[Congressional Record Volume 149, Number 160 (Thursday, November 6, 2003)]
[Senate]
[Pages S14160-S14171]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
Unanimous Consent Request--H.R. 1828
I ask unanimous consent that the order entered with respect to H.R.
1828, the Syria Accountability Act, be changed to reflect that the time
for consideration of the measure be reduced to 60 minutes--the original
time was 90 minutes--that the time be divided as follows: 30 minutes
for Senator Specter and 15 minutes each under the control of Senators
Lugar or Boxer or their designees; that at 9 a.m., Friday, November 7,
the Senate then proceed to consider the measure under the limitations
as provided under the previous order as modified above, with the
remaining provisions remaining in effect.
The PRESIDING OFFICER. Is there objection?
Mr. VOINOVICH. I object.
The PRESIDING OFFICER. The objection is heard.
Mr. REID. I, again, extend my appreciation to the Senator from
Virginia for yielding. I will speak at more length at a later time on
why I think it was important that these unanimous consents be approved
tonight.
The PRESIDING OFFICER. The Senator from Virginia.
Mr. ALLEN. Mr. President, I rise this evening to ask my colleagues to
support S. 150, the Internet Tax Nondiscrimination Act, and the
substitute or managers' amendment that has recently been adopted.
I thank our chairman of the Commerce Committee, John McCain, our
commodore, on his great navigational skills as we worked through this
measure. I also thank my colleague from Oregon, Senator Wyden, for his
great leadership, assistance, and true partnership in trying to get
this measure through for greater opportunity for Americans.
I also thank others who are on this amendment, Senators Grassley,
Hatch, Sununu, Leahy, Baucus, Boxer, Lincoln, Smith, the high-tech task
force chairman, Senator John Ensign, Senator Warner of Virginia,
Senator Burns, who is chairman of the Internet Caucus, and the Senator
who is in the chair right now, Mr. Chambliss. All have helped work on
this reasonable compromise.
There have been a number of concerns to this measure raised by our
opponents. We have had several months of negotiations. I am confident
the bill as it is presented to us on the Senate floor strikes an
appropriate balance between protecting every American from harmful
regressive taxes on Internet access while ensuring that necessary
protections are in place for State and local governments to maintain
their existing revenue base.
The fundamental principle driving this legislation is very simple and
clear, and that is the Internet must remain as accessible as possible
to all people in all parts of America forever. This was a principle
established in the 1998 legislation when Congress passed the Internet
Tax Freedom Act and it is the principle I ask all Senators to keep
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in mind as we consider this legislation this evening and tomorrow.
My colleagues have heard me say on many occasions that I believe we
ought to be promoting freedom and opportunities for all Americans. We
need to be advancing ideas, concepts, and policies that help create
more jobs and prosperity rather than more taxes and burdens.
The Internet itself is one of our country's greatest tools and
symbols of innovation and individual empowerment. In my view, the
Internet is the greatest invention for the dissemination of ideas and
thoughts since the Gutenberg press. When Martin Luther nailed his 95
theses to the church at Wittenberg, if it were not for the Gutenberg
press no one would have read those documents and those thoughts.
So today, we have the Internet for the dissemination of ideas. It is
an individualized empowerment zone where individuals are able to access
information, communicate, get knowledge, information, as well as engage
in commerce. It is a tool for education. It is a tool for information
and commerce. And when we are looking at that, I ask, why would there
be some who would want to burden that? I think we ought to be trusting
free people and free enterprise. We ought to be on the side of freedom,
because that is what has allowed the Internet to flourish, rather than
the side of those who would want to make this advancement in technology
easier to tax for tax collectors.
Some people ask, why is the Federal Government involved in this?
Well, heck, if there is anything that is in interstate commerce by its
architecture, by its design, by its structure, it is the Internet. One
of the great things about the Internet is that it is not confined to
boundaries of States or even countries for that matter. For those of us
who thought opening up to China was a question that we needed to
broach, I thought the fact that the Internet was available and to the
extent that the Chinese people could get more ideas from outside of
China and not filtered through their government, that was a reason to
hopefully open up China for greater prosperity and freedom.
This legislation provides and promotes equal access to the Internet
for all Americans. It obviously is designed to protect Americans from
harmful and regressive taxes on Internet access services, as well as
preventing duplicative and predatory taxes on Internet transactions.
Specifically, as this measure is before us now, it does several things.
First, it extends permanently the current Federal prohibition of
State and local taxation of Internet access service.
Second, it makes permanent the ban on all multiple and discriminatory
taxes relating to electronic commerce. It ensures that several
jurisdictions, for example, cannot tax the same transaction simply
because the transaction happens to occur over the Internet.
Third, our legislation repeals the so-called grandfathering provision
over a 3-year period.
Fourth, we make clear the original intent of the Internet Tax Freedom
Act by updating the definition of Internet access to ensure that the
moratorium applies consistently to all consumers.
If we are going to exempt Internet access services from taxation
permanently, then I believe it makes sense to do so in a manner that
applies to all methods of Internet access, regardless of how a consumer
chooses to access the Internet, whether by digital subscriber line,
otherwise known as DSL connections, by wireless connection, cable modem
service, satellite, or dial-up service.
Fifth, and lastly, this legislation makes very clear that nothing in
this measure prevents the collection or remittance of State and Federal
universal service fees. The Internet tax moratorium that has been in
place for 5 years has contributed to the extending of Internet access
to over 127 million citizens, about 45 percent of the population of
America. Unfortunately, that did expire Friday. Every day that it
lapses, there is the opportunity for consumers to be susceptible to
pestering new taxes on Internet access services as well as taxes on e-
mail, instant messages, spam filters, and even Web searches. For every
dollar in taxation added to the cost of Internet access, we can expect
to see the loss of utilization of the Internet by thousands of American
families, especially lower income families.
According to the Pew Internet and American Life Project, 30 percent
of non-internet users say cost is a major reason they remain offline.
Additionally, another 43 percent of non-internet users agreed with the
statement that the Internet is too expensive.
