[Congressional Record Volume 147, Number 116 (Monday, September 10, 2001)]
[Senate]
[Pages S9254-S9259]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. HAGEL:

[[Page S9255]]

  S. 1412. A bill to protect the property rights guaranteed by the 
fifth amendment to the Constitution by requiring Federal agencies to 
prepare private property taking impact analyses and by allowing 
expanded access to Federal courts; to the Committee on Governmental 
Affairs.
  Mr. HAGEL. Mr. President, America's property owners are increasingly 
pressured by more and more burdensome government regulations and 
restrictions. Federal agencies should comply with state and local laws 
on property rights, and ensure that our Nation's policies are 
implemented with minimal impact on property owners. Today, I am 
reintroducing legislation that would help enforce the U.S. 
Constitution's guarantee of private property rights.
  The Private Property Rights Act would help protect land owners in two 
ways. First, the bill would require the Federal Government to conduct 
an economic impact analysis prior to taking any action that would 
inhibit or restrict the use of private property. For the first time, 
the government would be forced to determine in advance how its actions 
will impact the property owner.
  Second, when government does take private property or restricts land 
use, the bill would allow landowners to plead their case in a Federal 
District Court instead of forcing them to the U.S. Court of Federal 
Claims. This means property owners could appeal any Federal taking of 
their property in their home state, rather than Washington, D.C.
  This bill has won the endorsement of the Nebraska Cattlemen, the 
Nebraska Farm Bureau, and the Defenders of Property Rights. Their 
letters of support are being submitted for the Record.
  The Private Property Rights Act is commonsense legislation that will 
return some justice to the system by reining in regulatory agencies, as 
well as giving the property owner a voice in the process. This is the 
fair thing to do. This is the right thing to do.
  Mr. President, I ask unanimous consent that additional material be 
printed in the Record.
  There being no objection, the additional material was ordered to be 
printed in the Record, as follows:

                                                September 6, 2001.
     Hon. Chuck Hagel,
     U.S. Senate,
     Washington, DC.
       Dear Senator Hagel: The Nebraska Cattlemen applaud you for 
     reintroducing property rights protection legislation, The 
     Private Property Rights Act of 2001, in the 107th Congress. 
     The Association supported similar legislation (S. 246) in the 
     106th Congress and extends their support for your efforts 
     again this year.
       The Private Property Rights Act of 2001 addresses a 
     phenomenon of federal and state government growth over the 
     past three decades--regulatory programs that creep into areas 
     and activities they were never envisioned to impact at their 
     creation. Wetland regulations and endangered or threatened 
     species designations are just two examples of how 
     ``regulatory creep'' has begun to affect almost every 
     agricultural activity. A little closer to home, recent 
     efforts by EPA to identify the sun as a source of pollution 
     in the Platte River may only be overshadowed by more recent 
     efforts to list the prairie dog as a species threatened with 
     extinction.
       Considering these examples, it has never been more 
     important for federal agencies to be required to conduct an 
     analysis of the effects of their actions on property rights. 
     As found in The Private Property Rights Act of 2001, agency 
     actions critical to public safety or law enforcement would be 
     exempt from this requirement. Finally, and most critically, 
     the legislation provides affected property owners an 
     opportunity to seek relief form federal agencies whose 
     actions result in a taking of private property rights through 
     a federal district court in their state--instead of forcing 
     them into the Federal Claims Court in Washington, DC.
       The Private Property Rights Act of 2001 is a solid solution 
     to a growing problem--the increased impact that federal 
     regulations have on property rights guaranteed by the Fifth 
     Amendment to the U.S. Constitution. The Nebraska Cattlemen 
     support this legislation and thank you for again taking a 
     leadership role on this important issue.
           Sincerely,

                                                  Greg Ruehle,

                                         Executive Vice President,
     Nebraksa Cattlemen.
                                  ____



