[Congressional Record Volume 148, Number 39 (Thursday, April 11, 2002)]
[Senate]
[Pages S2579-S2594]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS
By Mr. TORRICELLI:
S. 2090. A bill to eliminate any limitation on indictment for sexual
offenses and make awards to States to reduce their DNA casework
backlogs; to the Committee on the Judiciary.
Mr. TORRICELLI. Madam President, I rise today to introduce the Sexual
Assault Prosecution Act. This legislation will ensure that no rapist
will evade prosecution when there is reliable evidence of their guilt.
As Federal law is written today, a rapist can walk away scot-free if
they are not charged within five years of committing their crime. This
is true even if overwhelming evidence of the offender's guilt, such as
a DNA match with evidence taken from the crime scene, is later
discovered. Some States, including my home State of New Jersey, have
recognized the injustice presented by this situation and have already
abolished their statutes of limitations on sexual assault crimes, and
many other States are considering similar measures. Given the power and
precision of DNA evidence, it is now time that the Federal Government
abolish the current statute of limitations on Federal sexual assault
crimes.
The precision with which DNA evidence can identify a criminal
assailant has increased dramatically over the past couple decades.
Because of its exactness, DNA evidence is now routinely collected by
law enforcement personnel in the course of investigating many crimes,
including sexual assault crimes. The DNA profile of evidence collected
at a sexual assault crime scene can be compared to the DNA profiles of
convicted criminals, or the profile of a particular suspect, in order
to determine who committed the crime. Moreover, because of the
longevity of DNA evidence, it can be used to positively identify a
rapist many years after the actual sexual assault.
The enormous advancements in DNA science have greatly expanded law
enforcement's ability to investigate and prosecute sexual assault
crimes. Unfortunately, the law has not kept pace with science. Given
the precise accuracy and reliability of DNA testing, however, the legal
and moral justifications for continuing to impose a statute of
limitations on sexual assault crimes are extremely weak. To that end, I
am introducing the ``Sexual Assault Prosecution Act'' which will
eliminate the statue of limitations for sexual assault crimes. This
legislation will not affect the burdens of proof and the government
will still have to prove guilt beyond a reasonable doubt before any
person could be convicted of a crime.
Currently, the statue of limitations for arson and financial
institution crimes is 10 years and is 20 years for crimes involving the
theft of major artwork. If it made sense to extend the traditional
five-year limitations period for these offenses, surely it makes sense
to do so for sexual assault crimes, particularly when DNA technology
makes it possible to identify an offender many years after the
commission of the crime. By eliminating this ticking clock, we can see
to if that no victim of sexual assault is denied justice simply because
the clock ran out. I look forward to working with each and every one of
you in order to get this legislation enacted into law.
I ask unanimous consent that the text of the legislation be printed
in the Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:
S. 2090
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 ``Sexual Assault Prosecution
Act of 2002''.
SEC. 2. SEXUAL OFFENSE LIMITATION.
(a) In General.--Chapter 213 of title 18, United States
Code, is amended--
(1) in section 3283, by striking ``sexual or''; and
(2) by adding at the end the following:
``Sec. 3296. Sexual offenses
``An indictment for any offense committed in violation of
chapter 109A of this title may be found at any time without
limitation.''.
(b) Technical and Conforming Amendments.--The table of
sections for chapter 213 of title 18, United States Code, is
amended by adding at the end the following:
``3296. Sexual offenses.''.
SEC. 3. AWARDS TO STATES TO REDUCE DNA CASEWORK BACKLOG.
(a) Development of Plan.--
(1) In general.--Not later than 45 days after the date of
enactment of this Act, the Director of the Federal Bureau of
Investigation, in coordination with the Assistant Attorney
General of the Office of Justice Programs of the Department
of Justice, and after consultation with representatives of
States and private forensic laboratories, shall develop a
plan to grant voluntary awards to States to facilitate DNA
analysis of all casework evidence of unsolved crimes.
(2) Objective.--The objective of the plan developed under
paragraph (1) shall be to--
(A) effectively expedite the analysis of all casework
evidence of unsolved crimes in an efficient and effective
manner; and
(B) provide for the entry of DNA profiles into the combined
DNA Indexing System (``CODIS'').
(b) Award Criteria.--The Federal Bureau of Investigation,
in coordination with the Assistant Attorney General of the
Office of Justice Programs of the Department of Justice,
shall develop criteria for the granting of awards under this
section including--
(1) the number of unsolved crimes awaiting DNA analysis in
the State that is applying for an award under this section;
and
(2) the development of a comprehensive plan to collect and
analyze DNA evidence by the State that is applying for an
award under this section.
(c) Granting of Awards.--The Federal Bureau of
Investigation, in coordination with the Assistant Attorney
General of the Office of Justice Programs of the Department
of Justice, shall--
(1) develop applications for awards to be granted to States
under this section;
(2) consider all applications submitted by States; and
(3) disburse all awards under this section.
(d) Award Conditions.--States receiving awards under this
section shall--
(1) require that each laboratory performing DNA analysis
satisfies quality assurance standards and utilizes state-of-
the-art DNA testing methods, as set forth by the Federal
Bureau of Investigation in coordination with the Assistant
Attorney General of the Office of Justice Programs of the
Department of Justice;
(2) ensure that each DNA sample collected and analyzed be
made available only--
(A) to criminal justice agencies for law enforcement
purposes;
(B) in judicial proceedings if otherwise admissible;
(C) for criminal defense purposes, to a criminal defendant
who shall have access to samples and analyses performed in
connection with any case in which such defendant is charged;
or
[[Page S2580]]
(D) if personally identifiable information is removed,
for--
(i) a population statistics database;
(ii) identification research and protocol development
purposes; or
(iii) quality control purposes; and
(3) match the award by spending 15 percent of the amount of
the award in State funds to facilitate DNA analysis of all
casework evidence of unsolved crimes.
(e) Authorization of Appropriations.--There are authorized
to be appropriated to the Department of Justice $15,000,000
for each of fiscal years 2003 through 2006, for awards to be
granted under this section.
______
By Mr. TORRICELLI:
S. 2091. A bill to amend title 18, United States Code to prohibit
gunrunning, and provide mandatory minimum penalties for crimes related
to gunrunning; to the Committee on the Judiciary.
Mr. TORRICELLI. Madam President, I rise today to introduce the Gun
Kingpin Penalty Act. In introducing this bill, I hope that my
colleagues will soon join me in sending a clear and strong signal to
gunrunners, your actions will no longer be tolerated.
Data gathered by the Bureau of Alcohol, Tobacco and Firearms clearly
demonstrates what many of us already know all too well, several of our
Nation's highways have become pipelines for merchants of death who deal
in illegal firearms.
My own State of New Jersey is proud to have some of the toughest gun
control laws in the Nation. But for far too long, the courageous
efforts of New Jersey citizens in enacting these tough laws have been
weakened by out of State gunrunners who treat our State like their own
personal retail outlet.
ATF data shows that in 1996 New Jersey exported fewer guns used in
crimes, per capita, than any other State, less than one gun per 100,000
residents, or 75 total guns. Meanwhile, an incredible number of guns
used to commit crimes in New Jersey came from out of State, 944 guns
were imported, a net import of 869 illegal guns used to commit crimes
against the people of New Jersey.
This represents a one way street, guns come from, States with lax gun
laws straight to States, like New Jersey, with strong laws. It is clear
that New Jersey's strong gun control laws offer criminals little choice
but to import their guns from States with weak laws. We must act on a
Federal level to send a clear message that this cannot continue and
will not be tolerated.
The Gun Kingpin Penalty Act would create a new Federal gunrunning
offense for any person who, within a twelve-month period, transports
more than 5 guns to another State with the intent of transferring all
of the weapons to another person. The Act would establish mandatory
minimum penalties for gunrunning as follows: a mandatory 3 year minimum
sentence for a first offense involving 5-50 guns; a mandatory 5 year
minimum sentence for second offense involving 5-50 guns; and a
mandatory 15 year minimum sentence for any offense involving more than
50 guns.
We can never rest when it comes to gun violence. This problem will
not just go away, and we cannot standby and watch as innocent men,
women and children die at the hands of criminals armed with these guns.
I urge my colleagues to support this bill, and I ask unanimous consent
that the text of the legislation be printed in the Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:
S. 2091
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 ``Gun Kingpin Penalty Act''.
SEC. 2. GUN KINGPIN PENALTIES.
(a) Prohibition Against Gunrunning.--Section 922 of title
18, United States Code, is amended by adding at the end the
following:
``(z) It shall be unlawful for a person not licensed under
section 923 to ship or transport, or conspire to ship or
transport, 5 or more firearms from a State into another State
during any period of 12 consecutive months, with the intent
to transfer all of such firearms to another person who is not
so licensed.''.
(b) Mandatory Minimum Penalties for Crimes Related to
Gunrunning.--Section 924 of title 18, United States Code, is
amended by adding at the end the following:
``(p)(1)(A)(i) Except as otherwise provided in this
subsection, whoever violates section 922(z) shall be
imprisoned not less than 3 years, and may be fined under this
title.
``(ii) Except as otherwise provided in this subsection, in
the case of a person's second or subsequent violation of
section 922(a), the term of imprisonment shall be not less
than 5 years.
``(B) If a firearm which is shipped or transported in
violation of section 922(z) is used subsequently by the
person to whom the firearm was shipped or transported, or by
any person within 3 years after the shipment or
transportation, in an offense in which a person is killed or
suffers serious bodily injury, the term of imprisonment for
the violation shall be not less than 10 years.
``(C) If more than 50 firearms are the subject of a
violation of section 922(z), the term of imprisonment for the
violation shall be not less than 15 years.
``(D) If more than 50 firearms are the subject of a
violation of section 922(z) and 1 of the firearms is used
subsequently by the person to whom the firearm was shipped or
transported, or by any person within 3 years after the
shipment or transportation, in an offense in which a person
is killed or suffers serious bodily injury, the term of
imprisonment for the violation shall be not less than 25
years.
``(2) Notwithstanding any other provision of law, the court
shall not impose a probationary sentence or suspend the
sentence of a person convicted of a violation of section
922(z), nor shall any term of imprisonment imposed on a
person under this subsection run concurrently with any other
term of imprisonment imposed on the person by a court of the
United States.''.
(c) Crimes Related to Gunrunning Made Predicate Offenses
Under Rico.--Section 1961(1)(B) of title 18, United States
Code, is amended by inserting before ``section 1028'' the
following: ``section 922(a)(1)(A) (relating to unlicensed
importation, manufacture, or dealing in firearms), section
922(a)(3) (relating to interstate transportation or receipt
of firearm), section 922(a)(5) (relating to transfer of
firearm to person from another State), section 922(a)(6)
(relating to false statements made in acquisition of firearm
or ammunition from licensee), section 922(d) (relating to
disposition of firearm or ammunition to a prohibited person),
section 922(g) (relating to receipt of firearm or ammunition
by a prohibited person), section 922(h) (relating to
possession of firearm or ammunition on behalf of a prohibited
person), section 922(i) (relating to transportation of stolen
firearm or ammunition), section 922(j) (relating to receipt
of stolen firearm or ammunition), section 922(k) (relating to
transportation or receipt of firearm with altered serial
number), section 922(z) (relating to gunrunning), section
924(b) (relating to shipment or receipt of firearm for use in
a crime),''.
(d) Enforcement.--Notwithstanding any limitations imposed
by or under the Federal Workforce Restructuring Act (108
Stat. 111), the Secretary of the Treasury may hire and employ
200 personnel, in addition to any personnel hired and
employed by the Department of the Treasury under other law,
to enforce the amendments made by this section.
______
By Ms. STABENOW (for herself, Mr. Domenici, and Mr. Levin):
S. 2108. A bill to amend the Agriculture and Consumer Protection Act
of 1973 to assist the neediest of senior citizens by modifying the
eligibility criteria for supplemental foods provided under the
commodity supplemental food program to take into account the
extraordinarily high out-of-pocket medical expenses that senior
citizens pay, and for other purposes; to the Committee on Agriculture,
Nutrition, and Forestry.
Ms. STABENOW. Madam President, I rise today to introduce the Senior
Nutrition Act that will help prevent our seniors from having to make
the choice between food and medicine as they try to balance their
budgets.
That, is the most horrible of choices.
The problem, is this:
The average senior citizen pays over $1,000 per year on prescription
drugs. Many of these seniors, the majority of whom are widows, depend
entirely on Social Security for their income and cannot afford to buy
their prescription drugs without cutting back on their food.
At the same time, many food banks and other nutrition programs are
reporting an increase in participation by seniors.
These same food banks also say they are frustrated that many seniors
they would like to help are not eligible because under the United
States Department of Agriculture's, USDA, important nutrition program,
the Commodity Supplemental Food Program, CSFP, seniors are not able to
deduct the cost of their medications when seeking eligibility for food
assistance.
While clearly in need of help, and clearly deserving of help, these
seniors have to be turned away.
Michigan has the greatest number of CSFP participants in the country,
last year over 80,000 people benefited from this important program in
my State and 66,123 were seniors. I have a letter from the Director of
the largest program in our State asking for help. I
[[Page S2581]]
would like to insert his letter for the record because he raises some
very important points. Most importantly, he points out that if
something is not done to fix this program, many seniors will be turned
away. These are seniors just barely getting along, who rely on the
modest food package provided by the CSFP.
