[Congressional Record Volume 149, Number 108 (Monday, July 21, 2003)]
[Senate]
[Pages S9639-S9642]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. DOMENICI (for himself, Mr. Hagel, and Mr. Bingaman):
  S. 1432. A bill to amend the Safe Drinking Water Act to establish a 
program to provide assistance to small communities for use in carrying 
out projects and activities necessary to achieve or maintain compliance 
with drinking water standards; to the Committee on Environment and 
Public Works.
  Mr. DOMENICI. Mr. President, I want to talk about two things: One is 
strictly domestic and another is international.
  First, I am introducing a bill today in behalf of myself, Senator 
Hagel, and Senator Bingaman.
  I will start this discussion with a chart. The dark brown on this map 
are counties in these United States--you will note that they are 
predominantly in the West--with arsenic concentrations exceeding 10 
parts per billion or more in the water sampling. The little bit lighter 
ones are counties with 5 parts per billion. The little bit lighter ones 
are counties with 3 parts per billion. And, the very light ones are 
counties with fewer than 10 parts per billion.
  Arsenic is a very prevalent compound or chemical in the United 
States. Communities in the State of New Mexico and throughout the 
country are going to face, very soon, a very costly situation not of 
their own making. Beginning in the year 2000, Federal drinking water 
regulations established by the Environmental Protection Agency will 
require substantial reductions in the amount of arsenic present in 
water.
  Today, the limit is 50 parts per billion. In 2006, it will become 10 
parts per billion.
  When I was referring a while ago to these colorations, this dark 
brown is parts per billion. Today the limit is 50. In 2006, it will 
become 10 parts per billion. Arsenic is indeed poisonous if used in 
large amounts. It is naturally occurring, however, in much of the 
ground water throughout the Nation.
  That means there have been people living for as long as they have 
lived in areas that have naturally occurring arsenic in the ground 
water. Believe it or not, fellow citizens, they have been drinking that 
water.
  What is so strange about it is that we don't have any evidence it has 
been killing them. We don't have any evidence it has been hurting 
them. But actually there are scientific tests on which the 
Environmental Protection Agency relied, I regret to tell you, that, in 
this Senator's opinion, are very meager in terms of their strength, and 
they predominate in foreign countries. However, the law has been 
interpreted to say that, in 2006, drinking water systems will be down 
to 10 parts per billion or they will be in violation of this Federal 
law.

  In my home city of Albuquerque, which is shown on this second map I 
have put up--there is Albuquerque; you see there is the very dark 
brown--there are around 13 parts per billion. This illustrates the 
problem the new standard

[[Page S9640]]

will create. This bill recognizes that in some parts of the United 
States, and of my State, the burden will become so great that some 
communities just will not be able to bear it. They have to go through--
at least today--a whole new cleanup system for their domestic water. 
Whatever they have been doing, they must do it all another way.
  Although our scientists are busy at work, No. 1, trying to figure an 
easier way to clean it up, we are also having some of them busy at work 
trying to offer us more evidence that it is not dangerous to have 
Albuquerquians drink the water that must be cleaned up and water in 
water systems in many other parts of my State and in other parts of 
America.
  But this bill goes on to say that small communities may not have the 
resources to meet these standards and may need help, and it creates a 
grant program for the small communities to help them upgrade these 
systems and ensures them that not less than 20 percent of the grant 
moneys go to communities with fewer than 50,000 residents. And the bill 
authorizes appropriations of $1.9 billion for fiscal year 2004 and for 
each year through 2009.
  In New Mexico, the geology, the make up of the rocks and dirt, 
results in relatively high levels of arsenic in the groundwater. 
However, over time, New Mexico residents have not experienced higher 
levels of diseases associated with arsenic. Be that as it may, many 
small communities throughout New Mexico and the west will not be able 
to meet the financial burden. Because of this, I believe it is 
important to aid communities in meeting the coming standards. The 
financial burden facing many communities and individuals is great.
  The new standards could cost New Mexico communities between $370 to 
$440 million to improve treatment systems, plus $18 million a year in 
operating costs.
  Albuquerque, alone, is looking at having to spend $150 million to 
come into compliance. Its sister city, right across the river, Rio 
Rancho--our second largest city--is facing $60 million in improvements. 
And many individuals in small communities throughout the West are 
facing increases in their water bills of $50 to $90 a month just to pay 
for the cleanup. Most people cannot afford such an increase.
  This legislation will help these communities in upgrading their 
systems and training their people. We are forcing communities to comply 
with drinking water standards that many believe will not increase 
public health. The least we can do is help them meet the burden.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to the printed in the 
Record, as follows:

                                S. 1432

       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 ``Community Drinking Water 
     Assistance Act''.