                              Nebraska Farm Bureau Federation,

                                   Lincoln, NE, September 7, 2001.
     Hon. Chuck Hagel,
     Russell Senate Building,
     Washington, DC.
       Dear Senator Hagel: On behalf of the Nebraska Farm Bureau 
     Federation, I would like to offer our strong support for your 
     bill titled ``Private Property Rights' Act of 2001''
       As Nebraska's largest farm organization, we have been a 
     long time supporter of legislative efforts to protect 
     property rights for landowners. For years farmers and 
     ranchers have seen their property rights erode through 
     various government actions and regulations. The problem is 
     only exacerbated by the fact the government has failed to 
     provide full and equitable compensation for the loss of the 
     use of property due to government actions.
       Your bill would take a giant step forward by providing some 
     protection for landowners' property rights. By requiring 
     federal agencies to prepare private property taking impact 
     analyses and by allowing expanded access to Federal courts, 
     the bill would certainly help prevent or reduce the loss of 
     private property rights. Government should be forced to 
     determine in advance how its actions would impact the 
     property owner and this bill would put those necessary 
     requirements in place.
       In Nebraska, the Endangered Species Act and wetland 
     regulations have decreased the use or value on many privately 
     held acres by farmers and ranchers. This legislation would go 
     a long way towards putting some fairness back into the system 
     by making agencies think twice before they act on rules that 
     impact private property rights and by giving property owners 
     a voice in the process.
       Nebraska farmers and ranchers appreciate your support for 
     private property rights and your introduction of this bill.
           Sincerely,

                                              Bryce P. Neidig,

     President.
                                  ____



                                 Defenders of Property Rights,

                                Washington, DC, September 6, 2001.
     Re: Introduction of the Private Property Fairness Act.
     Hon. Chuck Hagel,
     Russell Senate Office Building,
     Washington, DC.
       Dear Senator Hagel: It has come to the attention of our 
     organization that you are to shortly re-introduce the Private 
     Property Fairness Act of 1999 [formerly S. 246]. As this 
     country's only public interest legal foundation dedicated 
     exclusively to the protection of private property rights, 
     Defenders of Property Rights commends your efforts to pass 
     this valuable piece of legislation. We would be happy to 
     assist you in your efforts to pass this piece of legislation.
       As you noted when you introduced S. 246 on January 20, 
     1999, ``. . . the law of takings is not yet settled to the 
     satisfaction of most Americans.'' Our membership includes 
     scores of individual property owners across this nation--in 
     courts from coast to coast--whose constitutionally protected 
     rights to ownership, use and enjoyment of property are or 
     have been unconstitutionally denied them, we can attest to 
     the accuracy of your observation. Sadly, Defenders of 
     Property Rights can report that there are fewer `satisfied' 
     Americans now, than when we began our efforts nearly a dozen 
     years ago. We can state without exaggeration that while 
     individual cases of regulatory takings of property without 
     just compensation are increasing, the operative effect of 
     regulations now threatens the very existence of entire 
     regions of rural America.
       Like you, Defenders of Property Rights acknowledges the 
     need for the rational application of this nation's 
     environmental laws to protect our natural resources. However, 
     when government policy and regulation unconstitutionally 
     deprive individuals or businesses of their private property 
     rights, then just and adequate compensation is 
     constitutionally required. However, as you correctly noted in 
     your January 20, 1999 statement, the cost of bearing too many 
     of the impacts of regulatory takings are shouldered by the 
     few. And, you rightly stated, ``This is not fair.'' We could 
     not agree more. We would also add that it is not 
     constitutional.
       We believe that enactment of the successor to The Private 
     Property Fairness Act would arrest the continued diminishment 
     of what the Framers of our Constitution considered a 
     fundamental right--property rights. Additionally, we believe 
     that your legislation will impose reasonable restraints on 
     governmental agencies that will add a measure of calculated 
     seriousness to their decisions to destroy private property. 
     Finally, we are encouraged to note that your bill would 
     dramatically increase the forums available to private 
     property owners who seek redress when their property rights 
     are diminished or taken.
       In short, Defenders of Property Rights is delighted to 
     register its support for your proposed legislation. The 
     fundamental importance of property rights is one of the 
     animating principles of our form of government. Moreover, we 
     are enormously encouraged by your leadership on this 
     important issue. We look forward to working with you on this 
     valuable piece of legislation.
           Yours truly,

                                           Nancie G. Marzulla,

                                                        President.
                                 ______
                                 
      By Mr. LUGAR (for himself and Mr. Harkin):
  S. 1413. A bill to amend the Consolidated Farm and Rural Development 
Act to permit borrowers and grantees to use certain rural development 
loans

