Congressional Record, Volume 148 Issue 78 (Thursday, June 13, 2002)

[Congressional Record Volume 148, Number 78 (Thursday, June 13, 2002)]
[Senate]
[Pages S5503-S5513]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

TERRORISM RISK INSURANCE ACT OF 2002--Continued

Mr. SCHUMER. Mr. President, I ask to address the House--I mean the
Senate. I am still used to the House, I am sorry. I had 18 years there.
I ask to address the Senate on this issue.
The PRESIDING OFFICER. The Senator has that right.
The Senator from New York is recognized.
Mr. SCHUMER. Thank you, Mr. President.
Mr. President, I spoke briefly a bit earlier on this legislation, but
now that we are getting pretty close to try to tie the final knot and
get the bill done, I do want to address it once again.
First, again, I thank my colleague from Connecticut, Senator Dodd,
who has worked so long and hard on this legislation. I also thank the
chairman of the Banking Committee, Senator Sarbanes, who has been a
good, careful guider, and Jon Corzine, my colleague, as well.
The four of us have been laboring on this proposal for a very long
time. I hope we can actually pass legislation tonight.
This is extremely important legislation. But it is deceptive. We are
not getting many calls. When you walk into your local townhall
meeting--or if I go into one of my favorite places, McGillicuddy's Pub,
on Quentin Road, they don't say: Hey, Charlie, what's doing on
terrorism insurance? It is not an issue on the lips of the average
citizen. But it affects the average citizen, and greatly.
The reason is very simple: Without terrorism insurance, large numbers
of construction projects will not go forward. Banks will not lend
unless they can have terrorism insurance. And insurance companies,
while they are offering terrorism insurance in many cases, are offering
that insurance at such a high rate that many projects are simply not
going forward.
What does this mean for the national economy? It is a slowly bleeding
cut on the arm of our economy. But every day, when a new project is not
refinanced, when a new proposal to build something large and grand does
not go forward, is a day our economy is hurt.
The reason is very simple. Since 9-11, we fear terrorist attacks, and
we fear them on large concentrations of economic power, of economic
wealth. They could be in cities--my city, of course, has many of
these--but they could also be not in cities, Disney World or Disneyland
in Florida and California. The Hoover Dam, every stadium, no matter
where it is in the country, is suffering effects. We have heard from
the owners of baseball and football about how their costs are
dramatically rising. And it will continue to occur. In fact, it will
spread. The dramatic increases in costs, the failure to do new projects
will continue unless we do something.
I know there are some who believe: Well, the Government should not be
involved. I strongly disagree.
The Government has always been involved in cases of war. We have
always been under the rule that in cases of war the Federal Government
will step in.
Well, since 9-11, the rules of war have been redefined. Terrorism is
war. So if I had my druthers, I would have a one-page bill, something
similar to what I worked out with Secretary O'Neill, that would say:
Should, God forbid, the next terrorist incident occur, the Federal
Government will step in.

That is what we would do in the case of war. If, during World War II,
the Germans or the Japanese had hurt the American homeland, that is
what would have happened; the same thing with Korea, and the same thing
when we faced the cold war with Russia. I don't know why it is any
different now, but some have had objections. They don't want to see the
Federal Government's role expand, even though if there was ever a place
that role should be needed, and make sense, it is here. They have
opposed that.
So we came up with a compromise. The Senator from Connecticut,
actually, the Senator from Texas, Mr. Gramm, and myself had a
compromise that was put on the floor in late December. We tried to have
a balance between those of us who believed the Government should be
fully involved and those of us who felt--on the other side, mainly--the
Government should not be involved at all. We came up with a proposal.
Unfortunately, it did not come forward, not because of objections to
the proposal but, rather, it ran up against the age-old whirlpool, if
you will, of tort reform.
It ran up on the shoals of tort reform, as many other proposals have
in this body in recent years, and nothing got done. I was delighted to
see the McConnell amendment defeated for the main reason that had it
passed, we would not have had a bill. It seems we have stepped past
probably the greatest impediment to the proposal, and now we have other
issues. I want to talk about one of those.
Before I do, I want to make a few points. First, I want to talk about
my city of New York and give people some examples. Examples could occur
in their cities as well. I have talked to my friend from Illinois,
Senator Durbin. The same thing is happening in Chicago. I have talked
to real estate leaders in Dallas and Houston and San Francisco and Los
Angeles. In all of our large cities, the same thing is occurring.
Let me cite some examples: 4 Times Square, one of our newest, most
beautiful buildings known as the Conde Nast building, is in litigation
with its lender due to the absence of terrorism insurance coverage. The
lender, La Salle Bank and CIGNA, had threatened to invade the lockbox
into which rents are deposited in order to buy $430 million in
terrorism insurance, the amount of the mortgage. The insurer for the
portfolio held by the owners of 4 Times Square has refused to write
coverage for this building claiming it is high profile. Even if the
$430 million of coverage was available, it wouldn't cover any of the
environmental risks, nor would the owner's equity of $450 million on
this $880 million be covered.
In downtown New York, a 1 million-square-foot office building could
not obtain refinancing for the underlying mortgage of approximately
$200 million because terrorism insurance was unavailable. Finally, a
lender agreed to go forward if the owner committed to pay $1 per square
foot for stand-alone terrorism insurance coverage. At the same time
that the owner faced that additional $1 million drain on cashflow, he
had to absorb an increase in his regular insurance from $110,000 to
$550,000. That additional cost did not cover mold or biological or
nuclear or chemical events whether terrorist-generated

[[Page S5504]]

or otherwise. The owner now has a $1,440,000 additional expense.

A major REIT with properties in central business districts from New
York to California can get only $250 million of insurance for the
entire portfolio. And if there is one more terrorist incident--God
forbid--it is likely that even this limited terrorism coverage will be
lost given its not uncommon 30-day cancellation clause.
A major residential and mixed use owner-builder renewed their all-
risk insurance a few months earlier than the expiration date for that
carrier and was about to lose its treaty agreement for reinsurance and
could only write $5 million. The list can go on and on and on of
buildings that couldn't get terrorism insurance, that had to pay so
much that it virtually made them noneconomic, of new projects not
started.
To simply and blithely say the market will come in and cover this is
not true. Just last Friday, another drain on the body economy of my
city, but this is happening in other cities as well, Moody's put 12
buildings in New York City on watch for possible downgrading of their
bonds, the whole cost of financing, because of terrorism insurance.
These include some of the premier properties in New York, including the
Exxon building, the Bankers Trust building, Celanese building, the
Conde Nast building, Rockefeller Center, the Marriot Marquis Hotel--the
list goes on.
So anyone who thinks this is not a problem, anyone who thinks the
market is solving this problem on its own is simply not understanding
what is occurring.
I am not the only one who thinks this. I ask unanimous consent to
print quotes from others in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:

