[Congressional Record Volume 147, Number 174 (Friday, December 14, 2001)]
[Senate]
[Pages S13301-S13305]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS
By Mrs. FEINSTEIN (for herself, Mr. Hollings, and Mrs. Boxer):
S. 1829. A bill to provide for transitional employment eligibility
for qualified lawful permanent resident alien airport security
screeners until their naturalization process is completed, and to
expedite that process; to the Committee on the Judiciary.
Mrs. FEINSTEIN. Mr. President, I rise today to introduce the Airport
Security Personnel Protection Act. This legislation would expedite the
naturalization process and authorize transitional employment for the
many deserving airport security screeners who are in danger of losing
their jobs as a result of a provision in the recently enacted Aviation
Transaction Security Act.
In providing this assistance to these worthy individuals, the bill
also will provide relief for the airports in which they work and the
many customers whom they serve.
On November 19, 2001, President Bush signed the Aviation
Transportation Security Act, P.L. 107-71, into law. The measure was
passed with overwhelming support in both chambers. Among its many
essential provisions was one, found in section 111(a) of the bill, that
requires all airport security screeners to be United States citizens.
Some expressed disagreement with the citizenship requirement while
the bill was pending but voted for the bill, nonetheless, because of
the many positive and essential provisions that the bill contained.
Others supported the citizenship requirement as a necessary step to
ensure the safety of our aviation system.
Regardless of how Senators and House Members feel about the merits of
the provision, we cannot help but be touched by one of its unfortunate
consequences. Because of the contentious manner in which differing
provisions in the House and Senate bills were resolved, we were unable
to provide adequate transition provisions for the many well-qualified,
hard-working, loyal, and deserving lawful permanent residents who are
on the verge of attaining U.S. citizenship but who will not be able to
complete that process before they lose their jobs.
My legislation would resolve their situation in two ways: First, it
would require the Attorney General to expedite the naturalization
process for those applicants who were employed as airport security
screeners at the time of enactment of the Aviation Transportation
Security Act.
Second, it would carve out a transition period during which qualified
lawful permanent residents could continue their employment as security
screeners while their naturalization applications are being
adjudicated.
The ``Airport Security Personnel Protection Act'' would provide for a
smoother transition for qualified lawful permanent resident airport
security screeners who are on the verge of completing the
naturalization process. In so doing, it also would preserve both the
integrity of the naturalization process and the strong requirements for
security screeners that are contained in the Aviation Transportation
Security Act.
Section 4(c) of the legislation specifically precludes the weakening
of standards for naturalization for these screeners. It makes it clear
that the legislation merely requires the Attorney General to expedite
the processing of the naturalization applications of qualified airport
security screeners.
Under current law, these standards include such requirements as five
years of lawful permanent residence for most of those naturalizing, a
demonstration of good moral character, an understanding of the English
language, and an understanding of the history, principles, and form of
government of the United States.
The legislation also makes it clear that the Standards for continuing
in employment during this transition period are to be the same, strong
standards that are included in the recently enacted Aviation
Transportation Security Act.
Under this bill, in order to continue in employment during the
transition
[[Page S13302]]
period, an affected security screener would have to: be a lawful
permanent resident alien; have been employed as a security screener on
the date of enactment of the Act; meet the employment eligibility
requirements under the Airport Security Screeners Act; have undergone
and successfully completed an employment investigation (including a
criminal history record check); have had a naturalization application
pending on the date of enactment of the Act or, in the alternative,
have to be within one year of being eligible to file an application for
naturalization; and be approved by the U.S. Department of
Transportation for hiring or continued employment.
Just as importantly, in order to remain employed during this
transition period, an alien would have to meet the new, enhanced
requirements of security screeners that were enacted as part of the
Aviation Transportation Security Act. These new, enhanced requirements
provide that the alien would have to: have a satisfactory or better
score on a Federal security screening personnel selection examination;
demonstrate daily a fitness for duty without any impairment due to
illegal drugs, sleep deprivation, medication, or alcohol; undergo an
employment investigation, including a criminal history record check;
not present a threat to national security; possess a high school
diploma, a general equivalency diploma, or experience that the Under
Secretary has determined to be sufficient for the individual to perform
the duties of the position; possess the ability to efficiently and
thoroughly manipulate and handle such baggage, containers, and other
objects subject to security processing; be able to read, speak, and
write English well enough to carry out written and oral instructions
regarding the proper performance of screening duties; be able to read
English language identification media, credentials, airline tickets,
and labels on items normally encountered in the screening process;
provide direction to and understand and answer questions from English-
speaking individuals undergoing screening; and write incident reports
and statements and log entries into security records in the English
language; have satisfactorily completed all initial, recurrent, and
appropriate specialized training required by the security program;
among other requirements.