[[Page S9256]]

and grants for other purposes under certain circumstances; to the 
Committee on Agriculture, Nutrition, and Forestry.
  Mr. LUGAR. Mr. President, I rise to introduce legislation amending 
the Consolidated Farm and Rural Development Act to allow the Secretary 
of Agriculture to approve changes to the original purpose for which a 
USDA Rural Development grant or loan was made when requested by a 
recipient.
  The Rural Community Advancement Program, as established under the Con 
Act, consists of separate accounts to provide funding for rural 
community facilities, rural waste and water utilities, and rural 
business and cooperative development. In the 1996 Farm Bill, we 
provided State Directors of Rural Development with the authority to 
transfer up to 25 percent of funds allocated to one of those accounts 
for a State in a fiscal year to any of the other accounts for which 
funds were allocated for the State in that fiscal year. This 
flexibility allows a State to adjust funding among the accounts to meet 
changing circumstances. For example, in a given year a State may have 
greater demand for financial assistance for rural community facilities 
than for rural business development, and the authority we granted in 
1996 would allow a State the flexibility to address that change in 
demand.
  The flexibility provided by the 1996 Farm Bill, however, extended 
only to prospective funding. It did not cover changes to loan and grant 
purposes needed by a community after a loan or grant has been made. Any 
post-award change to the grant or loan purpose would require return to 
USDA of any unspent grant or loan funds, or reimbursement to the 
Federal Government for its proportionate financial interest in any 
property acquired with the loan or grant funds.
  Communities in Pennsylvania, Oregon, and Oklahoma have faced this 
dilemma when they have sought to provide space in grant-funded 
industrial parks to businesses that were too large to qualify under the 
terms of their Rural Business Enterprise Grant but that otherwise would 
have been eligible for a Rural Development Business and Industry loan. 
An Indiana community has unused property in its grant-funded industrial 
park that it now would like to use for a critically needed police 
station and water tower. USDA has no authority to allow any of these 
communities to change the authorized use for the land for which the 
grant or loan originally was made.
  The measure I offer today would allow the Secretary to approve these 
types of requests. Under the bill, a community could request the 
Secretary to approve a change in the rural development purpose for 
previously awarded grants and loans to another rural development 
purpose authorized under the Con Act. A change in purpose could be 
requested only for property acquired with such funds, or for the 
proceeds from sale of property acquired with such funds.
  This measure would not require the Secretary to approve requests. It 
simply allows the Secretary to be fair and reasonable in considering 
requests by communities to alter the original purpose of the grant or 
loan. The beneficiary of such a change would not reap any financial 
windfall from such a change at the expense of the Federal government. 
The Federal government would retain its financial interest in any 
property used for the new purpose approved by the Secretary.
  We all know how the needs of communities change over time due to 
economic development and demographic change. This measure allows the 
Secretary to be fair and reasonable in considering requests by 
communities to alter the original purpose of a grant or loan in 
response to such changes. I am hopeful my colleagues will join me in 
supporting this legislation.
                                 ______
                                 