Economic Dislocation Resulting From the Terrorism Insurance Market
Turmoil

President Bush Calls For Action:
``If people can't get terrorism insurance on a construction
project, they're not going to build a project, and if they're
not going to build a project, then someone's not working. We
in Washington must deal with it and deal with it in a
hurry.'' (Source: President Bush during a White House
gathering on terrorism insurance 4/8/2002)
New Congressional Study Finds Lack of Terrorism Insurance
Risky to Economy; among the study's principal findings:
``The market for terrorism insurance remains limited.
``Only a small number of insurers are actively providing
stand-alone terrorism insurance policies.
``When available, coverage for terrorism losses is
expensive, terms of coverage are restrictive and policy
limits are often insufficient.
``The problems associated with terrorism insurance pose a
significant threat to sustained economic growth.
``The lack of terrorism insurance is stopping some business
deals, such as real estate and construction projects where
terrorism insurance may be necessary to obtain financing.
``The high cost of terrorism insurance (when available)
diverts resources from other more productive uses, negatively
affecting investment and jobs.
``Low coverage limits in terrorism insurance policies mean
that businesses are bearing a huge amount of risk themselves.
In the event of another attack similar to that of September
11th, insurance payments will not be available to the same
degree to rebuild.'' (Source: Joint Economic Committee,
United States Congress, ``Economic Perspectives on Terrorism
Insurance'' 5/23/02)
Top Officials Warn of Continued Terrorist Risk:
``I think we will see that in the future, I think it's
inevitable.'' (Source: Quote from FBI Director Robert Mueller
when asked of the possibility the U.S. could expect walk-in
suicide bombers, Wall Street Journal Online 5/20/02)
``Terrorism is an evil, pernicious thing, and it is one of
the biggest challenges we've ever faced as a nation.''
(Source: Vice President Dick Cheney as quoted in the Wall
Street Journal Online 5/20/02)
``Senate Majority Whip Harry Reid (D-Nev.) said June 4 on
the Senate floor that action on the legislation is needed to
maintain stability of the country's economic infrastructure.
`One issue we must seek to work on quickly, expeditiously, is
getting a bill out of this body to address the growing
problem of a lack of insurance coverage due to the threat of
terrorist attacks,' Reid said. Pointing to a similar move by
Moody's Investors Service May 31, Reid urged a compromise on
the legislation and called on the White House to assist in
moving the legislation. `Significant building projects, if
not already on hold, could be placed on hold until the
terrorism insurance issue is resolved,' Reid said.'' (Source:
Banking Daily 6/6/02)
``In just facing the facts, we have to recognize that
terrorist networks have relationships with terrorist states
that have weapons of mass destruction, and that they
inevitably are going to get their hands on them, and they
would not hesitate one minute is using them,'' Rumsfeld said.
``That's the world we live in.'' (Source: Defense Secretary
Donald Rumsfeld as quoted in the Washington Post 5/22/02)
``The FBI also heightened anxiety levels in New York by
advising officials that landmarks there could be terrorist
targets. Officials said the advisory was based on the same
kind of uncorroborated information that has led to other
notices to law enforcement in recent weeks about threats to
banks, nuclear power plants, water systems, shopping malls,
supermarkets and apartment buildings.'' (Source: The
Washington Post 5/22/02)
``We believe the Congress should enact a federal terrorism
risk insurance backstop in a timely fashion for four primary
reasons. First, lack of coverage and high premium rates imply
a drag upon our economy and a burden to the nascent recovery,
including the potential for a loss of even more jobs. Second,
the cost of lost and postponed investment opportunity is
potentially large for future economic growth. Third. inaction
paralyzes the private sector. Finally, the economic impact of
another terror attack could be even greater than the
September 11 attacks.''(Source: Lawrence B. Lindsay,
Assistant to the President for Economic Policy in a letter to
Steve Bartlett and Edward C. Sullivan--3/18/02)
Federal Officials Sound the Alarm:
``I think there is still great urgency to pass the
[terrorism insurance] bill. I think there is a very important
level of exposure here that needs to be addressed.'' (Source:
Senate Majority Leader Tom Daschle remarking on the issue at
the National Press Club 5/22/02)
``[Insurance] is a crucial aspect of a fairly large segment
of the economy. In this case, it is impossible for insurance
to [determine the risk for terrorism insurance] The
problem is really the types of real estate activity being
held up, whether delays in construction and building and
that sort of thing are having a significant impact on the
economy.'' (Source: Federal Reserve Chairman Alan
Greenspan, to the House Financial Services Committee 2/27/
2002)
``There is a real and immediate need for Congress to act on
terrorism insurance legislation. The terrorist attacks on
September 11 have caused many insurance companies to limit or
drop terrorist risk coverage from their property and casualty
coverage a move that leaves the majority of American
businesses extremely vulnerable. This dynamic in turn
threatens American jobs and will wreak havoc on the entire
economy in the case of future attacks.'' (Source: Treasury
Secretary Paul O'Neill in a statement issued on 4/8/2002)
``The disruption of terrorism coverage makes it more
difficult to operate, acquire or refinance property, leading
to diminished bank lending for new construction projects and
lower asset values for existing projects.'' (Source: letter
to Congress from Treasury Secretary Paul O'Neill, National
Economic Council Director Lawrence Lindsey, Office of
Management and Budget Director Mitch Daniels, and Council of
Economic Advisors Director Glenn Hubbard on 6/10/02)
``A fundamental necessity for a strong economy is
confidence. The lack of confidence lingers in some parts of
our economy, because of a lack of terrorism insurance.
[Congressional failure to pass terrorism insurance
legislation is hurting the economy.] People are delaying,
postponing, canceling major construction projects because
they can't get terrorism insurance.'' (Source: Treasury
Secretary Paul O'Neill, as quoted by Bloomberg News 2/21/
2002)
Construction Industry Hemorrhaging Jobs, AFL-CIO Calls For
Action:
``Employment in construction fell by 79,000, after seasonal
adjustment. Much of April's job loss was in special trades
(-61,000), though general building contractors and heavy
construction lost 12,000 and 6,000 jobs, respectively.
Following the turn of the business cycle in March 2001,
construction employment was relatively flat through the end
of the year. So far in 2002, however, the industry has lost
155,000 jobs.'' (Source: Bureau of Labor Statistics News
Release, May 2002)
``President Bush, like all of us here today, realizes that
as long as terrorism is a threat, new job-creating projects
are being delayed or canceled because we do not have adequate
insurance coverage or workers compensation coverage
available. The unions of the building trades and our members
join with him in urging the Senate to pass terrorism risk
insurance legislation without delay. The unavailability of
terrorism risk insurance is hurting the construction
industry by making the cost and risk of undertaking new
building projects prohibitive. Building projects are being
delayed or canceled for fear that they may be future
terrorist targets. Lenders are refusing to go forward with
previously planned projects where terrorism insurance
coverage is no longer available. As a result, construction
workers are losing job opportunities. In addition, workers
compensation premiums have increased because state laws do
not allow companies to exclude terrorism risk from workers
compensation insurance.'' (Source: Speech by Edward C.
Sullivan, President, Building and Construction Trades
Department, AFL-CIO 4/8/02)
``According to new figures compiled by the Census Bureau,
compared to March 2001, non-

[[Page S5505]]

residential construction was off by 19 percent, while office
building construction suffered a 32 percent drop over the
last year.'' (Source: U.S. Census Bureau)
Difficulty Obtaining Adequate Terrorism Coverage, Moodys
May Downgrade:
``Moody's Investors Service has placed the ratings of
classes from 14 commercial mortgage backed transactions on
watch for possible downgrade due to concerns about terrorism
insurance coverage. Moody's stated that the lack of,
insufficiency of, or near term expiration of terrorism
insurance coverage is the cause for these reviews for
downgrade.'' (Source: Moodys Investor Service Press Release
5/31/02)
``Billions of dollars in commercial mortgage-backed
securities, or CMBS, may face ratings downgrades by the end
of this month if terrorism insurance legislation continues to
stall in the Senate. `If Congress doesn't pass something soon
we will have to start downgrading bonds by Memorial Day,'
said Sally Gordon, vice-president and senior credit officer
at Moody's Investors Service in New York, which monitors
about $350 billion CMBS.'' (Source: Dow Jones Newswires 5/3/
02)
``The National Football League and individual teams and
stadiums have experienced difficulty acquiring terrorism
coverage. The Miami Dolphins and New York Giants have joined
the ranks of other teams around the country that have lost
terrorism coverage in the wake of the Sept. 11 attacks.''
(Source: Bureau of National Affairs 4/9/2002)
``Today, terrorism insurance can be purchased; although it
has a higher premium, higher deductible and lower limit of
coverage. High-risk assets the ones that serve the most
people face such steep cost increases and diminished
coverage, that it often makes sense to purchase only a
fraction of the original coverage or no coverage at all.
And that's if terrorism insurance can even be purchased.
``The federal government warns another terrorist attack is
possible, and insurance policies have 30-day cancellation
clauses. Thus, after another major attack, availability is
expected to disappear. Separately, capacity and concentration
issues for insurance companies are expected to arise, even in
the absence of another terrorist attack. There are only a few
companies providing terrorism coverage for high-risk assets
and at least one has announced it is reaching its threshold
for tolerance.'' (Source: Merrill Lynch Research Report,
Mortgage Backed Research, 5/17/02)
``While acknowledging the insurance market and risk of
terrorism is an evolving situation, rating agencies would
gain comfort from a federal terrorism insurance program or an
improvement in the insurance market. We have heard that the
insurance market is more likely to evolve into a capacity-
constrained market than it is to satisfy insurance neene is
relying on the amount and the quality of insurance to counter
balance the increased risk of terrorist attacks then one must
also recognize that insurance policies covering terrorist
acts have exclusions for losses due to atomic, biological or
chemical terrorism.'' (Source: Merrill Lynch Research Report,
6/5/02)
``Premiums on standard property and casualty insurance have
jumped by as little as 10 percent and by as much to 300
percent for owners of large urban commercial properties. They
are scrambling to find coverage from a single insurer for
properties worth more than $25 million, bond rating service
Standard & Poor's said in a recent report. The rift between
lenders and owners will likely deepen, investors and analysts
say, until more affordable terrorism policies are available--
or the government steps in.'' (Source: Reuters 5/27/02)
Wells Fargo Forced to Place Nearly $1 Billion Worth of
Construction Loans on Hold:
``Wells Fargo & Company, one of the largest real estate
lenders in the country, currently has three real estate
projects that are ready to be funded. The only obstacle to
moving these projects forward is the unavailability of
terrorism insurance. They are: A $600 million commercial real
estate project in Manhattan. A $260 million retail project in
Queens, NY. A $120 million commercial project in Oakland, CA.
(Information supplied by Wells Fargo & Company 4/8/2002)
Bond Markets Stall on $7 billion in Commercial Loans:
``The Bond Market Association announced April 18 that
according to a survey of its members who deal in commercial
mortgage-backed securities, due to the high cost or
unavailability of terrorism insurance for property owners,
this year large lenders have placed on hold or canceled
more than $7 billion in commercial mortgage loans.''
(Source: Bureau of National Affairs 4/22/2002)
Hyatt Puts 2,500 Jobs On Hold, Seeks Terrorism Insurance:
``The Hyatt Corporation has purchased a site for a new
office building in downtown Chicago at a cost of roughly $400
million. The company is now trying to obtain financing for
this project but is being told that nobody will make loans
without insurance for terrorism, yet adequate terrorism
insurance is unavailable. As a result, construction on the
project has not been able to begin. The project will lead to
the creation of 2,500 jobs if the Hyatt Corporation can get
insurance and proceed with the project.'' (Source: Bureau of
National Affairs 4/9/2002)
The Problem of the Underinsured:
``Officials in Georgia's Gwinnett County, an Atlanta
suburb, have been able to find only $50 million of terrorism
insurance coverage for a $300 million portfolio of properties
that includes the county jail and sewage treatment
facility.'' (Source: Washington Post, 4/8/2002)
``The New York Metropolitan Transit Authority has $150
million of terrorism insurance to cover its bridges and
tunnels, assets worth $1.5 billion.'' (Source: Washington
Post, 4/8/2002)
``Some property owners are opting to go without [terrorism
insurance] coverage. In the long-term, [the] limited or
complete lack of terrorism insurance coverage threatens a
property owners ability to get financing for new projects or
to refinance existing properties.'' (Source: summary of
remarks by Tony Edwards, general counsel of the National
Association of Real Estate Investment Trusts, Dow Jones 1/15/
02)
Building Projects Placed on Hold:
``In downtown Chicago, Pritzker Realty Group LP cannot get
financing to build an office building because the project
does not have terrorism insurance.'' (Source: Washington
Post, 4/8/2002)
``Casino developer Steve Wynn has halted plans to build a
$2 billion development in Las Vegas that would create 16,000
new jobs because he cannot buy enough terrorism insurance to
satisfy his lenders.'' (Source: Washington Post, 4/8/2002)
Many Insurers Not Willing to Write Commercial Property
Insurance:
``Wells Fargo is threatening to throw a $275 million
securitized mortgage into default unless terrorism insurance
is arranged for the collateral property the Opryland Hotel
and Convention Center in Nashville.'' (Source: Commercial
Mortgage Alert 5/31/02)
``The result of 9/11 was a sizable reduction in the number
of available insurers willing to write commercial property
insurance.'' (Source: Christopher Ewers, vice president of
March Risk & Insurance Services, the brokerage for the Golden
Gate Bridge 3/23/2002)
``However, the limited capacity that Lloyd's and other
commercial insurers have available to write this business
will not be sufficient in the near-term to satisfy the
growing coverage gap in the United states economy.'' (Source:
Saxon Riley, Chairman, Lloyds of London 4/18/02)
Difficulty in Assessing Terrorist Risk:
To date, terrorists have not behaved predictably, and no
study we have seen suggests they will do so. We do not
believe insurers have a reasonable basis for underwriting the
risk at this time. At best, they can limit the amount of
capital they expose to risk. Source: Alice D. Schroeder,
senior U.S. non-life equity insurance analyst for Morgan
Stanley Dean Whitter & Co., testifying before the House
Financial Services Committee 2/27/2002)
``Due to the changes in insurance coverage since issuance,
the risks related to potential terrorist actions have been or
in the near term may be transferred to the
Certificateholders. While acknowledging that these risks are
very difficult to quantify, a spokesman for the rating agency
said, `we believe that ignoring the risks would be
inappropriate given the events of September 11th and
continued government warnings of the likelihood of future
terrorist attacks. While the probability of a major downgrade
or default because of a terrorist attack remains fairly
remote, the overall risk in these transactions has clearly
increased.' '' (Source: Moodys Investor Service Press Release
5/31/02)
Lack of Terrorism Coverage Constricts Lending:
``I have to assume that nobody in their right mind is going
to lend $300 million, $400 million, $500 million if there's
no terrorism coverage.'' (Source: GMAC Commercial Holding
Corp. Chairman and CEO David E. Creamer, as quoted in the
Philadelphia Business Journal 2/27/2002)
``Last year at any point in time we had a large number of
single high-profile transactions to work on, and now we
don't.'' (Source: Tad Phillipp, managing director of Moodys
Investors Service, referring to lenders becoming wary about
financing real estate deals, as quoted in the Wall Street
Journal 1/11/02)
Transportation in Crisis:
``Considering the fact that trucking moves the majority of
the freight in America, a crisis like this is a real problem
for the national economy.'' (Source: American Trucking
Association President and CEO William J. Canary, as quoted on
ATAs website)
``Amtrak was unable to obtain terrorism coverage when its
$500 million property insurance policy came up for renewal on
Dec. 1. Amtrak believes that only limited amounts of
terrorism coverage are available today, and that limited
coverage is at extremely high rates.'' (Source: Bureau of
National Affairs 4/9/2002)
A Growing Chorus Calls For Action:
``The story is only half-told right now. Over the year it
will grow in magnitude.'' (Source: Marty DePoy, speaking on
behalf of the Coalition to Insure Against Terrorism, which
includes the National Association of Real Estate Investment
Trusts, the U.S. Chamber, the National Football League, the
National Retail Federation, and the Association of American
Railroads, among several other diverse organizations 2/13/02
``The entire market that provided workers compensation
catastrophe reinsurance has dried up.'' (Source: Timothy P.
Brady, managing director, Marsh, Inc., as quoted in the Wall
Street Journal 1/9/02
``[Higher insurance costs, higher deductibles and fewer
insurance choices are] going to affect the cost of doing
business for all companies. It might take a while to hit