So, for about half the country who are still not on line, keeping
access affordable is vital, and that means keeping access free from
State, local, and Federal taxation. The guiding principle is clear, of
course: To keep it accessible to all people in all parts of the country
forever. This is the position I have held since 1997, since my days as
Governor in Virginia when I was one of only four Governors with this
position.
I cannot ever envision a time where we believe it desirable for any
government, State, local, or Federal, to tax access to the Internet. I
cannot envision any time in our future where it will make sense to have
multiple taxes on the Internet. Nor can I imagine any time in the
future where there ought to be discriminatory taxes or predatory taxes
on the Internet.
Yet if the Senate fails to take action or vote for this legislation,
such Members of this body will be permitting and in effect advocating
taxing the Internet.
There are more people empowered by the Internet today because the
Federal policy of the United States has consciously allowed Internet
innovators, investors, entrepreneurs, and consumers to remain free from
onerous taxation of access to the Internet.
As many of you know, when this was first enacted there were dozens of
States and local taxing commissars who were, back then, right in the
beginning, imposing disparate taxes on a consumer's ability to surf the
Internet. Since the last expiration of the Internet Tax Freedom Act in
2001, some States have begun taxing the high-speed component of
broadband Internet access services. They are asserting that certain
portions of high-speed broadband Internet access are telecommunications
services rather than Internet access and the States are thereby
circumventing the original intentions of the law.
Working with Chairman McCain and Senator Wyden and Senator Sununu in
the Commerce Committee, we updated the definition of Internet access to
assure that all access services, regardless of the technology used to
deliver the service, are covered by the moratorium and therefore exempt
from State and local taxation.
There have been some misleading statements, some clever hyperbole,
and some statements that are just flat-out wrong. I want to set the
record straight.
They have raised a number of concerns, the proponents of higher
taxes, with this legislation, indicating that we have expanded the
moratorium on Internet access to include all telecommunications
services making tax free even traditional services like local and long
distance telephone communications.
They have also raised a question of whether or not this bill would
prohibit States from imposing property taxes, income taxes, or
corporate taxes on telecommunications carriers and Internet service
providers.
I want Members of this body to understand and be clear on the facts
and the truth about this legislation. This bill does not affect
traditional voice or long distance telephone services or any other
communications service that is not directly used to provide Internet
access. This bill, S. 150, does not affect a State's ability to collect
income taxes, property taxes, or other corporate taxes, such as
franchising fees, that are unrelated to Internet access.
The facts are, S. 150 does not unnecessarily expand the moratorium on
Internet access; rather, the legislation clarifies and updates the
original intentions of the Internet Tax Freedom Act to include high-
speed Internet access services. Only because some States and localities
have attempted, and in fact are circumventing the original law by
taxing portions of high-speed Internet access, did the definition of
Internet access need to be updated.
The impact of broadband and efforts to stop broadband from being
deployed by this taxing approach that is going
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on, that we are trying to cure, will have a very significant impact on
small towns and rural areas. Our colleague, Conrad Burns of Montana,
likes to talk about how you have to get broadband out in the country,
and he would say there is a lot of dirt you have to dig through just to
get from one light bulb to another. The same applies to getting
broadband out into the communities and out into the country. If you
have higher costs imposed on Internet access and then on top of it all
you are putting higher costs on the investment for the transport, that
means fewer people in a less populated area will be able to afford
broadband, thereby denying them opportunities that one would have,
whether it is for information, for education, for knowledge, or for
commerce, for small businesses and people who live in rural areas.
Another fact: In this bill it only makes permanent the tax moratorium
on Internet access services, which is simply the ability to get access
to the Internet. Once a consumer has accessed the Internet, the
moratorium does not affect the services that are purchased, used, or
sold over the Internet that would otherwise be taxable, even if such
services are bundled together with Internet access services.
So, in summary, the fact is, by allowing this moratorium to expire,
the Senate has opened the door for States and localities to begin
imposing regressive taxes on Internet access services. By taxing
Internet access, States and localities are actually contributing, and
would be contributing, to the economic digital divide. The more
expensive we allow the State and local tax commissars to make Internet
access, the less likely people are going to be able to buy these
advanced services, such as high-speed broadband connections, Internet
protocol software, wireless or WiFi devices, and many other multimedia
applications.
At a time when technology, as my friend Senator Wyden has said, and
the Internet are growing and improving almost every aspect of our daily
lives, where access to the Internet is not a nicety but a necessity for
Americans, imposing new taxes on access or levying taxes that
discriminate against the Internet as a form of commerce will never be
sound policy for America. As a tool, the Internet breaks down economic
and educational barriers, leveling the playing field for millions of
Americans.
There are those who say it shouldn't be permanent; let's make it
shorter. When you talk to business investors--and let's go back to
rural and small town areas. When someone is making a business
investment they want to have some credibility and stability and
predictability as to making these millions of dollars of investment to
get into a smaller market. What is going to be our rate of return? When
are we going to recoup the tens of millions of dollars it takes to get
into these areas?
We just heard an argument on the Agriculture bill about loans to get
broadband. It is a lifeline for folks out in the country, in rural
areas. There are all sorts of incentives that people are for.
Businesses making those investments have to figure out when are they
going to get a return on the investment. If you tax a transport or make
it for a short duration of time, they are going to say: Gosh, there are
going to be taxes on it in a few years so there will be fewer
customers. We just can't risk that investment to get out into those
areas.
So, more than ever, I really do believe we ought to listen to good,
sound business reasoning, common sense and logic. In fact, most
economists and technology experts agree that we need to be encouraging
the deployment of the next generation broadband Internet connections
and bring our communications infrastructure into the 21st century.
Economists at the Brookings Institution estimate that widespread
high-speed broadband access would increase our national gross domestic
product by $500 billion annually by 2006.
Failure to pass this legislation with a permanent moratorium and with
an updated and clear definition of Internet access like the one this
amendment provides, will leave broadband Internet access susceptible
and open to harmful taxation. In many States and localities, those
taxes could go up as high as 25 percent.