This simple but important bill would help the many deserving lawful
permanent residents who are well qualified, have been performing their
jobs admirably, and whose lives are in danger of being disrupted. But
it also would help the traveling public.
It is estimated that at least 25 percent of the current 28,000
airport security screeners in the Nation's 419 commercial airports are
noncitizens. I have heard from the mayor and airport director of the
San Francisco International Airport. They came to me out of concern
that, as a result of the new citizenship requirements under the
Aviation and Transportation Security Act, the airport stands to lose 70
to 80 percent of its screening personnel. In Los Angeles, about 40
percent of the baggage screeners are noncitizens.
Certainly, not all of these noncitizens will be able to meet the
stringent requirements of this legislation. But to the extent that
those who are well-qualified are permitted to continue their employment
while their naturalization applications are being adjudicated, it will
be a great help to the many airports in which they are employed.
I urge my colleagues to move expeditiously to enact this bill into
law. 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. 1829
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 ``Airport Security Personnel
Protection Act''.
SEC. 2. DEFINITIONS.
In this Act:
(1) Airport security screener.--The term ``airport security
screener'' means an individual who is employed to perform
security screening services at an airport in the United
States.
(2) Lawful permanent resident alien.--The term ``lawful
permanent resident alien'' means an alien lawfully admitted
for permanent residence, as defined in section 101(a)(20) of
the Immigration and Nationality Act (8 U.S.C. 1101(a)(20)).
(3) Qualified lawful permanent resident alien defined.--The
term ``qualified lawful permanent resident alien'' means an
alien with respect to whom a certification has been made by
the Under Secretary of Transportation for Security under
section 111(e)(1)(B) of the Aviation and Transportation
Security Act (Public Law 107-71), as added by section 3 of
this Act.
SEC. 3. TRANSITIONAL EMPLOYMENT ELIGIBILITY FOR QUALIFIED
LAWFUL PERMANENT RESIDENT AIRPORT SECURITY
SCREENERS.
(a) In General.--Section 111 of the Aviation and
Transportation Security Act (Public Law 107-71) is amended by
adding at the end the following:
``(e) Special Transition Rule for Qualified Lawful
Permanent Resident Aliens.--
``(1) In general.--Notwithstanding any rule or regulation
promulgated to implement the citizenship requirement in
section 44935(e)(2)(A)(ii) of title 49, United States Code,
as amended by subsection (a), or any other provision of law
prohibiting the employment of aliens by the Federal
Government, an alien shall be eligible for hiring or
continued employment as an airport security screener until
the naturalization process for such alien is completed, if--
``(A) the Attorney General makes the certification
described in paragraph (2) to the Under Secretary of
Transportation for Security with respect to the alien; and
``(B) the Under Secretary of Transportation for Security
makes the certification described in paragraph (3) to the
Attorney General with respect to such alien.
``(2) Certification by the attorney general.--A
certification under this paragraph is a certification by the
Attorney General, upon the request of the Under Secretary of
Transportation for Security, with respect to an alien
described in paragraph (1) that--
``(A) the alien is a lawful permanent resident alien (as
defined in section 2 of the ``Airport Security Personnel
Protection Act); and
``(B)(i) an application for naturalization has been
approved, and the alien is awaiting the holding of a ceremony
for the administration of the oath of renunciation and
allegiance, as required by section 337 of the Immigration and
Nationality Act (8 U.S.C. 1448);
``(ii) an application for naturalization filed by the alien
prior to the date of enactment of this Act is pending before
the Immigration and Naturalization Service but has not been
finally adjudicated; or
``(iii) the alien--
``(I) satisfies, or will satisfy within one year of the
date of certification if the alien remains in the United
States, the residence requirements applicable to the alien in
the Immigration and Nationality Act, or any other Act that
are necessary for eligibility for naturalization; and
``(II) not more than 180 days after the date of enactment
of the Airport Security Personnel Protection Act, filed under
section 334(f) of the Immigration and Nationality Act an
application for a declaration of intention to become a United
States citizen.