[[Page S5506]]

the bottom line, but its something that affects the total
company.'' (Source: James Shelton, regional risk manager at
Manpower Inc., in Glendale, WI, as quoted by CNNMoney 12/31/
01
``The situation that we're in at the moment is analogous to
getting into your car without seat belts or the steel frame.
If you're not in an accident, nothing's going to be affected.
If you're in an accident, the results are going to be
disastrous because you don't have the infrastructure in place
to protect you.'' (Source: David Mair, risk manager for the
U.S. Olympic Committee, quoted by Dow Jones 2/7/02)
``The real damage likely will come in the secured lending
market. Depending on the size of the building, it's going to
be hard to get mortgage and [commercial mortgage-backed
securities] done.'' (Source: Richard Kincaid, chief operating
officer of Equity Office Properties Trust, quoted by Dow
Jones 1/16/02)
``This is a national problem. Everybody needs shoes to
walk. Suddenly, shoes are not available. Its as simple as
that.'' (Source: Deborah B. Beck, executive vice president of
the Real Estate Board of New York, discussing the lack of
coverage for real estate owners, as quoted by the Washington
Post 1/15/02)
``It's little strange. You could understand [higher
insurance costs] at signature buildings like Liberty Place
and Mellon Bank Center. But the new building being built in
Plymouth Meeting is facing the same soaring [insurance rates
as the high-rises]. Its going to have a pretty dramatic
effect on tenants. I had a lender in here today who said they
have had to postpone a couple of settlements because the
escrow required for first-year payments are prohibitive''
(Source: Walt DAlessio, chief executive of Legg Mason Capital
Markets, a national real estate finance company, as quoted in
the Philadelphia Inquirer 1/14/02)
``Ultimately, [increased insurance costs for terrorism for
coverage] all passes down to you and I when we go shopping.
Most of those costs will be passed down to our tenants in
their operating costs and then to the products, whether it is
a pair of jeans or a pound of coffee.'' (Source: Steven
Sachs, insurance risk manager for The Rouse Co., which has 47
shopping malls and over 100 office buildings, as quoted by
Dow Jones 12/21/01)
``The issue has nothing to do with the size of the
property. It could be a manufacturing plant of 20,000 square
feet or an office building of 2 million square feet. Theyre
all affected.'' (Source: Jerry I. Speyer, president and chief
executive of Tishman Speyer Properties, a prominent New York
developer, as quoted in the Washington Post 01/15/02)
``One of the lessons learned from Sept. 11 is that many
insurers have concentrations of risk that they had not
previously factored into their underwriting decisions.
Employee groups of 1,000 or more lives are common across
Corporate America and even globally. Terror attacks on large
corporate sites could easily bankrupt insurers with workers'
compensation claims averaging $1 million or more.'' (Source:
Standard & Poors 1/9/02)
``Our inability to obtain insurance on our properties could
cause us to be in default under covenants on our debt
instruments or other contractual commitments we have which
require us to maintain adequate insurance on our properties
to protect against the risk of loss. If this were to occur,
or if we were unable to obtain insurance and our properties
experienced damages which otherwise have been covered by
insurance, it could materially adversely affect our business
and the conditions of our properties.'' (Source: Host
Marriott, L.P., in an S-4 filing dated 1/10/02)
``Washington's decision to postpone any action on
apportioning the burden for terrorism coverage could have
long-term negative economic consequences for business and the
pace of recovery.'' (Source: New York City Partnership and
Chamber of Commerce 2/11/02)
``Executives at the companies that service the hundreds of
billion of dollars in commercial-mortgage-backed securities
have already begun to question whether they are going to have
to declare property owners in technical default if they lose
terrorism coverage. These mortgage-servicing companies may
have little choice. If they don't declare a default and the
property is attacked by terrorists, they could face a lawsuit
from bondholders.'' (Source: Wall Street Journal 2/13/02)
``Sales and refinancing of high-profile office buildings
and other trophy properties are slowing, as the real estate
industry grapples with the lower availability and higher cost
of terrorism insurance. Owners of properties that can't get
terrorism insurance are reluctant to speak out for fear of
scaring tenants and drawing attention to themselves.''
(Source: Wall Street Journal 1/11/02)
``Some companies may have experienced troubles already but
are unwilling to talk about them, especially publicly traded
companies worried about the impact on their stock prices or
builders concerned about their overall market.'' (Source:
Hartford Courant 1/10/02)
``One developer in the New York area is close to finishing
an office building for a solid tenant. [Its a company that
has been around for decades and signed a long-term lease.]
That sort of tenant is precisely what real estate lenders
like. But the developers bank is no longer willing to finance
the building because the owner cannot get adequate terrorism
coverage. If the developer has to sink its own money into the
effort, it will tie up capital the firm could use to start
new projects.'' (Source: Washington Post 1/15/02)