The Senior Nutrition Act helps resolve this problem and helps the
neediest seniors by amending the eligibility criteria for nutrition
assistance provided through the CSFP. Most importantly, the bill
acknowledges the extraordinarily high out-of-pocket medical expenses
that senior citizens have and helps these seniors by making many of
them eligible for the food available through the CSFP. The Senior
Nutrition Act means the fewer seniors will be forced to make the tough
choice between medication or food.
Nationally, 28 States and the District of Columbia participate in the
CSFP, which works to improve the health of both women with children and
seniors by supplementing their diets with nutritious USDA commodity
foods. An average of more than 388,000 people each month participated
in the CSFP during fiscal year 2000. Of those, 293,000 were elderly and
that number is on the rise. This program is important for anyone who
cares about making sure seniors have enough to eat.
The bill I am introducing today, the Senior Nutrition Act, makes the
following important changes: one: In those areas where CSFP operates,
categorical eligibility is granted for seniors for the CSFP if the
individual participates or is eligible to participate in the Food Stamp
Program. No further verification of income would be necessary in such
cases. The Food Stamp Program provides a medical expense deduction,
which seniors may use to account for their high prescription drug
costs.
Two: This bill says that the same income standard that is currently
used to determine eligibility for women, infants and children in the
CSFP, 185 percent of the Poverty Income Guidelines, would be applied to
seniors as well. The current income eligibility standard for seniors
has been capped by regulation at just 130 percent. Under the current
standards a single senior must earn no more than $11,518 per year to
qualify. By raising the standard to 185 percent of poverty, the same
senior can earn as much as $16,391 to qualify for food. This will make
a major difference in the lives of so many seniors who are struggling
with the high cost of prescription drugs.
Finally, this bill establishes an authorization for the CSFP that
will double the current appropriation levels to $200 million over five
years to accommodate any expansion that may occur in the program due to
the changes in eligibility standards.
This bill has been endorsed by the National CSFP Association. I would
like to submit a copy of their letter for the Record.
The golden years should be bright and active years for our seniors.
They should not be lived in a grey dusk of indifference as we sit by
and watch them make literal life and death decisions between food and
medicine.
I would like to thank my colleagues who have joined me as original
cosponsors of this bill, Senators Levin and Domenici. Together, I know
we can make a difference for seniors.
I ask unanimous consent that the text of this bill and that the
letters from Mr. Frank Kubik and Ms. Barb Packett be printed in the
Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
S. 2108
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 ``Senior Nutrition Act of
2002''.
SEC. 2. FINDINGS.
Congress finds that--
(1) senior citizens in the United States have significant
out-of-pocket costs for medical expenses, especially for
prescription drugs;
(2) 3 in 5 Medicare beneficiaries do not have dependable,
affordable, prescription drug coverage;
(3) as medical costs continue to rise, many senior citizens
are forced to make the difficult choice between purchasing
prescription drugs and purchasing food;
(4) the commodity supplemental food program provides
supplemental nutritious foods to senior citizens in a number
of States and localities;
(5) under the commodity supplemental food program--
(A) women, infants, and children with household incomes up
to 185 percent of the Federal Poverty Income Guidelines
published annually by the Department of Health and Human
Services may be eligible for supplemental foods; but
(B) senior citizens are ineligible for supplemental foods
if their household incomes are greater than 130 percent of
the Federal Poverty Income Guidelines;
(6) during fiscal year 2000--
(A) an average of more than 388,000 people each month
participated in the commodity supplemental food program; and
(B) the majority of those participants, 293,000, were
senior citizens; and
(7) in order to serve the neediest senior citizens, taking
into account their high out-of-pocket medical (including
prescription drug) expenses, the eligibility requirements for
the commodity supplemental food program should be modified to
make more senior citizens eligible for the supplemental foods
provided under the program.
SEC. 3. ELIGIBILITY OF ELDERLY PERSONS UNDER THE COMMODITY
SUPPLEMENTAL FOOD PROGRAM.
(a) In General.--Section 5 of the Agriculture and Consumer
Protection Act of 1973 (7 U.S.C. 612c note; Public Law 93-86)
is amended--
(1) in the first sentence of subsection (d)(2)--
(A) by striking ``provide not less'' and inserting
``provide, to the Secretary of Agriculture, not less'';
(B) by inserting ``, or such greater quantities of cheese
and nonfat dry milk as the Secretary determines are
necessary,'' after ``nonfat dry milk''; and
(C) by striking ``in each of the fiscal years 1991 through
2002 to the Secretary of Agriculture'' and inserting ``in
each fiscal year'';
(2) in subsection (i)--
(A) by redesignating paragraphs (1), (2), and (3) as
subparagraphs (A), (B), and (C), respectively, and indenting
appropriately; and
(B) by striking ``(i) Each'' and inserting the following:
``(i) Programs Serving Elderly Persons.--
``(1) Eligibility.--An elderly person shall be eligible to
participate in a commodity supplemental food program serving
elderly persons if the elderly person is at least 60 years of
age and--
``(A) is eligible for food stamp benefits under the Food
Stamp Act of 1977 (7 U.S.C. 2011 et seq.); or
``(B) has a household income that is less than or equal to
185 percent of the most recent Federal Poverty Income
Guidelines published by the Department of Health and Human
Services.
``(2) Provision of information.--Each''; and
(3) by adding at the end the following:
``(m) Authorization of Appropriations.--
``(1) In general.--There are authorized to be appropriated
to carry out the commodity supplemental food program--
``(A) $120,000,000 for fiscal year 2003;
``(B) $140,000,000 for fiscal year 2004;
``(C) $160,000,000 for fiscal year 2005;
``(D) $180,000,000 for fiscal year 2006;
``(E) $200,000,000 for fiscal year 2007; and
``(F) such sums as are necessary for fiscal year 2008 and
each fiscal year thereafter.
``(2) Limitation on use of funds.--None of the funds made
available under paragraph (1) shall be available to reimburse
the Commodity Credit Corporation for commodities donated to
the commodity supplemental food program.''.
(b) Conforming Amendments.--
(1) Section 5(a) of the Agriculture and Consumer Protection
Act of 1973 (7 U.S.C. 612c note; Public Law 93-86) is amended
by striking ``Secretary (1) may'' and all that follows
through ``(2) shall'' and inserting ``Secretary shall''.
(2) Section 5(g) of the Agriculture and Consumer Protection
Act of 1973 (7 U.S.C. 612c note; Public Law 93-86) is amended
by striking ``(as defined by the Secretary)'' and inserting
``described in subsection (i)(1)''.
____
February 21, 2002.
Hon. Debbie Stabenow,
Hart Senate Office Building, Washington, DC.
Dear Senator Stabenow: I am writing this letter to ask for
your continued support for the Commodity Supplemental Food
Program. We are facing some potential problems in the
upcoming months that I would like to bring to your attention.
For FY02 we may be seeing program participation threaten to
exceed our assigned caseload of 42,700 here at Focus: HOPE as
well as other programs nationally that are at or above their
assigned caseloads due to the downturn in the economy.
November saw us serve 43,553 and 42,902 participated in
January. These are traditionally slow months for us and my
concern is that if we continue to serve over one hundred per
cent of our caseload and additional resources are not found,
we may be faced with the prospect of removing senior citizens
from our program. The Department of Agriculture has done an
outstanding job in assigning caseload nationally to maximize
its usage but if this participation trend continues they may
not have the ability to meet the demand. Seniors depend
heavily on the nutritious commodities provided by CSFP. In
many cases this is a lifeline for them by not only giving
them access to the food but also the additional services many
CSFP's are able to bring to the
[[Page S2582]]
seniors by the strong use of volunteers and other community
programs.
My hope is that we will not get to the point of removing
seniors from the program and that additional caseload, if
needed, can be found.
Another point I would like to bring up is the plight of
senior citizens who are over the income guideline limits of
one hundred and thirty per cent of the poverty level and are
ineligible for CSFP. We routinely have to turn away seniors
who's income is over the guidelines yet have major expenses
in the way of prescriptions and other medical care that
leaves very little to live on for the rest of the month. The
average income of a senior on our program is around $520 a
month. Even though the maximum amount for participation is
$931 a month we find many who don't qualify due to the
reasons I've mentioned. A possible solution is to increase
the senior income guidelines to the same amount as mothers
and children who are participating in CSFP of one hundred and
eighty five per cent of the poverty level. Originally when
the senior program was piloted in 1983, the income guidelines
were the same. They were reduced after the seniors were
permanently added to the program. Increasing the income
guidelines would address the needs of a growing senior
population while still maintaining priority to mothers and
children in the program as required by regulations.
I know that this is a time of tightening budgets but I am
hopeful that a way will be found to continue to support this
much needed program that has made a difference in so many of
our most vulnerable citzens.
I am most appreciative of all of your support for Focus:
HOPE and the Commodity Supplemental Food Program.
Sincerely,
Frank Kubik,
CSFP Manager.
____
National CSFP Association,
March 18, 2002.
Hon. Debbie Stabenow,
U.S. Senate, Hart Senate Bldg., Washington, DC.
Dear Senator Stabenow: The National Commodity Supplemental
Food Program (CSFP) Association strongly supports your
efforts to introduce and pass The Stabenow/Domenici Senior
Nutrition Act in the upcoming weeks.
CSFP enables us to reach the most vulnerable seniors along
with mothers and children every month with a food package
designed to supplement protein, calcium, iron and vitamin A &
C. The Hunger in America 2001 study done by America's Second
Harvest reports that of the people seeking emergency food
assistance, 30 percent had to choose between paying for food
and paying for medicine or medical care. By amending the
eligibility criteria for the seniors served by CSFP, this Act
will assist the neediest of seniors in receiving nutrition
assistance they so desperately need to remain in better
health.
On behalf of the Association, let me thank you again for
all your efforts on behalf of the CSFP and the participants
we serve. We are committed to supporting The Stabenow/
Domenici Senior Nutrition Action.
Sincerely,
Barb Packett,
Legislative Affairs Chair.
Mr. LEVIN. Madam President, today I am proud to be an original
cosponsor of the Senior Nutrition Act. This legislation which is
cosponsored by my friend and colleague from my home state of Michigan,
Senator Stabenow as well as my good friend Senator Domenici seeks to
address in inequity in the Commodity Supplemental Food Program, CSFP,
that I have long sought to address.
CSFP is an important U.S. Department of Agriculture commodity food
program that serves nearly four hundred thousand individuals every
month, many of whom live in my home state of Michigan. The vast
majority of these individuals are senior citizens. In fact, CSFP is the
primary senior commodity program of the USDA. The average senior
citizen pays $1000 dollars per year to purchase prescription drugs, and
many senior citizens living on fixed incomes, are forced to choose
between prescription drugs and food.
Given the dire choices facing many seniors, reforming the Commodity
Supplemental Food Program so that it can serve more seniors is a matter
of great importance. This legislation seeks to increase the ability of
seniors to get the food that they need by granting categorical
eligibility for seniors if they can participate in the Food Stamp
Program. Additional verification is not needed in this case. The Food
Stamp Program provides a medical expense deduction which seniors may
use to account for their high prescription drug costs. This legislation
will also raise the CSFP eligibility level for seniors to 185 percent
of the poverty level. Raising the eligibility level to 185 percent of
the poverty level, from the current level of 130 percent, would make
eligibility levels consistent for women with children and senior
citizens. In addition this bill will raise the authorized level for
CSFP to $200 million of funding over 5 years. This will ensure that all
eligible to receive food under CSFP will do so while allowing for the
expansion of the program beyond the 28 States and the District of
Columbia which currently participate in the program.
I am proud to be an original cosponsor of this legislation, and would
like to thank Senators Stabenow and Domenici for their hard work in
crafting this legislation. I hope that my Senate colleagues will join
us in supporting and assign this legislation.
______
By Ms. COLLINS (for herself and Mr. Nelson of Nebraska):
S. 2110. A bill to temporarily increase the Federal Medicare
assistance percentage for the Medicaid Program; to the Committee on
Finance.
Ms. COLLINS. Madam President, I am pleased today to rise, with my
good friend Senator Ben Nelson, to introduce a bill that would assist
States through a period when many are experiencing a fiscal crisis.
Stated simply, for the remainder of this year and next, the bill would
increase the Federal Government's share of each State's Medicaid costs
by 1.5 percent and hold the Federal matching rate for each State
harmless in order to provide approximately $7 billion in fiscal relief
to States and allow them to expand, not contract, their Medicaid
programs.
Last month, I was pleased to join with an overwhelming number of our
colleagues in passing an economic recovery bill that extended benefits
for unemployed workers and provide depreciation incentives for
businesses to invest in new facilities and equipment. In short, the
bill provided welcome relief to our unemployed workers and to our
economy. But it also posed a difficult choice to State governments.
In all but a handful of States, corporate and individual income taxes
are calculated based on the Federal tax code's definition of income.
Thus, when we change how taxable income is calculated under the Federal
code, the changes automatically affect the amount of tax collected by
States. It has been estimated, for example, that the tax changes made
by the economic recovery package will reduce State revenues by $14
billion. States can avoid the revenue loss by ``decoupling'' their tax
policies from Federal law, but they do so at a price. Decoupling
increases the complexity of paying taxes and forces businesses to
devote more resources to compliance. At the most basic level, they
would have to calculate taxes two different ways and would have to
factor the dueling tax consequences into their business decisions.