     SEC. 2. FINDINGS.

       Congress finds that--
       (1) drinking water standards proposed and in effect as of 
     the date of enactment of this Act will place a large 
     financial burden on many public water systems, especially 
     those public water systems in rural communities serving small 
     populations;
       (2) the limited scientific, technical, and professional 
     resources available in small communities complicate the 
     implementation of regulatory requirements;
       (3) small communities often cannot afford to meet water 
     quality standards because of the expenses associated with 
     upgrading public water systems and training personnel to 
     operate and maintain the public water systems;
       (4) small communities do not have a tax base for dealing 
     with the costs of upgrading their public water systems;
       (5) small communities face high per capita costs in 
     improving drinking water quality;
       (6) small communities would greatly benefit from a grant 
     program designed to provide funding for water quality 
     projects;
       (7) as of the date of enactment of this Act, there is no 
     Federal program in effect that adequately meets the needs of 
     small, primarily rural communities with respect to public 
     water systems; and
       (8) since new, more protective arsenic drinking water 
     standards proposed by the Clinton and Bush administrations, 
     respectively, are expected to be implemented in 2006, the 
     grant program established by the amendment made by this Act 
     should be implemented in a manner that ensures that the 
     implementation of those new standards is not delayed.

     SEC. 3. ASSISTANCE FOR SMALL PUBLIC WATER SYSTEMS.

       (a) Definition of Indian Tribe.--Section 1401(14) of the 
     Safe Drinking Water Act (42 U.S.C. 300f(14)) is amended in 
     the second sentence by striking ``1452,'' and inserting 
     ``1452 and part G,''.
       (b) Establishment of Program.--The Safe Drinking Water Act 
     (42 U.S.C. 300f et seq.) is amended by adding at the end the 
     following:

          ``PART G--ASSISTANCE FOR SMALL PUBLIC WATER SYSTEMS

     ``SEC. 1471. DEFINITIONS.

       ``In this part:
       ``(1) Eligible activity.--
       ``(A) In general.--The term `eligible activity' means a 
     project or activity concerning a small public water system 
     that is carried out by an eligible entity to comply with 
     drinking water standards.
       ``(B) Inclusions.--The term `eligible activity' includes--
       ``(i) obtaining technical assistance; and
       ``(ii) training and certifying operators of small public 
     water systems.
       ``(C) Exclusion.--The term `eligible activity' does not 
     include any project or activity to increase the population 
     served by a small public water system, except to the extent 
     that the Administrator determines such a project or activity 
     to be necessary to--
       ``(i) achieve compliance with a national primary drinking 
     water regulation; and
       ``(ii) provide a water supply to a population that, as of 
     the date of enactment of this part, is not served by a safe 
     public water system.
       ``(2) Eligible entity.--The term `eligible entity' means a 
     small public water system that--
       ``(A) is located in a State or an area governed by an 
     Indian Tribe; and
       ``(B)(i) if located in a State, serves a community that, 
     under affordability criteria established by the State under 
     section 1452(d)(3), is determined by the State to be--
       ``(I) a disadvantaged community; or
       ``(II) a community that may become a disadvantaged 
     community as a result of carrying out an eligible activity; 
     or
       ``(ii) if located in an area governed by an Indian Tribe, 
     serves a community that is determined by the Administrator, 
     under affordability criteria published by the Administrator 
     under section 1452(d)(3) and in consultation with the 
     Secretary, to be--
       ``(I) a disadvantaged community; or
       ``(II) a community that the Administrator expects to become 
     a disadvantaged community as a result of carrying out an 
     eligible activity.
       ``(3) Program.--The term `Program' means the small public 
     water assistance program established under section 1472(a).
       ``(4) Secretary.--The term `Secretary' means the Secretary 
     of Health and Human Services, acting through the Director of 
     the Indian Health Service.
       ``(5) Small public water system.--The term `small public 
     water system' means a public water system (including a 
     community water system and a noncommunity water system) that 
     serves--
       ``(A) a community with a population of not more than 
     200,000 individuals; or
       ``(B) a public water system located in--
       ``(i) Bernalillo or Sandoval County, New Mexico;
       ``(ii) Scottsdale, Arizona;
       ``(iii) Mesquite or Washoe County, Nevada; or
       ``(iv) El Paso County, Texas.