Mr. SCHUMER. I have quotes from President Bush who stated last month
how important this was; from the Joint Economic Committee of the
Congress, ably chaired by our Presiding Officer, from May 23; from FBI
Director Robert Mueller; from Vice President Cheney; from Secretary
Donald Rumsfeld; from Larry Lindsay; from Secretary Paul O'Neill; from
Reserve Chairman Greenspan. All of these people are not known as people
who believe the Government ought to come in and solve the problem at
the drop of a hat. In fact, philosophically most of them are of the
opposite view. They all felt the need to talk about terrorism
insurance.
We have to move this legislation. We have to move forward. Again,
each of us could have our own idea on how to make it better, how to
change it. We know things will fall apart. My guess is, if we don't
solve this problem now, we are not going to solve it until a crisis is
truly upon us, until this slow drain on the economy, which the lack of
terrorist insurance is causing, becomes not a flow but a cascade. Then,
of course, the damage will have been done, and it will be almost too
late.
Finally, I want to talk a little bit about the per-company cap which
I know is an issue that Senator Gramm and I are debating. As you know,
I fought hard to have this cap put in. The Senator from Connecticut,
whom I mentioned while he was out of the room, has done a great job. He
understood the position and put it in. It was at that point supported
by the Senator from Texas in the final proposal that was made. This did
not stand in the way. It was tort reform that stood in the way.
Let me explain why this is so needed and why so many people are for
this on both sides of the aisle. In the bill, as you know, there is a
$10 billion industry-wide benchmark for triggering individual company
retentions in the first year. It goes to $15 billion in year 2, if the
program is extended by the Treasury Secretary. That benchmark would
result in substantial private insurer losses before the Federal
backstop is triggered.
We didn't want the Federal Government in the compromise that came
about--this was not to my liking--but it was intended to have the
private sector step in first until they were so limited because of the
extent of the damage, God forbid, that they couldn't do it anymore.
Well, if we didn't have this cap for a number of companies, the larger
companies, the companies that concentrated, again, on the big economic
properties, the losses that they would incur before the Federal
Government's involvement was triggered would equal those losses. They
would be comparable to the losses incurred on September 11. And for
almost every insurer, they would exceed the losses sustained in any
previous natural disaster.
In order for insurers to sustain such significant losses without
risking insolvency, each company must be able to determine with some
degree of certainty the outer bounds of terrorism exposure in actuarial
terms, its probable maximum loss. And since January, the Coalition to
Insure Against Terrorism, which is a broad-based business group, has
stressed the need for this kind of insurance that will bring the
insurers back into high-risk property insurance. Per-company retentions
are the way to do so. They are the best way to assure that the company
is temporary because they will facilitate a quick transition to the
private sector as insurers and reinsurers begin to develop underwriting
relationships with even the highest risk policyholders.
This experience will make it easier to develop actuarial models for
use after the Federal program expires because, as you know, unlike the
wishes of many of us, this expires in a few years, depending on whether
the Treasury Secretary does an extension.
The per-company retentions will also minimize Federal involvement
since there is no need for Treasury to develop a formalized allocation
procedure for determining each company's share of the aggregate
industry retention or the quota share payment. Because the insurance
industry comprises more than 3,000 competing firms, private insurers
cannot otherwise get together

[[Page S5507]]

and agree on a loss-sharing formula that would bind the industry as a
whole. So inclusion of the per company retention in the legislation
provides some certainty as to when the backstop is triggered for each
insurer, without an elaborate Federal bureaucracy to allocate the
losses.

The bottom line is that we need this bill. We need the per company
cap to make it work--particularly for large properties, particularly
for areas of high economic risk. I urge the Senate to pass S. 2600,
including these retentions. It is the right solution to an ongoing
problem that threatens insurers, policyholders, and the economy at
large.
Mr. President, I yield the floor.
The PRESIDING OFFICER (Mr. Nelson of Florida). The Senator from
Missouri is recognized.
Mr. BOND. Mr. President, I rise to speak on the pending legislation
concerning terrorism reinsurance. Last December--December 13, I
believe--I spoke here urging the leadership to bring up bipartisan
legislation that was at the time being negotiated between the White
House and the Senate Banking Committee. Unfortunately, the legislation
before us today does not reflect those discussions. At that point, I
thought we had a good start on a bipartisan terrorism reinsurance
effort.
The availability and affordability of insurance is vital to the
stability of our Nation's economy. Now that we know terrorists can and
have struck in the United States, and have struck against major
buildings, insurance is going to have to change because the insurance
is going to have to cover risks that were never before recognized as
being legitimate in this country.
We hear reports from all over that many insurance and reinsurance
companies are no longer able to provide the insurance coverage that is
necessary for builders of buildings, for those owning buildings, to get
the kind of financing they need or to have the protection they need for
the resources they put into those buildings.
At this moment, affordable terrorism risk insurance is not attainable
by many businesses, both small and large--apartment and condominium
buildings, shopping centers, as well as many cultural institutions.
Recently, the St. Louis Art Museum was identified by the Joint Economic
Committee as not being able to afford terrorism insurance. As a result,
the museum is not covered. I am positive there are many entities across
the country facing the same situation as the museum. I know major
sports facilities, including ones in my State, are in a position where
they cannot get the terrorism risk insurance they would need to add new
construction, or even to continue their operations. The fact that
terrorism has struck our country has a double impact now that we are in
a position where insurance companies are not able to write and insure
against and to ascertain the level of insurance risk that might be
brought about by terrorist acts. It is unacceptable that we hold large
segments of our economy hostage to the acts of terrorists.

Right now, many small business and small property owners are at
disadvantages. They face the prospect of doubling and tripling
insurance premiums. They are not only faced with increased property
insurance costs, but they are facing workers' compensation insurance
costs, health insurance costs; and without affordable insurance, many
small businesses and property owners are simply forgoing insurance.
That is bad business. Those that have elected to pay much higher
insurance costs are finding they have to pass this cost along to their
customers, renters, leaseholders, and others. This could have a
tremendous impact on our economy.
We are hearing about major construction projects coming to a halt
across the country as lenders and major financing institutions are
seeking, but unable to get, terrorism risk insurance. The Bond Market
Association has stated that more than $7 billion worth of construction
projects are on hold or have been canceled due to the lack of
affordable terrorism risk insurance.
Rating organizations have issued warnings in the past 2 weeks that
large securitizations are in jeopardy of being downgraded. We are
trying to get out of a recession. The economic recovery that we expect
and that we need is in grave danger if we do not provide a means of
reinsuring the risk that has now become a reality in this country with
possible terrorist acts. This is an unknown at this point, and this is
the time, and this is something in which the Federal Government could
play a very significant role. That is why good terrorism risk
reinsurance legislation must be provided.
I also agree with my colleague from Kentucky that businesses that are
victimized by terrorist attacks should not be subject to punitive
damages. Now, unfortunately, on a party line vote, we rejected the
standard my colleague proposed. I hope we can find other means of
compromise to ensure that a business owner or a business that is struck
by a terrorist act is not also struck by a punitive damage action that
could be economically as devastating as a terrorist act.
We cannot and should not hold our major economic engines hostage to
the threat of punitive damages on top of a terrorist act. I hope we can
agree on a means of avoiding this kind of risk to those who have
businesses or property that might be subject to a terrorist attack. As
I said back in December, this is a potential problem. I believe now it
is a problem. I think our recovery from the economic downturn, the
recession, has been slowed because the business community--especially
small businesses from which I hear--are really in a position where they
cannot go forward and, in many instances, they cannot get financing
without terrorism insurance, and most insurance companies are not in a
position to offer that.
So I hope we can move with a good piece of legislation that will
provide the temporary reinsurance by the Federal Government to allow us
to get back to the normal business of building facilities, building
shopping centers, operating cultural facilities, and conducting
business.
Mr. President, I look forward to working with my colleagues. I hope
we can get a good product, and I hope we can do it very quickly so we
can get our economy moving again.
I thank the Chair.
I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll
The assistant legislative clerk proceeded to call the roll.
Mr. SANTORUM. Mr. President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.

Amendment No. 3842

(Purpose: To implement the International Convention for the Suppression
of Terrorist Bombings to strengthen criminal laws relating to attacks
on places of public use, to implement the International Convention of
the Suppression of the Financing of Terrorism, to combat terrorism and
defend the Nation against terrorist acts, and for other purposes)

Mr. SANTORUM. Mr. President, I send an amendment to the desk.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:

The Senator from Pennsylvania [Mr. Santorum] proposes an amendment
numbered 3842.

Mr. SANTORUM. Mr. President, I ask unanimous consent that the reading
of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
(The amendment is printed in today's Record under ``Text of
Amendments.'')
Mr. SANTORUM. Mr. President, a clarification for Members. This is the
same amendment that Senator Hatch proposed earlier today. I understand
Senator Hatch engaged in some conversation with Senator Leahy about
withdrawing his amendment. I think it is vitally important for the
Senate to vote on this amendment. It is an important amendment. It is
an amendment that is relevant to this bill because it deals with
terrorism.
We had the same agreement yesterday, I understand, to vote on this
amendment. We had consent to do so, and there was an objection filed at
the last minute. We are now going out of session and will not be back
until next week, and I think it is important we have a record vote.
Mr. REID. Will my friend yield for a question?
Mr. SANTORUM. I will be happy to yield.
Mr. REID. I have just been informed--and this may be something of