Any additional tax burdens on the Internet will mean additional costs
many Americans cannot afford, forcing the poor in our society to reduce
or even forego their use of the Internet as a tool for exploration,
information, education, and individual opportunity.
More than ever before, when our economy is finally moving forward in
the right direction, the people of this country need security with
regard to their financial future. Businesses need certainty that prices
for Internet access will remain affordable to consumers if they are
expected to build out high-speed networks to rural and small-town
communities. In a society, indeed a world, where the quality of life
and economic power is directly proportionate to one's access to
knowledge, we must close the economic digital divide rather than
exacerbate it with State and local taxes.
I call on my colleagues to join with the chairman, our commodore,
Senator McCain, Senator Wyden, and all of us in supporting the Internet
Tax Nondiscrimination Act and permanently extending the Internet
moratorium on tax access and multiple and discriminatory taxes. As we
vote on amendments to what would be this Internet access tax issue--and
there will be amendments--I respectfully ask my colleagues as we look
at these amendments to be leaders who stand strong for freedom and
opportunity for all Americans.
I thank the Chair.
The PRESIDING OFFICER. The Senator from Delaware.
Mr. CARPER. Mr. President, like my friend from Virginia, I am a
former Governor, as were Senator Alexander, Senator Graham, and Senator
Voinovich. We served as chief executives of our States. I loved being
Governor. I have never talked to anybody who didn't like the job. As a
matter of fact, I enjoy being here and working with my friends John
McCain, Ron Wyden, and others.
When I was privileged to be Governor of Delaware, we actually cut
taxes 7 out of 8 years. We also balanced our budget 8 years in a row.
Among the things I didn't like as Governor was when the Federal
Government came in and tried to tell us in Delaware we had to spend
money for some purpose but never provided the revenues to pay for that
expenditure. Similarly, I never liked it when the Federal Government
came in and unilaterally reduced our revenue base for programs we
needed in our State to educate our kids, to provide health care, child
care, environmental protection, and transportation. I never liked it
when the Federal Government came in and tried to undercut our ability
to raise revenues for those purposes and never provided an offset to
make up the difference in the revenue that was taken away by the
Federal action.
I remember as Governor coming here and testifying in the early to mid
1990s. I believe Governor Voinovich did as well. We called on the
Federal Government to stop placing unfunded mandates on State and local
governments. The message is pretty simple. Don't tell us to spend money
for things and expect us to use our revenues. Don't come in and
restrict our ability to collect revenues without providing something to
make up for it. Our voices were heard. In 1995, legislation was adopted
to stop unfunded mandates and dictates by the Federal Government which
had an adverse effect on my State and other States.
I believe--correct me if I am wrong--that 91 Senators voted in 1995
for the unfunded mandates bill. Sixty-three of the 91 Senators who
voted for that bill in 1995 are still here in the Senate.
In 1998, when Congress adopted an Internet tax moratorium, it was in
essence on an unfunded mandate. The Congress agreed to restrict the
ability of State and local governments to raise revenues in three
areas. The moratorium which was adopted in 1998 said State and local
governments could not tax access to the Internet. For the monthly bills
we receive from AOL and other Internet providers, State and local
governments cannot add a tax to that Internet access bill.
Similarly, if there was an Internet transaction multiple States would
like to tax or multiple counties within a State would like to tax,
those multiple taxes were essentially stopped by the 1998 moratorium.
Thirdly, discriminatory taxes against transactions over the Internet
were banned as well. For example, we don't
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have a sales tax in our State, but in my State you could, of course,
buy from a local merchant a good or a product and not pay a sales tax
or tax of any kind. If any State were to pass a law that said if we
were to make the purchase of the same good over the Internet we would
have to pay a tax, that would be a discriminatory tax. That is not
permitted under the 1998 Internet tax moratorium.
The Internet tax moratorium which was adopted 5 years ago was adopted
in order to give Internet commerce a chance to grow and to mature.
States didn't like having their ability to raise revenues as they saw
fit restricted by the Federal Government. But they excepted 11 States
that were actually doing that kind of thing, and their ability to raise
revenues was grandfathered in.
For the last 5 years--initially the Internet tax moratorium was for,
I think, 2 or maybe 3 years--when it was about to expire, the question
was, should we renew it? I believe it was in 2001 when it was about to
expire that Congress renewed it for an additional 2 years. It did not
broaden the kind of three principal activities that were covered in the
initial moratorium that said the same three applied. State and local
governments, unless they are grandfathered in, can't begin taxing
access to the Internet. State and local governments could not have
multiple taxes on the same transactions over the Internet. Further,
this ban on discriminatory taxes was upheld for another 2 years. Last
Friday that 5-year ban expired, as I think most of us know. Certainly
Senators Voinovich and Alexander and I would like to see the
moratorium, the ban, on the Internet tax access, multiple taxes, and
the ban on discriminatory taxes extended.
This is not an argument about taxes on access to the Internet. I
think we actually agree on that. There should not be taxes imposed by
State and local governments unless they are already grandfathered in on
access to the Internet. That is not what this is all about. This is not
about whether or not we are going to tax anybody's e-mail. We are not
going to do that. We are not interested in that. One of our colleagues,
Senator Voinovich, will have more to say about that later. He may offer
a sense of the Senate to make it absolutely clear that nobody around
here is interested in taxing access to the Internet.
But as we look to nurture our economy and economic activity that is
driven in part by commerce over the Internet, let us remember there is
another set of voices that need to be heard. They are the voices of the
people who are running our State governments, the folks who are running
our cities and our counties and trying to do so in an environment where
their revenue base continues to diminish. Their responsibilities to
educate our kids don't diminish. In fact, those responsibilities are
getting tougher as we impose academic standards and raise our
expectations in our schools. We need to provide some kind of health
care for people, young and old. Those needs are not diminishing. In
fact, the burden through Medicaid on State and local governments, if
anything, is increasing, not diminishing.