``(3) Certification by the under secretary of
transportation.--A certification under this paragraph is a
certification by the Under Secretary of Transportation for
Security with respect to an alien described in paragraph (1)
that--
``(A) the Under Secretary has decided to hire or continue
the employment of such alien; and
``(B) the alien--
``(i) meets the qualifications to be a security screener
under section 44935(f);
``(ii) was employed as an airport security screener as of
the date of enactment of this Act, as determined by the Under
Secretary of Transportation for Security; and
``(iii) has undergone and successfully completed an
employment investigation (including a criminal history record
check) required by section 44935(e)(2)(B) of such title, as
amended by subsection (a).''.
(b) Effective Date.--The amendment made by subsection (a)
shall be deemed effective as if included in the enactment of
the Aviation and Transportation Security Act.
SEC. 4. EXPEDITED NATURALIZATION FOR QUALIFIED LAWFUL
PERMANENT RESIDENT AIRPORT SECURITY SCREENERS.
(a) Requirement.--
(1) In general.--For the purpose of enabling qualified
lawful permanent resident aliens to satisfy in a timely
manner the citizenship requirement in section
44935(e)(2)(A)(ii) of title 49, United States Code, the
Attorney General shall expedite--
(A) the processing and adjudication of an application for
naturalization filed by any qualified lawful permanent
resident alien who was employed as an airport security
screener as of the date of enactment of the Aviation and
Transportation Security Act (Public Law 107-71); and
(B) if such application for naturalization is approved, the
holding of a ceremony for administration of the oath of
renunciation and allegiance to such qualified lawful
permanent resident alien, as required by section 337 of the
Immigration and Nationality Act (8 U.S.C. 1448).
(b) Deadlines for Completed Action.--The Attorney General
shall complete the actions described in subsection (a)--
[[Page S13303]]
(1) not later than 30 days after the date of enactment of
this Act, in the case of a qualified lawful permanent
resident alien with respect to whom an application for
naturalization is approved but such alien is awaiting the
holding of a ceremony for the administration of the oath of
renunciation and allegiance, as required by section 337 of
the Immigration and Nationality Act (8 U.S.C. 1448);
(2) not later than 180 days after the date of enactment of
this Act, in the case of a qualified lawful permanent
resident alien with respect to whom an application for
naturalization was pending on the date of enactment of this
Act; and
(3) not later than 180 days after the date on which an
application for naturalization is received by the Attorney
General, in the case of a qualified lawful permanent resident
alien with respect to whom an application for naturalization
is filed after the date of enactment of this Act.
(c) Statutory Construction.--Nothing in this section may be
construed to lower the standards of qualification set forth
in title III of the Immigration and Nationality Act (8 U.S.C.
1401 et seq.) that applicants for naturalization must meet in
order to become naturalized citizens of the United States.
______
By Mr. DeWINE:
S. 1830. A bill to amend sections 3, 4, and 5 of the National Child
Protection Act of 1993, relating to national criminal history
background checks of providers of care to children, elderly persons,
and persons with disabilities, and for other purposes; to the Committee
on the Judiciary.
Mr. DeWINE. 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. 1830
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 ``National Child Protection
Amendments Act of 2001''.
SEC. 2. FACILITATION OF BACKGROUND CHECKS.
(a) In General.--Section 3 of the National Child Protection
Act of 1993 (42 U.S.C. 5119a) is amended to read as follows:
``SEC. 3. FACILITATION OF BACKGROUND CHECKS.
``(a) In General.--
``(1) Background checks.--
``(A) In general.--A qualified entity designated by a State
may contact an authorized agency of the State to obtain a
fingerprint-based national criminal history background check
(referred to in this section as a `background check') of a
provider who provides care to children, the elderly, or
individuals with disabilities (referred to in this section as
a `provider').
``(B) Definition.--In this paragraph, the term
`fingerprint-based' means based upon fingerprints or other
biometric identification characteristics approved under rules
applicable to the Interstate Identification Index System as
defined in Article I (13) of the National Crime Prevention
and Privacy Compact.
``(2) Procedures.--
``(A) Submission.--A request for background check pursuant
to this section shall be submitted through a State criminal
history record repository.