[[Page S5508]]

which the Senator is not aware--Senator Hatch and others have been
working on this in the last few minutes, and we have something we
believe can be completed in wrapup this evening that takes care of the
matter.
I suggest my friend take a look at this. I do not know the subject
matter very well, but I assume Senator Hatch and Senator Leahy have
worked it out.
Mr. SANTORUM. I will be happy to deal with this as a separate matter
as long as we get a vote on it. I am just looking for a vote. This is
an important piece of legislation that deals with terrorism, the
implementation of a treaty on terrorist bombing. It is an important
vote. It is the implementation act of a treaty that we passed last
year. There are criminal code sections dealing with terrorist bombings,
as well as people who are financing terrorism. It is important
legislation. I think it is something on which we should vote.
I am not being critical of what Senator Leahy and Senator Hatch did.
I just think it is important legislation that should be voted on in the
Senate.
Mr. REID. Will the Senator yield for one more question?
Mr. SANTORUM. I will be happy to yield.
Mr. REID. If the Senator wants a vote, we can and should have a vote.
It is my understanding Senator Hatch and Senator Leahy have worked out
a substitute. It will be passage of S. 1770, the Terrorist Bombing
Convention Implementation Act of 2001.
Mr. SANTORUM. Right.
Mr. REID. We were going to do this by unanimous consent this evening
in wrapup. I assume it will be easy to work out a vote.
Mr. SANTORUM. If we can work out a vote on this legislation, that
will be amenable to me. I will be happy to put us back in a quorum call
and see if we can arrange that.
Mr. REID. What I suggest--and I will be happy for the Senator to
continue his statement--maybe in the near future he can look at this
and see that Senators Hatch and Leahy agree to have a vote on this
issue.
Mr. SANTORUM. My concern is to have a vote. I would be comfortable to
have a vote on that legislation which, while I understand it is not
identical to the amendment I offered, is legislation that accomplishes
the same purpose.
Why don't I suggest the absence of a quorum, and we can see if we can
work this out.
The PRESIDING OFFICER. Does the Senator suggest the absence of a
quorum?
Mr. REID. Will the Senator withhold his request?
Mr. SANTORUM. I will be happy to.
The PRESIDING OFFICER. The Senator from Nevada.
Mr. REID. Mr. President, while the Senator is in the Chamber, and we
can certainly talk about this, there is no reason not to do this. I
think the chairman and ranking member would like to do this separate
and apart from this bill. This way, we can send a freestanding bill to
the House so they can work on this issue, and it will not be tied up in
this legislation.
Mr. SANTORUM. Again, I am fine with that. My concern is we get a vote
on it. I am happy to do it that way, but my concern is we vote on this
legislation.
Mr. REID. I say to my friend from Pennsylvania, we will try our very
best to work with him. We have Senator Leahy's staff here. Senator
Hatch's staff is not here, but they will be here shortly. We will work
on trying to do this separate and apart from this legislation.
Mr. SANTORUM. I thank the assistant majority leader.
Mr. REID. I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. DODD. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. DODD. Mr. President, it is now after 5 p.m. We are hoping to get
this done. It could go into the end of next week. I know the majority
leader is trying to bring up the Defense authorization bill. I am more
than happy to consider other amendments. If people have them, bring
them up and see if we cannot finish this legislation. It is possible we
can get it done this evening. The majority leader has indicated if we
can complete this bill this evening, there will be no votes tomorrow.
We will then complete the process and next week, I guess, move--I do
not want to speak for the leadership--but I gather there is a strong
indication we will move to the Defense authorization bill. We will move
to other legislation, if not Defense authorization.
I was hoping in the next hour or so we could get some time agreements
on amendments. Otherwise, my fear is we will end up into next week, and
if that is the case, then people will be slow-walking this bill.
I appreciate the comments of the Senator from Missouri. He made a
fine speech about the importance of this legislation. There is a
consensus that we need to do something on terrorism insurance. It is
causing economic problems for our country, for all the reasons I
identified.
Certainly I am happy to entertain and debate relevant amendments that
deal directly with this bill and move on them, either accepting them or
defeating them. Let's see if we cannot get this bill done. We started
it early this morning. We have already dealt with a couple major
amendments. We have accepted some colloquies that have been offered as
an alternative.
We are going to end up in a conference with the other body. There are
substantial differences between both of these bills. It is going to
require continued work and labor. Those who are concerned about getting
something done, let it be known I am fully prepared to entertain
amendments. I will offer time agreements to try to wrap them up early,
but if this goes on much longer, I presume the leader will consider
having to file cloture, and then we will have to limit amendments, at
least limit them to relevant amendments.
It is now almost 5:30, and I hope we might get a couple more
amendments done, particularly some of those that are outstanding that I
know need to be debated and considered. The quicker that is done, the
more rapidly we can conclude work on this bill and vote it either up or
down, but we will have dealt with terrorism insurance.
Mr. REID. Will the Senator yield for a question?
Mr. DODD. I will be happy to yield to my colleague.
Mr. REID. The distinguished Senator from Connecticut with whom I have
been on this floor when considering major pieces of legislation--we do
not have a better manager in the Senate than Senator Dodd. He does a
wonderful, outstanding, exemplary job. He is here ready to work.
Yesterday afternoon, we finished the estate tax debate. The majority
leader at that time wanted to move to this legislation, but Members who
were interested in this legislation said: We have had a hard couple
days; why don't you wait until tomorrow?
I say to my friend from Connecticut, it appears to me that this is an
effort to slow down this legislation. We wanted to move to it last
night, allow Members to make opening statements and offer amendments,
but the majority leader said: No, they say they do not want to; go
ahead and agree with that.
Now here we are today, not much happening all afternoon, and if the
majority leader did decide to file cloture today people would yell and
scream saying this is the first day.
It is not really the first day. We wanted to do it yesterday.
Tomorrow is Friday. Monday is already a scheduled no-vote day, but that
does not mean it is a no-amendment day. Tomorrow we may not work a full
day as we normally do with votes all day, but this body will stay in as
late as anyone wants to offer amendments.
So the Senator is absolutely right. We are going to finish this
legislation. I say to my friend, and I think he is aware of this, all
of the industry groups all over America that are interested in this
have sent letters and e-mails to anyone who will pick them up, saying
they support cloture on this.
Everybody is tired of this. We have danced since late last year on
this legislation. We are going to complete this legislation. It is only
a question of whether we do it tonight or whether we do it next week
sometime. Will the Senator agree?
Mr. DODD. I agree with that.

[[Page S5509]]

Obviously, it helps the work of the Senate if we can complete it this
evening, but tomorrow morning would make more sense. We still have a
lot of work to do in conference to get this done. I know the
administration is interested, as well as the Secretary of the Treasury,
the President, and many others. My colleague from Nevada mentioned the
various business groups that are interested. I should also note that
the building trades, the AFL-CIO, have sent a strong letter in support
of this legislation. It is one of those rare occasions when groups that
sometimes are antagonistic to each other on a legislative effort have
come together and have, for months now, asked that we respond to this.
So we are hopeful to get this done.
Again, I will stay here as late as anyone wants. I will make time
tomorrow. I will make time next week. We are going to get the bill done
one way or the other. It serves everyone's interest to try to complete
this work sooner rather than later.
I merely wanted to make those points to our colleagues who are
wondering what the schedule will be. Obviously, the leadership will
make up its own mind about how to proceed, but it certainly would be in
our interest--we have been here a couple of hours with really no
amendments. I know there are some. If people have them, come over and
offer them. We will happily consider them. I do not include in that
group the Presiding Officer, who offered a very strong amendment, who
is now working with us and is working on another amendment trying to
work things out, but it is relevant to the subject matter of the bill.
I hope those who have amendments will offer them, withdraw them, or
offer some alternative we can consider as we go into the conference, if
the bill is passed.
I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. BROWNBACK. I ask unanimous consent that the order for the quorum
call be rescinded.
The PRESIDING OFFICER. Is there objection?
Mr. REID. Mr. President, I object.
The PRESIDING OFFICER. Objection is heard.
The legislative clerk continued with the call of the roll.
Mr. BROWNBACK. Mr. President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. BROWNBACK. Mr. President, the Senator from Virginia, Mr. Allen,
will be here momentarily and will ask to set aside the pending
amendment in order to offer an amendment on terrorism to obtain
judgments from frozen assets of terrorists, terrorist organizations,
and state-sponsored terrorism, and others.
I thought since we had a moment I would address this issue. As I
understand it, the majority leader will be coming out shortly to make
announcements, and I will be happy to yield the floor at that time.
I am hopeful we can take up this issue on the floor and that it can
be considered before the body, allowing people to be able to consider
this. There are a number of people who have been harmed greatly, and
family members have been killed by terrorist organizations. We need to
provide a means for satisfaction. This is one way that it could be
taken care of.
If I may reply to those who say this particular bill is not the
appropriate vehicle, we have a limited number of vehicles left in front
of this body. This is the appropriate point in time for us to be able
to bring this forward.
I understand the Senator from Virginia will be bringing it forward so
it can be worked out, and the administration and Congress is coming
forward with other ways and means of dealing with it. Yet I am still
hopeful that we can get this taken care of on this particular bill.
I note there has been a lot of pressure to get this bill wrapped up.
I understand the Senator from Virginia has been caught in traffic and
is trying to get here to offer his amendment. I would like to see us
take up this amendment and have it considered and moved forward.
He asked me, through his staff, if I would bring up this amendment.
If we could consider this important piece of legislation in front of
this body, I think this would be very valuable. If we could allow this
to take place, I think it would be a positive note.
I yield the floor. I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. ALLEN. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER (Mr. Dayton). Without objection, it is so
ordered.
Mr. ALLEN. I ask unanimous consent to set aside the pending
amendment.
The PRESIDING OFFICER. Without objection, the pending amendment is
set aside.

Amendment No. 3838

Mr. ALLEN. Mr. President, I call up amendment No. 3838.
The PRESIDING OFFICER. The clerk will report.
The assistant legislative clerk read as follows:

The Senator from Virginia [Mr. Allen], for himself, Mr. Burns, Mrs.
Hutchison, Mr. Smith of New Hampshire and Mr. Warner, proposes an
amendment numbered 3838.

Mr. ALLEN. Mr. President, I ask unanimous consent that further
reading of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

(Purpose: To provide for satisfaction of judgments from frozen assets
of terrorists, terrorist organizations, and State sponsors of
terrorism, and for other purposes)

At the appropriate place, insert the following:

SEC. __. SATISFACTION OF JUDGMENTS FROM FROZEN ASSETS OF
TERRORISTS, TERRORIST ORGANIZATIONS, AND STATE
SPONSORS OF TERRORISM.