     ``SEC. 1472. SMALL PUBLIC WATER SYSTEM ASSISTANCE PROGRAM.

       ``(a) Establishment.--
       ``(1) In general.--Not later than 1 year after the date of 
     enactment of this part, the Administrator shall establish a 
     program to provide grants to eligible entities for use in 
     carrying out projects and activities to comply with drinking 
     water standards.
       ``(2) Priority.--Subject to paragraph (3), the 
     Administrator shall award grants under the Program to 
     eligible entities based on--
       ``(A) first, the financial need of the community for the 
     grant assistance, as determined by the Administrator; and
       ``(B) second, with respect to the community in which the 
     eligible entity is located, the per capita cost of complying 
     with drinking water standards, as determined by the 
     Administrator.
       ``(3) Small communities.--In making grants under this 
     section, the Administrator shall ensure that not less 20 
     percent of grant funds provided for each fiscal year are used 
     to carry out eligible activities in communities with a 
     population of less than 50,000 individuals.
       ``(b) Application Process.--
       ``(1) In general.--An eligible entity that seeks to receive 
     a grant under the Program shall submit to the Administrator, 
     on such form as the Administrator shall prescribe (not to 
     exceed 3 pages in length), an application to receive the 
     grant.
       ``(2) Components.--The application shall include--
       ``(A) a description of the eligible activities for which 
     the grant is needed;
       ``(B) a description of the efforts made by the eligible 
     entity, as of the date of submission of the application, to 
     comply with drinking water standards; and
       ``(C) any other information required to be included by the 
     Administrator.
       ``(3) Review and approval of applications.--

[[Page S9641]]

       ``(A) In general.--On receipt of an application under 
     paragraph (1), the Administrator shall forward the 
     application to the Council.
       ``(B) Approval or disapproval.--Not later than 90 days 
     after receiving the recommendations of the Council under 
     subsection (e) concerning an application, after taking into 
     consideration the recommendations, the Administrator shall--
       ``(i) approve the application and award a grant to the 
     applicant; or
       ``(ii) disapprove the application.
       ``(C) Resubmission.--If the Administrator disapproves an 
     application under subparagraph (B)(ii), the Administrator 
     shall--
       ``(i) inform the applicant in writing of the disapproval 
     (including the reasons for the disapproval); and
       ``(ii) provide to the applicant a deadline by which the 
     applicant may revise and resubmit the application.
       ``(c) Cost Sharing.--
       ``(1) In general.--Except as provided in paragraph (2), the 
     Federal share of the cost of carrying out an eligible 
     activity using funds from a grant provided under the Program 
     shall not exceed 90 percent.
       ``(2) Waiver.--The Administrator may waive the requirement 
     to pay the non-Federal share of the cost of carrying out an 
     eligible activity using funds from a grant provided under the 
     Program if the Administrator determines that an eligible 
     entity is unable to pay, or would experience significant 
     financial hardship if required to pay, the non-Federal share.
       ``(d) Enforcement and Implementation of Standards.--
       ``(1) In general.--Subject to paragraph (2), the 
     Administrator shall not enforce any standard for drinking 
     water under this Act (including a regulation promulgated 
     under this Act) against an eligible entity during the period 
     beginning on the date on which the eligible entity submits an 
     application for a grant under the Program and ending, as 
     applicable, on--
       ``(A) the deadline specified in subsection (b)(3)(C)(ii), 
     if the application is disapproved and not resubmitted; or
       ``(B) the date that is 3 years after the date on which the 
     eligible entity receives a grant under this part, if the 
     application is approved.
       ``(2) Arsenic standards.--No standard for arsenic in 
     drinking water promulgated under this Act (including a 
     standard in any regulation promulgated before the date of 
     enactment of this part) shall be implemented or enforced by 
     the Administrator in any State until the earlier of January 
     1, 2006 or such date as the Administrator certifies to 
     Congress that--
       ``(A) the Program has been implemented in the State; and
       ``(B) the State has made substantial progress, as 
     determined by the Administrator in consultation with the 
     Governor of the State, in complying with drinking water 
     standards under this Act.
       ``(e) Role of Council.--The Council shall--
       ``(1) review applications for grants from eligible entities 
     received by the Administrator under subsection (b);
       ``(2) for each application, recommend to the Administrator 
     whether the application should be approved or disapproved; 
     and
       ``(3) take into consideration priority lists developed by 
     States for the use of drinking water treatment revolving loan 
     funds under section 1452.