States that automatically or affirmatively decide to conform to the
tax law changes in the economic recovery package are faced with finding
ways to cover the loss in expected revenue. This could mean making
painful cuts in important areas such as health care, transportation,
and education. My home State of Maine was faced with a $27 million
revenue loss over the next two years if it chose to conform to the
Federal tax law changes, and this on top of a much larger structural
budget shortfall. The resulting bleak picture forced the State
legislature to contemplate some extremely problematic alternatives,
including cuts in the State Medicaid program.
Today, Medicaid is the fastest growing component of State budgets.
While State revenues were stagnant or declined in many States last
year, Medicaid costs increased 11 percent. Maine is only one of a
number of States that has been forced to consider cuts in their
Medicaid programs to make up for their budget shortfalls.
Earlier this year, Maine was facing a $248 million revenue shortfall.
Faced with nothing but tough choices, our Governor proposed $58 million
in Medicaid cuts, including reductions in payments to hospitals,
nursing homes, group homes, and physicians. He was also forced to
propose a delay in the enactment of legislation passed by the State
Legislature last year to expand Medicaid to provide health coverage to
an estimated 16,000 low-income uninsured Mainers.
While subsequent revisions in the State's revenue forecasts enabled
the Governor to restore most of these Medicaid cuts, the loss of
revenue due to the tax law changes in the economic recovery package
could very well put
[[Page S2583]]
them back on the table, particularly because the Maine legislature has
decided to defer a decision on whether to fully conform in 2002 to the
bonus depreciation provisions of the economic recovery package until
its next legislative session.
The legislation I am introducing today will help to bridge Maine's
funding gap by bringing an additional $40 million to my State's
Medicaid program over the next two years. This should not only
forestall the need for any further cuts, but will also provide
additional funds to Maine to proceed with its plans to expand its
Medicaid program to provide health care coverage for more of our low-
income uninsured.
I do not want Maine or other States to have to choose between helping
our economy recover from recession and helping people in need. Our
States need more Federal assistance in providing health care services
through Medicaid, not less, which is why I am introducing this bill
today. By increasing the Federal medical assistance percentage for all
States this year and next, we can relieve the pressure put on States to
cut spending on important programs while increasing their capacity to
provide services through Medicaid. I urge our colleagues to join
Senator Nelson and me in this effort.
Mr. NELSON of Nebraska. Madam President, I come to the floor to talk
about a bill I plan on introducing later on today with my good friend
Senator Susan Collins. I am pleased to say that our legislation could
be considered the next step in economic stimulus. A little more than a
month ago, this body passed and the President signed a bill to
stimulate the economy and help workers. It was not a perfect bill, but
few are. But the economy was hurting and it was time to act.
One of the unintended consequences of the stimulus bill was a revenue
loss for many states. The final package included a provision that will
stimulate business development through tax incentives. Unfortunately,
because the majority of states ``couple'' their tax rates to the
federal tax rates, this benefit for businesses will mean an estimated
$14 billion loss in state revenues. States can avoid the revenue loss
by decoupling from the federal law, but this approach is not without
its own traps and pitfalls. Decoupling makes the tax codes of states
just that much more confusing.
Many states have explored ways to decouple, or in simpler terms, they
have searched for ways to hold their state harmless from the
experienced revenue loss. In fact, the state Legislature in Nebraska is
considering such a measure today, as it attempts to find a way out of
it's expected $119 million budget shortfall.
We must now take steps to alleviate the unintended impact of the tax
reductions on state budgets. In previously debated stimulus packages, a
provision was included that would have helped state governments by
increasing the federal contribution of the Federal Medicaid Assistance
Percentage, FMAP, by 1.5 percent. This provision enjoyed wide support.
Unfortunately, and over the objections of the crafters of the Centrist
stimulus plan, it was not included in the final package signed by
President Bush.
Even before the passage of the stimulus bill, Medicaid costs were
rising at the same time state tax revenues were decreasing. States are
now faced with the choice of either cutting Medicaid services or
diverting funding from other essential programs to fund Medicaid. This
``choice'' is no choice at all either cut health care service to
Medicaid recipients or cut funding for schools, roads, police and
firefighters. In a time of economic turmoil this ``choice'' can stall
the economic recovery the stimulus bill was meant to jump-start.
Our bill would revive the FMAP provision this body earlier
considered. It would provide a direct response to the false ``choice''
faced by states. This bill will alleviate state's Medicaid liabilities
by increasing the federal government's contribution to the Medicaid
program by 1.5 percent for this year and next. This would mean an
additional $7 billion for states. In Nebraska, the savings would amount
to an estimated $42.7 million. This more than offsets the $34 million
that Nebraska is expected to lose if they comply with the business tax
incentives in the stimulus bill and would in fact provide $8.7 million
on top of what was lost.
A month ago, we took steps to help the economy recover and to help
workers. Today, we need to take an additional step to help states
struggling with fiscal calamity. With this increase in federal Medicaid
assistance throughout this year and next, states will be given some
breathing room to deal with the difficult choices they face in
balancing their budgets. I urge my colleagues to join Senator Collins
and I in this effort and show the states that Congress is not
indifferent to their budget problems and that we will step in and
provide meaningful assistance at a time when governors need it most.
Mrs. CLINTON. Madam President, I commend my colleague from Nebraska
for recognizing the extraordinary burdens that are being placed on our
States both because of the economic slowdown and the increase in health
costs, as well as the effects of the 9-11 attacks in our State
particularly, but also because of the unintended consequences of some
of the efforts that were undertaken in the stimulus bill to stimulate
investment which have the direct effect of further cutting State
revenues.
As a former Governor, I know our colleague from Nebraska understands
this intimately. I very much appreciate his leadership on this issue
and look forward to working with him.
Mr. NELSON of Nebraska. I thank the Senator.
______
By Mr. ROCKEFELLER (for himself, Mr. Byrd, and Mr. Specter):
S. 2113. A bill to reduce temporarily the duty on N-
Cyclohexylthiophthalimide; to the Committee on Finance.
Mr. ROCKEFELLER. Madam President, I am pleased to introduce this bill
today with Senators Specter and Byrd to temporarily suspend a portion
of the tariff applicable to a specific chemical product, N-
(Cyclohexylthio)-phthalimide, which is usually referred to as ``PVI,''
and thereby provide for greater economic growth.
Import duties are intimately related to the tax and trade policies of
the United States. Just as Congress expressly imposes duties on
imported goods to protect specific domestic industries and at the same
time raise revenue, Congress abolishes, reduces, or suspends duties to
encourage domestic business enterprise and export activity,
particularly if a specific domestic industry will not be harmed. This
is the situation applicable to PVI.
PVI stands for ``Pre-Vulcanization Inhibitor,'' which means that PVI
retards the onset of the vulcanization when rubber is being processed.
In other words, PVI functions as a safeguard when rubber articles are
being manufactured. There is no direct substitute product for PVI.
As you might expect, there is a reasonable demand for this product in
the U.S. rubber industry, particularly in the tire industry. To meet
this demand, various companies around the world now manufacture PVI and
export it to the United States; however, PVI is not manufactured in the
United States.
Therefore, the U.S. economy is paying a duty for the use of PVI, but
no domestic industry is being protected. Therefore, this tariff should
be suspended to the maximum extent possible. This legislation would
suspend the tariff above the 2 percent level, which will provide for
greater economic growth for the United States.
I encourage my colleagues to support this initiative. 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. 2113
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. N-CYCLOHEXYLTHIOPHTHALIMIDE.
(a) In General.--Subchapter II of chapter 99 of the
Harmonized Tariff Schedule of the United States is amended by
inserting in numerical sequence the following new heading:
[[Page S2584]]
`` 9902.29.82 N- 3% No change No change On or before 12/
Cyclohexylthiophthali 31/2005 ''
mide (CAS No. 17796- .
82-6) (provided for
in subheading
2930.90.24)..........
(b) Effective Date.--The amendment made by subsection (a)
applies to articles entered, or withdrawn from warehouse for
consumption, on or after the 15th day after the date of
enactment of this Act.
______
By Mr. VOINOVICH (for himself and Mr. DeWine):
S. 2114. A bill to authorize the Attorney General to carry out a
racial profiling educating and awareness program within the Department
of Justice and to assist state and local law enforcement agencies in
implementing such programs; to the Committee on the Judiciary.
Mr. VOINOVICH. Madam President, we've heard all too often of
situations in cities and towns across the country in which concerns
over racial profiling are creating serious divisions between
communities and law enforcement agencies. Despite the shared interest
each have in fighting crime and making neighborhoods safer, mistrust
and wariness stands in the way of cooperation.
Today I introduced a bill entitled the ``Racial Profiling Education
and Awareness Act of 2002'' that I believe will put us on the road to
preventing problems caused by racial profiling and help begin
reconciliation in communities torn apart by racial unrest connected to
police-community relations.
Rooted in the belief that education and dialogue are the most
effective tools for bridging racial divides, my bill establishes a
program within the Department of Justice to educate city leaders,
police chiefs, and law enforcement personnel on the problems of racial
profiling and the value of community outreach, as well as to recognize
and disseminate information on ``best practice'' procedures for
addressing police-community racial issues.
My experience as mayor of Cleveland and governor of Ohio has taught
me that reaching the hearts and minds of people is the most effective
means of dealing with intolerance and the problems that result.
As mayor of Cleveland I established the city's first urban coalition,
the Cleveland Roundtable, to bring together representatives of the
city's various racial, religious and economic groups to create a common
agenda. I also established a one-week sensitivity training course for
all Cleveland police officers and created six police district community
relations committees to open lines of communication between police
officers and community members.
As governor, I launched efforts to increase community outreach by law
enforcement in order to foster a cooperative, rather than adversarial,
relationship between citizens and law enforcement. Through my
``Governor's Challenge,'' I worked to bring members of local
communities together with law enforcement officials and members of the
business community in order to educate and break down barriers that
lead to intolerance. Outstanding communities were recognized for their
efforts.
On Friday, April 12, 2002, Attorney General Ashcroft is scheduled to
travel to Cincinnati, Ohio to endorse a settlement agreement between
the Cincinnati Police Department and the Department of Justice. The
settlement is in reference to a Federal lawsuit, filed last March that
alleges a 30-year pattern of racial profiling by the department. Just
one month after the suit was filed, riots broke out in the city of
Cincinnati after a white officer shot and killed an unarmed black
teenager in a foot chase. The riots prompted Mayor Luken of Cincinnati
to invite the Justice Department to review the practices and procedures
of the Cincinnati Police Department and make recommendations for
improvement.
What results is a settlement, endorsed by all parties, including the
local Fraternal Order of Police chapter and the local ACLU chapter,
which sets forth several recommendations for the department, including
revising procedures governing the use of deadly force, choke holds and
irritant spray; increasing training requirements; and keeping a
database of all citizen-reported positive interactions with police.
Most importantly in my eyes, however, is the requirement that the
department works to improve relations between communities and the
police.
I firmly believe that Cincinnati can become a model for turning
around a difficult situation and building good community-police
relations. And I believe that if other cities and towns throughout the
country can open the lines of communication between their communities
and law enforcement as Cincinnati is doing, they can prevent problems
from ever happening.
The overwhelming majority of State and local law enforcement agents
throughout the Nation discharge their duties professionally and justly.
I salute them for their committed efforts in what is one of America's
toughest jobs. It is unfortunate that the misdeeds of a minute few have
such a corrosive effect on the police-community relationship. Through
education and dialogue we can help turn situations around so that
groups who once thought they had little in common can realize how much
they actually have to gain by working together to make our communities
safer places to live.
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. 2114
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 ``Racial Profiling Education
and Awareness Act of 2002.''
SEC. 2. FINDINGS.
Whereas, the overwhelming majority of state and local law
enforcement agents throughout the nation discharge their
duties professionally and without bias.
Whereas, a large majority of individuals subjected to stops
and other enforcement activities based on race, ethnicity, or
national origin are found to be law-abiding and therefore
racial profiling is not an effective means to uncover
criminal activity.
Whereas, racial profiling should not be confused with
criminal profiling, which is a legitimate tool in fighting
crime.
Whereas, racial profiling violates the Equal Protection
Clause of the Constitution. Using race, ethnicity, or
national origin as a proxy for criminal suspicion violates
the constitutional requirement that police and other
government officials accord to all citizens the equal
protection of the law. Arlington Heights v. Metropolitan
Housing Development Corporation, 429 U.S. 252 (1977).
SEC. 3. AUTHORIZATION OF PROGRAM.
(a) In General.--The Attorney General, in consultation with
law enforcement agencies and civil rights organizations,
shall establish an education and awareness program on racial
profiling and the negative effects of racial profiling on
individuals and law enforcement.
(b) Purposes of Program.--The purposes of this new
educational program are to (1) encourage state and local law
enforcement agencies to cease existing practices that may
promote racial profiling, (2) encourage involvement with the
community to address the problem of racial profiling, (3)
assist state and local law enforcement agencies in developing
and maintaining adequate policies and procedures to prevent
racial profiling, and (4) assist state and local law
enforcement agencies in developing and implementing internal
training programs to combat racial profiling and to foster
enhanced community relations.
(c) Program for Local Law Enforcement Agencies.--The
education and awareness program and materials developed
pursuant to subsections (a) and (b) shall be offered to state
and local law enforcement agencies.
(d) Regional Programs.--The education and awareness program
developed pursuant to subsections (a) and (b) shall be
offered at various regional centers across the country to
ensure that all law enforcement agencies have reasonable
access to the program.
SEC. 4. EVALUATION OF BEST PRACTICES.
(a) Performance Measures.--The Department of Justice shall
develop measures to evaluate the performance of programs
implemented under Section 3(b)(4).