      By Mr. CRAIG:
  S. 1414. A bill to provide incentives for States to establish and 
administer periodic testing and merit pay programs for elementary 
school and secondary school teachers, and for other purposes; to the 
Committee on Health, Education, Labor, and Pensions.
  Mr. CRAIG. Mr. President, I rise today to introduce the Parent and 
Teacher Achievement Act of 2001. We spent much of the spring debating 
the Federal Government's role in education, and in the end we passed a 
bill which gives a lot of money to the education establishment. Now, 
however, it is time to work on a policy that addresses what we can do 
for parents and teachers, and how we can let them keep some of their 
money so they can start improving education from the ground up.
  This bill has many important provisions, but the most important is 
the tax credit for parents and relatives to use for education expenses. 
They can use this credit for any expenses they incur when they spend 
money on their children's education, such as school supplies, 
computers, private tutors, or other such expenses. This credit can also 
be used by parents who home school as well as to help offset tuition at 
private schools. This is not a voucher program nor is it a government 
subsidy for private schools. This tax credit is simply the Federal 
Government recognizing that parents know best how to educate their 
children. As education researcher Andrew Coulson has said, ``. . . 
parents have consistently made better education choices for their own 
children than state-appointed experts have made on their behalf.'' The 
Federal Government should not penalize them by taxing the money parents 
spend to further that education. It should be pointed out that this 
credit would also apply to relatives of students if they contribute 
money towards educational expenses. We all know that grandparents and 
aunts and uncles do a lot to contribute to children's education. It is 
only appropriate to recognize those efforts, too.
  The idea of the type of tax credit contained in this bill has been 
picking up steam recently, and many think tanks, such as the Cato 
Institute, the Mackinac Center, and the Buckeye Institute, have issued 
reports on tuition tax credits which clearly illustrate their benefits. 
A tax credit of this type has also begun to be enacted in the real 
world. Arizona has had an education tax credit for a few years, and it 
has proven to be remarkably successful. The Canadian province of 
Ontario also recently enacted a tax credit of this type.
  Of course, a tax credit is only available to people who pay taxes, 
but my bill also benefits low income individuals. To address the needs 
of these people, I have included a provision in this bill which would 
give individuals or corporations a tax credit when they donate money to 
organizations which give scholarships to lower income students. This 
would allow funds to go to private organizations so they award 
scholarships, while avoiding any church/state entanglements which 
concern so many who oppose vouchers. The state of Arizona has had 
success with this program, too.
  Another important tax component contained in this bill is one which 
allows teachers to take a credit for money spent on school supplies for 
their students. Nobody goes into teaching to get rich; they do it 
because they recognize their job is one of the most important in this 
Nation, preparing our youth for the future. And though teachers do not 
receive lavish salaries, many of them spend considerable sums for 
school supplies for their students. It is only fair that the Federal 
Government should not tax this money. The bill also contains a 
provision that would allow teachers and other school staff a tax 
deduction for expenses they incur while improving their education or 
job skills. Our teachers need to be the best trained teachers in the 
world, and we should encourage this all we can.
  The final section of this bill would empower teachers by allowing the 
Secretary of Education to give grants to States and school districts 
which set up merit pay systems in schools and implement teacher testing 
programs, as long as those states also have a continuing education 
requirement as part of their teacher certification process. It also has 
a provision which clarifies any Department of Education regulations and 
says that federal funds can be used for merit pay systems and for 
teacher testing programs. If States and school districts find the need 
to use their funds for these programs, the Federal Government should 
not tie them up in red tape and prevent them from meeting their needs 
as they see them. We all know that local educators have a much better 
view of the needs they encounter, and we in Washington

[[Page S9257]]

should give them as much freedom as possible to meet those needs.
  By enacting this bill, the U.S. Senate will be making a firm 
commitment to helping parents and teachers achieve education success. 
Parents in this country need to have as much freedom as possible to 
choose the ways in which their children will be educated, and this bill 
is a modest step in that direction. To complement the efforts of 
parents, though, we need to have teachers who are the most qualified 
and the most able to meet the needs of the children parents send to 
them every day. Encouraging states to implement merit pay and teacher 
testing, and allowing teachers to have a credit for their educational 
expenses, will go a long way towards making this a reality.
  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. 1414

       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 ``Parent and Teacher 
     Achievement Act of 2001''.

     SEC. 2. STATE INCENTIVES FOR TEACHER TESTING AND MERIT PAY.

       (a) Amendments.--Title II of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 6601 et seq.) is amended--
       (1) by redesignating part E as part F;
       (2) by redesignating sections 2401 and 2402 as sections 
     2501 and 2502, respectively; and
       (3) by inserting after part D the following:

      ``PART E--STATE INCENTIVES FOR TEACHER TESTING AND MERIT PAY

     ``SEC. 2401. STATE INCENTIVES FOR TEACHER TESTING AND MERIT 
                   PAY.

       ``(a) State Awards.--From funds made available under 
     subsection (b) for a fiscal year, the Secretary shall make an 
     award to each State that--
       ``(1) administers a test to each elementary school and 
     secondary school teacher in the State, with respect to the 
     subjects taught by the teacher, every 3 to 5 years;
       ``(2) has an elementary school and secondary school teacher 
     compensation system that is based on merit; and
       ``(3) requires elementary school and secondary school 
     teachers to earn continuing education credits as part of a 
     State recertification process.
       ``(b) Available Funding.--Notwithstanding any other 
     provision of law, the amount of funds that are available to 
     carry out this section for a fiscal year is 50 percent of the 
     amount of funds appropriated to carry out this title that are 
     in excess of the amount so appropriated for fiscal year 2001, 
     except that no funds shall be available to carry out this 
     section for any fiscal year for which--
       ``(1) the amount appropriated to carry out this title 
     exceeds $600,000,000; or
       ``(2) each of the several States is eligible to receive an 
     award under this section.
       ``(c) Award Amount.--A State shall receive an award under 
     this section in an amount that bears the same relation to the 
     total amount available for awards under this section for a 
     fiscal year as the number of States that are eligible to 
     receive such an award for the fiscal year bears to the total 
     number of all States so eligible for the fiscal year.
       ``(d) Use of Funds.--Funds provided under this section may 
     be used by States to carry out the activities described in 
     section 2207.
       ``(e) Definition of State.--In this section, the term 
     `State' means each of the 50 States and the District of 
     Columbia.''.
       (b) Effective Date.--The amendments made by subsection (a) 
     shall take effect on October 1, 2001.