     ``SEC. 1473. AUTHORIZATION OF APPROPRIATIONS.

       ``There is authorized to be appropriated to carry out this 
     part $1,900,000,000 for each of fiscal years 2004 through 
     2009.''.
                                 ______
                                 
      By Mr. LEAHY (for himself, Mr. Jeffords, and Mr. Gregg):
  S. 1433. A bill to authorize the Secretary of the Interior to provide 
assistance in implementing cultural heritage, conservation, and 
recreational activities in the Connecticut River watershed of the 
States of New Hampshire and Vermont; to the Committee on Energy and 
Natural Resources.
  Mr. LEAHY. Mr. President, I rise today to introduce the Upper 
Connecticut River Partnership Act that will help bring recognition to 
New England's largest river ecosystem and help the communities along 
the river protect and enhance their natural, cultural and recreational 
resources. I am pleased to add Senators Jeffords and Gregg as original 
cosponsors of this bill.
  For years, our offices and our States have worked together to help 
communities on both sides of the river develop local partnerships to 
protect the Connecticut River valley of Vermont and New Hampshire. This 
valley is a scenic region of historic villages located in a working 
landscape of farms and forests.
  Citizens on both sides of the river know just how special this region 
is and have worked side by side for years to protect it. The two States 
came together to create the Connecticut River Joint Commissions, which 
help coordinate the efforts of towns, watersheds and other local groups 
to implement the Connecticut River Corridor Management Plan. This Plan 
has become the blueprint for how communities along the river can work 
together, with the States of Vermont and New Hampshire and with the 
Federal Government to protect the river's resources.
  The Upper Connecticut River Partnership Act would help carry out the 
recommendations of the Connecticut River Corridor Management Plan and 
help communities along the river protect their cultural, natural and 
recreational resources. This Act would provide the Secretary of 
Interior with the ability to assist the States of New Hampshire and 
Vermont with technical and financial aid for the Upper Connecticut 
River through the Connecticut River Joint Commissions. The people 
living in the Upper Connecticut Watershed region would be able to learn 
about the river and be given knowledge on how to protect it. Also, the 
Act would assist local community efforts to continue cultural heritage 
outreach and education programs while enriching the recreational 
activities already active in the Connecticut River Watersheds of 
Vermont and New Hampshire.
  The bill also will require that the Secretary of Interior establish a 
Connecticut River Grants and Technical Assistance Program to help local 
community groups develop new projects and build on existing ones to 
enhance the river basin. Over the next few years, I hope this bill will 
help bring new recognition to the Connecticut River as one of our 
Nation's great water resources.
                                 ______
                                 
      By Mr. NELSON of Florida (for himself, Mr. Graham of Florida, Mr. 
        Daschle, and Mr. Johnson):
  S. 1436. A bill to amend the Internal Revenue Code of 1986 to allow a 
deduction for State and local sales taxes in lieu of State and local 
income taxes, and for other purposes; to the Committee on Finance.
  (At the request of Mr. Daschle, the following statement was ordered 
to be printed in the Record.)
 Mr. GRAHAM of Florida. Mr. President, when Congress enacted 
the Tax Reform Act of 1986, it was heralded for its simplicity, 
efficiency and fairness. Yet the legislation was not fair to states 
such as Florida that choose not to finance the government through the 
imposition of an income tax. Residents from these States are forced to 
pay a higher Federal income tax liability than comparable citizens of 
other States. This results from the 1986 Act's elimination of the 
Federal income tax deduction for State sales taxes.
  Today, Senators Nelson of Florida, Daschle, Johnson and I are 
introducing the Sales Tax Equity act to remedy this inequity and lift 
our constituents from second-class status. The bill allows taxpayers to 
elect a deduct State and local sales taxes in lieu of a deduction for 
State and local income taxes. Although the election is available to 
residents of all States, the practical effect of the bill is to make 
the deduction for State taxes available to residents of States with no 
State income tax. Residents from these States should not be forced to 
pay higher Federal tax bills simply because their State government's 
funding does not derive from an income tax.
  To avoid burdensome record-keeping requirements, the deduction for 
State and local sales taxes would be determined by tables produced by 
Treasury. Those tables will take into consideration the sales tax rates 
in the various States and average consumption.
  The Joint Committee on Taxation estimates the cost of restoring this 
fairness to the citizens of non-income tax States at $26 billion over 
ten years. Under most circumstances it should not be incumbent upon 
those of us who are trying to restore equity in our Federal tax laws to 
find offsets for this cost. The problem we face, however, is that last 
week the Office of Management and Budget announced that the deficit for 
this year would be 455 billion dollars--165 billion dollars greater 
than the previous record deficit. The fiscal hole in which we now find 
ourselves--primarily as a result of the fiscal mismanagement of the 
Bush Administration--places an extra burden on us. The responsible 
approach to fixing this problem, therefore, requires us to put together 
a proposal that will not exacerbate the deficit. Fortunately, offsets 
exist that will fully offset the cost of the restored sales tax 
deduction and improve the Nation's tax laws by making it tougher for 
taxpayers to avoid paying their fair share.