(b) Evaluation According To Performance Measures.--Applying
the performance measures developed under subsection (a), the
Department of Justice shall evaluate programs implemented
under section 3(b)(4)--
(1) to judge their performance and effectiveness;
(2) to identify which of the programs represents the best
practices to combat racial profiling; and
(3) to identify which of the programs may be replicated and
used to provide assistance to other law enforcement agencies.
[[Page S2585]]
(c) Applying the performance measures developed under
subsection (a), the Department of Justice shall work with
those state and local law enforcement agencies that would
most benefit from the education program and materials
developed under section three in order to assist them in
implementing a plan for the prevention of racial profiling
within their agency.
SEC. 5. AUTHORIZATION OF APPROPRIATIONS.
There are authorized to be appropriated such sums as are
necessary to carry out this Act.
______
By Mr. CLELAND:
S. 2115. A bill to amend the Public Health Act to create a Center for
Bioterrorism Preparedness within the Centers for Disease Control and
Prevention; to the Committee on Health, Education, Labor, and Pensions.
Mr. CLELAND. Madam President, I rise today to introduce legislation
to create a National Center for Bioterrorism Preparedness and Response
within the Centers for Disease Control and Prevention. This center will
be the first in the Federal Government to be dedicated solely to
protecting the Nation against the public health threats posed by
biological, chemical, and radiological weapons attacks.
The monumental importance of this task, compounded by the potentially
devastating consequences of a failure to give it the national
commitment it deserves, makes the creation of a single center that will
focus all its energies and resources on encountering the public health
threat of bioterrorism imperative and of the greatest urgency.
The events of last fall made it painfully clear that we as a nation
are not as prepared as we need to be to deal with a bioterrorist
attack.
The Federal response to the anthrax crisis has been variously
characterized as fragmented, slow, confused, ineffectual--in a word,
inadequate. This is in no way a reflection on the dedication or
abilities of the men and women who performed so exceptionally well in
their roles at the Federal, State, and local level in response to a
threat none of us had encountered before. They did not let us down. If
anything, we, the Congress of the United States, let them down through
years of neglect of the public health sector and by failing to give
adequate recognition sooner to the threat posed to us by bioterrorism.
It was not until 1999 that the Department of Health and Human
Services launched its bioterrorism initiative. The military had
understood and taken steps to counter the threat of biological warfare
against our troops decades earlier. But it took the civilian sector
until 3 years ago even to begin to take seriously the threat of
domestic terrorism.
Today not one of us could possibly fail to understand how serious the
threat posed by bioterrorism truly is. Some among us were the intended
targets of last fall's bioterrorist attack. All of us keenly felt the
threat.
Between 1999 and 2001, we spent in this Nation a total of $730
million on HHS's bioterrorism initiative, the lion's share of which was
used by the CDC to bolster bioterrorism preparedness and response
capacity of State and local health departments.
This initiative was a good start, but it is now clear that between
1999 and September 11, 2001, we continued to grossly underestimate the
national commitment that would be required to counter the threat of
bioterrorism.
Finally, late last year, as we finished allocating funds for fiscal
year 2002 in the wake of September 11 and the anthrax attacks, we
boosted HHS bioterrorism spending to $3 billion, roughly a tenfold
increase.
Congress is often accused of being reactive instead of proactive, and
I think that criticism is, I am sad to say, valid in this case.
Certainly a dramatic ratcheting up to our commitment to bioterrorism
defense was the right reaction to the events of last fall. But now we
are presented with the opportunity, and I think the obligation, to take
proactive steps to anticipate future threats and needs based on our
recent experiences.
My proposal today is just such a step, and I exhort my colleagues in
this body and in the House to support the immediate authorization of a
National Center for Bioterrorism Preparedness and Response.
The CDC is on the public health front in the war against domestic
terrorism, the tip of the spear. It is not the only weapon in our
arsenal. The CDC joins the National Institutes of Health, the Food and
Drug Administration, and Health Resources and Services Administration,
the many State and local health departments, and many others on the
front line. But the CDC is the one with the greatest responsibility in
the event of a bioterrorist attack.
Despite the critical nature of these responsibilities, we must
remember how new they are to the CDC, especially relative to the CDC's
56 years of experience addressing public health threats of a
fundamentally different nature.
The threat posed by bioterrorism bears a surface resemblance to that
posed by more conventional disease outputs. But closer inspection
reveals real substantive differences, and a recognition of these
differences can make the difference between an effective and
ineffective emergency response.
The scientists and other experts at the National Center for
Infectious Diseases and the National Center for Environmental Health
are highly skilled in controlling and preventing disease outbreaks of a
natural origin, but when it comes to bioterrorism, they are treading
new ground without a compass.
CDC's rapid response personnel, in the absence of the specialized and
focused bioterrorism training that a national center could provide,
will inevitably bring to bear epidemiological models and methods that,
while exceptionally effective in approaching naturally occurring
disease outbreaks, are poorly suited to manmade outbreaks.
As my friend and former Senator Sam Nunn so wonderfully noted in
testimony to Congress just months before September 11 of last year:
A biological weapons attack cuts across categories and
mocks old strategies.
We need a new approach. Under the present structure, CDC's
bioterrorism preparedness and response efforts exist alongside and are
dispersed among its more traditional programs. This is the prevailing
state of affairs because HHS's bioterrorism initiative is still
relatively new, not because it is the ideal method of organizing CDC's
response to bioterrorism, but the time has come to give the CDC's
bioterrorism defense efforts the focus they deserve.
Counterbioterrorism activities at the CDC jumped from zero percent of
the CDC's overall budget in 1998 to 4 percent in 2001 and 34 percent in
2002.
Each of the CDC's other major programs, none of which now even
approaches the bioterrorism program in terms of size, has been given a
national center with its own director, its own budget authority, and
own accountability to Congress.
The CDC's Bioterrorism Preparedness and Emergency Response Program,
by contrast, is not even funded through the CDC. Its resources come
from the external public health and social service emergency fund.
In the Children's Health Act of 2000, we authorized a National Center
on Birth Defects and Developmental Disabilities, not because the CDC
had no prior programs relating to birth defects and developmental
disabilities, but rather because only in their own dedicated center
could these programs receive the focus and priority they deserve.
There is a National Center for Health Statistics, but there is right
now no National Center for Bioterrorism Preparedness and Response. It
seems to me that if a dedicated center is called for by the need for
accurate health statistics, the urgent need for a comprehensive,
effective, and focused defense against bioterrorism certainly demands
one as well.
Under my legislation, the National Center for Bioterrorism
Preparedness and Response would be charged with the following
responsibilities: training, preparing, and equipping bioterrorism
emergency response teams, who will become the special forces of the
Public Health Service, for the unique purpose of immediate emergency
response to a man-made assault on the public health; overseeing,
expanding, and improving the laboratory response network; and that is a
mission; developing response plans for all conceivable contingencies
involving terrorist attacks with weapons of mass destruction, that is
much needed and developing protocols of coordination and communication
between Federal, State, and local actors, as well as between different
Federal actors, in collaboration with these entities, for each of those
contingencies,
[[Page S2586]]
which is highly needed; maintaining, managing, and deploying the
National Pharmaceutical Stockpile, what an important challenge that is;
regulating and tracking the possession, use, and transfer of dangerous
biological, chemical, and radiological agents that the Secretary of HHS
determines pose a threat to the public health; developing and
implementing disease surveillance systems, including a nationwide
secure electronic network linking doctors, hospitals, public health
departments, and the CDC, for the early detection, identification,
collection, and monitoring of terrorist attacks involving weapons of
mass destruction; administering grants to state and local public health
departments for building core capacities, such as the Health
Alert Network; and organizing and carrying out simulation exercises
with respect to terrorist attacks involving biological, chemical, or
radiological weapons in close coordination with other relevant federal,
state, and local actors.
This Center is designed specifically to complement HHS's existing
structure for the coordination of its multi-agency counter-bioterrorism
initiative. At present, the Director of the Office of Public Health
Preparedness is responsible for coordinating the bioterrorism functions
of the CDC with those of the NIH, with those of the FDA and so forth.
The housing of all the CDC's bioterrorism functions in one dedicated
center will facilitate the Director's coordination task by providing a
single point of contact within the CDC for its bioterrorism defense
efforts. When the National Center for Bioterrorism Preparedness and
Response goes online, the CDC will benefit from a much more focused and
prioritized bioterrorism mandate; the Office of Public Health
Preparedness will benefit from a streamlining of its coordination
duties; and the American people will benefit from a firmer, sounder,
stronger defense against bioterrorism.
Let me be clear that what I am proposing is not an added layer of
bureaucracy. Most of the responsibilities that would be assigned to the
National Center for Bioterrorism Preparedness and Response already
accrue to the CDC in Atlanta. My legislation would gather these
existing bioterrorism functions from their various locations throughout
the CDC, which has 21 different buildings, I might add, and bring them
all under one roof, one center--an elimination of bureaucratic layers,
not an addition of a new one. There are a few new responsibilities that
my legislation would charge to the Center that do not currently reside
with the CDC, but I challenge anyone to claim that they constitute
merely an added layer of bureaucracy. Where there are
new responsibilities--for instance, the tracking and regulation not
merely of the transfer but of the possession and use of deadly
biological toxins--it is only in instances of national security
imperatives of the highest order.
In 1947, President Truman advocated and presided over the creation of
the National Military Establishment, a new department bringing the
Departments of War and Navy under one aegis. In 1949, the National
Military Establishment was renamed the Department of Defense. President
Truman recognized in the waning days of World War II that the Nation's
military as it was then structured would be incapable of meeting future
threats. That is important. The Department of Defense, with its unified
command structure and cohesive focus on national defense, was his
solution to the problem. Today, we all know how well the Department of
Defense has served us. In the 1980s, President Reagan appointed the
first drug czar to lend focus to what had previously been a loosely
dispersed and consequently ineffectual war on drugs. More recently,
President Bush created the Office of Homeland Security because he
recognized that we need one office and one director whose sole
responsibility is to ensure the security of our homeland. In this same
tradition, I propose a National Center for Bioterrorism Preparedness
and Response. When a threat--be it our inability to win future wars,
rampant drug use, or terrorist designs on our homeland--reaches
critical proportions, our Nation has historically responded by creating
a focal point whose sole mandate is addressing that threat. Today, I
can say without fear of contradiction that the threat of bioterrorism
has surpassed the critical threshold. In my view, we are therefore
called upon by history and by our obligation to future generations to
create a dedicated National Center for Bioterrorism Preparedness and
Response.
I ask unanimous consent that the text of my legislation be printed in
the Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:
S. 2115
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. NATIONAL CENTER FOR BIOTERRORISM PREPAREDNESS AND
RESPONSE.
Title III of the Public Health Service Act (42 U.S.C. 241
et seq.) is amended by adding at the end the following:
``PART R--NATIONAL CENTER FOR BIOTERRORISM PREPAREDNESS AND RESPONSE
``SEC. 399Z-1. NATIONAL CENTER FOR BIOTERRORISM PREPAREDNESS
AND RESPONSE.
``(a) In General.--There is established within the Centers
for Disease Control and Prevention a center to be known as
the National Center for Bioterrorism Preparedness and
Response (referred to in this section as the `Center') that
shall be headed by a director appointed by the Director of
the Centers for Disease Control and Prevention.
``(b) Duties.--The Director of the Center shall--
``(1) administer grants to State and local public health
entities, such as health departments, academic institutions,
and other public health partners to upgrade public health
core capacities, including--
``(A) improving surveillance and epidemiology;
``(B) increasing the speed of laboratory diagnosis;
``(C) ensuring a well-trained public health workforce; and
``(D) providing timely, secure communications and
information systems (such as the Health Alert Network);
``(2) maintain, manage, and in a public health emergency
deploy, the National Pharmaceutical Stockpile administered by
the Centers for Disease Control;
``(3) ensure that all States have functional plans in place
for effective management and use of the National
Pharmaceutical Stockpile should it be deployed;
``(4) establish, in consultation with the Department of
Justice, the Department of Energy, and the Department of
Defense, a list of biological, chemical, and radiological
agents and toxins that could pose a severe threat to public
health and safety;
``(5) at least every 6 months review, and if necessary
revise, in consultation with the Department of Justice, the
Department of Energy, and the Department of Defense, the list
established in paragraph (4);
``(6) regulate and track the agents and toxins listed
pursuant to paragraph (4) by--
``(A) in consultation and coordination with the Department
of Justice, the Department of Energy, and the Department of
Defense--
``(i) establishing procedures for access to listed agents
and toxins, including a screening protocol to ensure that
individual access to listed agents and toxins is limited; and
``(ii) establishing safety standards and procedures for the
possession, use, and transfer of listed agents and toxins,
including reasonable security requirements for persons
possessing, using, or transferring listed agents, so as to
protect public health and safety; and
``(B) requiring registration for the possession, use, and
transfer of listed agents and toxins and maintaining a
national database of the location of such agents and toxins;
and
``(7) train, prepare, and equip bioterrorism emergency
response teams, composed of members of the Epidemic
Intelligence Service, who will be dispatched immediately in
the event of a suspected terrorist attack involving
biological, chemical, or radiological weapons;
``(8) expand and improve the Laboratory Response Network;
``(9) organize and carry out simulation exercises with
respect to terrorist attacks involving biological, chemical,
or radiological weapons, in coordination with State and local
governments for the purpose of assessing preparedness;
``(10) develop and implement disease surveillance measures,
including a nationwide electronic network linking doctors,
hospitals, public health departments, and the Centers for
Disease Control and Prevention, for the early detection,
identification, collection, and monitoring of terrorist
attacks involving biological, chemical, or radiological
weapons;
``(11) develop response plans for all conceivable
contingencies involving terrorist attacks with biological,
chemical, or radiological weapons, that specify protocols of
communication and coordination between Federal, State, and
local actors, as well as between different Federal actors,
and ensure that resources required to carry out the plans are
obtained and put into place; and
``(12) perform any other relevant responsibilities the
Secretary deems appropriate.