     SEC. 3. TEACHER TESTING AND MERIT PAY.

       (a) In General.--Notwithstanding any other provision of 
     law, a State may use Federal education funds--
       (1) to carry out a test of each elementary school or 
     secondary school teacher in the State with respect to the 
     subjects taught by the teacher; or
       (2) to establish a merit pay program for the teachers.
       (b) Definitions.--In this section, the terms ``elementary 
     school'' and ``secondary school'' have the meanings given the 
     terms in section 14101 of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 8801).

     SEC. 4. NONREFUNDABLE CREDIT FOR ELEMENTARY AND SECONDARY 
                   SCHOOL EXPENSES.

       (a) In General.--Subpart A of part IV of subchapter A of 
     chapter 1 of the Internal Revenue Code of 1986 (relating to 
     nonrefundable personal credits) is amended by inserting after 
     section 25B the following new section:

     ``SEC. 25C. CREDIT FOR ELEMENTARY AND SECONDARY SCHOOL 
                   EXPENSES.

       ``(a) Allowance of Credit.--In the case of an individual, 
     there shall be allowed as a credit against the tax imposed by 
     this chapter for the taxable year an amount equal to the 
     qualified elementary and secondary education expenses (within 
     the meaning of section 530(b)(4)) with respect to one or more 
     qualifying students which are paid or incurred by the 
     individual during such taxable year.
       ``(b) Limitations.--
       ``(1) Maximum credit.--The credit allowed by subsection (a) 
     for any taxable year shall not exceed $1000 per qualifying 
     student.
       ``(2) Maximum tuition expenses.--The tuition expenses which 
     may be taken into account in determining qualified elementary 
     and secondary education expenses for any taxable year shall 
     not exceed $500 per qualifying student.
       ``(c) Qualifying Student.--For purposes of this section, 
     the term ``qualifying student'' means a dependent (within the 
     meaning of section 152) or a relative of the taxpayer who is 
     enrolled in school (as defined in section 530(b)(4)(B)) on a 
     full-time basis. For purposes of the preceding sentence, the 
     term `relative' means an individual bearing a relationship to 
     the taxpayer which is described in any of paragraphs (1) 
     through (8) of section 152(a).
       ``(d) Denial of Double Benefit.--No deduction or exclusion 
     shall be allowed under this chapter for any expense for which 
     credit is allowed under this section.
       ``(g) Election To Have Credit Not Apply.--A taxpayer may 
     elect to have this section not apply for any taxable year.''.
       (b) Conforming Amendment.--The table of sections for 
     subpart A of part IV of subchapter A of chapter 1 of the 
     Internal Revenue Code of 1986 is amended by inserting after 
     the item relating to section 25B the following new item:

``Sec. 25C. Credit for elementary and secondary school expenses.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2001.

     SEC. 5. CREDIT FOR CONTRIBUTIONS FOR THE BENEFIT OF 
                   ELEMENTARY AND SECONDARY SCHOOLS.

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

     ``SEC. 30B. CREDIT FOR CONTRIBUTIONS FOR THE BENEFIT OF 
                   ELEMENTARY AND SECONDARY SCHOOLS.

