patent and 
     Trademark Office is the office of origin with respect to that 
     mark.

     ``SEC. 66. EFFECT OF FILING A REQUEST FOR EXTENSION OF 
                   PROTECTION OF AN INTERNATIONAL REGISTRATION TO 
                   THE UNITED STATES.

       ``(a) Requirement for Request for Extension of 
     Protection.--A request for extension of protection of an 
     international registration to the United States that the 
     International Bureau transmits to the Patent and Trademark 
     Office shall be deemed to be properly filed in the United 
     States if such request, when received by the International 
     Bureau, has attached to it a declaration of bona fide 
     intention to use the mark in commerce that is verified by the 
     applicant for, or holder of, the international registration.
       ``(b) Effect of Proper Filing.--Unless extension of 
     protection is refused under section 68, the proper filing of 
     the request for extension of protection under subsection (a) 
     shall constitute constructive use of the mark, conferring the 
     same rights as those specified in section 7(c), as of the 
     earliest of the following:
       ``(1) The international registration date, if the request 
     for extension of protection was filed in the international 
     application.
       ``(2) The date of recordal of the request for extension of 
     protection, if the request for extension of protection was 
     made after the international registration date.
       ``(3) The date of priority claimed pursuant to section 67.

     ``SEC. 67. RIGHT OF PRIORITY FOR REQUEST FOR EXTENSION OF 
                   PROTECTION TO THE UNITED STATES.

       ``The holder of an international registration with an 
     extension of protection to the United States shall be 
     entitled to claim a date of priority based on the right of 
     priority within the meaning of Article 4 of the Paris 
     Convention for the Protection of Industrial Property if--
       ``(1) the international registration contained a claim of 
     such priority; and
       ``(2)(A) the international application contained a request 
     for extension of protection to the United States; or
       ``(B) the date of recordal of the request for extension of 
     protection to the United States is not later than 6 months 
     after the date of the first regular national filing (within 
     the meaning of Article 4(A)(3) of the Paris Convention for 
     the Protection of Industrial Property) or a subsequent 
     application (within the meaning of Article 4(C)(4) of the 
     Paris Convention).

     ``SEC. 68. EXAMINATION OF AND OPPOSITION TO REQUEST FOR 
                   EXTENSION OF PROTECTION; NOTIFICATION OF 
                   REFUSAL.

       ``(a) Examination and Opposition.--(1) A request for 
     extension of protection described in section 66(a) shall be 
     examined as an application for registration on the Principal 
     Register under this Act, and if on such examination it 
     appears that the applicant is entitled to extension of 
     protection under this title, the Director shall cause the 
     mark to be published in the Official Gazette of the Patent 
     and Trademark Office.
       ``(2) Subject to the provisions of subsection (c), a 
     request for extension of protection under this title shall be 
     subject to opposition under section 13. Unless successfully 
     opposed, the request for extension of protection shall not be 
     refused.
       ``(3) Extension of protection shall not be refused under 
     this section on the ground that the mark has not been used in 
     commerce.
       ``(4) Extension of protection shall be refused under this 
     section to any mark not registrable on the Principal 
     Register.
       ``(b) Notification of Refusal.--If, a request for extension 
     of protection is refused under subsection (a), the Director 
     shall declare in a notification of refusal (as provided in 
     subsection (c)) that the extension of protection cannot be 
     granted, together with a statement of all grounds on which 
     the refusal was based.
       ``(c) Notice to International Bureau.--(1) Within 18 months 
     after the date on which the International Bureau transmits to 
     the Patent and Trademark Office a notification of a request 
     for extension of protection, the Director shall transmit to 
     the International Bureau any of the following that applies to 
     such request:
       ``(A) A notification of refusal based on an examination of 
     the request for extension of protection.
       ``(B) A notification of refusal based on the filing of an 
     opposition to the request.
       ``(C) A notification of the possibility that an opposition 
     to the request may be filed after the end of that 18-month 
     period.