``(B) Duties of repository.--After receipt of a request
under subparagraph (A), the State criminal history record
repository shall--
``(i) conduct a search of the State criminal history record
system and, if necessary, forward the request, together with
the fingerprints of the provider, to the Federal Bureau of
Investigation; and
``(ii) make a reasonable effort to respond to the qualified
entity within 15 business days after the date on which the
request is received.
``(C) Duties of the fbi.--Upon receiving a request from a
State repository under this section, the FBI shall--
``(i) conduct a search of its criminal history record
system; and
``(ii) make a reasonable effort to respond to the State
repository or the qualified entity within 5 business days
after the date on which the request is received.
``(3) National crime prevention and privacy compact.--Each
background check pursuant to this section shall be conducted
pursuant to the National Crime Prevention and Privacy
Compact.
``(b) Guidelines.--
``(1) In general.--In order to conduct background checks
pursuant to this section, a State shall--
``(A) establish or designate one or more authorized
agencies to perform the duties required by this section,
including the designation of qualified entities; and
``(B) establish procedures requiring that--
``(i) a qualified entity that requests a background check
pursuant to this section shall forward to the authorized
agency the fingerprints of the provider and shall obtain a
statement completed and signed by the provider that--
``(I) sets out the name, address, and date of birth of the
provider appearing on a valid identification document (as
defined in section 1028 of title 18, United States Code);
``(II) states whether the provider has a criminal history
record and, if so, sets out the particulars of such record;
``(III) notifies the provider that the qualified entity may
request a background check and that the signature of the
provider to the statement constitutes an acknowledgement that
such a background check may be conducted and explains the
uses and disclosures that may be made of the results of the
background check;
``(IV) notifies the provider that pending the completion of
the background check the provider may be denied unsupervised
access to children, the elderly, or disabled persons with
respect to which the provider intends to provide care; and
``(V) notifies the provider of the rights of the provider
under subparagraph (B);
``(ii) each provider who is the subject of an adverse
fitness determination based on a background check pursuant to
this section shall be provided with an opportunity to contact
the authorized agency and initiate a process to--
``(I) obtain a copy of the criminal history record upon
which the determination was based; and
``(II) file a challenge with the State repository or, if
appropriate, the FBI, concerning the accuracy and
completeness of the criminal history record information in
the report, and obtain a prompt determination of the
challenge before a final adverse fitness determination is
made on the basis of the criminal history record information
in the report;
``(iii) an authorized agency that receives a criminal
history record report that lacks disposition information
shall make appropriate inquiries to available State and local
recordkeeping systems to obtain complete information, to the
extent possible considering available personnel and
resources;
``(iv) an authorized agency that receives the results of a
background check conducted under this section shall either--
``(I) make a determination regarding whether the criminal
history record information received in response to the
background check indicates that the provider has a criminal
history record that renders the provider unfit to provide
care to children, the elderly, or individuals with
disabilities and convey that determination to the qualified
entity; or
``(II) provide some or all of such criminal history record
information to the qualified entity for use by the qualified
entity in making a fitness determination concerning the
provider; and
``(v) a qualified entity that receives criminal history
record information concerning a provider in response to a
background check pursuant to this section--
``(I) shall adhere to a standard of reasonable care
concerning the security and confidentiality of the
information and the privacy rights of the provider;
``(II) shall make a copy of the criminal history record
available, upon request, to the provider; and
``(III) shall not retain the criminal history record
information for any period longer than necessary for a final
fitness determination concerning the subject of the
information.
``(2) Retention of information.--The statement required
under paragraph (1)(B)(i)--
``(A) may be forwarded by the qualified entity to the
authorized agency or retained by the qualified entity; and
``(B) shall be retained by such agency or entity, as
appropriate, for not less than 1 year.
``(c) Guidance by the Attorney General.--The Attorney
General shall to the maximum extent practicable, encourage
the use of the best technology available in conducting
background checks pursuant to this section.
``(d) Guidance by the National Crime Prevention and Privacy
Compact Council.--
``(1) In general.--The Compact Council shall provide
guidance to States to ensure that national background checks
conducted under this section comply with the National Crime
Prevention and Privacy Compact and shall provide guidance to
authorized agencies to assist them in performing their duties
under this section.
``(2) Model fitness standards.--The guidance under
paragraph (1) shall include model fitness standards for
particular types of providers, which may be adopted
voluntarily by States for use by authorized agencies in
making fitness determinations.