       ``(a) Allowance of Credit.--There shall be allowed as a 
     credit against the tax imposed by this chapter for the 
     taxable year an amount equal to 75 percent of the qualified 
     charitable contributions of the taxpayer for the taxable 
     year.
       ``(b) Maximum Credit.--
       ``(1) Individuals.--In the case of a taxpayer other than a 
     corporation, the credit allowed by subsection (a) for any 
     taxable year shall not exceed $500 ($1,000 in the case of a 
     joint return).
       ``(2) Corporations.--In the case of a corporation, the 
     credit allowed by subsection (a) shall not exceed $100,000.
       ``(c) Qualified Charitable Contribution.--For purposes of 
     this section--
       ``(1) In general.--The term `qualified charitable 
     contribution' means, with respect to any taxable year, the 
     aggregate amount allowable as a deduction under section 170 
     (determined without regard to subsection (d)(1)) for cash 
     contributions to a school tuition organization.
       ``(2) School tuition organization.--
       ``(A) In general.--The term `school tuition organization' 
     means any organization which--
       ``(i) is described in section 170(c)(2),
       ``(ii) allocates at least 90 percent of its gross income 
     and contributions and gifts to elementary and secondary 
     school scholarships, and
       ``(iii) awards scholarships to any student who is eligible 
     for free or reduced cost lunch under the school program 
     established under the Richard B. Russell National School 
     Lunch Act.
       ``(B) Elementary and secondary school scholarship.--The 
     term `elementary and secondary school scholarship' means any 
     scholarship excludable from gross income under section 117 
     for expenses related to education at or below the 12th grade.
       ``(d) Special Rules.--
       ``(1) Denial of double benefit.--No deduction shall be 
     allowed under this chapter for any contribution for which 
     credit is allowed under this section.
       ``(2) Application with other credits.--The credit allowable 
     under subsection (a) for any taxable year shall not exceed 
     the excess (if any) of--
       ``(A) the regular tax for the taxable year, reduced by the 
     sum of the credits allowable under subpart A and the 
     preceding sections of this subpart, over
       ``(B) the tentative minimum tax for the taxable year.
       ``(3) Controlled groups.--All persons who are treated as 
     one employer under subsection (a) or (b) of section 52 shall 
     be treated as 1 taxpayer for purposes of this section.
       ``(e) Election To Have Credit Not Apply.--A taxpayer may 
     elect to have this section not apply for any taxable year.''.
       (b) Conforming Amendment.--The table of sections for 
     subpart B of part IV of subchapter A of chapter 1 of the 
     Internal Revenue Code of 1986 is amended by adding at the end 
     the following new item:

``Sec. 30B. Credit for contributions for the benefit of elementary and 
              secondary schools.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2001.

     SEC. 6. CREDIT TO ELEMENTARY AND SECONDARY SCHOOL TEACHERS 
                   WHO PROVIDE CLASSROOM MATERIALS.

       (a) In General.--Subpart B of part IV of subchapter A of 
     chapter 1 of the Internal

[[Page S9258]]

     Revenue Code of 1986 (relating to other credits), as amended 
     by section 4(a), is amended by adding at the end the 
     following new section:

     ``SEC. 30C. CREDIT TO ELEMENTARY AND SECONDARY SCHOOL 
                   TEACHERS WHO PROVIDE CLASSROOM MATERIALS.

       ``(a) Allowance of Credit.--In the case of an eligible 
     educator, there shall be allowed as a credit against the tax 
     imposed by this chapter for the taxable year an amount equal 
     to the qualified elementary and secondary education expenses 
     which are paid or incurred by the taxpayer during such 
     taxable year.
       ``(b) Maximum Credit.--The credit allowed by subsection (a) 
     for any taxable year shall not exceed $1,000.
       ``(c) Definitions.--
       ``(1) Eligible educator.--The term `eligible educator' 
     means an individual who is a teacher, instructor, counselor, 
     principal, or aide in a school (as defined in section 
     530(b)(4)(B)) for at least 900 hours during a school year.
       ``(2) Qualified elementary and secondary education 
     expenses.--The term `qualified elementary and secondary 
     education expenses' means expenses for books, supplies (other 
     than nonathletic supplies for courses of instruction in 
     health or physical education), computer equipment (including 
     related software and services) and other equipment, and 
     supplementary materials used by an eligible educator in the 
     classroom.
       ``(d) Special Rules.--
       ``(1) Denial of double benefit.--No deduction shall be 
     allowed under this chapter for any expense for which credit 
     is allowed under this section.
       ``(2) Application with other credits.--The credit allowable 
     under subsection (a) for any taxable year shall not exceed 
     the excess (if any) of--
       ``(A) the regular tax for the taxable year, reduced by the 
     sum of the credits allowable under subpart A and the 
     preceding sections of this subpart, over
       ``(B) the tentative minimum tax for the taxable year.
       ``(e) Election To Have Credit Not Apply.--A taxpayer may 
     elect to have this section not apply for any taxable year.''.
       (b) Clerical Amendment.--The table of sections for subpart 
     B of part IV of subchapter A of chapter 1 of the Internal 
     Revenue Code of 1986, as amended by section 4(b), is amended 
     by adding at the end the following new item:

``Sec. 30C. Credit to elementary and secondary school teachers who 
              provide classroom materials.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2001.