I was Governor during good times. I don't know if it was easy to be
Governor from 1992 to 2000, but it was a heck of a lot easier than
today. Today, instead of dealing with budget surpluses and figuring out
how to invest or use the budget surpluses or how to cut taxes in order
to return a portion of the surpluses, State and local governments are
scraping for every dime to try to meet the needs of their States.
The question to consider today and tomorrow and perhaps next week is,
What right do we have as a Federal legislature, as a Congress, to step
in and mandate the reduction in the tax base, the revenue base, of
State and local governments? What right do we have to do that? What
right do we have to do that in the face of the Constitution? What right
do we have to do that in light of the legislation adopted in 1995
banning unfunded mandates? We have heard from Governors and mayors from
every corner, county council men and women, commissioners, we heard
from folks from every corner of this country saying, Abide by the law
you voted for in 1995 banning unfunded mandates.
I close with where I started. I have not talked to one Senator who
says he or she is for taxing access to the Internet. We are not. I have
not heard from any Senator, Democrat or Republican, from any part of
this country, who says they are for taxing any person's e-mails. We are
not. By the same token, my friends, I don't believe we should be for
stepping in, beyond a very narrow moratorium on which we already spoke
in those three areas, to broaden that moratorium to further undermine
the revenue base of our State and local governments, during very
difficult times for all of them, without giving that action in this
proposal a whole lot more thought and debate and discussion. We will
have that opportunity today and tomorrow.
I say to Senator Voinovich, Senator Graham, Senator Alexander, and
others who have joined and will join in offering an amendment tomorrow,
including Senator Hollings, Senator Stevens, Senator Dorgan, Senator
Feinstein, Senator Lautenberg, and others, I am proud to join in this
initiative. It is possible in the end, I believe, to come up with a
policy that is fair to State and local governments and is fair to those
who would seek to expand our economy and to do so through Internet
commerce.
Tomorrow we will have the opportunity to vote on an amendment offered
by Senator Alexander, Senator Graham, Senator Voinovich, and myself to
do just that. I look forward to further debate on that amendment and
the opportunity for an up-or-down vote on that amendment.
I yield back the remainder of my time.
The PRESIDING OFFICER. The Senator from Ohio.
Mr. VOINOVICH. Mr. President, I thank my colleague from Delaware, my
colleague from the State of Tennessee, and my colleague from the State
of Florida for standing up--all of us former Governors--to deal with a
matter that will have great impact on our respective citizens for many
years ahead. We want to make sure that whatever we do makes sense.
Before I begin, I would like to set the record straight that this
debate is about federalism, unfunded mandates, and protecting States'
ability to collect taxes. It has nothing to do with taxing e-mail.
I have made the issue of unfunded Federal mandates a top priority
during my 36 years of public service. At every level of government--as
a State representative, county auditor, county commissioner, lieutenant
governor, mayor of the City of Cleveland, Governor of Ohio for 8
years--I have seen firsthand how the relationship of the Federal
Government with its State and local counterparts affects our citizens
and the communities in which they live. My background has fueled my
passion for the issue of federalism and the need to balance the Federal
Government's power with powers that our Founding Fathers envisioned to
the States.
This very body was created, in part, to guarantee that States had
adequate, equal means to assert their interest before the Federal
Government. Our forefathers provided that each State has two Senators
to protect States rights and federalism, and prior to 1913 those
Senators were elected by their legislatures to guarantee that they
would protect federalism. I believe strongly that the relationship
between the Federal Government and State and local governments should
be one of partnership. That is why I vowed when I was elected to the
Senate, I would work to find ways in which the Federal Government can
improve the way it works with these levels of government to serve the
American people.
I have also been concerned about the tendency of the Federal
Government to preempt the functions of State and local governments and
force on them new responsibilities, particularly without also providing
the funding to pay for these new responsibilities.
Seventeen years ago, in 1986, I spoke to the Volunteers of the
National Archives regarding the relationship of the Constitution to
America's cities and the revolution of federalism. I brought to the
attention of the audience my observation, since my early days in
government, regarding the course American government has been taking:
We have seen the expansion of the federal government into
new, non-traditional domestic policy areas. We have
experienced a
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tremendous increase in the proclivity of Washington both to
preempt state and local authority and to mandate actions on
state and local governments. The cumulative effect of a
series of actions by the Congress, the Executive Branch and
the U.S. Supreme Court have caused some legal scholars to
observe that while constitutional federalism is alive in
scholarly treatises, it has expired as a practical political
reality.
In 1991, I started a long crusade when I became a member of the
National Governors Association, working with the State and Local
Government Coalition to do something about unfunded mandates. In fact,
as Governor of Ohio, I requested that a study be done to examine
unfunded mandates. It was the first of its kind in any State. It
captured just how bad the mandate problem was in real dollars. Between
1992 and 1995, Ohio had unfunded mandates of almost $2 billion. These
efforts were strongly supported by Senator Kempthorne, Senator Roth,
Senator Glenn, Congressmen Robert Portman, Tom Davis, and Bill Clinger
and culminated with the passage of the unfunded mandates legislation in
the Senate on March 15, 1995.
As a matter of fact, for the first time in my life I set foot in the
Senate when the Senate passed that Unfunded Mandate Relief Act. I was
in the Rose Garden representing State and local government when
President Clinton signed the legislation on March 22, 1995. In fact, I
have that pen proudly displayed in my Senate office.
This milestone concluded a lengthy and coordinated effort by State
and local government officials and their congressional allies to reduce
the economic burden of Federal unfunded mandates and the adverse impact
they have on State and local services.
By the way, this was the second plank in the Contract With America
that was developed in 1994. I will never forget when we were in
Williamsburg and committed ourselves to the Contract With America. The
Senator from Virginia was present at that time in the capacity of
Governor of Virginia.