[[Page S1637]]

       ``(2) If the Director has sent a notification of the 
     possibility of opposition under paragraph (1)(C), the 
     Director shall, if applicable, transmit to the International 
     Bureau a notification of refusal on the basis of the 
     opposition, together with a statement of all the grounds for 
     the opposition, within 7 months after the beginning of the 
     opposition period or within 1 month after the end of the 
     opposition period, whichever is earlier.
       ``(3) If a notification of refusal of a request for 
     extension of protection is transmitted under paragraph (1) or 
     (2), no grounds for refusal of such request other than those 
     set forth in such notification may be transmitted to the 
     International Bureau by the Director after the expiration of 
     the time periods set forth in paragraph (1) or (2), as the 
     case may be.
       ``(4) If a notification specified in paragraph (1) or (2) 
     is not sent to the International Bureau within the time 
     period set forth in such paragraph, with respect to a request 
     for extension of protection, the request for extension of 
     protection shall not be refused and the Director shall issue 
     a certificate of extension of protection pursuant to the 
     request.
       ``(d) Designation of Agent for Service of Process.--In 
     responding to a notification of refusal with respect to a 
     mark, the holder of the international registration of the 
     mark shall designate, by a written document filed in the 
     Patent and Trademark Office, the name and address of a person 
     resident in the United States on whom may be served notices 
     or process in proceedings affecting the mark. Such notices or 
     process may be served upon the person so designated by 
     leaving with that person, or mailing to that person, a copy 
     thereof at the address specified in the last designation so 
     filed. If the person so designated cannot be found at the 
     address given in the last designation, such notice or process 
     may be served upon the Director.

     ``SEC. 69. EFFECT OF EXTENSION OF PROTECTION.

       ``(a) Issuance of Extension of Protection.--Unless a 
     request for extension of protection is refused under section 
     68, the Director shall issue a certificate of extension of 
     protection pursuant to the request and shall cause notice of 
     such certificate of extension of protection to be published 
     in the Official Gazette of the Patent and Trademark Office.
       ``(b) Effect of Extension of Protection.--From the date on 
     which a certificate of extension of protection is issued 
     under subsection (a)--
       ``(1) such extension of protection shall have the same 
     effect and validity as a registration on the Principal 
     Register; and
       ``(2) the holder of the international registration shall 
     have the same rights and remedies as the owner of a 
     registration on the Principal Register.

     ``SEC. 70. DEPENDENCE OF EXTENSION OF PROTECTION TO THE 
                   UNITED STATES ON THE UNDERLYING INTERNATIONAL 
                   REGISTRATION.

       ``(a) Effect of Cancellation of International 
     Registration.--If the International Bureau notifies the 
     Patent and Trademark Office of the cancellation of 
     an international registration with respect to some or all 
     of the goods and services listed in the international 
     registration, the Director shall cancel any extension of 
     protection to the United States with respect to such goods 
     and services as of the date on which the international 
     registration was canceled.
       ``(b) Effect of Failure To Renew International 
     Registration.--If the International Bureau does not renew an 
     international registration, the corresponding extension of 
     protection to the United States shall cease to be valid as of 
     the date of the expiration of the international 
     registration.
       ``(c) Transformation of an Extension of Protection Into a 
     United States Application.--The holder of an international 
     registration canceled in whole or in part by the 
     International Bureau at the request of the office of origin, 
     under Article 6(4) of the Madrid Protocol, may file an 
     application, under section 1 or 44 of this Act, for the 
     registration of the same mark for any of the goods and 
     services to which the cancellation applies that were covered 
     by an extension of protection to the United States based on 
     that international registration. Such an application shall be 
     treated as if it had been filed on the international 
     registration date or the date of recordal of the request for 
     extension of protection with the International Bureau, 
     whichever date applies, and, if the extension of 
     protection enjoyed priority under section 67 of this 
     title, shall enjoy the same priority. Such an application 
     shall be entitled to the benefits conferred by this 
     subsection only if the application is filed not later than 
     3 months after the date on which the international 
     registration was canceled, in whole or in part, and only 
     if the application complies with all the requirements of 
     this Act which apply to any application filed pursuant to 
     section 1 or 44.