     SEC. 7. ADJUSTED GROSS INCOME DETERMINED BY TAKING INTO 
                   ACCOUNT PROFESSIONAL DEVELOPMENT EXPENSES OF 
                   ELEMENTARY AND SECONDARY SCHOOL TEACHERS.

       (a) In General.--Section 62(a)(2) of the Internal Revenue 
     Code of 1986 (relating to certain trade and business 
     deductions of employees) is amended by adding at the end the 
     following:
       ``(D) Professional development expenses of elementary and 
     secondary school teachers.--The deductions allowed by section 
     162 which consist of expenses, not in excess of $1,500, paid 
     or incurred by an eligible educator (as defined section 
     30C(c)(1)) by reason of the participation of the educator in 
     professional development courses which are related to the 
     curriculum and academic subjects in which the educator 
     provides instruction or to the students for which the 
     educator provides instruction and which are part of a program 
     of professional development which is approved and certified 
     by the appropriate local educational agency (as defined by 
     section 14101 of the Elementary and Secondary Education Act 
     of 1965, as in effect on the date of the enactment of this 
     subparagraph).''.
       (b) Special Rules.--Section 62 of the Internal Revenue Code 
     of 1986 is amended by adding at the end the following:
       ``(d) Special Rules.--A deduction shall be allowed under 
     subsection (a)(2)(D) for expenses only to the extent the 
     amount of such expenses exceeds the amount excludable under 
     section 135, 529(c)(1), or 530(d)(2) for the taxable year.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2001.
                                 ______
                                 
      By Mr. HATCH (for himself, Mr. Baucus, and Mr. Dodd):
  S. 1415. A bill to amend the Internal Revenue Code of 1986 to enhance 
book donations and literacy; to the Committee on Finance.
  Mr. HATCH. Mr. President, I rise today to introduce legislation 
designed to clarify and enhance the charitable contribution tax 
deduction for donations of excess book inventory for educational 
purposes. I am pleased to be joined in this effort by my good friends 
and colleagues Senators Baucus and Dodd. This proposal would simplify a 
complex area of the current law and eliminate significant roadblocks 
that now stand in the way of corporations with excess book inventory to 
donating those books to schools, libraries, and literacy programs, 
where they are much needed.
  Unfortunately, our current tax law contains a major flaw when it 
comes to the donation of books that are excess inventory for publishers 
or booksellers. The tax benefits for donating such books to schools or 
libraries are often no greater than those of sending the books to the 
landfill. And, since it is generally cheaper and faster for a company 
to simply send the books to the dump, rather than go through the 
trouble and cost of finding donees, and of packing, storing, and 
shipping the books, it often ends up being more cost effective and 
easier for companies to truck the books to a landfill or recycling 
center.
  While there are provisions in the current law where a larger 
deduction is available for the donation of excess books, many companies 
have found that the complexity and uncertainty of dealing with the 
requirements, regulations, and possible Internal Revenue Service 
challenges of the higher deduction serve as a real disincentive to 
making a contribution.
  This is a sad situation, when one considers that many, if not most, 
of these books would be warmly welcomed by schools, libraries, and 
literacy programs.
  The heart of the problem is that under the current law, the higher 
deduction requires that the donated books be used only for the care of 
the needy, the sick, or infants. This requirement makes it difficult 
for schools to qualify as donees and also frequently prohibits 
libraries and adult literacy programs from receiving such deductions. 
This is because these schools, libraries, and literacy programs often 
serve those who are not needy or are over the age of 18. Further 
complicating the issue, the valuation of donated book inventory has 
been the subject of ongoing disputes between taxpayers and the IRS. The 
tax code should not contain obstacles that provide disincentives to 
charitable donations of books that can enhance learning.

