[Congressional Record Volume 149, Number 2 (Wednesday, January 8, 2003)]
[Extensions of Remarks]
[Pages E33-E34]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                     REINTRODUCTION OF LEGISLATION

                                 ______
                                 

                           HON. CLIFF STEARNS

                               of florida

                    in the house of representatives

                        Tuesday, January 7, 2003

  Mr. STEARNS. Mr. Speaker, I am pleased on this first day of the 108th 
Congress to introduce four pieces of legislation that I have been 
pursuing over the years, and for which I will continue to advocate 
these next two years.
  First, together with the gentleman from Illinois (Mr. Crane), I 
introduced bill H.R. 804, a bill to repeal the 2 percent excise tax on 
private foundations. The United States is blessed with a deep spirit of 
philanthropy. Charitable organizations serve the interest of both the 
individual and the community. Private foundations in particular have 
made measurable differences in the lives of Americans, from access to 
public libraries, developing the polio vaccine, and even leading in the 
creation of the emergency number 911. Each and every American has 
experienced the benefits of the tireless efforts of these foundations. 
Under current law, not-for-profit private foundations generally must 
pay a 2 percent excise tax on their net investment income. This 
requirement was originally enacted in the Tax Reform Act of 1969 as a 
way to offset the cost of government audits on these organizations. So 
some 34 years ago, we instituted a tax on these foundations to cover 
the audit expense. However, when you look at the number of audits that 
have been performed, particularly since 1990, the IRS audits on private 
foundations has decreased from 1,200 to just 191. Yet the excise 
collection during these 31 years has grown from roughly $200 million in 
1990 to $500 million in the year 1999.
  In addition, private foundations are bound by a 5 percent 
distribution rule. Foundations must make annual qualifying 
distributions for charitable purposes equal to roughly 5 percent of 
their fair market value of the foundation's net investment assets. The 
required 2 percent excise tax, which is payable to the IRS, actually 
counts as a credit to the 5 percent distribution rule.
  So in a nutshell, what we have here is a private foundation making a 
charitable grant to the Federal Government every year, and since 1969 
the number of audits have gone down; yet the number of charitable 
foundations has gone up.
  Mr. Speaker, I believe that Americans have been more than charitable 
in giving the government their hard-earned dollars. It is time that we 
begin the process of returning the money to the people and the 
foundations to which it is intended.

[[Page E34]]

  President Bush is working to accomplish that goal with his reduction 
in tax rates, allowing for the increased use of charitable deductions 
and credits. My bill goes one step further. It gives those charitable 
organizations relief from the $500 billion tax that the Federal 
Government instituted 34 years ago so they can give more of their money 
back to the people who need it.
  I would like to also emphasize that the former President, Mr. 
Clinton, proposed a reduction in this same excise tax in his fiscal-
year 2001 budget. The Treasury Department noted: ``Lowering the excise 
tax rate for all foundations would make additional funds available for 
charitable purposes.''
  So, Madam Speaker, common sense dictates that the elimination of this 
tax would increase additional charitable giving. I would like to thank 
my colleague, the gentleman from Illinois (Mr. Crane), for his support 
on this bill, and for my other colleagues who have graciously 
recommitted their support. I ask my colleagues to take a look at this 
piece of legislation.