I believed then and I believe today that mandates forced us to cut
vital services and cut taxes. Mandates also rob our citizens and
elected officials of perhaps the most fundamental responsibility of
government, prioritizing government services. The Unfunded Mandates
Reform Act does not prohibit unfunded mandates, but it does slow down
the process of enacting a mandate and forces each Senator and House
Member to go on record that we want to mandate or prevent action by
State or local governments without providing the resources with which
to pay for it. It ensures that Congress is informed and accountable
when considering an unfunded mandate for pending legislation. The law
was designed specifically to ensure an up-or-down vote on whether to
impose a mandate.
The mandate we are debating is exactly what the Unfunded Mandates
Reform Act was designed to address. This is the first time this Act has
been used on the Senate floor since it was enacted in 1995. When this
legislation passed the Senate in March of 1995, the vote was an
overwhelming 91-to-9 vote. Of the 91 Senators supporting the bill, 50
are still here today, and of the 9 nays, 7 Senators are still in
office. In addition, 14 Members of the House--voting in favor of
unfunded mandates reform--have moved over to the Senate. So we have 64
Senators today who voted for this bill in 1995 in their respective
Chambers.
The bill currently under consideration, the Internet Tax
Nondiscrimination Act of 2003, sponsored by my good friend from
Virginia, Senator Allen, and Senator Wyden and Senator McCain, has
included unfunded mandates by the Congressional Budget Office.
In fact, I want to quote from the Commerce Committee's report dated
September 29, 2003, in which CBO said:
By extending and expanding the moratorium on certain types
of state and local taxes, S. 150 would impose an
intergovernmental mandate as defined in the Unfunded Mandates
Reform Act. CBO estimates that the mandate would cause state
and local governments to lose revenue beginning in October
2006; those losses would exceed the threshold established in
[the unfunded mandates relief legislation]. While there is
some uncertainty about the number of states affected, CBO
estimates that the direct costs to states and local
governments would probably total between $80 and $120 million
annually. . . .
Furthermore, they went on to say:
Depending on how the language altering the definition of
what telecommunications services are taxable is interpreted,
that language also could result in substantial revenue losses
for states and local governments. It is possible that states
could lose revenue if services that are currently taxed are
redefined as Internet access under the definition of S. 150.
Finally, the report states that CBO cannot estimate the magnitude of
these losses.
Mr. President, let me reiterate, CBO said: Depending on how the
definition is interpreted, the loss of revenue to the States and local
governments could be substantial.
If CBO cannot calculate the potential loss of revenue to the States,
why in the world would we change the definition of Internet access? And
why in the world would we make the new definition permanent?
Even FCC Commissioner Michael Powell said the telecommunications
industry is in flux and that few industry experts could agree on a
definition in view of the rapid changes in technology.
Senator Wyden, in his presentation earlier this evening, made the
allegation that no State will lose money under this proposal. We asked
the National Governors Association to contact the tax commissioners
from various States and here are some of the findings: Kentucky will
lose $265 million; Iowa, $45 to $50 million; Maine, $35 million;
Michigan, $360 million; New Jersey, $600 million; Ohio, $55 million;
Oklahoma, $159 million; Tennessee, $358 million; Utah, $92 million;
Washington, $33 million.
That is a lot of money--a lot of money--and States will lose tax
revenue under this proposal.
In my own State, I spent a lot of time with our Ohio Tax
Commissioners Office and the Office of Budget and Management. According
to the Department of Taxation in Ohio, we will be losing about $700
million over our 2-year biannual budget period.
Last week, my staff was on a conference call with SBC Communications,
Bell South, Sprint, the Tennessee Revenue Director, and the Ohio Tax
Commissioner's Office. The telecommunications companies did not dispute
the Ohio Tax Department's estimates.
So let's be honest about it. If this permanent moratorium goes
through with the current definition, there is no question in the world
that States are going to lose money.
At the end of that conversation, by the way, the only thing we got
out of it was that there was uncertainty, confusion, and speculation
regarding what this all meant.
In addition, we are going to be losing $350 million, at least, as a
result of this proposal today.
If we pass S. 150, Congress will, in effect, force States to raise
taxes or cut services in order to make up the difference. In other
words, all 50 States will be forced to debate whether to raise taxes,
cut services, or come to Congress for more money. Mr. President, unlike
Congress, by law all states must balance their budgets. They don't have
the option of printing more money like the federal government.
States have to balance their budgets and if they don't spend within
their means, they are forced to make a choice to either cut services or
raise taxes. Of course, that is something we have not done. And I
mention, that some of my colleagues say States are not fiscally
responsible. I would like to say that most of the States in the United
States of America are much more fiscally responsible than this body, in
which we have increased spending and added to our burgeoning deficit.
Mr. President, the newspapers in Ohio get it. The Cincinnati
Enquirer, one of the most conservative papers in Ohio, understands:
One reason governors, mayors and county officials oppose
expanding the Internet tax ban is that telecom companies are
racing as fast as they can to convert most services to the
Internet. If just about everything gets tax-exempt under a
broader ``Internet access'' definition, states and localities
would take a huge tax revenue hit.
The development of DSL, broadband and cable Internet
service were just the sort of new access technology that
Voinovich and others hoped would result from the tax
moratorium, but they don't want it expanded to kill existing
tax revenues.
The Akron Beacon-Journal also understands:
[[Page S14165]]
In short, critical programs would be put in jeopardy, from
mental health care to public schools.
Even the Washington Post understands:
What's driving this legislation is that telecommunications
companies and Internet service providers see an opportunity
not only to make the tax moratorium permanent--in itself a
bad idea--but to save what could amount to billions in
additional taxes. The law frees service providers from having
to pay taxes on telephone service they use to provide
Internet access. And as the Internet becomes a more effective
medium for providing phone service and delivering products
such as downloaded movies, software and music, the
legislation could sweep such offerings within the ambit of
services that states are prohibited from taxing.
The Internet shouldn't be subject to conflicting taxes, but
that's no reason to argue that it shouldn't be taxed at all.
There should be a level playing field for taxing Internet
access, whether it comes through ordinary dial-up, cable
modems or high-speed telephone lines.