``(c) Transfers.--
``(1) In general.--Notwithstanding any other provision of
law, on the date described
[[Page S2587]]
in paragraph (4), each program and function described in
paragraph (3) shall be transferred to, and administered by
the Center.
``(2) Related transfers.--Personnel employed in connection
with the programs and functions described in paragraph (3),
and amounts available for carrying out such programs and
functions shall be transferred to the Center. Such transfer
of amounts does not affect the availability of the amounts
with respect to the purposes for which the amounts may be
expended.
``(3) Programs and functions described.--The programs and
functions described in this paragraph are all programs and
functions that--
``(A) relate to bioterrorism preparedness and response; and
``(B) were previously dispersed among the various centers
that comprise the Centers for Disease Control and Prevention.
``(4) Date described.--The date described in this paragraph
is the date that is 180 days after the date of enactment of
this section.''.
______
By Mr. KERRY:
S. 2116. A bill to reform the program of block grants to States for
temporary assistance for needy families to help States address the
importance of adequate, affordable housing in promoting family progress
towards self-sufficiency, and for other purposes; to the Committee on
Finance.
Mr. KERRY. Madam President, I am pleased today to introduce the
Welfare Reform and Housing Act. This bill contains measures to improve
access to adequate and affordable housing for families eligible for
Temporary Assistance for Needy Families, TANF, benefits.
It is essential that low-income families struggling to make the
transition from welfare to work have access to affordable, quality
housing options. Families with housing affordability problems are often
forced to move frequently, which disrupts work schedules and
jeopardizes employment. Many of the affordable housing options are
located in areas that have limited employment opportunities and are
located a long distance from centers of job growth. Furthermore, high
housing costs can rob low-wage workers of a majority of their income,
leaving insufficient funds for child care, food, transportation, and
other basic necessities.
Maintaining stable and affordable housing is critically important to
holding down a job, yet an alarming number of low-income families do
not have access to affordable housing. The data from Massachusetts is
shocking: in order to afford a two-bedroom unit at the fair market rent
established by the Department of Housing and Urban Development, HUD, a
minimum-wage worker would have to work 105 hours per week; in 1995,
2,900 poor families used private homeless shelters, while in 2000 the
number grew to 4,300, with a majority of these families being low-wage
workers who had once been on welfare. Lack of affordable housing is not
a problem exclusive to Massachusetts. The Brookings Institution found
that nearly three-fifths of poor renting families nationwide pay more
than half of their income for rent or live in seriously substandard
housing. Nationwide there are only 39 affordable housing units
available for rent for every 100 low-income families needing housing.
And for the fourth year in a row, rents have increased faster than
inflation. We must address the issue of affordable housing during
reauthorization of the welfare law because many low-income families hit
this formidable roadblock on their path to employment.
Though access to affordable housing is often left out of the
discussion of welfare reform, it is crucial that we address this issue
during our reauthorization of the welfare reform law this year. The
welfare reform legislation will not allocate considerable new funds to
increase affordable housing opportunities, however, modifications to
the TANF statute can be made to address the problem by other means.
That is why today I am introducing the Welfare Reform and Housing Act.
This legislation will address the housing issue in the context of
welfare reform in six major ways:
First, the measure will make it simpler for states to use TANF funds
to provide ongoing housing assistance. TANF-funded housing subsidies
provided for more than four months would be considered ``non-
assistance'' instead of ``assistance''. By considering these subsidies
as ``non-assistance,'' states that want to implement housing assistance
programs using TANF funds will not have to work within the constraints
of current Health and Human Services rules surrounding ``assistance''
subsidies.
Second, the bill would encourage states to consider housing needs as
a factor in TANF planning and implementation. My legislation would
direct the Department of Health and Human Services to work with the
Department of Housing and Urban Development to gather increased and
improved data on the housing status of families receiving TANF and the
location of places of employment in relation to families' housing.
States will be required to consider the housing status of TANF
recipients and former recipients in TANF planning.
Third, the legislation would allow states to determine what
constitutes ``minor rehabilitation costs'' payable with TANF funds. It
is now permissible to use TANF funds for ``minor rehabilitation'' but
there is no guidance from HHS on what types or cost of repairs are
allowable, making it difficult for states to determine the extent to
which using TANF funds in this area is permissible. By allowing states
to define what constitutes ``minor rehabilitation,'' more states with
similar needs will follow suit. A recent study of the health of current
and former welfare recipients found that non-working TANF recipients
were nearly 50 percent more likely than working former recipients to
have two or more problems with their housing conditions. Research has
shown that poor housing conditions often can cause or exacerbate health
problems.
Fourth, my bill would encourage cooperation among welfare agencies
and agencies that administer federal housing subsidies. By improving
the dialogue between public housing agencies and state welfare
agencies, the two groups will be able to enter into agreements on how
to promote the economic stability of public housing residents who are
receiving or have received TANF benefits.
Fifth, the legislation would authorize HHS and HUD to conduct a joint
demonstration to explore the effectiveness of a variety of service-
enriched and supportive housing models for TANF families with multiple
barriers to work, including homeless families.
Finally, my bill would clarify that legal immigrant victims of
domestic violence eligible for TANF and other welfare-related benefits
are also eligible for housing benefits. The proposal would ensure that
abused immigrant women seeking protection under the 1994 Violence
Against Women Act that are also eligible for other federal benefit
programs have access to federal housing programs under section 214 of
the Housing and Community Development Act.
Recent proposals made by the Administration and some members of
Congress aim to increase work requirements for families receiving TANF
funds. Therefore it is important that we are committed to ensuring that
low-income families have a fair chance at employment. We have made
progress addressing many barriers to work for low-income families such
as child care, job training, and transportation. But in order to fully
support families make the transition to work we must address the
shortage of adequate and affordable housing. The Welfare Reform and
Housing Act brings housing into the welfare reform dialogue and aims to
help ameliorate the housing problem so that low-income families leaving
welfare have a chance to succeed in the work force.
______
By Mr. DODD (for himself, Ms. Snowe, Mr. Jeffords, Mr. DeWine,
Mr. Breaux, Mr. Reed, and Mr. Rockefeller):
S. 2117. A bill to amend the Child Care and Development Block Grant
Act of 1990 to reauthorize the Act, and for other purposes; to the
Committee on Health, Education, Labor, and Pensions.
Mr. DODD. Madam President, I am pleased to join with my colleagues
Senators Snowe, Jeffords, DeWine, Breaux, Reed, Rockefeller, and
Collins. By joining together on this legislation, we are indicating a
strong bipartisan consensus to invest in both improving the quality of
child care and expanding assistance to low income working families.
It is significant that we are joining together today not only in a
bipartisan manner, but also as members of the
[[Page S2588]]
HELP and Finance Committees in recognition of the support and
neccessity of child care assistance.
Today we are introducing legislation to reauthorize the Child Care
and Development Block Grant. We are calling this legislation the
``Access to High Quality Child Care Act'', because it's about time that
we put the focus on ``Development'' back into the Child Care and
Development Block Grant. Children are 20 percent of our population, but
100 percent of our future.
Today, 78 percent of mothers with school-age children are working. 65
percent of mothers with children under 6 are working. And, more than
half of mothers with infants are working.
Most parents are simply not home full-time anymore. Many would like
to be. For those who are, I introduced legislation in the Senate to
provide a tax credit for stay-at-home parents. Because they, too,
deserve support in their efforts to raise their children.
But most families don't have a choice. If the kids are going to eat,
go to school, and have a roof over their heads, both parents must work.
I don't know of any working parents who think that balancing work and
family is easy. It's not.
Since 1996, the number of families receiving child care assistance
has grown dramatically to about 2 million children today. But, for as
many children who receive assistance, available child care funds reach
only one out of seven eligible children.
Child care in too many communities is not affordable. And in too many
more, it's not available, or, even worse, of dubious quality.
About 14 million children under the age of 6 are in some type of
child care arrangement every day. This includes about 6 million
infants. The cost of care averages between $4,000 and $10,000 a year,
more than the cost of tuition at any state university.
Far too many of America's parents are left with far too little
choice.
Nearly 20 States currently have waiting lists for child care
assistance. Every State has difficulty meeting child care needs. No
state serves every eligible child.
Now, I know that there are some who say that we don't need more money
for child care, that during the last few years we have pumped billions
more into child care. But, I think we have a responsibility to look at
what has happened over the last few years as well.
The welfare caseload dropped by 1.8 million families from 1996 to
1999. The majority of welfare leavers are now employed in low wage
jobs.
The share of TANF families working or participating in work-related
activities while receiving TANF has soared to nearly 900,000 in fiscal
year 99.
Between 1996 and 1999, the number of employed single mothers grew
from 1.8 million to 2.7 million.
According to the Congressional Research Service, there has been a
marked increase in single mothers working, from 63.5 percent in 1996 to
73 percent in 2001.
But, let's face it. Most welfare leavers are leaving for low wage
jobs. On average, they are making $7 or $8 an hour. They are working,
but they are still struggling to get by. Many low wage parents move
from one low wage job to another, but rarely to a high wage job.
Therefore, even over time, these parents still need child care
assistance to stay employed.
I am very concerned that the Administration's welfare reauthorization
plan, with no additional funds for child care, will result in States
shifting assistance from the working poor to those on welfare. House
Republicans joined with Secretary Thompson on Wednesday to announce the
introduction of the President's welfare plan in the House. One change
they made to address child care needs was to allow states additional
flexibility to transfer 50 percent of TANF funds to child care instead
of 30 percent under current law.
Since States are already spending all of their TANF money and the
Administration's welfare plan adds significant additional work
requirements for TANF recipients, I just don't see what giving the
States additional flexibility buys them in child care dollars. At best,
it's robbing Peter to pay Paul, taking cash assistance payments away
from welfare parents to pay for child care for working TANF parents.
That makes no sense. So, instead of robbing assistance from the working
poor to pay for child care assistance for welfare recipients, states
would rob welfare assistance directly from the worst off who are not
working to pay for child care for those on welfare who are working?
What's the logic? How does this help anyone?
We held two hearings on child care in March. At one hearing, a woman
from Maine testified who earns about $18,000 a year, pays half her
income in child care every week, but remains on a waiting list to
receive assistance. In the meantime, she and her two year old sleep on
her grandmother's couch because she can't afford a place of her own.
At another hearing, a woman from Florida with $13,000 in earnings a
year recently lost her child care assistance because in Florida
families working their way off TANF have only 2 years of transitional
child care. After that, they must join the waiting list of some 48,000
children. Because she lost her child care assistance and the state
waiting list is so long, this woman may have to return to welfare.
I've heard some say the answer is flexibility, that if we give the
States more flexibility, then they will step up to the plate. A more
realistic prediction would be that if we give states the resources,
they will step up to the plate.
Let me tell you what flexibility without sufficient resources leads
to: low eligibility levels, no outreach, low provider reimbursement
rates, high co-pays, and waiting lists. Sound familiar? That's right.
With the cost of child care today, even with additional resources
provided over the last several years, too many of the states are forced
to restrict access to low income working parents. Assistance that is
provided often limits parents' choices.
We can do better than this. Too often I hear about low income
families stringing together whatever care they can find so that they
can hold their jobs. For many this means Grandma one day, an aunt the
next day, an uncle the following day, and then maybe the aunt's
boyfriend.
It's no wonder that 46 percent of kindergarten teachers report that
half or more of their students are not ready for kindergarten.
We need to look at these issues in an integrated manner. The
education bill that the President recently signed will require schools
to test every child every year from 3rd through 8th grade, and the
results of those tests will be used to hold schools accountable.
But, if we expect children to be on par by third grade, we need to
look at how they start school. The learning gap doesn't begin in
kindergarten, it is first noticed in kindergarten.
If we are serious about education reform, we need to look at the
child care settings children are in and figure out how to strengthen
them. Seventy-five percent of children under 5 in working families are
in some type of child care arrangement. Too often it is of poor
quality.
The bill we are introducing today is geared toward improving the
quality of care to promote school readiness while expanding child care
assistance to more working poor families.
The Child Care and Development Block Grant is designed to give
parents maximum choice among child care providers. In our bill, we
retain parental choice, but provide States with a number of ways to
help child care providers improve the quality of care that they
provide.
We set aside 5 percent of child care funds to promote workforce
development, helping States to improve child care provider compensation
and benefits, offer scholarships for training in early childhood
development, initiate or maintain career ladders for childhood care
professional development, foster partnerships with colleges and
``resource & referral'', R&Rs, organizations to promote teacher
training in the social, emotional, physical, and cognitive development
of children, including preliteracy and oral language so necessary for
school readiness.
We set aside 5 percent of child care funds to help States increase
the reimbursement rate for child care providers to ensure that parents
have real choices among quality providers. Under current law, child
care payment rates are supposed to be sufficient ``to ensure equal
access for eligible children to comparable child care services in the
State or substate area that are provided to children whose parents are
not
[[Page S2589]]
eligible to receive assistance''. But, low State reimbursement rates do
not offer parents comparable care.