[[Page S9642]]

  In his last report to the IRS Oversight Board, former Commissioner 
Rossotti identified corporate tax shelters as one of the top problems 
facing the IRS. To combat this growing problem, the bill includes 
measures to crack down on the proliferation of tax shelters. The 
purpose of these provisions is to reinforce the Treasury department's 
administrative enforcement regime. A key element of the Service's 
enforcement regime is their ability to detect potentially abusive 
transactions. Thus, the bill promotes disclosure of such transactions 
through a framework of increased penalties and limited defenses in the 
event of nondisclosure.

  The legislation also clarifies the judicially created doctrine of 
economic substance and imposes a new 40 percent strict-liability 
penalty for those transactions that fail this new requirement. 
Clarification of the economic substance doctrine requires that the 
taxpayer establish that (1) The transaction changes in a meaningful 
way, apart from the Federal income tax consequences, the taxpayer's 
economic position, (2) the taxpayer has a substantial non-tax purpose 
of entering into the transaction, and (3) the transaction is a 
reasonable means of accomplishing such non-tax purpose.
  In addition to cracking down on potentially abusive transactions, our 
bill will shut down known abusive transactions. Last year, at the 
request of the Chairman and Ranking Members of the Senate Committee on 
Finance, the Joint Committee on Taxation investigated Enron's tax 
returns. One of the areas on which the Joint Committee focused was the 
tax shelter arrangements, offshore entities, and special purposes 
entities that Enron used to reduce its tax liability. The Joint 
Committee issued its report on this investigation on February 13, 2003 
and included recommendations for shutting down some of the tax shelters 
used by the company. This legislation includes those recommendations.
  The legislation also eliminates incentives in our tax code that 
encourage individuals and corporations to renounce their U.S. 
citizenship to avoid paying U.S. tax. For individuals, the legislation 
generally subjects U.S. citizens who relinquish their U.S. citizenship 
and certain long-term U.S. residents who terminate their U.S. residence 
to tax on the net unrealized gain in their property as if such property 
were sold at fair market value on the day before the expatriation or 
residency termination. Only a gain in excess of $600,000, $1.2 million 
for a married couple, is subject to tax.
  The legislation also establishes new rules to thwart efforts by some 
U.S. corporations to reincorporate in a foreign country in order to 
avoid paying U.S. tax. These proposals are identical to legislation 
passed previously by the Senate.
  There is one additional, and crucial, benefit of our legislation. It 
will not slow down the current conference negotiations on legislations 
extending the child credit expansion to low-income families. As my 
colleagues know, legislation resolving this matter has passed both the 
House and Senate and the differences between the two bills must be 
reconciled. It is important for that legislation to get resolved as 
soon as possible so that the IRS has ample time to send checks out to 
these families this summer. Some have suggested that resolution of the 
sales tax issue--a matter not included in either the House or Senate 
bill--be attached to the child credit bill. I fear that such an attempt 
would further complicate resolution of that important legislation.
  I hope our colleagues will look upon this legislation in the spirit 
with which it is offered. It is fundamentally unfair that for the past 
seventeen years the residents of our States have faced higher Federal 
income tax liabilities than their fellow citizens living in other 
States. We feel that we have structured our legislation in a manner 
that corrects this inequity without jeopardizing the tax benefits 
available to residents of other States. Furthermore, the bill is 
fiscally responsible and improves the tax system by making it more 
difficult for those who would use tax shelters and other devices to 
lower their taxes.

                          ____________________