The last thing Congress should do now to cash-strapped
states is pass a law that would not only permanently put
Internet access off limits for taxation but also deprive them
of revenue that they now collect.
And they go on--I will finish the quote--
Proponents of the law are busy demagoguing the issue,
suggesting, as Senate sponsor Ron Wyden (D-OR) put it the
other day, that users ``could be taxed every time they read
their local newspaper online or check the score of a football
game.'' Congress should step back from the brink, temporarily
extend the moratorium and sort this all out in a way that
doesn't intrude on state prerogatives.
Mr. President, I ask unanimous consent that these articles be printed
in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
[From the Cincinnati Enquirer, Oct. 31, 2003]
Halloween Scare: Internet Taxes
(By Tony Lang)
Sen. George Voinovich of Ohio has been boiled in a witches'
cauldron this week by critics angered that he helped block an
expanded ban of taxes on Internet services. The current
Internet Tax Moratorium, which he supports, expires Saturday.
Anti-tax groups making Voinovich out to be the devil
incarnate are roasting the wrong guy. Voinovich favors
keeping the tax moratorium on Internet access. He helped
negotiate the Internet Tax Freedom Act of 1997, supported its
renewal in 2001 and opposes new taxes on telecommunication
services. And yes, he strongly opposes a tax on e-mail.
But he and other senators do object to new legislation
which would expand the definition of ``Internet access'' and
not only exempt some telecom services now taxed but also some
income, property and other business taxes. That legislative
change could cost state and local governments between $4
billion and $8.75 billion a year by 2006, the Multistate Tax
Commission estimates. The Congressional Budget Office agrees
losses would be substantial.
Voinovich, a states-rights federalist, argues it would be
unconstitutional for the Federal government to abolish
existing State and local tax revenue streams. It also would
violate the 1995 Unfunded Mandates Relief Act, which then-
Gov. Voinovich lobbied for and U.S. Rep. Rob Portman of
Terrace Park sponsored. That law attempts to bar Congress
from imposing a mandate on states without paying for it.
One reason governors, mayors and county officials oppose
expanding the Internet tax ban is that telecom companies are
racing as fast as they can to convert most services to the
Internet. If just about everything gets tax-exempted under a
broader ``Internet access'' definition, States and localities
would take a huge tax revenue hit. The development of DSL
broadband and coaxial cable Internet service were just the
sort of new access technology that Voinovich and others hoped
would result from the tax moratorium, but they don't want it
expanded to kill existing tax revenues. The loss in Ohio
services is calculated at $450 million.
The world won't end tomorrow if the tax moratorium expires.
It lapsed for a month in 2001 before Congress extended it.
The House already passed a bill (H.R. 49) on Sept. 17 making
the Internet tax ban permanent. This week, Sens. Voinovich,
Lamar Alexander of Tennessee, Ernest Hollings of South
Carolina, Frank Lautenberg of New Jersey and Maria Cantwell
of Washington State put a legislative ``hold'' on S. 150, and
according to Senate rules of ``unanimous consent,'' it will
take some cutting and pasting before all agree to bring it to
a floor vote.
Ohio Gov. Bob Taft wrote to urge the Senate Finance
Committee to limit the tax ban to Internet access only.
Internet sales are a different matter. The Capitol Hill in-
fighting over taxing e-commerce is even more bloodcurdling,
and as rife with falsehoods. The tax ban doesn't mean the
Internet is a tax-free zone. But Internet sales, according to
the Department of Commerce, accounted for only 1.3 percent of
all retail sales in 2002. Still it's no wonder Lamar
Alexander is leery of sales tax bans. Tennessee has no State
income tax. Someday, States may settle on some simple point-
of-origin sales tax system for mail order, catalog and
Internet sales, but meantime Congress should keep its hands
off and limit itself to protecting interstate commerce and
lively tax competition between states.
____
[From the Beacan Journal, Oct. 30, 2003]
Responsible George
Sen. George Voinovich finds himself in a familiar position.
The Ohio Republican has angered many in his party. His
offense? He wants Congress to act responsibly. He has
correctly questioned aspects of legislation that would extend
the Internet Tax Freedom Act, the five-year-old moratorium on
State and local taxation of Internet services set to expire
on Saturday.
Voinovich isn't alone. Sen. Lamar Alexander, a Tennessee
Republican, has echoed his concerns. So have many Republican
governors, including Bob Taft of Ohio. They do not oppose the
ban. (Voinovich helped to negotiate the original moratorium.)
They recognize the need to encourage Web businesses. What
they find troubling is the breadth of the extension.
In September, the House approved legislation that would
make the ban permanent. The Senate is considering a similar
bill. Both would expand the definition of Internet services
to such an extent that State and local governments would risk
a substantial erosion of their tax base. Not surprisingly,
the revised definition was inserted in haste, more
ideologically driven that practical.
No surprise, either, that Voinovich, a former governor,
would spot the difficulty ahead. States collect taxes on
local and long-distance telephone services.
Telecommunications companies are increasingly looking to
``bundle'' products, offering a collection of services,
including Internet access. The proposed extension would
permit the bundled items to be viewed as one product. Thus,
products that currently are taxed, such as a local phone
service, would be exempt.
The amount of revenue lost? Ohio would surrender an
estimated $350 million a year. The potential bleeding
explains why Bob Taft fired a letter to Charles Grassley of
Iowa, the chairman of the Senate Finance Committee. The
governor stressed the ``devastating'' impact on States.
The Multistate Tax Commission (an association of State tax
directors) estimates the proposed extension would drain at
least $4 billion a year from all State treasuries and as much
as $8.75 billion by 2006. Again, these are funds States
already collect, and many States face a fiscal crunch as
severe as any in the past 50 years.
In short, critical programs would be put in jeopardy, from
mental health care to public schools.
George Voinovich certainly knows unfunded mandates. He has
long railed against the feds making demands and leaving
States to pick up the tab. In this instance, Congress would
tamper with established ways of States raising essential
revenue, leaving governors and State lawmakers to cover the
difference.