``(3) NCPA care provider committee.--In providing the
guidance under paragraph (1), the Compact Council shall
create a permanent NCPA Care Provider Committee which shall
include, but not be limited to, representatives of national
organizations representing private nonprofit qualified
entities using volunteers to provide care to children, the
elderly, or individuals with disabilities.
``(4) Reports.--At least annually, the Compact Council
shall report to the President and Congress with regard to
national background checks of providers conducted pursuant to
the NCPA.
``(e) Penalty.--Any officer, employee, or authorized
representative of a qualified entity who knowingly and
willfully--
``(1) requests or obtains any criminal history record
information pursuant to this section under false pretenses;
or
[[Page S13304]]
``(2) uses criminal history record information for a
purpose not authorized by this section, shall be guilty of a
misdemeanor and fined not more than $5,000.
``(f) Limitations on Liability.--
``(1) Liability of qualified entities.--
``(A) Failure to request background check.--A qualified
entity shall not be liable in an action for damages solely
for the failure of such entity to request a background check
on a provider.
``(B) Willful violations.--A qualified entity shall not be
liable in an action for damages for violating any provision
of this section, unless such violation is knowing and
willful.
``(C) Reasonable care standard.--A qualified entity that
exercises reasonable care for the security, confidentiality,
and privacy of criminal history record information received
in response to a background check pursuant to this section
shall not be liable in an action for damages.
``(2) Liability of governmental entities.--A State or
political subdivision thereof, or any agency, officer, or
employee thereof, shall not be liable in an action for
damages for the failure of a qualified entity (other than
itself) to take adverse action with respect to a provider who
was the subject of a background check.
``(3) Reliance on information.--An authorized agency or a
qualified entity that reasonably relies on criminal history
record information received in response to a background check
pursuant to this section shall not be liable in an action for
damages based upon the inaccuracy or incompleteness of the
information.
``(g) Fees.--
``(1) Limitation.--In the case of a background check
pursuant to a State requirement adopted after December 20,
1993, conducted with fingerprints on a person who volunteers
with a qualified entity, the fees collected by authorized
State agencies and the Federal Bureau of Investigation may
not exceed $18, respectively, or the actual cost, whichever
is less, of the background check conducted with fingerprints.
``(2) State fee systems.--The States shall establish fee
systems that ensure that fees to nonprofit entities for
background checks do not discourage volunteers from
participating in child care programs.
``(3) Authority of federal bureau of investigation.--This
subsection shall not effect the authority of the Federal
Bureau of Investigation or the States to collect fees for
conducting background checks of persons who are employed as
or apply for positions as paid care providers.''.
SEC. 3. AUTHORIZATION OF APPROPRIATIONS; CONFORMING
AMENDMENTS.
(a) Funding for Improvement of Child Abuse Crime
Information.--Section 4 of the National Child Protection Act
of 1993 (42 U.S.C. 5119b) is amended--
(1) by redesignating subsections (b) and (c) as subsections
(a) and (b), respectively; and
(2) in subsection (a), as redesignated--
(A) in paragraph (1)--
(i) in each of subparagraphs (C) and (D), by striking
``national criminal history background check system'' and
inserting ``criminal history record repository''; and
(ii) by striking subparagraph (E) and inserting the
following:
``(E) to assist the State in offsetting the costs to
qualified entities of background checks under section 3 on
volunteer providers.''; and
(B) by striking paragraph (2) and inserting the following:
``(2) Authorization of appropriations.--There are
authorized to be appropriated for grants under paragraph
(1)--
``(A) $80,000,000 for fiscal year 2001; and
``(B) such sums as may be necessary for each of fiscal
years 2002 through 2005.''.
(b) Funding for Compact Council.--There are authorized to
be appropriated to the Federal Bureau of Investigation to
support the activities of the National Crime Prevention and
Privacy Compact Council--
(1) $1,000,000 for fiscal year 2001; and
(2) such sums as may be necessary for fiscal years 2002
through 2005.
SEC. 4. DEFINITIONS.
