[Congressional Record Volume 149, Number 58 (Thursday, April 10, 2003)]
[Senate]
[Pages S5208-S5209]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. Smith.
  S. 879. A bill to amend the Internal Revenue Code of 1986 to increase 
and extend the special depreciation allowance, and for other purpose; 
to the Committee on Finance.
  Mr. SMITH. Mr. President, I rise today to introduce the Economic 
Stimulus Act of 2003, legislation that will allow a 50 percent bonus 
depreciation over a 5 year period. Last year I was proud to introduce 
and pass a 30 percent bonus depreciation incentive as part of 
legislation signed into law in March 2002. We had great bipartisan 
support on this issue and I hope that similar action will take place 
during consideration of this year's tax bill.
  I introduce the Economic Stimulus Act of 2003 in order to build on 
last year's effort by both increasing that bonus to 50 percent and 
extending it through 2008. Our economy clearly needs a boost, and this 
provision will complement many of the provisions in President Bush's 
economic growth package.
  Recently, U.S. Department of Commerce data revealed that private 
investment in high tech equipment ended it's decline as this provision 
went into effect last year and has begun to increase modestly in the 
past year. A significant increase in that bonus along with an extension 
of its effective date can only boost business investment even further. 
By extending the effective date past next year, businesses will be able 
to better plan for sustained increases in technology investment.
  This legislation will provide an immediate and broad stimulus to the 
U.S. economy by encouraging business investment. In my own state of 
Oregon I can look to both heavy industry and the hi tech sector and see 
the real return this legislation will have on our economy. Heavy 
industry in my state will have an ability to save family-wage jobs and 
put additional employees to work in Oregon. For example, the rail 
supply industry has been hard hit, and though there is a need for 
investment, there has been a reluctance to invest significant sums that 
are necessary to sustain this industry. Bonus depreciation provisions 
is an additional incentive that will lead institutional investors, 
leasing companies, shippers and railroads to invest in new rail 
equipment.
  In Oregon's high-tech sector the strong increase in the first year 
depreciation amount will have a real and positive impact on the 
investment environment for high-tech equipment, such as computer 
hardware, software and broadband network infrastructure. This 
legislation will definitely stimulate the demand for the software and 
the whole high-tech sector. In Oregon, the hi-tech sector has been a 
major component of economic growth and I am intent that this engine of 
growth continue to provide stimulus to the economy.

[[Page S5209]]

  I note that there are a myriad of bonus depreciation proposals out 
there. Most don't provide enough lead time however to make real and 
substantive business decisions. The current downturn is caused in part 
by a decline in business investment. So what kind of investment can be 
stimulated by a year-long depreciation incentive? It probably gives 
business people time to buy a chair and some new wastebaskets.
  But a year is not enough time to start a major project that could 
employ thousands of people. It doesn't allow time to build heavy 
equipment, modernize a lumber mill, revamp a corporate computer system, 
repair a railbed, or construct an airplane. It doesn't allow enough 
time to obtain building permits, perform environmental reviews, or 
complete architectural or engineering studies.
  We need to create a booming economy not just for today, but for the 
next several years. So I must emphasize that short depreciation 
proposals lack economic weight.
  Bonus depreciation is probably the best idea of any stimulus 
proposal. I ask that all my colleagues consider and support the 
Economic Stimulus Act of 2003. I ask unanimous consent that the text of 
this bill be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 879

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Economic Stimulus Act of 
     2003''.

     SEC. 2. EXPANSION OF SPECIAL DEPRECIATION ALLOWANCE.

       (a) In General.--Subsection (k) of section 168 (relating to 
     accelerated cost recovery system) is amended--
       (1) by adding at the end of paragraph (1) the following new 
     flush sentence:
     ``In the case of any qualified property acquired by the 
     taxpayer pursuant to a written binding contract which was 
     entered into after the date of the enactment of the Economic 
     Stimulus Act of 2003, subparagraph (A) shall be applied by 
     substituting `50 percent' for `30 percent'.'',
       (2) by redesignating subclauses (III) and (IV) of paragraph 
     (2)(A)(i) as subclauses (IV) and (V), respectively,
       (3) by inserting after subclause (II) of paragraph 
     (2)(A)(i) the following new subclause:

       ``(III) which is a motion picture film or videotape (as 
     defined in section 167(f)(1)(B) for which a deduction is 
     allowable under section 167 without regard to this 
     subsection,'',

       (4) by striking clause (iv) of paragraph (2)(A) and 
     inserting the following new clause:
       ``(iv) which is placed in service by the taxpayer--

       ``(I) except as provided in subclauses (II) and (III), 
     before April 1, 2010,
       ``(II) in the case of transportation property described in 
     subparagraph (B), before the later of the date which is 90 
     days after delivery of such property or which is 10 years 
     after the date of the enactment of the Economic Stimulus Act 
     of 2003, or
       ``(III) in the case of other property described in 
     subparagraph (B), before January 1, 2011.'',

       (5) by inserting ``transportation property which meets the 
     requirements of clauses (i), (ii), and (iii) of subparagraph 
     (A), or other'' before ``property'' in the matter preceding 
     subclause (I) of paragraph (2)(B)(i),
       (6) by striking ``production before September 11, 2004.'' 
     in paragraph (2)(B)(ii) and inserting ``production--

       ``(I) with respect to transportation property, before the 
     earlier of the date which is 90 days after delivery of such 
     property or which is 10 years after the date of the enactment 
     of the Economic Stimulus Act of 2003, and
       ``(II) with respect to other property, before January 1, 
     2010.'',

       (7) by striking ``September 11, 2004'' in the heading of 
     clause (ii) of paragraph (2)(B) and inserting ``certain'',
       (8) by striking ``subparagraph'' in paragraph (2)(B)(iii) 
     and inserting ``paragraph'',
       (9) by striking ``September 11, 2004'' each place it 
     appears in the subsection and inserting ``January 1, 2010'', 
     and
       (10) by striking ``September 11, 2004'' in the heading 
     thereof and inserting ``January 1, 2010''.
       (b) Conforming Amendments.--
       (1) The heading for clause (i) of section 1400L(b)(2)(C) of 
     the Internal Revenue Code of 1986 is amended by striking ``30 
     percent additional'' and inserting ``Additional''.
       (2) Section 1400L(b)(2)(D) of such Code is amended by 
     inserting ``(as in effect on the day after the date of the 
     enactment of this section)'' after ``section 168(k)(2)(D)''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to property acquired after the date of the 
     enactment of this Act, in taxable years ending after such 
     date.
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