     ``SEC. 71. AFFIDAVITS AND FEES.

       ``(a) Required Affidavits and Fees.--An extension of 
     protection for which a certificate of extension of protection 
     has been issued under section 69 shall remain in force for 
     the term of the international registration upon which it is 
     based, except that the extension of protection of any mark 
     shall be canceled by the Director--
       ``(1) at the end of the 6-year period beginning on the date 
     on which the certificate of extension of protection was 
     issued by the Director, unless within the 1-year period 
     preceding the expiration of that 6-year period the holder of 
     the international registration files in the Patent and 
     Trademark Office an affidavit under subsection (b) together 
     with a fee prescribed by the Director; and
       ``(2) at the end of the 10-year period beginning on the 
     date on which the certificate of extension of protection was 
     issued by the Director, and at the end of each 10-year period 
     thereafter, unless--
       ``(A) within the 6-month period preceding the expiration of 
     such 10-year period the holder of the international 
     registration files in the Patent and Trademark Office an 
     affidavit under subsection (b) together with a fee prescribed 
     by the Director; or
       ``(B) within 3 months after the expiration of such 10-year 
     period, the holder of the international registration files in 
     the Patent and Trademark Office an affidavit under subsection 
     (b) together with the fee described in subparagraph (A) and 
     an additional fee prescribed by the Director.
       ``(b) Contents of Affidavit.--The affidavit referred to in 
     subsection (a) shall set forth those goods or services 
     recited in the extension of protection on or in connection 
     with which the mark is in use in commerce and the holder of 
     the international registration shall attach to the affidavit 
     a specimen or facsimile showing the current use of the mark 
     in commerce, or shall set forth that any nonuse is due to 
     special circumstances which excuse such nonuse and is not due 
     to any intention to abandon the mark. Special notice of the 
     requirement for such affidavit shall be attached to each 
     certificate of extension of protection.

     ``SEC. 72. ASSIGNMENT OF AN EXTENSION OF PROTECTION.

       ``An extension of protection may be assigned, together with 
     the goodwill associated with the mark, only to a person who 
     is a national of, is domiciled in, or has a bona fide and 
     effective industrial or commercial establishment either in a 
     country that is a Contracting Party or in a country that is a 
     member of an intergovernmental organization that is a 
     Contracting Party.

     ``SEC. 73. INCONTESTABILITY.

       ``The period of continuous use prescribed under section 15 
     for a mark covered by an extension of protection issued under 
     this title may begin no earlier than the date on which the 
     Director issues the certificate of the extension of 
     protection under section 69, except as provided in section 
     74.

     ``SEC. 74. RIGHTS OF EXTENSION OF PROTECTION.

       ``An extension of protection shall convey the same rights 
     as an existing registration for the same mark, if--
       ``(1) the extension of protection and the existing 
     registration are owned by the same person;
       ``(2) the goods and services listed in the existing 
     registration are also listed in the extension of protection; 
     and
       ``(3) the certificate of extension of protection is issued 
     after the date of the existing registration.''.

     SEC. 3. EFFECTIVE DATE.

       This Act and the amendments made by this Act shall take 
     effect on the date on which the Madrid Protocol (as defined 
     in section 60(1) of the Trademark Act of 1946) enters into 
     force with respect to the United States.
                                  ____


    Madrid Protocol Implementation Act--Section-by-Section Analysis


                         SECTION 1. SHORT TITLE

       This section provides a short title: the ``Madrid Protocol 
     Implementation Act.''