  The bill we are introducing today addresses the obstacles of donating 
excess book inventory by providing a simple and clear rule whereby any 
donation of book inventory to a qualified school, library, or literacy 
program is eligible for the enhanced deduction. This means that 
booksellers and publishers would receive a higher tax benefit for 
donating the books rather than throwing them away and would thus be 
encouraged to go to the extra trouble and expense of seeking out 
qualified donees and making the contributions.
  My home State of Utah, like the rest of the Nation, has a problem 
with illiteracy. According to the National Institute for Literacy, 
between 21 and 23 percent of the adult population of the United States, 
about 44 million people, are only at Level 1 literacy, meaning they can 
read a little but not well enough to fill out an application, read a 
food label, or read a simple story to a child. Another 25 to 28 percent 
of the adult population, or between 45 and 50 million people, are 
estimated to be at Level 2 literacy, meaning they can usually can 
perform more complex tasks such as comparing, contrasting, or 
integrating pieces of information but usually not higher level reading 
and problem-solving skills. Literacy experts tell us that adults with 
skills at Levels 1 and 2 lack a sufficient foundation of basic skills 
to function successfully in our society.
  While this bill is not a cure-all for the tragedy of illiteracy, it 
will increase access to books, both for adults and for children. Our 
tax code should not encourage the destruction of perfectly good books 
while schools, libraries, and literacy programs go begging for them.
  The Senate is already on record in unanimous support of this bill. 
During the floor debate on the Economic Growth and Tax Relief 
Reconciliation Act of 2001, I offered this proposal as an amendment, 
which was accepted without opposition. Unfortunately, the provision was 
dropped in the conference with the House.
  The Joint Committee on Taxation estimates this provision to decrease 
revenues to the Treasury by $246 million over a ten year period. This 
estimate helps demonstrate the extent of the value of the books that 
are currently being discarded that could be utilized to help America's 
adults and children.
  I hope our colleagues will join us in supporting this bill. It is 
wrong for our

[[Page S9259]]

tax code to encourage book publishers to send books to the landfill 
instead of to the library. Let's correct this problem.
  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. 1415

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

     SECTION 1. CONTRIBUTIONS OF BOOK INVENTORY.

       (a) In General.--Section 170(e)(3) of the Internal Revenue 
     Code of 1986 (relating to certain contributions of ordinary 
     income and capital gain property) is amended by adding at the 
     end the following new subparagraph:
       ``(D) Special rule for contributions of book inventory for 
     educational purposes.--
       ``(i) Contributions of book inventory.--In determining 
     whether a qualified book contribution is a qualified 
     contribution, subparagraph (A) shall be applied without 
     regard to whether or not--

       ``(I) the donee is an organization described in the matter 
     preceding clause (i) of subparagraph (A), and
       ``(II) the property is to be used by the donee solely for 
     the care of the ill, the needy, or infants.

       ``(ii) Qualified book contribution.--For purposes of this 
     paragraph, the term `qualified book contribution' means a 
     charitable contribution of books, but only if the 
     contribution is to an organization--

       ``(I) described in subclause (I) or (III) of paragraph 
     (6)(B)(i), or
       ``(II) described in section 501(c)(3) and exempt from tax 
     under section 501(a) which is organized primarily to make 
     books available to the general public at no cost or to 
     operate a literacy program.''.

       (b) Effective Date.--The amendment made by this section 
     shall apply to contributions made after the date of the 
     enactment of this Act.

  Mr. DODD. Mr. President, I rise with my colleagues Senator Hatch and 
Senator Baucus to introduce a measure to encourage book publishers to 
donate excess inventory to schools, libraries, and literacy programs.
  Currently, because of the TAX CODE's treatment of such donations, and 
the cost of shipping books to schools and libraries, often it is more 
economical for publishers to destroy books than to donate them. That is 
as shocking as it is unacceptable.
  Both the House and Senate versions of the education bills that 
currently are in conference authorize nearly $1 billion dollars for 
grants to State and local educational agencies for pre-reading or 
reading programs for children from pre-kindergarten through 3rd grade. 
I think it goes without saying that programs to teach kids to read 
won't work unless they can provide kids with access to books. You can't 
learn to read if you don't have anything to read.
  That is why measures such as this, and the provision in the Senate's 
education bill to help school libraries acquire up-to-date books and to 
remain open for longer hours, are essential to the success of the 
reading programs in both bills. This provision will increase children's 
access to books, introduce them to whole new worlds of knowledge, and 
enable them to read more at school, in libraries, and at home.
  This is important, because in a recent study of 15 countries, the 
United States was 12th in the percentage of 13- year-olds who read for 
fun. Of course, reading for fun is valuable for its own sake, but it 
also is an important indicator of academic achievement. For example, 
students who read on their own do better on both math and reading 
tests.
  So, I believe that this provision is exactly the sort of good 
bipartisan tax and public policy that we ought to be promoting in the 
Senate, and I ask my colleagues to join Senators Hatch, Baucus, and 
myself in supporting this bill.

                          ____________________