Better, the responsible argument goes, to extend the
current ban on taxing Internet services for a period of time,
allowing lawmakers to think harder about their next step.
____
[From the Washington Post, Nov. 4, 2003]
Tax and Click
State and local governments have broad power to tax as they
see fit--everything from clothes and food to electricity and
telephone service. Nearly everything, that is, except the
Internet. Under a supposedly temporary law passed in 1998 and
already extended once, Congress prohibited States from taxing
Internet access fees, the monthly charges imposed by Internet
service providers. Proponents argued that the nascent engine
of the Internet shouldn't be slowed by taxing it and that it
would take time to devise a system to prevent duplicative or
discriminatory taxes. Now, with the tax moratorium having
expired on Saturday, Congress is poised to make the ban
permanent, broaden its reach and wipe out existing taxes that
had been grandfathered in under the previous law. With State
budgets under stress and the Internet thriving, this is an
unnecessary--and costly--incursion on States' rights.
The argument for permanently barring taxes on Internet
services centers on two issues. One is the argument that
taxing Internet access, whether through phone lines or cable
modems, would amount to double taxation, because the phone
lines and cable service are already taxed. That's true, but
purchasing Internet access provides a separate--and
separately taxable--bundle of services. Terming this double
taxation is like saying that a shopper who pays tax on a pair
of slacks should then be exempt from being taxed on a shirt
bought with it.
The other argument is that taxing Internet access would
worsen and prolong the digital divide, the computer gap
between rich and poor. This may be a problem, but prohibiting
taxation is not the answer. It's not the extra few cents on a
monthly bill that's stopping the less well-off from Googling
their way to the middle class. A policy to erase the digital
divide, however laudable, doesn't justify the no-tax
solution. The federal government wants to spur home ownership
for low-income families--surely a bigger problem than lack of
Internet access--but that doesn't lead it to tell local
governments that they can't impose property taxes.
[[Page S14166]]
What's driving this legislation is that telecommunications
companies and Internet service providers see an opportunity
not only to make the tax moratorium permanent--in itself a
bad idea--but to save what could amount to billions in
additional taxes. The law frees service providers from having
to pay taxes on telephone service they use to provide
Internet access. And as the Internet becomes a more effective
medium for providing phone service and delivering products
such as downloaded movies, software and music, the
legislation could sweep such offerings within the ambit of
services that states are prohibited from taxing.
The Internet shouldn't be subject to conflicting taxes, but
that's no reason to argue that it shouldn't be taxed at all.
There should be a level playing field for taxing Internet
access, whether it comes through ordinary dial-up, cable
modems or high-speed telephone lines. The last thing Congress
should do now to cash-strapped States is pass a law that
would not only permanently put Internet access off limits for
taxation but also deprive them of revenue that they now
collect. Proponents of the law are busy demagoguing the
issue, suggesting, as Senate sponsor Ron Wyden (D-Ore.) put
it the other day, that users ``could be taxed every time they
send an e-mail, every time they read their local newspaper
online or check the score of a football game.'' Congress
should step back from the brink, temporarily extend the
moratorium and sort this all out in a way that doesn't
intrude on State prerogatives.
Mr. VOINOVICH. Mr. President, I have made the point that I have
strong concerns with the pending legislation because it is an unfunded
mandate. At the same time, I think it would be wrong for Congress to do
nothing and allow taxes on Internet access.
As I have said emphatically, I am against taxes on e-mail and the
Internet. It is no secret that my interest in the current moratorium
dates back to my time as Governor. During my tenure as Governor, I was
also chairman of the National Governors Association. As chairman, I
asked Governor Mike Leavitt to be the lead Governor on the Internet
economy and its effects on State government and federalism. The NGA
efforts on this important topic led to the current moratorium on
Internet taxes which was signed into law in 1998, and then again in
2001.
Our goal then is the same as my goal today: to encourage the growth
of the Internet as a driving force in our economy.
Let's look at the facts.
Under the original 3-year moratorium from 1998 to 2001, the Internet
rapidly expanded to all corners of our country. The point I am trying
to make is that with the current moratorium that we have, we have seen
unbelievable expansion in the Internet. That is what we wanted to have.
That is why we put the moratorium in effect.
In February 2002, the National Telecommunications and Information
Administration at the Department of Commerce issued a report entitled
``a Nation Online: How Americans Are Expanding Their Use of the
Internet.'' It is just unbelievable what has happened during that
period of time. My point is, the Internet flourished in all segments of
society during the original moratorium, and I think it is safe to
assume that Internet usage continues to increase every day.
The question is, how do we continue to support the growth of the
Internet and bring parity for all Internet service providers without
causing undue harm to our State and local governments that have been
experiencing serious budget shortfalls?
S. 150 would, for the first time since 1998, change the definition of
Internet access and, without a clear understanding of the definition's
impact, rush to make it permanent.
The fact is, Internet technologies are changing more rapidly than
ever. Companies are moving quickly to provide multiple services over a
single line, including Internet access, voice communication, data
service, and entertainment service. It does not make sense to change
and make permanent the definition of Internet access when the
technologies and the different ways Internet services are being offered
is changing so rapidly.
My colleagues, Senators Alexander, Graham, and Carper, and I will
introduce an amendment that simply keeps current law in place and
offers language to level the playing field for DSL, wireless, cable,
and satellite Internet services. Basically, what we are offering will
be a 2-year moratorium. We will amend the current definition of the
Internet tax moratorium to preclude the taxing of DSL.
Many States today, under the grandfather clause of the tax
moratorium, have been collecting taxes on DSL. Several other States,
because of a loophole in the definition, have started collecting taxes
on DSL connections. What we are proposing--and it is very fair--is that
in consideration of this body extending this moratorium for only 2
years, States such as Ohio and others that are now collecting Internet
taxes will give them up at the end of a 2-year period. This gives them
adequate time to prepare, in terms of their budget, for the loss of the
revenues.