Section 5 of the National Child Protection Act of 1993 (42
U.S.C. 5119c) is amended--
(1) by striking paragraph (8);
(2) by redesignating paragraphs (6) and (7) as paragraphs
(7) and (8), respectively;
(3) by inserting after paragraph (5) the following:
``(6) the term `criminal history record repository' means
the State agency designated by the Governor or other
executive official of a State, or by the legislature of a
State, to perform centralized recordkeeping functions for
criminal history records and services in the State;''; and
(4) in paragraph (9)--
(A) in subparagraph (A)(iii)--
(i) by inserting ``or to an elderly person or person with a
disability'' after ``to a child''; and
(ii) by striking ``child care'' and inserting ``care''; and
(B) in subparagraph (B)(iii)--
(i) by inserting ``or to an elderly person or person with a
disability'' after ``to a child''; and
(ii) by striking ``child care'' and inserting ``care''.
SEC. 5. AMENDMENT TO NATIONAL CRIMINAL HISTORY ACCESS AND
CHILD PROTECTION ACT.
Section 215 of the National Criminal History Access and
Child Protection Act is amended by--
(1) striking subsection (b) and inserting the following:
``(b) Direct Access to Certain Records Not Affected.--
Nothing in the Compact shall affect any direct terminal
access to the III System provided prior to the effective date
of the Compact under the following:
``(1) Section 9101 of title 5, United States Code.
``(2) The Brady Handgun Violence Prevention Act (Public Law
103-159; 107 Stat. 1536).
``(3) The Violent Crime Control and Law Enforcement Act of
1994 (Public Law 103-322; 108 Stat. 2074) or any amendments
made by that Act.
``(4) The United States Housing Act of 1937 (42 U.S.C. 1437
et seq.).
``(5) The Native American Housing Assistance and Self-
Determination Act of 1996 (25 U.S.C. 4101 et seq.).
``(6) Any direct terminal access to Federal criminal
history records authorized by law.''; and
(2) in subsection (c) by inserting after the period at the
end thereof the following: ``Criminal history records
disseminated by the FBI pursuant to such Act by means of the
III System shall be subject to the Compact.''.
______
By Mr. GRASSLEY (for himself and Mr. Kerry):
S. 1831. A bill to provide alternative minimum tax relief with
respect to incentive stock options exercised during 2000; to the
Committee on Finance.
Mr. GRASSLEY. Mr. President, today Senator Kerry and I introduced
bipartisan legislation that will provide some relief to those workers
who are facing a massive tax bill on the phantom income they have from
incentive stock options.
Because it is important that my colleagues understand the unfairness
of this matter, let me provide a very brief background.
Incentive stock options ISO, are an option given by an employer to an
employee to purchase stock at a certain price. An individual does not
recognize any income on the grant of the option or exercise thereof if
the individual holds the shares for more than 2 years after grant and 1
year after exercise. If the holding period requirements are satisfied,
the employee is taxed on the excess of the sale price over the exercise
price on his disposition of the shares.
The reason these employees have such a significant tax bill is due to
the workings of the Tax Code's answer to Rube Goldberg, the Alternative
Minimum Tax, AMT. The employee's nonrecognition of income discussed
above does not apply for AMT purposes. For AMT purposes, the code
requires the recognition of the excess for the stock's fair market
value on the date of exercise over the option price when the stock is
substantially vested. Thus, while an employee does not have a tax
liability of ordinary income for exercising his ISO the employee may be
subject to AMT when he exercises his ISO.
While in years past, this may not have been too great a problem in a
time when share prices are increasing and individuals have the money to
pay the AMT. It is a very different story when shares are declining.
The individual is then facing the AMT charges based on the exercise
value but often has no funds to pay the AMT since the stock that was
the source of the AMT has declined in value since it was exercised.
It is true that if the individual had sold the stock in the same year
he exercised his ISO he would have potentially reduced his AMT
liability significantly. However, the code sends a mixed signal to the
individual telling him that he must hold the stock for one year after
exercise if he wants to avoid taxation at ordinary income on the value
at the point of exercise.
The above are the facts of the tax code, but they do not reflect the
very real disaster this has done to many people across the country. The
story of one company in Cedar Rapids, IA, McLeod USA, puts a real face
on how this tax has destroyed families. I have received letters from
dozens of honest hard-working people of this company telling me how
they are making a good salary in Iowa, say $50,000 or $70,000, and were
also given these ISOs as an additional incentive to work for McLeod.
Now, because of the AMT rules and the declining market, these families
are facing tax bills of tens of thousands, if not over a hundred
thousand dollars. It is wiping out a lifetime of savings and hardwork,
all to pay a tax bill on phantom income, income they never received,
never enjoyed and never had. It is outrageous and it is just plain
wrong.