           SECTION 2. AMENDMENTS TO THE TRADEMARK ACT OF 1946

       This section amends the ``Trademark Act of 1946'' by adding 
     a new Title XII with the following provisions:
       The owner of a registration granted by the Patent and 
     Trademark Office (PTO) or the owner of a pending application 
     before the PTO may file an international application for 
     trademark protection at the PTO.
       After receipt of the appropriate fee and inspection of the 
     application, the PTO Director is charged with the duty of 
     transmitting the application to the WIPO International 
     Bureau.
       The Director is also obliged to notify the International 
     Bureau whenever the international application has been ``. . 
     . restricted, abandoned, canceled, or has expired . . .'' 
     within a specified time period.
       The holder of an international registration may request an 
     extension of its registration by filing with the PTO or the 
     International Bureau.
       The holder of an international registration is entitled to 
     the benefits of extension in the United States to the extent 
     necessary to give effect to any provision of the Protocol; 
     however, an extension of an international registration shall 
     not apply to the United States if the PTO is the office of 
     origin with respect to that mark.
       The holder of an international registration with an 
     extension of protection in the United States may claim a date 
     of priority based on certain conditions.
       If the PTO Director believes that an applicant is entitled 
     to an extension of protection, he or she publishes the mark 
     in the ``Official Gazette'' of the PTO. This serves notice to 
     third parties who oppose the extension. Unless an official 
     protest conducted pursuant to existing law is successful, the 
     request for extension may not be refused. If the request for 
     extension is denied, however, the Director notifies the 
     International Bureau of such action and sets forth the 
     reason(s) why. The Director must also apprise

[[Page S1638]]

     the International Bureau of other relevant information 
     pertaining to requests for extension within the designated 
     time periods.
       If an extension for protection is granted, the Director 
     issues a certificate attesting to such action, and publishes 
     notice of the certificate in the ``Gazette.'' Holders of 
     extension certificates thereafter enjoy protection equal to 
     that of other owners of registration listed on the Principal 
     Register of the PTO.
       If the International Bureau notifies the PTO of a 
     cancellation of some or all of the goods and services listed 
     in the international registration, the Director must cancel 
     an extension of protection with respect to the same goods and 
     services as of the date on which the international 
     registration was canceled. Similarly, if the International 
     Bureau does not renew an international registration, the 
     corresponding extension of protection in the United States 
     shall cease to be valid. Finally, the holder of an 
     international registration canceled in whole or in part by 
     the International Bureau may file an application for the 
     registration of the same mark for any of the goods and 
     services to which the cancellation applies that were covered 
     by an extension of protection to the United States based on 
     that international registration.
       The holder of an extension of protection must, within 
     designated time periods and under certain conditions, file an 
     affidavit setting forth the relevant goods or services 
     covered an any explanation as to why their nonuse in commerce 
     is related to ``special circumstances,'' along with a filing 
     fee.
       The right to an extension of protection may be assigned to 
     a third party so long as the individual is a national of, or 
     is domiciled in, or has a ``bona fide'' business located in a 
     country that is a member of the Protocol; or has such a 
     business in a country that is a member of an 
     intergovernmental organization (like the E.U.) belonging to 
     the Protocol.
       An extension of protection conveys the same rights as an 
     existing registration for the same mark if the extension and 
     existing registration are owned by the same person, and 
     extension of protection and the existing registration cover 
     the same goods or services, and the certificate of extension 
     is issued after the date of the existing registration.