The children of working parents need quality child care if they are
to enter school ready to learn. Yet, 30 States require no training in
early childhood development before a teacher walks into a child care
classroom. Forty-two States require no training in early childhood
development before a family day care provider opens her home to
unrelated children.
Our bill would require States to set training standards, just as they
are required to do now for health and safety under current law. Such
training would go beyond CPR and first aid to include training in the
social, emotional, physical, and cognitive development of children.
Relatives would be exempt, but through the quality funding in CCDBG,
States could partner with colleges and R&Rs to provide training to
relatives and informal caregivers on a voluntary basis. Initial
evaluations in Connecticut of such efforts show that relatives and
informal caregivers are voluntarily participating and are feeling
better about themselves and their interactions with the children have
improved.
Leading studies have found that early investments in children can
reduce the likelihood of being held back in school, reduce the need for
special education, reduce the dropout rate of high school students, and
reduce juvenile crime arrest rates.
If we don't improve both the quality of child care that our children
now spend so much time in and expand access to child care assistance to
more of the working poor, we will be in danger of missing the boat on a
whole generation of children.
I think I speak for all of the cosponsors of this legislation that we
hope to mark up child care in conjunction with the Finance Committee
consideration of welfare reform.
Ms. SNOWE. Madam President, I rise today to join my good friend and
colleague Senator Dodd, in introducing the ``Access to High Quality
Child Care Act of 2002.'' This legislation seeks to build upon
Congress' efforts in 1996 to reform the Nation's welfare system and
with it, overhaul the Nation's largest child care assistance program,
the Child Care Development Block Grant.
One of the most important tasks before Congress this session is the
reauthorization of two critical public assistance laws, the landmark
1996 welfare reform law, and the Child Care Development Block Grant.
Together, these two programs, which are inextricably linked, comprise
the backbone for our Nation's support infrastructure for working
families.
The 1996 welfare law reformed the entire nature of the welfare
system, ending welfare as a way of life and making it instead a
temporary program, providing a hand up instead of a hand out to
families making the transition from welfare to work. The Child Care
Development Block Grant, working with the welfare law, provides more
than $4.8 billion for child care in 2002, giving assistance to those
families that are in transition as well as those who have already
successfully made it out of the welfare system, and helping them stay
out of the welfare system by helping them meet the high cost of child
care. The result is that since 1996, with more parents working, more
children than ever before are receiving child care subsidy assistance.
The key to the successful welfare reform, as witnessed by the 52
percent decline in welfare caseloads since 1996, is the system of work
supports that provides assistance to working parents to help them make
ends meet while in low paying jobs, and sustain the family's successful
transition from welfare to self sufficiency. And perhaps the most
critical of all work supports is child care. Without access to quality
child care, a parent is left with two choices, to leave their child in
a unsafe, and often unsupervised situation, or to not work at all.
Frankly, neither option is acceptable.
This is the underlying philosophy behind the legislation we introduce
today: to ensure that working parents have access to affordable, high
quality child care.
From the onset, our goal has been to reauthorize the Child Care
Development Block Grant to ensure the working parents of America can
continue their jobs with the peace of mind that their children are in a
safe and quality child care situation, whether it is at a child care
center, a relative's home, or in their own home.
We do so by increasing the amount of funding set aside to raise the
quality of care, giving states the ability to improve strengthen their
child care workforce. States will have the option to choose how they
will do so, but options include partnering with community colleges and
Resource and Referral agencies to provide training in early childhood
development to the workforce, or by simply increasing child care
worker's wages. Astonishingly, the national average salary for a child
care worker is between $15,000 and $16,000, and usually with few
benefits. This legislation would give states even greater flexibility
to decide how to improve quality using even greater resources.
Additionally, our legislation simplifies and streamlines the use of
federal welfare dollars for child care, whether it be spent directly on
child care or whether it is transferred to the Child Care Development
Block Grant, while holding these expenditures to the same health and
safety standards as those under the CCDBG. As a member of the Senate
Finance Committee, which has the jurisdiction over the welfare
reauthorization, fixing what's wrong with the rules regarding the use
of federal welfare funding for child care is a high priority of mine as
welfare works its way through Committee consideration.
Approximately 14 million children under the age of six are regularly
in child care, corresponding with the fact that 65 percent of mothers
with children under age six are in the workforce. Considering that the
goal of welfare reform is to move people off the welfare rolls and onto
payrolls, offering help with the cost of child care is one sure way to
ensure that parents can work. Child care is expensive and often
difficult to find. In some states, child care costs as much as four
years in a public college. And that's even before considering the
additional cost of caring for infants, or for odd hour care for those
working nights or weekends, or care for children with special needs.
And the fact is, we know child care pays off in encouraging more
parents on welfare to find and keep a job. States have devoted
significant funding to child care assistance, and have redirected the
bulk of unspent federal welfare dollars under the Temporary Assistance
for Needy Families block grant, TANF, and state Maintenance of Effort,
MOE, dollars to child care assistance. In 2000 alone, states
transferred $2.4 billion in TANF dollars to the Child Care and
Development Block Grant, and spent an additional $1.5 billion in direct
TANF dollars for child care. Why? Because they realize that child care
assistance keeps parents working and that is the key to self
sufficiency.
However, since parents who are making the transition from welfare to
work typically hold minimum wage jobs, those workers' ability to place
their children in quality child care often stretches their families'
budget to the limit. And while these families may no longer be in need
of, or eligible for, cash assistance, without child care assistance,
they may be forced back on the welfare rolls.
The fact of the matter is, quality affordable child care remains
difficult to afford for families nationwide. This reality was made
clear last month, when a young woman from Maine, Sheila Merkinson,
testified before Senator Dodd's Health, Education, Labor and Pensions
Subcommittee, that the cost of her son's child care absorbs 48 percent
of her weekly income, leaving her to provide for her family with only
half of her $18,000 a year earnings. Sadly, Sheila's situation is not
unique.
Our legislation will help Sheila, and thousands like her, by
improving the current child care delivery system, and increases the
funding for the Child Care Development Fund to meet the needs
established by the welfare work requirements. This link not only makes
sense, it also is critical, responsible and essential for the future of
our nation's children and families.
Mr. JEFFORDS. Madam President, I would like to thank Senators Dodd,
Snowe, DeWine, Breaux, Reed, Rockefeller, and Collins for their hard
work and dedication to helping provide
[[Page S2590]]
working families with access to high-quality child care, and I am proud
to be an original co-sponsor of this important legislation. Senator
Dodd and I have been working together on this and other critical issues
affecting children for over twenty years now. And, I look forward to
continue working with him and my esteemed colleagues as we move forward
in helping children and families across the country.
A recent Administration report reveals that as many as 75 percent of
children under the age of five in this country are in some form of
child care arrangement. And, as more mothers of young children enter
the workforce, working families need even greater access to higher
quality child care. In my State of Vermont, approximately 87 percent of
Vermont children under the age of six live with two working parents,
and only 56 percent of the estimated need for child care in Vermont is
met through regulated care.
The evidence overwhelmingly demonstrates that the quality of early
child care and education has a significant effect on children's health
and development and their readiness for school. According to a recent
study, children participating in quality, comprehensive early care and
education programs had a 29 percent higher rate of high school
completion, a 41 percent reduction in special education placement, a 40
percent reduction in the rate of grade retention, a 33 percent lower
rate of juvenile arrest, and a 42 percent reduction in arrest for a
violent offense.
All other industrialized nations acknowledge the great value of early
care and education, and make the care and education of toddlers and
pre-schoolers a mandatory part of their public education system, and
pay for it. Unfortunately, the United States does not.
Quality child care is available in the United States to young
parents, but in many cases, it costs more than ten thousand dollars per
year. This is almost twice the cost of going to many public colleges.
Earlier last week, the President proposed an initiative to strengthen
early learning. He stated that he wants every child to enter school
ready to learn. I am pleased that the President is making the care and
education of our youngest children a priority. However, if we really
want to help all children enter school ready to learn, then we need to
actually provide the resources to do so. The costs of quality child
care exceed what most working families can afford. Yet, unbelievably,
the President has proposed NO additional funding to help families gain
access to quality child care. This just doesn't make any sense.
Many States across the country are working hard to improve the
quality and accessibility of child care, but they simply do not have
the resources to provide sufficient access and quality. For example,
the State of Vermont spends approximately $33 million to provide
working families with access to child care and to improve the quality
of child care around the State. For a small State like Vermont, this is
a lot of money, but is hardly sufficient to provide the type of access
and quality necessary to make sure all kids enter school ready to
learn. The State would need an additional $40 to $50 million to
effectuate real change.
And further, due to the recent economic downturn, a majority of the
States has reported revenues well below expected levels. Accordingly,
while the States want to do more to further the quality and
accessibility of child care, many States will actually have less money
to spend on helping families with quality care and education. Again,
the President has proposed no additional funding to help States provide
families with quality child care. On the contrary, we must
significantly increase funding for child care to help States and local
communities provide this vital support to working families and their
children.
I am proud to be an original co-sponsor of the new Access to High
Quality Child Care Act of 2002.
The 2002 ACCESS Act not only helps provide families with greater
access to child care, but also significantly raises the bar on the
quality of child care in this country. The 2002 ACCESS Act provides
States with real resources to help them improve the quality of child
care for working families. It allows for great flexibility, yet holds
States accountable for making real quality improvements.
Research shows that qualified and well-trained providers are critical
to supporting and enhancing the cognitive and social development of
children in child care. The 2002 ACCESS Act helps States strengthen the
quality of the child care workforce by setting aside a dedicated
portion of funds to support State initiatives that improve both the
qualifications and the compensation of child care providers.
The ACCESS Act also helps States increase child care provider
reimbursement rates to more accurately reflect the true cost of care.
It helps States provide training and technical assistance to informal
and family child care providers as well as center-based providers. It
helps States develop and expand resource and referral services. It
helps families gain access to quality child care for infants and
toddlers, and children with special needs. It provides oversight to
child care centers situated on Federal property. And, the ACCESS Act
also helps States leverage funding to provide technical assistance, and
share in the cost of construction and improvement of child care
facilities and equipment.
I believe that we all recognize that the foundation for learning
begins in the earliest years of life. However, a failure to nurture
development in these early years is a lost opportunity forever. The
2002 ACCESS Act provides States and local communities with a real
opportunity to nurture that development and improve the quality of care
for our youngest children in this country so that all of our children
enter school ready to learn. I urge my colleagues to support this bold,
yet critical initiative, so that indeed, every child truly has an
opportunity to learn.
Mr. DeWINE. Madam President, I rise today to join my colleagues,
Senators SNOWE and DODD, in introducing the Access to High Quality
Child Care Act, ACCESS. This legislation would reauthorize the Child
Care and Development Block Grant through 2007 and rename it the ACCESS
Act.
We all know that our children are the most vulnerable members of our
population and our most valuable resources. Today, 75 percent of
children less than five years of age are in some kind of regular
childcare arrangement. Parents need to feel confident that the people
caring for their children are giving the love and support that children
deserve. The bill we are introducing today would help give parents that
kind of piece of mind.
There are two pieces of the ACCESS Act that I would like to focus on
because they are vital to improving the accessibility of high quality
care. Last year, Senator Dodd and I introduced the Child Care
Facilities Financing Act, which uses small investments to help leverage
existing community resources. In my home State of Ohio, and throughout
the country, resources for the development or enhancement of space are
extremely scarce for childcare facilities. This leveraging approach has
been successful in helping expand childcare capacity. Let me give you
an example.
Wonder World in Akron, OH, is an urban childcare center located in an
old church. This facility was in dire need of repairs. The upstairs
space was poorly lit and not well ventilated, and the downstairs was a
damp basement. The childcare rooms had no windows and no direct access
to bathrooms or a kitchen. There was no outdoor play space. This
environment, itself, had a negative effect on the children, no matter
how dedicated the caregivers. In spite of these dismal conditions, the
center had a waiting list. There were no other choices for affordable
childcare facilities within the community!
Fortunately, in Ohio, we have the Ohio Community Development Finance
Fund, OCDFF, which is a statewide nonprofit organization that works
with local organizations in low-income communities. This fund was able
to coordinate public and private monies to build a new eight-room
childcare facility, a facility that serves approximately 200 children!
It is programs like OCDFF that are possible under the Child Care
Facilities Fund. The ACCESS Act includes the language from the Child
Care Facilities Fund bill that Senator Dodd and I introduced, which
authorizes $50 million dollars for the Child Care Facilities Fund.
[[Page S2591]]
The second most important part of our ACCESS Act is a section that
contains vital language to help provide emergency childcare services.
This section would allow parents to access quality care when their
childcare provider is sick or has a family emergency. The need for this
type of care was made clear by a tragic incident that happened in Ohio,
when little two-year-old Charles Knight's mother had to go to work and
had no one available to care for Charles and his siblings.
The boy's father was supposed to baby-sit, but he failed to show up
that day. Charles' mother tried to find a neighbor or family member to
care for her children, but no one was available. Tragically, she made
the poor decision to leave her sleeping children unattended, so she
could work her 12-hour shift. She thought her boys' father would
eventually show up and baby-sit while she worked.
The father never arrived. Charles was able to climb up on the
balcony. This young, unsupervised child fell nine stories off the
apartment balcony to his death. His mother was charged with
manslaughter, and his father was charged with child neglect.
This sad incident just might have been prevented with emergency
childcare centers. With access to such a center, Charles' mother could
have gone to work knowing her children were safe and secure.