(a) In General.--Notwithstanding any other provision of
law, and except as provided in subsection (b), in every case
in which a person has obtained a judgment against a terrorist
party on a claim based upon an act of terrorism or for which
a terrorist party is not immune under section 1605(a)(7) of
title 28, United States Code, the blocked assets of that
terrorist party (including the blocked assets of any agency
or instrumentality of that terrorist party) shall be subject
to execution or attachment in aid of execution in order to
satisfy such judgment to the extent of any compensatory
damages for which such terrorist party has been adjudged
liable.
(b) Presidential Waiver.--
(1) In general.--Subject to paragraph (2), upon determining
on an asset-by-asset basis that a waiver is necessary in the
national security interest, the President may waive the
requirements of subsection (a) in connection with (and prior
to the enforcement of) any judicial order directing
attachment in aid of execution or execution against any
property subject to the Vienna Convention on Diplomatic
Relations or the Vienna Convention on Consular Relations.
(2) Exception.--A waiver under this subsection shall not
apply to--
(A) property subject to the Vienna Convention on Diplomatic
Relations or the Vienna Convention on Consular Relations that
has been used by the United States for any nondiplomatic
purpose (including use as rental property), or the proceeds
of such use; or
(B) the proceeds of any sale or transfer for value to a
third party of any asset subject to the Vienna Convention on
Diplomatic Relations or the Vienna Convention on Consular
Relations.
(c) Special Rule for Cases Against Iran.--Section 2002 of
the Victims of Trafficking and Violence Protection Act of
2000 (Public Law 106-386; 114 Stat. 1542) is amended--
(1) in subsection (a)(2)(A)(ii), by inserting after ``July
27, 2000'' the following: ``or before October 28, 2000,'';
(2) in subsection (b)(2)(B), by inserting after ``the date
of enactment of this Act'' the following: ``(less amounts
therein as to which the United States has an interest in
subrogation pursuant to subsection (c) arising prior to the
date of entry of the judgment or judgments to be satisfied in
whole or in part hereunder).'';
(3) by redesignating subsections (d), (e), and (f) as
subsections (e), (f), and (g), respectively; and
(4) by inserting after subsection (c) the following new
subsection (d):
``(d) Distribution of Foreign Military Sales Funds
Inadequate to Satisfy Full Amount of Compensatory Awards
Against Iran.--
``(1)(A) In the event that the Secretary determines that
the amounts available to be paid under subsection (b)(2) are
inadequate to pay the entire amount of compensatory damages
awarded in judgments issued as of the date of the enactment
of this subsection in cases identified in subsection
(a)(2)(A), the Secretary shall, not later than 60 days after

[[Page S5510]]

such date, make payment from the account specified in
subsection (b)(2) to each party to which such judgment has
been issued a share of the amounts in that account which are
not subject to subrogation to the United States under this
Act.
``(B) The amount so paid to each such person shall be
calculated by the proportion that the amount of compensatory
damages awarded in a judgment issued to that particular
person bears to the total amount of all compensatory damages
awarded to all persons to whom judgments have been issued in
cases identified in subsection (a)(2)(A) as of the date
referred to in subparagraph (A).
``(2) Nothing herein shall bar, or require delay in,
enforcement of any judgment to which this subsection applies
under any procedure or against assets otherwise available
under this section or under any other provision of law.
``(3) Any person receiving less than the full amount of
compensatory damages awarded to that party in judgments to
which this subsection applies shall not be required to make
the election set forth in subsection (a)(2)(C) in order to
qualify for payment hereunder.''.
(d) Definitions.--In this section:
(1) The term ``terrorist party'' means a terrorist, a
terrorist organization, or a foreign state designated as a
state sponsor of terrorism under section 6(j) of the Export
Administration Act of 1979 (50 U.S.C. App. 2405(j)) or
section 620A of the Foreign Assistance Act of 1961 (22 U.S.C.
2371).
(2) The term ``blocked asset'' means any asset seized or
frozen by the United States in accordance with law, or
otherwise held by the United States without claim of
ownership by the United States.
(3) The term ``property subject to the Vienna Convention on
Diplomatic Relations or the Vienna Convention on Consular
Relations'' and the term ``asset subject to the Vienna
Convention on Diplomatic Relations or the Vienna Convention
on Consular Relations'' mean any property or asset,
respectively, the attachment in aid of execution or execution
of which would result in a violation of an obligation of the
United States under the Vienna Convention on Diplomatic
Relations or the Vienna Convention on Consular Relations, as
the case may be.

Mr. ALLEN. Mr. President, I rise to present this amendment, No. 3838,
which is a measure that has to do with allowing those who are victims
of terrorist acts in the past who have judgments, to collect those
judgments against the assets of the terrorist states or the state-
sponsored terrorist states involved in these acts. I thank the
cosponsors of the basic bill that has been introduced, which is the
basis for this amendment.
The cosponsors include Senator Warner; the lead of this on the
Democrat side, Senator Harkin of Iowa, Conrad Burns of Montana, Senator
Bayh, Senator Cleland, Senator Collins, Senator Feinstein, Senator
Johnson, Senator Miller, Senator Schumer, Senator Torricelli, Senator
Baucus, Senator Burns, Senator Clinton, Senator Craig, Senator
Hollings, Senator Mikulski, Senator Nickles, and Senator Bob Smith.
I particularly want to thank Mr. Harkin for the leadership he has
shown on this issue. He has stood strong for making terrorists
responsible for their actions and for justice. I'm grateful for Sen.
Harkin's tireless efforts in making this proposal a reality. Now, this
amendment would permit the blocked assets of terrorists, terrorist
organizations, and state sponsors of international terrorism, to be
used to compensate American victims of terrorism.
A little history: In 1996, Congress passed the Antiterrorism and
Effective Death Penalty Act, which, in section 221, expressly amended
the Foreign Sovereign Immunities Act to allow American victims of
terrorism to seek justice through the courts against foreign terrorist
governments. In 1998, Congress again amended the Foreign Sovereign
Immunities Act, stating explicitly that any property of a terrorist
state that was frozen by the U.S. Treasury Department was subject to
execution or attachment to satisfy the victim's court judgments.
However, in response to bureaucratic interference, Congress again, in
2000, as part of the Victims of Trafficking and Violence Protection
Act, endorsed the policy of using blocked assets to impose a cost on
terrorism and provide justice to victims.
Currently, there are at least $3.7 billion in blocked or frozen
assets of seven state sponsors of terrorism. However, the executive
branch bureaucracy is once again preventing these funds from being used
to compensate American victims who have brought lawsuits in our Federal
courts, won their cases, and secured court-ordered judgments--victims
such as Edwina Hegna of Virginia.
In the 1980s, Mrs. Hegna's husband, Charles Hegna, was an employee of
the U.S. Agency for International Development. In 1984, his flight from
Kuwait City to Karachi, Pakistan, was hijacked by Hizbollah, an
Iranian-backed organization. The terrorists demanded that all Americans
reveal themselves. Mr. Hegna stepped forward. The terrorists then beat
and tortured him. Upon landing, they forced him to kneel. Witnesses
heard Mr. Hegna praying for his life. He was then shot in the stomach
and thrown 20 feet to the tarmac below while still alive, breaking
nearly every bone in his lower body. He didn't die. He laid in agony
for about an hour. As an ambulance arrived, the terrorists leaned out
of the airplane door and shot him repeatedly. He died in the ambulance
at the age of 50, survived by his wife and their 4 children.
Mrs. Hegna currently has a multimillion dollar judgment, but is
unable to receive any compensation.
In another equally brutal case in which I prefer not to mention the
name of the family, but nevertheless it was a case in Kuwait. A pastor
who now lives in Richmond, VA, was held captive while he and his
children were forced to watch--and his children at the time were 10 and
13 years old--the terrorists sexually assault his wife. He currently
holds a $1 million court judgment but is unable to satisfy that
judgment.
The United States must say today to the executive bureaucracy that
Mrs. Hegna and this pastor from Richmond and all the victims--and they
are not all from Virginia; they are from Iowa, New York, New Hampshire;
they are from States across our Nation--for all these victims who have
suffered at the hands of these ruthless terrorists we ought to say they
can be compensated from the blocked assets of these terrorists and
their sponsors.
Indeed, this measure talks about terrorism reinsurance and who ought
to be sued, the obligations of insurance companies and how should we
back up those insurance companies. In these cases where someone has a
judgment and where there are assets that have been seized, it is the
terrorists and their state sponsors, not the American taxpayers, who
should be held accountable for these heinous crimes.
This amendment will accomplish three salient principles:
Responsibility, justice, and punishment and deterrence.
Responsibility: At least financial responsibility for the injuries
and damages from those who are culpable for the terrorist criminal
acts.
Justice: Justice for the victims and the victims' families.
Punishment and deterrence: Those who sponsor these terrorist acts
should be punished and deterred.
Therefore, I ask that my colleagues stand with the victims, stand
with their families, and allow them to get some satisfaction, albeit
only financial satisfaction.
I request that we move forward with this terrorism reinsurance bill,
but also add to it this opportunity for the Senate to take a stand and
allow those folks who have had these injuries and these damages and
loss of life, in some cases, to have those judgments satisfied, maybe
satisfied in part, but satisfied against the assets that have been
seized from primarily two countries that have been involved--Iran and
Iraq.
Some say we should be worried about what Iraq and Iran might do about
all this. But sitting back and worrying about what they might do is not
going to help these families and is not going to help this country. I
am going to stand with these families, these victims, and our judicial
system. Let these victims get after these assets. Let them try to
rebuild their lives in some part.
I ask for the yeas and nays on this amendment and yield the floor.
The PRESIDING OFFICER. Is there a sufficient second?
Mr. GRAMM. What are we seconding?
Mr. President, I suggest the absence of a quorum.
Mr. ALLEN. Mr. President, I am asking for the yeas and nays.
The PRESIDING OFFICER. The Senator from Virginia is requesting the
yeas and nays on his amendment. Is there a sufficient second?
There is a sufficient second.
The yeas and nays were ordered.
Mr. SMITH of New Hampshire. Mr. President, I rise today to support
Senator Allen's amendment to provide justice to American victims of
international terrorism.