                       SECTION 3. EFFECTIVE DATE

       This section states that the effective date of the act 
     shall commence on the date on which the Madrid Protocol takes 
     effect in the United States.
  Mr. HATCH. Mr. President, today I am pleased to introduce with my 
distinguished colleague, Senator Leahy, legislation that will, for the 
first time, enable American businesses to obtain international 
trademark protection with the filing of a single application and the 
payment of a single fee.
  For many businesses, a company's trademark is its most valuable 
asset. This is illustrated now as never before in the growth of the new 
Internet economy, where so-called ``branding'' is the name of the game 
and the cornerstone of any business plan. Whether a business is an e-
business or a more traditional Main Street storefront, United States 
trademark law has proven to be a powerful tool for these businesses in 
protecting their marks against domestic misappropriation. However, as 
global trading increases and multinational businesses grow, worldwide 
trademark protection is becoming extremely important and desirable. 
Unfortunately, achieving similar protection on an international scale 
has always been a much more difficult task. This difficulty stems in 
large part from the diversity among national trademark laws, as well as 
the sometimes prohibitive costs of filing individual registrations and 
seeking foreign representation in each and every country for which 
trademark protection is sought. As a result, American businesses, and 
small businesses in particular, are often forced to pick only a handful 
of countries in which to seek protection for their brand names and hope 
for the best in the rest of the world.
  In the past, Senator Leahy and I have sponsored a number of bills 
addressing the international protection of intellectual property. In 
the trademark arena, we strongly supported legislation implementing the 
Trademark Law Treaty. That treaty serves to streamline the trademark 
registration process in member countries around the world and to 
minimize the hurdles faced by American trademark owners in securing 
international protection of their marks. The legislation we introduce 
today will build upon those improvements by allowing trademark owners 
to seek international protection with a single application filed in the 
English language with the United States Patent and Trademark Office, 
USPTO, and with the payment of a single fee. Most important, it paves 
the way for the USPTO to act as a one-stop shop for international 
trademark protection without making substantive changes to United 
States trademark law. Foreign trademark owners must still meet all of 
the substantive requirements of United States trademark law in order to 
gain protection in the United States based on an international 
application filed under the Madrid Protocol. In short, it is a win-win 
situation for American trademark owners.
  As my colleagues here know, United States adherence to the Madrid 
Protocol was stalled for years over administrative provisions--
unrelated to the substance of the Protocol itself--relating to voting 
rights. Since 1994, the Administration voiced objections to these 
provisions, which would allow an intergovernmental organization, e.g., 
the European Union, a vote in certain treaty matters taken before the 
Assembly, separate and apart from the votes of its member states. 
Although matters before the Assembly would largely be limited to 
administrative matters, e.g., those involving formalities and fee 
changes, the concern expressed has been that these provisions, which 
appear to violate the democratic principle of one vote for each state, 
would create an undesirable precedent in future international 
agreements.
  While this stumbling block to United States accession to the Protocol 
has been the subject of much negotiation between the United States and 
the European Union, I am pleased that a successful resolution on this 
issue of voting rights has been reached, and I was pleased that the 
Senate finally received the Administration's request for its advice and 
consent last year. By passing The Madrid Protocol Implementation Act, 
we will take an important step in making sure that American trademark 
owners will be able to take full advantage of the benefits of the 
Protocol as soon as it comes into force with respect to the United 
States. This is a particularly important measure for American 
competitiveness, and for the individual businesses in each of our 
states. I want to thank Senator Leahy for his leadership with respect 
to this legislation, and I look forward to my colleagues' support for 
it.
                                 ______
                                 
      By Mrs. BOXER (for herself and Mrs. Feinstein):
  S. 408. A bill to provide emergency relief to small businesses 
affected by significant increases in the price of electricity; to the 
Committee on Small Business.
  Mrs. BOXER. Mr. President, today, I am introducing the Small Business 
Electricity Emergency Relief Act. As the electricity crisis in 
California continues, small businesses are being hit hard by the 
increase in electricity prices.
  Across California, small business owners are opening their 
electricity bills only to be in a state of shock. In some cases they 
find that their bills have doubled, and sometimes even tripled. This 
has resulted in many small businesses having to close their doors and 
many more facing severe economic hardship.
  Under the Small Business Electricity Emergency Relief Act of 2001, 
the Small Business Administration could make loans to small businesses 
that have suffered economic injury due to a ``sharp and significant 
increase'' in their electricity bills.
  This legislation will provide California's small businesses with some 
much needed financial relief. This will greatly assist small businesses 
in the San Diego region that suffered dramatic increases in their 
electricity bills last summer.
  Small businesses represent the heart of our great state's thriving 
economy. This legislation will ensure that these small businesses are 
provided assistance to help keep their lights on.

                          ____________________