[[Page S13305]]
The bill that Senator Kerry and I have introduced will provide
significant relief from the AMT tax bill for workers. It allows
employees to determine the value of their stock options on April 15,
2001, (as opposed to the exercise date), which will reflect the
downturn of the market. This will go far in minimizing the AMT hit that
employees face. In addition, the relief is targeted to assist low-
income and middle-income families.
I hope my colleagues will join myself and Senator Kerry to put an end
to this tax disaster.
I ask unanimous consent 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. 1831
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. ALTERNATIVE MINIMUM TAX RELIEF WITH RESPECT TO
INCENTIVE STOCK OPTIONS EXERCISED DURING 2000.
(a) In General.--In the case of an incentive stock option
(as defined in section 422 of the Internal Revenue Code of
1986) exercised during calendar year 2000, the amount taken
into account under section 56(b)(3) of such Code by reason of
such exercise shall not exceed the amount that would have
been taken into account if, on the date of such exercise, the
fair market value of the stock acquired pursuant to such
option had been its fair market value as of April 15, 2001
(or, if such stock is sold or exchanged on or before such
date, the amount realized on such sale or exchange).
(b) Limitation.--
(1) In general.--If the adjusted gross income of a taxpayer
for the taxable year in which an exercise described in
paragraph (1) occurs exceeds the threshold amount, the amount
otherwise not taken into account under paragraph (1) shall be
reduced by the amount which bears the same ratio to such
amount as the taxpayer's adjusted gross income in excess of
the threshold amount bears to the phaseout amount.
(2) Threshold amount.--For purposes of this subsection, the
threshold amount is equal to--
(A) $106,000 in the case of a taxpayer described in section
1(a) of such Code,
(B) $84,270 in the case of a taxpayer described in section
1(b) of such Code, and
(C) $53,000 in the case of a taxpayer described in section
1(c) or 1(d) of such Code.
(3) Phaseout amount.--For purposes of this subsection, the
phaseout amount is equal to--
(A) $230,000 in the case of a taxpayer described in section
1(a) of such Code,
(B) $172,500 in the case of a taxpayer described in section
1(b) of such Code, and
(C) $115,000 in the case of a taxpayer described in section
1(c) or 1(d) of such Code.
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By Mr. LEVIN:
S. 1834. A bill for the relief of retired Sergeant First Class James
D. Benoit and Wan Sook Benoit; to the Committee on the Judiciary.
Mr. LEVIN. Mr. President, I rise today to introduce a bill that I
hope will assist a family in my home State of Michigan who suffered the
death of their child while living on a U.S. Army base in the Republic
of Korea. Nearly 18 years ago, Mr. James Benoit and his wife Mrs. Wan
Sook Benoit lost their three year old son, David Benoit, in a tragic
mishap.
Some years ago, Mr. and Mrs. Benoit approached my office with a
request for assistance. The Benoit family felt that they did not
receive the relief that they were entitled to receive. To assist the
family, I introduced two private relief bills that sought to give the
Benoit family a hearing before the U.S. Court of Federal Claims.
This case was referred to U.S. Court of Federal Claims as the result
of private relief legislation I introduced. The legislation, S. 1168,
gave the Court of Federal Claims ``jurisdiction to hear, determine and
render judgement on a claim by Retired Sergeant First Class James D.
Benoit, Wan Sook Benoit, or the estate of David Benoit concerning the
death of David Benoit on June 28th 1983. On March 14, 2000, oral
arguments were heard by the hearing officer assigned to the case and
the hearing officer recommended to the Court of Federal Claims on July
28, 2000, ``that Sergeant and Mrs.. Benoit be awarded $415,000 for the
wrongful death of David Benoit.'' Subsequently on May 23, 2001, the
Court of Federal Claims Review Panel upheld the conclusion of the
hearing officer, and found that the plaintiffs ``have a valid and
equitable claim against the United States.'' It went on to state that
``the Review Panel recommends that plaintiffs be awarded $415,000.''
As a result of these findings, I am introducing special legislation
to provide relief consistent with the court's recommendation. This
legislation can in no way compensate the Benoit's for the horrible loss
that they have suffered. No amount of money can do that. However, as
the court has stated, the Benoit family does indeed ``have a valid and
equitable claim.'' It is my hope that Congress will act expeditiously
to resolve this claim.
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