[[Page S5511]]

It is appropriate that today we are debating legislation to provide a
Federal backstop to existing and future insurance policies covering
terrorist acts. That legislation provides economic protection for the
U.S. economy for acts of terrorism. I believe that this legislation
should be amended to address the issue of Americans held hostage and
tortured by terrorists to specifically hold liable nations that provide
financial and other support for terrorist that target the symbols and
citizens of America. I am proud to be an original cosponsor of the The
Terrorism Victim's Access to Compensation Act of 2002 that Senator
George Allen and Senator Tom Harkin have introduced.
That bill provides redress for victims of terrorism to receive
compensation from nations that sponsor terrorism. I appeared with
Senators Harkin and Allen at a press conference with Americans who have
experienced first hand the despicable and evil use of terrorism that
every American can understand as a result of the tragic events of
September 11 2001.
What right does a citizen have to fight back against a terrorist
nation? The only power that individual has is to sue that terrorist
nation in court to gain access to seized assets from terrorist nations.
Our Nation is in a war against terrorism and this amendment provides
another tool in the war against nations that sponsor terrorism. This
amendment requires that compensation be paid from the blocked assets of
terrorist nations provided that the American victims of terrorism
secure a final judgment in our Federal courts.
Victims of terrorism have many sad stories, and I want to bring to
you attention the sad plight of a man who had a residence in New
Hampshire during the toughest time of his life.
In November of 1989, William Van Dorp was sent by his employer from
his home in Kingston, NH to Kuwait City to teach the Kuwaiti Air Force
English. On August 2, 1990, Kuwait was invaded by the forces of Saddam
Hussein.
Let me use William Van Dorp's own words to describe what happened:

On August 4, I heard loud rumblings coming from the road
and, when I looked out my window, I saw seventeen trucks,
filled with Iraqi troops, and three tanks driving toward the
beach. It became apparent to me that I was still in the
middle of a combat zone and in immediate danger of
encountering enemy fire.

William Van Dorp attempted to escape the Iraqis who were rounding up
American hostages. Mr. Van Dorp was attempting to leave the
Intercontinental Hotel in Kuwait City. Mr. Van Dorp describes the event
as follows:

When I reached the lobby, I saw a U.S. Embassy official
yelling at an Iraqi colonel and trying to convince him not to
take the Westerners away. I was being taken into custody by
heavily armed Iraqi soldiers. Later that evening I was packed
into a military truck with roughly 23 American citizens and
transported to an army camp about an hour from Kuwait City.

William Van Dorp was held hostage by the Iraqi government for months.
During the Persian Gulf war Iraqi used American hostages to be
imprisoned at sites where the Iraqis thought the United States would
target during the Persian Gulf war.
The nations of Iran and Iraq have committed unspeakable acts against
American and against citizens of my state of New Hampshire. Those
nations deserve to be punished. Recently, Iraqi President Saddam
Hussien pledged increased Iraq's payments to the families of
Palestinian suicide bombers from $10,000 to $25,000.
The press has reported in the past that Iran may be harboring
terrorists from the Al-Qaida network and Taliban. I don't know that to
be true, but it has been reported by the press that Iran and Iraq have
not been allies in the war against terrorism. Our diplomatic efforts to
change these countries has fallen on deaf ears and these countries are
supporting terrorism throughout the globe. Iran, Iraq, and North Korea
are the ``Axis of Evil.''
I am sure that every Member of this body remembers the Iran hostage
crisis. Americans who worked in the U.S. Embassy of Iran were held
hostage by the Iranian government more than 20 years ago. Those
hostages sued the government of Iran. The Iranian Government did not
make an appearance in the U.S. court to defend themselves, but as iron
would have it, lawyers, not from Iran, were in the U.S. courtroom to
defend the interests of government of Iran.
Does anybody in this Chamber know what lawyers were in court
defending the interests of the Iranian government? It was our own
Justice Department and the U.S. State Department. How do you think the
U.S. hostage felt about the U.S. Government, using tax dollars from
these same U.S. hostages, defending the interests of the Iran
government.
The Washington Post, on October 16, 2001 reported that:

U.S. Government lawyers went to Federal court yesterday
seeking to vacate a judgment against Iran in a lawsuit filed
by 52 Americans have were held captive in that country more
than 20 years ago. The timing of the government motion,
nearly a year after the lawsuit was filed and two months
after the judgment was entered, drew sharp criticism from
some of the former hostages, who accused the Bush
administration of trying to mute their claims because of the
current conflict in Afghanistan. ``The State Department and
the Justice Department are doing this only to curry favor
with Iran at this juncture of history,'' said Barry M. Rosen,
a former hostage who is now director of public affairs at
Columbia University's Teachers College. ``I was outraged.''

Another former hostage retired Army Col. Charles W. Scott who had
three teeth knocked out during brutal interrogations, said, ``In
combat, you have a weapon and can fight back. Here, we were defenseless
and brutalized. For the first time I understood what the people of the
Holocaust went through.'' Americans who are the victims of terrorist
acts sponsored by nations that are deemed by the State Department to be
state sponsors of terrorism should be punished.
I urge the Senate to support the Allen amendment.
The PRESIDING OFFICER. The Senator from Kansas.
Mr. BROWNBACK. Mr. President, I have an amendment.
The PRESIDING OFFICER. The Chair is in error. The majority leader.
Mr. DASCHLE. Mr. President, we will work to attempt to vote on the
Allen amendment tomorrow as well, but we have been working over the
course of the last several hours--and I thank those of our colleagues
who have been involved--to accommodate a unanimous consent request that
I understand has now been cleared on both sides. In order to ensure we
can inform our colleagues of the schedule for the remainder of the
evening and tomorrow, I propound this unanimous consent request so that
at least this can be scheduled.
I ask unanimous consent that when the Senate resumes consideration of
the terrorism insurance bill on Friday, June 14, at 9:35 a.m., the
Santorum amendment No. 3842 be withdrawn; that the Judiciary Committee
be discharged from further consideration of H.R. 3275 and that the
Senate proceed to its immediate consideration; that Senator Leahy, or
his designee, be recognized to call up the Leahy-Hatch substitute
amendment at the desk; that upon reporting by the clerk, the Senate
vote on the adoption of the amendment; that following adoption of the
amendment, the bill, as amended, be read a third time and the Senate
vote on passage of the bill, with no intervening action or debate;
further, that upon the disposition of H.R. 3275, the Judiciary
Committee be discharged from further consideration of S. 1770; that the
Senate proceed to its consideration; that the Senate consider the
Leahy-Hatch amendment at the desk; and that upon reporting the
amendment, the Senate vote on the adoption of the amendment; that
following the vote, the bill, as amended, be read three times and
passed, and the motion to reconsider be laid upon the table, all
without intervening action or debate; further, that any statements
relating to these items be printed in the Record.
The PRESIDING OFFICER. Is there objection?
The Senator from Kansas.
Mr. BROWNBACK. Mr. President, I have an amendment I would like to
have considered at some point. I would like to see it considered. It is
a very narrow issue, and I would like to see if we can get this in the
queue of items. It is not under consideration. If my colleague, the
majority leader, can consider it, I would like to be able to put it
forward. If not, I believe I will need to object to proceeding under
this unanimous consent request.

[[Page S5512]]

Mr. DASCHLE. I ask unanimous consent that the Senator from Kansas be
recognized to offer his amendment following the disposition of the
amendment offered by the Senator from Virginia.
The PRESIDING OFFICER. Is there objection?
Mr. DODD. Reserving the right to object, may I inquire of the
substance of the amendment of the Senator from Kansas?
Mr. BROWNBACK. It is an issue on patenting, and it is an issue that I
think is a very important one for us to consider. I want to bring it up
and press it. It is a narrow one. I think we ought to consider it. I
would like to offer it.
Mr. DODD. Further reserving the right to object, is this the cloning
amendment?
Mr. BROWNBACK. It is patenting of human beings. It is the issue of
patenting of humans which I would like to put forward at this time.
Mr. DODD. Mr. President, with all due respect, as someone trying to
manage a bill, I regretfully object to consideration of that amendment
at this point. I am trying to deal with the subject matter at hand. It
is going to be impossible----