Just last month, Summit County, OH, started a program called
ChildCare NOW in response to an alarming spike in child death and
injuries. ChildCare NOW is being offered at 17 centers in the Akron-
Canton area of Ohio. These childcare centers are opening their doors to
many parents whose baby-sitter cancels at the last minute. This program
is not meant as a permanent childcare replacement but when an
``emergency'' arises, these are safe alternatives to parental care.
The language I have included in this bill, emphasizes that local and
State childcare agencies may use funds on emergency childcare programs,
programs like ChildCare NOW. More importantly, the next time a mother
must chose between going to work and leaving her children all alone or
staying at home and losing a day's pay, she will have a third option,
to leave her children in an emergency child care center. I think that
is an important option that we must give to working mothers. It is my
hope that this language will prevent future tragedies like the death of
two-year-old Charles Knight.
Once again, I want to thank Senator Snowe and Senator Dodd for their
work on the ACCESS Act. This bill is necessary for parents who work,
especially parents who have worked hard to get off welfare. They should
be confident that their children are receiving quality care.
Mr. BREAUX. Madam President. I am pleased to be a cosponsor of the
2002 ACCESS Act. It is imperative that the Congress continue its
commitment to low-income families by presenting the President with a
bipartisan bill reauthorizing the Child Care and Development Block
Grant.
I share the Administration's goal to ``Leave No Child Behind.''
Children should not be the victims of welfare reform, left behind with
inconsistent child care accommodations that do not adequately prepare
them for the challenges to come. It is precisely this cycle of
dependency and poverty that welfare reform was intended to end.
In 1996, we fundamentally changed the mentality of welfare from
dependence to independence by creating the Temporary Assistance to
Needy Families TANF, block grant. At the same time, we made a
commitment to poor families that were sent into the work force at low
wages that they would be supported with access to quality child care.
Reliable child care is directly related to job retention. A parent
cannot be in two places at once, and an employer is not likely to
retain an employee that is unreliable at work due to a lack of
consistent care for their child. It is not just about getting a job,
this is about helping families keep their jobs and move up the career
ladder.
In Louisiana, I hear over and over again about access to safe and
affordable child care. The legislation being introduced today will
ensure that child care provided to these families is not only
affordable, but that it meets certain safety and quality standards to
ensure children are placed in an environment where they can grow and
learn.
Access to child care is often limited by states to families with the
lowest incomes. National studies show only 12-15 percent of children
eligible for federally subsidized child care get it. And in many rural
areas, there are no child care providers at all. So as Congress debates
increasing work requirements for people on welfare, the increasing need
for working families to have quality child care must also be taken into
consideration.
I commend Senators Dodd and Snowe for their efforts to increase
access to child care for low income families, while improving the
quality of child care services.
______
By Mr. JEFFORDS:
S. 2118. A bill to amend the Toxic Substances Control Act and the
Federal Insecticide, Fungicide, and Rodenticide Act to implement the
Stockholm Convention on Persistent Organic Pollutants and the Protocol
on Persistent Organic Pollutants to the Convention on Long-Range
Transboundary Air Pollution; to the Committee on Environment and Public
Works.
Mr. JEFFORDS. Madam President, I rise today to introduce the POPs
Implementation Act of 2002.
POPs, or persistent organic pollutants, are chemicals that are
persistent, bioaccumulate in human and animal tissue, biomagnify
through the food chain, and are toxic to humans. These substances
travel across international boundaries, creating a circle of pollution
requiring a global solution.
In April 2001, one year ago, President Bush announced his support for
the Stockholm Convention on Persistent Organic Pollutants, POPs, and in
May 2001, the U.S. signed the Convention. I share the President's
enthusiasm for this sound and workable treaty that targets chemicals
detrimental to human health and the environment.
The Stockholm Convention seeks the elimination or restriction of
production and use of all intentionally produced POPs. The POPs that
are to be initially eliminated include the pesticides aldrin,
chlordane, dieldrin, endrin, heptachlor, mirex, and toxaphene, and the
industrial chemicals hexachlorobenzene and polychlorinated biphenyls,
PCBs. Use of the pesticide DDT is limited to disease control until
safe, effective, and affordable alternatives are identified. The
Convention also seeks the continuing minimization and, where feasible,
ultimate elimination of releases of unintentionally produced POPs such
as dioxins and furans.
Today, I am introducing a bill to amend the Toxic Substances Control
Act, TSCA, and the Federal Insecticide, Fungicide, and Rodenticide Act,
FIFRA, to implement the Stockholm Convention on POPs and the Protocol
on POPs to the Convention on Long-Range Transboundary Air Pollution.
These are the first amendments to TSCA since its enactment in October
1976.
Currently in the U.S., the registrations for nine of the twelve POPs
covered by the Stockholm Convention have been canceled, the manufacture
of PCBs has been banned, and stringent controls have been placed on the
release of the other covered chemicals. The POPs Implementation Act of
2002 provides EPA with the authority, which it currently does not have,
to prohibit the manufacture for export of the twelve POPs and POPs that
are identified in the future. In addition, this legislation provides a
science-based process consistent with the Stockholm Convention for
listing additional chemicals exhibiting POPs characteristics, thereby
attempting to avoid the further production and use of POPs. To assist
in this goal, the National Academy of Sciences is directed to develop
new strategies to screen candidate POPs and new sampling methodologies
to identify future POPs.
Although a previous EPA draft included a mechanism for adding new
chemicals, the Administration's current POPs implementation package
does not. The Stockholm Convention was not intended to be a static
agreement, as it explicitly provides for the additional of new
chemicals. If we are to be most effective in globally reducing these
dangerous chemicals, we must fully commit to this treaty.
[[Page S2592]]
______
By Mr. GRASSLEY (for himself and Mr. Baucus):
S. 2119. A bill to amend the Internal Revenue Code of 1986 to provide
for the tax treatment of inverted corporate entities and of
transactions with such entities, and for other purposes; to the
Committee on Finance.
Mr. GRASSLEY. Madam President, I rise today to offer a bill on behalf
of Senator Baucus and myself, to address the growing problem of
corporate inversions. Our legislation, the ``Reversing the Expatriation
of Profits Offshore,'' REPO Act, will stem the rising tide of corporate
inversions.
It's tax season. Citizens across America are filing their taxes this
week. They're paying their taxes. A lot of taxes. But some corporate
citizens are relaxing this tax season. They've moved their mailing
address out of the country. They've set up a filing cabinet and a mail
box overseas. This way, they escape from millions of dollars of Federal
taxes.
These corporate expatriations aren't illegal. But they're sure
immoral. During a war on terrorism, coming out of a recession, everyone
ought to be pulling together. But instead, these companies are using
recession and terrorism to get out of the United States. If companies
don't have their hearts in America, they ought to get out.
Adding insult to injury, some of these companies have fat contracts
with the government. So they'll take other people's tax dollars to make
a profit, but they won't pay their share of taxes to keep America
strong.
The bill Chairman Baucus and I are introducing today will place
corporate inversions on the endangered species list. Our bill requires
the IRS to look at where a company has its heart and soul, not where it
has a filing cabinet and a mail box. If a company remains controlled in
the United States, our bill requires the company to pay its fair share
of taxes, plain and simple.
When I am firmly committed to halting corporate inversions, I also
recognize that the rising tide of corporate expatriations demonstrates
that our international tax rules are deeply flawed. In many cases,
those flaws seriously undermine an American company's ability to
compete in the global marketplace. This competitive disadvantage is
often cited by companies that engage in inversion transactions.
I believe that we need to bring our international tax system in line
with our open market trade policies, and wish to affirm for the record
that reform of our international tax laws is necessary for our U.S.
businesses to remain competitive in the global marketplace. Moreover,
those U.S. companies that rejected doing a corporate inversion are left
to struggle with the complexity and competitive impediments of our
international tax rules. This is an unjust result for companies that
chose to remain in the United States of America. I am committed to
remedying this inequity.
Mr. President, I ask unanimous consent that the text of the bill and
a technical explanation be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
S. 2119
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 ``Reversing the Expatriation
of Profits Offshore Act''.
SEC. 2. TAX TREATMENT OF INVERTED CORPORATE ENTITIES.
(a) In General.--Subchapter C of chapter 80 of the Internal
Revenue Code of 1986 (relating to provisions affecting more
than one subtitle) is amended by adding at the end the
following new section:
``SEC. 7874. RULES RELATING TO INVERTED CORPORATE ENTITIES.
``(a) Inverted Corporations Treated as Domestic
Corporations.--
``(1) In general.--If a foreign incorporated entity is
treated as an inverted domestic corporation, then,
notwithstanding section 7701(a)(4), such entity shall be
treated for purposes of this title as a domestic corporation.
``(2) Inverted domestic corporation.--For purposes of this
section, a foreign incorporated entity shall be treated as an
inverted domestic corporation if, pursuant to a plan (or a
series of related transactions)--
``(A) the entity completes after March 20, 2002, the direct
or indirect acquisition of substantially all of the
properties held directly or indirectly by a domestic
corporation or substantially all of the properties
constituting a trade or business of a domestic partnership,
``(B) after the acquisition at least 80 percent of the
stock (by vote or value) of the entity is held--
``(i) in the case of an acquisition with respect to a
domestic corporation, by former shareholders of the domestic
corporation by reason of holding stock in the domestic
corporation, or
``(ii) in the case of an acquisition with respect to a
domestic partnership, by former partners of the domestic
partnership, and
``(C) the expanded affiliated group which after the
acquisition includes the entity does not have substantial
business activities in the foreign country in which or under
the law of which the entity is created or organized when
compared to the total business activities of such expanded
affiliated group.
``(b) Preservation of Domestic Tax Base In Certain
Inversion Transactions To Which Subsection (a) Does Not
Apply.--
``(1) In general.--If a foreign incorporated entity would
be treated as an inverted domestic corporation with respect
to an acquired entity if either--
``(A) subsection (a)(2)(A) were applied by substituting `on
or before March 20, 2002' for `after March 20, 2002' and
subsection (a)(2)(B) were applied by substituting `more than
50 percent' for `at least 80 percent', or
``(B) subsection (a)(2)(B) were applied by substituting
`more than 50 percent' for `at least 80 percent',
then the rules of subsection (c) shall apply to any inversion
gain of the acquired entity during the applicable period and
the rules of subsection (d) shall apply to any related party
transaction of the acquired entity during the applicable
period. This subsection shall not apply for any taxable year
if subsection (a) applies to such foreign incorporated entity
for such taxable year.
``(2) Acquired entity.--For purposes of this section--
``(A) In general.--The term `acquired entity' means the
domestic corporation or partnership substantially all of the
properties of which are directly or indirectly acquired in an
acquisition described in subsection (a)(2)(A) to which this
subsection applies.
``(B) Aggregation rules.--Any domestic person bearing a
relationship described in section 267(b) or 707(b) to an
acquired entity shall be treated as an acquired entity with
respect to the acquisition described in subparagraph (A).
``(3) Applicable period.--For purposes of this section--
``(A) In general.--The term `applicable period' means the
period--
``(i) beginning on the first date properties are acquired
as part of the acquisition described in subsection (a)(2)(A)
to which this subsection applies, and
``(ii) ending on the date which is 10 years after the last
date properties are acquired as part of such acquisition.
``(B) Special rule for inversions occurring before march
21, 2002.--In the case of any acquired entity to which
paragraph (1)(A) applies, the applicable period shall be the
10-year period beginning on January 1, 2002.
``(c) Tax on Inversion Gains May Not Be Offset.--If
subsection (b) applies--
``(1) In general.--The taxable income of an acquired entity
for any taxable year which includes any portion of the
applicable period shall in no event be less than the
inversion gain of the entity for the taxable year.
``(2) Credits not allowed against tax on inversion gain.--
Credits shall be allowed against the tax imposed by chapter 1
on an acquired entity for any taxable year described in
paragraph (1) only to the extent such tax exceeds the product
of--
``(A) the amount of taxable income described in paragraph
(1) for the taxable year, and
``(B) the highest rate of tax specified in section
11(b)(1).
``(3) Special rules for partnerships.--In the case of an
acquired entity which is a partnership--
``(A) the limitations of this subsection shall apply at the
partner rather than the partnership level,
``(B) the inversion gain of any partner for any taxable
year shall be equal to the sum of--
``(i) the partner's distributive share of inversion gain of
the partnership for such taxable year, plus
``(ii) gain required to be recognized for the taxable year
by the partner under section 367(a), 741, or 1001, or under
any other provision of chapter 1, by reason of the transfer
during the applicable period of any partnership interest of
the partner in such partnership to the foreign incorporated
entity, and
``(C) the highest rate of tax specified in the rate
schedule applicable to the partner under chapter 1 shall be
substituted for the rate of tax under paragraph (2)(B).
``(4) Inversion gain.--For purposes of this section, the
term `inversion gain' means the gain required to be
recognized under section 304, 311(b), 367, 1001, or 1248, or
under any other provision of chapter 1, by reason of the
transfer during the applicable period of stock or other
properties by an acquired entity--
``(A) as part of the acquisition described in subsection
(a)(2)(A) to which subsection (b) applies, or
``(B) after such acquisition to a foreign related person.
``(5) Coordination with section 172 and minimum tax.--Rules
similar to the rules of paragraphs (3) and (4) of section
860E(a) shall apply for purposes of this subsection.