  Next, I am pleased to again sponsor the Health Care Tax Deduction Act 
of 2003. What it does is allow deductions for amounts paid for health 
insurance premiums and unreimbursed prescription drugs. What I am 
proposing would also provide much-needed relief to individuals 
struggling with the high cost of health insurance and prescription 
drugs through a tax deduction.
  As we all know, employers can write off the cost of health care 
coverage that is purchased for their employees. Why cannot individuals 
be afforded this same opportunity to write off their premiums and their 
unreimbursed prescription drug expenses? The current tax code sets a 
threshold at 7.5 percent of adjusted gross income before medical 
expenses can be taken as a write-off. I do not think this is fair.
  Right now, under the current tax code, in order to claim health care 
expenses the individuals must file an itemized tax return. I believe 
that all taxpayers should be allowed to deduct these out-of-pocket 
expenses and costs and that we need to include a place where this 
deduction could be taken on the short form such as the 1040 EZ, and the 
1040A. My bill also applies to the self-employed because although 
individuals who are self-employed are now eligible for a 100 percent 
write-off of health insurance premiums, not so with prescription drug 
expenses.
  I believe we must address this issue because so many Americans are 
uninsured today, and many millions more are underinsured. And, we all 
end up paying for the uninsured through higher premiums, deductibles 
and copayments for covered services, higher taxes for uncompensated 
care, and reduced wages.
  Did you know that Americans spends more than $1 trillion on health 
care? That represents about 13.5 percent of the gross domestic product. 
By 2008, spending will increase to 16.5 percent of the gross domestic 
product. In fact, Mr. Speaker, Americans spend more per capita for 
health care than any other nation in the world.
  But why are so many people uninsured? Most studies cite cost as a 
major reason for not having insurance. Many workers decline coverage 
through their place of employment because they cannot afford to pay 
their share of the premium. Others, such as temporary workers, cannot 
afford to purchase their own insurance.
  We all know that the cost of health care has risen dramatically over 
the last 20 years. According to the Health Insurance Association of 
America, the average major medical premium costs about $ for an 
individual and about $ for a family. Of that amount, employees pay 
anywhere from 10 to 30 percent of that premium, typically. 
Unfortunately, things may get worse in an economic downturn, because 
many employers cover the cost of the high premiums to keep workers in a 
tight labor market, and as costs increase employers might pass the cost 
along to the employees, or in fact discontinue providing health 
insurance altogether. Further, as unemployment has risen, begins to 
rise, many individuals have turned to the individual market, and must 
shoulder the entire cost on their own.
  Seniors, in particular, have been impacted because so many HMOs have 
pulled out of Medicare due in large part to,the high cost of 
prescription drugs. Allowing a simple write-off of certain costly 
health care expenses such as health insurance premiums and out-of-
pocket expenses for prescription drugs would be a tremendous benefit 
that may not be available to them under the current system. Mr. 
Speaker, I hope all of my colleagues cosponsor my bill. It makes sense 
to have all taxpayers have this type of deduction available to them.
  Turning to our nation's veterans, residing in my home state of 
Florida, I am sponsoring legislation to establish a national Veterans' 
Affairs cemetery in Jacksonville, Florida. Florida has our nation's 2nd 
largest veterans population, and the number one oldest. Nearly 325,000 
veterans call home somewhere in the Jacksonville vicinity of three 
congressional districts. Yet, the closest VA cemetery is at least a 
three-hour drive from Jacksonville. The next closest in proximity lies 
in Marietta, Georgia, just north of Atlanta. A new national VA cemetery 
in Jacksonville would answer this unmet need for north Floridians and 
southern Georgians. I hope my colleagues will consider cosponsoring 
this bill, and help provide the dignified, hallowed grounds our 
veterans deserve.
  Finally, I am pleased to reintroduce a resolution supporting the 
goals and ideals of establishing a Chronic Obstructive Pulmonary 
Disease (COPD) awareness month. In the 107th Congress, this bill had 
tremendous support from Members and from the U.S. COPD Coalition, 
including the patient and provider community. We are so pleased to 
report that on November 9th, President George W. Bush proclaimed 
November 2001 COPD Awareness Month. Next, the President sent a gracious 
letter on October 24, 2002 commending the organizations of the U.S. 
COPD Coalition for their efforts. COPD is an umbrella term used to 
describe the airflow obstruction associated mainly with emphysema and 
chronic bronchitis. This is a debilitating disease, that is currently 
the nation's fourth leading cause of death. Both conditions decrease 
the lungs' ability to take in oxygen and remove carbon dioxide. Long-
term smoking--the most common cause of COPD--is responsible for 80-90 
percent of all cases, while other risk factors include heredity, 
second-hand smoke, air pollution, and a history of frequent childhood 
respiratory infections. Common symptoms of COPD include shortness of 
breath, chronic coughing, chest tightness, and increased effort to 
breathe. COPD has no cure, but there are treatment options available to 
those who have been properly diagnosed.
  I look forward to working with my colleagues on all four of these 
important pieces of business for the nation.

                          ____________________