Mr. BROWNBACK. I must object.
The PRESIDING OFFICER. Objection is heard.
The Senator from Nevada.
Mr. REID. Mr. President, while the majority leader is in the Chamber,
we have worked now for several hours to get a vote for Senator
Santorum. I cannot understand why the Senator from Kansas would prevent
us from having this vote. He has an opportunity on this legislation at
a subsequent time to offer an amendment. No one can stop him from
offering an amendment.
I think the majority leader will announce shortly that there will be
ample opportunity tomorrow and Monday to offer amendments. So I do not
know why the Senator from Kansas would hold up a vote that the Senator
from Pennsylvania has been trying to get for several hours.
I also say to the leader that while he was proffering his unanimous
consent request, the Senator from Virginia said he would have no
problem voting on his amendment tomorrow morning. That will give anyone
who has any objection to the amendment of the Senator from Virginia the
chance to speak tonight for as long as they want. We can set this up
following the vote on the Santorum amendment, whatever we want to call
it, the one on which we asked unanimous consent.
I ask the Senator from Kansas to kindly reconsider allowing us to
vote on the Santorum amendment and, following that, vote on the
amendment of the Senator from Virginia, and then the floor is open and
anybody can offer an amendment. The Senator from Kansas or the Senator
from Pennsylvania can offer another amendment, or the Senator from
anyplace can offer any amendment they want.
The PRESIDING OFFICER. The majority leader.
Mr. DASCHLE. Mr. President, I will renew my request in a moment. I do
not know that any Senator can be denied the right to offer an amendment
as long as cloture has not been filed and achieved. It is not my desire
now to file cloture. At some point, if we cannot bring this debate to a
conclusion, I will be forced to do so. Until that time, of course, the
Senator has every right to come to the floor to offer an amendment.
We are going to be in session tomorrow and on Monday, even though
there are no votes on Monday. So I hope Senators will use that time to
come to the floor to offer what I would hope will be relevant
amendments.
We certainly cannot prohibit the Senator from offering other
legislation. So I would renew my request.
The PRESIDING OFFICER. Is there objection?
Mr. BROWNBACK. Reserving the right to object.
The PRESIDING OFFICER. The Senator from Kansas.
Mr. BROWNBACK. I would like to make sure I do get an opportunity to
bring this issue forward, so I ask unanimous consent that before the
conclusion of this bill I have the opportunity to put forward and have
this amendment considered.
The PRESIDING OFFICER. Will the majority leader so modify his
request?
The Senator from Nevada.
Mr. REID. Could the Senator do this tomorrow morning or Monday?
Mr. BROWNBACK. All I am doing is asking unanimous consent that I be
allowed to offer this amendment sometime during the pendency of this
bill.
Mr. REID. Reclaiming my time.
The PRESIDING OFFICER. The Senator from Nevada.
Mr. REID. That seems somewhat unfair. We have all day Friday, all day
Monday. Anytime before the end of the bill could be a long time from
now.
Several Senators addressed the Chair.
The PRESIDING OFFICER. The majority leader has the floor.
Mr. DASCHLE. Mr. President, the Senator does not need that consent.
He can offer that amendment, as the Senator from Nevada has noted,
tomorrow, Monday, or any day. That does not require a unanimous
consent. I have no objection to his request, but it does not take a
unanimous consent. He is entitled to that until cloture is obtained. If
cloture were invoked, he would probably be denied the right. We are not
anticipating a cloture vote, at least in the foreseeable future. So the
Senator is certainly entitled to his right to offer this amendment
whenever he chooses.
The PRESIDING OFFICER. The Senator from Kansas.
Mr. BROWNBACK. Mr. President, I have had difficulty at times being
able to get the floor, as people maybe would say, well, we do not want
to consider this at this particular time. I want to make sure we can.
Unfortunately for me, I will not be present tomorrow. As many of my
colleagues know, we have had in the Philippines the death of a Kansan
who is being buried tomorrow, Mr. Burnham, and I will be at that
funeral tomorrow morning. But I want to make sure this issue can come
up and can be heard before the end of this bill. I do not think that is
an inappropriate request.
I renew the request that I be allowed to bring up this amendment
sometime during the pendency of this bill. I ask unanimous consent that
I be allowed to do so.
The PRESIDING OFFICER. Does the majority leader so modify his
request?
Mr. DASCHLE. I did not understand the request. I have not modified my
request.
The PRESIDING OFFICER. The majority leader made a unanimous consent
request to which the objection was heard from the Senator from Kansas.
So the question is, Will the majority leader modify his unanimous
consent request to include the unanimous consent request of the Senator
from Kansas?
Mr. DASCHLE. Mr. President, as I said, that does not require a
unanimous consent request, but I would not object to the request made
by the Senator from Kansas.
The PRESIDING OFFICER. Is there objection?
Mr. DODD. Reserving the right to object.
The PRESIDING OFFICER. The Senator from Connecticut.
Mr. DODD. My concern is we are providing the Senator from Kansas
something that has been provided to no one else. We could have every
Member demand a unanimous consent on totally irrelevant amendments to
this bill. If we go down that road and if the Senator wants to kill
this bill, that is fine, filibuster the bill, but to bring up totally
extraneous amendments, it seems to me, is unwarranted.
I have talked a number of our colleagues out of offering amendments
that had nothing to do with this bill, no matter how meritorious their
proposals. Certainly, the majority leader has indicated the Senator has
the right precloture to bring up an amendment. Cloture has not been
invoked. If we can move this bill along, there is no reason for it to
be invoked, but to cut out one exception for one Member to make a
unanimous consent request, after I have talked other people out of it,
I do not think is terribly fair.
I urge my colleague from Kansas to withdraw the request. If we can
agree to move this bill along, we are dealing, then, with the Santorum
amendment tomorrow. We have tomorrow, next Monday, next Tuesday. We can
spend all next week on this bill if Members are so inclined.
The PRESIDING OFFICER. The majority leader.

[[Page S5513]]

Mr. DASCHLE. Mr. President, let me reiterate something I think
everybody understands. Obviously, the consideration of an amendment
does not mean the disposal or the resolution of the issue. The Senator
is only asking for consideration of the amendment. It could be second-
degreed. It could be debated. I do not know that he has asked that it
be brought to some final conclusion.
I will say this: If cloture is invoked, if the amendment has not been
disposed of and it is not a germane amendment, then it would fall, but
that certainly would not disallow the consideration of an amendment.
So, again, I would pursue my request.
Mr. DODD. Will the majority leader yield for 1 minute?
Mr. BROWNBACK. If the Senator will yield, I think I have perhaps a
solution.
The PRESIDING OFFICER. The Senator from Kansas.
Mr. BROWNBACK. I ask the amendment I have be considered after the
Allen amendment tonight. I am prepared to put it forward this evening,
if it would be acceptable to the leader to do that.
Mr. GRAMM. Will the distinguished majority leader yield?
Mr. DASCHLE. I would be happy to yield.
The PRESIDING OFFICER. The Senator from Texas.
Mr. GRAMM. I am hopeful that at some point we are going to work out a
compromise and move this bill forward. It seems to me the position we
are in is we want to set this vote up for tomorrow. The Senator has the
right to object to doing that, pending getting the opportunity
guaranteed that he can offer his amendment. If he is here--and he has
this problem with this funeral apparently--no one can prevent him from
doing it. I am hopeful if we work out a compromise that we might talk
him out of offering the amendment. So I think we should accept the
amended unanimous consent request of the majority leader. I do not see
that we are giving him anything that he would not have if we were not
here. It seems to me, pending trying to work out a compromise, that we
would be better off not having it offered tonight. He could offer it as
a second-degree amendment tonight--it is perfectly within the rules--
by objecting to setting up the vote for tomorrow. So I think the
logical thing to do is to take the majority leader's proposal.

Mr. DODD. Will the majority leader yield for one question?
Mr. DASCHLE. Yes.
Mr. DODD. I would make a parliamentary inquiry. If there is a
unanimous consent request which is agreed to, for the consideration of
an amendment that would otherwise fail in a postcloture environment,
does that amendment still prevail if cloture is invoked? Or at least
will that amendment be considered without being violative of the rules
of cloture?
The PRESIDING OFFICER. If that is the intent of the unanimous consent
request, then it would be in order.
The Senator from Virginia.
Mr. ALLEN. Mr. President, if I may ask the distinguished majority
leader a question, so I understand the procedure as he originally
outlined it. May I inquire as to when the vote on my amendment would
occur? As far as I am concerned, the amendment having to do with
getting after terrorist assets for those who obtain judgments in this
country has broad bipartisan support. Is there any reason why we could
not vote on that tonight or, in accommodation to a lot of people who
will be gone, vote on it on Tuesday?
Mr. DASCHLE. Mr. President, I was entertaining the possibility of
voting on the Allen amendment, as well as on the Santorum amendment,
tomorrow morning. If the discussion of the amendment has been
completed, we could lay it aside temporarily to allow the Brownback
amendment to be laid down and then return to the Allen amendment
tomorrow morning. That would be fine with me. I will say that this will
generate other amendments. The Brownback amendment will not be the only
amendment offered.
Mr. ALLEN. All right.
Mr. BROWNBACK. We will then be able to dispose of the Allen amendment
tomorrow morning. So I have no reservations or objections to doing that
if our colleagues would be interested in taking that approach.
The PRESIDING OFFICER. The Senator from Virginia.
Mr. ALLEN. A further inquiry of our leader. The point is, as I
understand it, at some point tomorrow morning the earliest vote would
be a vote on the Santorum amendment. Let us assume the vote on the
Santorum amendment is at 9 or 9:30. Thereafter, say 10 minutes later,
there would be a vote on my amendment tomorrow morning?
Mr. DASCHLE. Mr. President, we have not propounded the request, but
it would be my intention to vote on it immediately after the
disposition of the Santorum amendment.
Mr. ALLEN. I have no objection.
The PRESIDING OFFICER. The majority leader.
Mr. DASCHLE. If there is no disagreement, I would then again amend my
request in the following manner: In addition to the request as it was
originally propounded, I ask that we vote on the Allen amendment
immediately following the disposition of the Santorum amendment
tomorrow morning. I would further ask that the Allen amendment be set
aside to accommodate the amendment to be offered by the Senator from
Kansas, and that amendment be the pending business this evening; that
we return to the Santorum amendment tomorrow morning, to be followed
then by the Allen amendment, after its disposition.

The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. DASCHLE. Mr. President, just for clarification, when I refer to
the Santorum amendment, I refer to the legislation as it was referred
to in the unanimous consent request. It is more than an amendment. It
is now a freestanding bill under the request. I think all of my
colleagues understood that, but I want to ensure that people know that
would be the order of business tomorrow morning.
With this request, there will be no further rollcall votes tonight.
Mr. President, I ask further unanimous consent that no amendments be
in order to the Allen amendment prior to the vote on the Allen
amendment tomorrow morning.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. DASCHLE. Mr. President, if there are no Senators wishing to be
recognized, I have a statement to make, for which I will use leader
time, with regard to the Middle East.
The PRESIDING OFFICER. The Senator is recognized.

____________________