[[Page S2593]]
``(d) Special Rules Applicable to Related Party
Transactions.--
``(1) Annual preapproval required.--
``(A) In general.--An acquired entity to which subsection
(b) applies shall enter into an annual preapproval agreement
under subparagraph (C) with the Secretary for each taxable
year which includes a portion of the applicable period.
``(B) Failures to enter agreements.--If an acquired entity
fails to meet the requirements of subparagraph (A) for any
taxable year, then for such taxable year--
``(i) there shall not be allowed any deduction, or addition
to basis or cost of goods sold, for amounts paid or incurred,
or losses incurred, by reason of a transaction between the
acquired entity and a foreign related person,
``(ii) any transfer or license of intangible property (as
defined in section 936(h)(3)(B)) between the acquired entity
and a foreign related person shall be disregarded, and
``(iii) any cost-sharing arrangement between the acquired
entity and a foreign related person shall be disregarded.
``(C) Preapproval agreement.--For purposes of subparagraph
(A), the term `preapproval agreement' means a prefiling,
advance pricing, or other agreement specified by the
Secretary which--
``(i) is entered into at such time as may be specified by
the Secretary, and
``(ii) contains such provisions as the Secretary determines
necessary to ensure that the requirements of sections 163(j),
267(a)(3), 482, and 845, and any other provision of this
title applicable to transactions between related persons and
specified by the Secretary, are met.
``(2) Modifications of limitation on interest deduction.--
In the case of an acquired entity to which subsection (b)
applies, section 163(j) shall be applied--
``(A) without regard to paragraph (2)(A)(ii) thereof, and
``(B) by substituting `25 percent' for `50 percent' each
place it appears in paragraph (2)(B) thereof.
``(e) Other Definitions and Special Rules.--For purposes of
this section--
``(1) Rules for application of subsection (a)(2).--In
applying subsection (a)(2) for purposes of subsections (a)
and (b), the following rules shall apply:
``(A) Certain stock disregarded.--There shall not be taken
into account in determining ownership for purposes of
subsection (a)(2)(B)--
``(i) stock held by members of the expanded affiliated
group which includes the foreign incorporated entity, or
``(ii) stock of such entity which is sold in a public
offering related to the acquisition described in subsection
(a)(2)(A).
``(B) Plan deemed in certain cases.--If a foreign
incorporated entity acquires directly or indirectly
substantially all of the properties of a domestic corporation
or partnership during the 4-year period beginning on the date
which is 2 years before the ownership requirements of
subsection (a)(2)(B) are met, such actions shall be treated
as pursuant to a plan.
``(C) Certain transfers disregarded.--The transfer of
properties or liabilities (including by contribution or
distribution) shall be disregarded if such transfers are part
of a plan a principal purpose of which is to avoid the
purposes of this section.
``(D) Special rule for related partnerships.--For purposes
of applying subsection (a)(2) to the acquisition of a
domestic partnership, except as provided in regulations, all
partnerships which are under common control (within the
meaning of section 482) shall be treated as 1 partnership.
``(2) Expanded affiliated group.--The term `expanded
affiliated group' means an affiliated group as defined in
section 1504(a) but without regard to section 1504(b), except
that section 1504(a) shall be applied by substituting `more
than 50 percent' for `at least 80 percent' each place it
appears.
``(3) Foreign incorporated entity.--The term `foreign
incorporated entity' means any entity which is, or but for
subsection (a)(1) would be, treated as a foreign corporation
for purposes of this title.
``(4) Foreign related person.--The term `foreign related
person' means, with respect to any acquired entity, a foreign
person which--
``(A) bears a relationship to such entity described in
section 267(b) or 707(b), or
``(B) is under the same common control (within the meaning
of section 482) as such entity.
``(f) Regulations.--The Secretary shall provide such
regulations as are necessary to carry out this section,
including regulations providing for such adjustments to the
application of this section as are necessary to prevent the
avoidance of the purposes of this section, including the
avoidance of such purposes through--
``(1) the use of related persons, pass-through or other
noncorporate entities, or other intermediaries, or
``(2) transactions designed to have persons cease to be (or
not become) members of expanded affiliated groups or related
persons.''.
(b) Treatment of Agreements.--
(1) Confidentiality.--
(A) Treatment as return information.--Section 6103(b)(2) of
the Internal Revenue Code of 1986 (relating to return
information) is amended by striking ``and'' at the end of
subparagraph (C), by inserting ``and'' at the end of
subparagraph (D), and by inserting after subparagraph (D) the
following new subparagraph:
``(E) any preapproval agreement under section 7874(d)(1) to
which any preceding subparagraph does not apply and any
background information related to the agreement or any
application for the agreement,''.
(B) Exception from public inspection as written
determination.--Section 6110(b)(1)(B) of such Code is amended
by striking ``or (D)'' and inserting ``, (D), or (E)''.
(2) Reporting.--The Secretary of the Treasury shall include
with any report on advance pricing agreements required to be
submitted after the date of the enactment of this Act under
section 521(b) of the Ticket to Work and Work Incentives
Improvement Act of 1999 (Public Law 106-170) a report
regarding preapproval agreements under section 7874(d)(1) of
the Internal Revenue Code of 1986. Such report shall include
information similar to the information required with respect
to advance pricing agreements and shall be treated for
confidentiality purposes in the same manner as the reports on
advance pricing agreements are treated under section
521(b)(3) of such Act.
(c) Conforming Amendments.--The table of sections for
subchapter C of chapter 80 of the Internal Revenue Code of
1986 is amended by adding at the end the following new item:
``Sec. 7874. Rules relating to inverted corporate entities.''
SEC. 3. REINSURANCE OF UNITED STATES RISKS IN FOREIGN
JURISDICTIONS.
(a) In General.--Section 845(a) of the Internal Revenue
Code of 1986 (relating to allocation in case of reinsurance
agreement involving tax avoidance or evasion) is amended by
striking ``source and character'' and inserting ``amount,
source, or character''.
(b) Effective Date.--The amendments made by this section
shall apply to any risk reinsured after April 11, 2002.
____
Reversing the Expatriation of Profits Offshore, REPO, Act--Technical
Explanation of the Staff of the Committee on Finance
Senate Finance Committee Ranking Member Chuck Grassley, R-
IA, and Chairman Max Baucus, D-MT, today are offering their
legislative response to the growing problem of corporate
inversions, the ``Reversing the Expatriation of Profits
Offshore'', REPO, Act. Following is a brief summary of the
REPO Act.
In general, this legislation would curtail the tax benefits
sought by U.S. companies undertaking inversion transactions.
The legislation would apply to two types of inversion
transactions, which would be subject to different regimes
under the proposal.
The first type would be a ``pure'' or nearly pure
inversion, in which: 1. a U.S. corporation becomes a
subsidiary of a foreign corporation or otherwise transfers
substantially all of its properties to a foreign corporation;
2. the former shareholders of the U.S. corporation end up
with 80 percent or more (by vote or value) of the stock of
the foreign corporation after the transaction; and 3. the
foreign corporation, including its subsidiaries, does not
have substantial business activities in its country of
incorporation. The legislation would deny the intended tax
benefits of this type of inversion by deeming the top-tier
foreign corporation to be a domestic corporation for all
purposes of the Internal Revenue Code. This proposal would be
effective as to inversion transactions occurring on or after
March 21, 2002.
For purposes of this proposal, corporations with no
significant operating assets, few or no permanent employees,
or no significant real property in the foreign country of
incorporation would not be treated as meeting the substantial
business activities test. In addition, companies would not be
considered to be conducting substantial business activities
in the country of incorporation by merely holding board
meetings in the foreign country or by relocating a limited
number of executives to the foreign jurisdiction.
The second type of inversion covered by the legislation
would be a transaction similar to the ``pure'' inversion
defined above, except that the 80 percent ownership threshold
is not met. In such a case, if a greater-than-50 percent but
less than 80 percent ownership threshold is met, then a
second set of rules would apply to these ``limited''
inversions.
Under these rules, the inversion transaction would be
respected, i.e., the foreign corporation would be respected
as foreign, but: 1. the corporate-level ``toll charge'' for
establishing the inverted structure would be strengthened,
and 2. restrictions would be placed on the company's ability
to reduce U.S. tax on U.S.-source income going forward. These
measures generally would apply for a 10-year period following
the inversion. This prong of the proposal would be effective
as to inversion transactions in this second category
occurring on or after March 21, 2002. It would also be
effective as to all structures arising from pure inversions
or limited inversions that are grandfathered under the
legislation, but it would be applied to those structures
prospectively.
Under the legislation, the corporate-level ``toll charge''
imposed under sections 304, 311(b), 367, 1001, 1248, or any
other provision of the Internal Revenue Code with respect to
the transfer of controlled foreign corporation stock or other
assets from a U.S. corporation to a foreign corporation would
be taxable, without offset by any other tax attributes, e.g.,
net operating losses or foreign tax credits. No similar
``walling-off'' of toll charges would apply to shareholder-
level toll charges imposed under section 367(a).
[[Page S2594]]
In addition, no deductions or additions to basis or cost of
goods sold for transactions with foreign related parties
would be permitted unless the taxpayer concludes an annual
pre-filing agreement, advance pricing agreement, or other
agreement with the IRS, a ``preapproval agreement'', to
ensure that all related-party transactions comply with all
relevant provisions of the Code, including sections 482, 845,
163(j), and 267(a)(3). Similarly, the transfer or license of
intangible property from a U.S. corporation to a related
foreign corporation would be disregarded, and cost-sharing
arrangements would not be respected unless approved under
such an agreement.
The confidentiality and disclosure rules normally
applicable to advance pricing agreements would apply to all
preapproval agreements entered into pursuant to this
legislation, and the parameters for the IRS's statutorily
required annual APA report would be amended to require a
summary section for inversion transactions.
The second set of measures also includes modifications to
the ``earnings stripping'' rules of section 163(j) (which
deny or defer deductions for certain interest paid to foreign
related parties), as applied to inverted corporations. The
legislation would eliminate the debt-equity threshold
generally applicable under that provision and reduce the 50
percent threshold for ``excess interest expense'' to 25
percent.
The provisions of both prongs of this legislation also
would apply to certain partnership transactions similar to
corporate inversion transactions.
The legislation also strengthens the present-law rules of
section 845(a) in a manner intended to address reinsurance
transactions with foreign related parties that have the
effect of stripping out earnings of a U.S. corporation,
regardless of whether an inversion transaction has occurred.
The legislation modifies the present-law provision permitting
the Treasury Department to allocate or recharacterize items
of investment income, premiums, deductions, assets, reserves,
credits or other items, or to make other adjustments, under a
reinsurance agreement between related parties, if necessary
to reflect the proper source and character of income. The
legislation permits such an allocation, recharacterization or
adjustment if necessary to reflect the proper amount, source
or character of income. This provision would be effective for
any risk reinsured after April 11, 2002.
Mr. BAUCUS. Madam President, I am pleased to be a co-sponsor, with
Senator Grassley, of this important piece of legislation. Our
legislation, Reversing the Expatriation of Profits Offshore, (REPO),
Act, is designed to put the brakes on the potential rush to move U.S.
corporate headquarters to tax havens, through increasingly popular
transactions known as corporate inversions. Prominent U.S. companies
are literally re-incorporating in off-shore tax havens in order to
avoid U.S. taxes. They are, in effect, renouncing their U.S.
citizenship to cut their tax bill.
Tax avoidance costs honest taxpayers tens of billions of dollars each
year. When one taxpayer, whether a corporation or an individual,
doesn't pay their fair share of taxes, we all pay. The REPO Act cracks
down on corporations that avoid taxes at the expense of honest,
hardworking American taxpayers.
The local hardware store in Butte, MT, isn't re-incorporating in
Bermuda or one of these tax haven countries. He is keeping his company
an American company. The companies reincorporating in tax haven
countries, and their executives, are still physically located in the
United States. Their executives and employees enjoy all the privileges
afforded to honest U.S. taxpayers.
I understand that the corporate inversion issue is complex. I also
understand that, over the long term, we may need to consider whether
the structure of the U.S. international tax rules creates an incentive
for U.S. corporations to shift their operations abroad in order to
remain competitive. For now, we are putting a stop to the erosion of
the U.S. tax base through these tax avoidance schemes.
Our legislation distinguishes between two types of inversions, pure
inversions and limited inversions. A pure inversion is when a U.S.
company becomes a subsidiary of a foreign company or shifts
substantially all of its properties to a foreign corporation and 80
percent of more of the shareholders in the original U.S. company are
now shareholders in the new foreign company. The foreign company has no
substantial business activity in the foreign tax haven country.
Companies that hold board meetings in the tax haven country or send a
few employees or executives to work in the tax haven country will not
meet the substantial business activity standard. Under our legislation,
the parent company will be treated as a U.S. company.
A limited inversion transaction is when more than 50 percent and
fewer than 80 percent of the shareholders are the same. The new foreign
company is recognized as a foreign company for tax purposes but there
is a tax cost. The company won't be able to use tax attributes, such as
net operating losses and foreign tax credits, to offset the gain
incurred upon inverting. Finally, the company won't be able to strip
earnings out of the U.S. to avoid U.S. taxes.
This week is the last week leading up to the April 15 tax filing
deadline. Families in Montana and across the nation are sitting down at
their kitchen tables, or at their home computers, and figuring out
their taxes. The calculations may be complex, the tax bite may seem
high, but by and large, with quiet patriotism, average Americans will
step up and pay the tax they owe. They're counting on us to make sure
that sophisticated corporations pay their fair share, as well.
____________________