Clearly, the States are willing to give up taxes that they are now
collecting on the Internet in consideration of not going forward with a
permanent moratorium with the definition that is now contained in the
bill before us. In other words, the fear of what could happen under the
definition of the bill that is before us today in the managers'
amendment is so large that they are saying: We will give up that money
just so it lasts for 2 years. During this time, we can work on a
definition that will make sense.
I believe that is a very fair proposal. It means we will be reducing
taxes on the Internet in many of our States that are now collecting
taxes.
Last but not least, on October 29, the Wall Street Journal wrote an
editorial entitled ``Taxing Your E-Mail.'' The Journal claimed that a
few Republicans have decided to dress up as tax-and-spend Democrats for
Halloween. The fact is, the Wall Street Journal article completely
misstated what we are trying to do here tonight. The reference to
taxing e-mail is nonsense.
In fact the Cincinnati Enquirer followed up the Wall Street Journal
by saying on October 31, quote:
Anti-tax groups making Voinovich out to be the devil
incarnate are roasting the wrong guy. Voinovich favors
keeping the tax moratorium on Internet access. He helped
negotiate the Internet Tax Freedom Act of 1998, supported its
renewal in 2001 and opposes new taxes on telecommunication
services. And yes, he strongly opposes a tax on e-mail.
In fact, I am going to be introducing an amendment tomorrow that is a
Sense of the Senate to make it very clear that this is not about taxing
e-mail. I think it is important my colleagues understand that. This is
not what this legislation is about.
I am hoping tomorrow we will have an opportunity to vote on this bill
and this amendment. I hope my colleagues will be fair enough to
understand how serious this matter is to the future of our States and
to federalism. I hope we are successful tomorrow with our amendment.
The PRESIDING OFFICER. The Senator from Florida.
Mr. GRAHAM of Florida. Mr. President, there have been some comments
by my colleagues that the people who are concerned about this issue and
who are at risk are Governors, State legislators, mayors, county
commissioners, and other officials at the State and local level. I beg
to disagree. The people who are at risk include that child who is in an
overcrowded classroom. The people who are at risk are those persons who
have suffered a heart attack and are waiting for the emergency medical
service to arrive. The people who are at risk include that woman whose
car is broken down on a dark highway and who is waiting for the State
trooper to come give assistance.
Under this concept of federalism that our Government has followed
since its beginning, those responsibilities--education, emergency
response, law enforcement--have been placed in the hands of the States.
It is their responsibility to provide for a governmental structure of
State and local response that will fulfill those and literally
thousands of other responsibilities.
It has been said that federalism is the most significant governmental
concept which has been developed by the United States. It is a
philosophy which has always been in flux. We are looked down upon in
this Chamber by two of the figures who represent the divisions within
federalism: Our first Vice President, John Adams, who was a strong
advocate of a central government; Thomas Jefferson, our second Vice
President, who was an equally strong advocate of responsibility being
placed as close as possible to where the people affected by that action
of government live.
Federalism depends upon certain fundamental principles. One, it
depends
[[Page S14167]]
upon the principle of a respectful relationship between the central
government and the States. It depends upon the ability to accept
diversity.
Most countries have a ministry of education which is responsible for
education on a nationwide basis. We have gone a different course. We
have 50 States which have the primary responsibility for education from
prekindergarten to graduate school. We have the concept that the States
should be given significant latitude so they can be the laboratories
for experimentation in our Nation.
We also believe under federalism that there should be, to the
greatest degree possible, a matching of power and responsibility. If
the States, for instance, have a certain set of responsibilities, they
should have the commensurate power to organize to meet those
responsibilities and to determine what level of revenues are going to
be necessary to meet those responsibilities and from what source or
sources those revenues should come.
We recognize that under our Constitution, the Federal Government has
ultimate authority. If there is a conflict between the States and the
national government, the national government prevails. That concept was
engrained in our Nation through the Civil War which settled the
question of which level of government was supreme.
The Federal Government should not use this power that it has in an
arrogant manner but, rather, with discretion and respect. State
governments have all power that is not delegated to the Federal
Government. But they, too, should not use that residual power in an
arrogant way but recognize that, while they are serving specifically
the constituents of their State, they also are serving ends that
benefit the Nation. Education is the most obvious example of a
responsibility which has national service but which is directed at the
State and local school district level.
Mr. President, the term ``situational Federalist'' has come into
vogue to describe people who will be Federalist, particularly in
representing the role of State and local government when the ends to be
met will be achieved through decentralization, and they are not
Federalist when the ends they seek to achieve will be better
accomplished through centralizing power.
I reject the concept of ``situational Federalism.'' I believe, for
this great, large, diverse, dynamic country to best function, we in
Washington should be very respectful of the role of the States, even
when the end result of that may be a policy position with which we do
not necessarily agree.
I think we have arrived at one of those moments tonight. In this
case, almost everyone in this Chamber supports the principle that is in
the national interest to have an expansion of access to this wonderful
new world made possible by the Internet. But we believe we should carry
out that objective with discretion. That is what we have done to date.
We have incrementally, 2 years at a time, extended the moratorium on
the ability of State and local governments to have taxation of access
to the Internet; and we have been carefully defining just what the
range of that moratorium on taxation would be. And outside of that
definition, we have given the States and local governments significant
authority. That authority has resulted in a not insignificant totality
of the revenue of State governments.
As an example, last year, on a nationwide basis, State governments
collected between $4 billion and $9 billion of revenue from sources
which this legislation would render immediately and permanently
nontaxable. I believe that is not an example of the respectful way in
which the Federal Government should deal with our Federal partners at
the State level.
As Senator Voinovich has said, and as Senator Carper and as Senator
Alexander will say, we will make a proposal tomorrow that I think
represents that appropriate respectful relationship. It does what we
have done now twice before--provide for a 2-year moratorium on Internet
access. It keeps, with one exception, the same definition of interstate
access that we have had from the beginning of this series of
moratoriums. It does not preemptorily eliminate the ability of those
States that were grandfathered in to continue to collect those taxes.
It will anticipate a gradual phaseout of that grandfather status, but
not one that could have a shock effect on the ability of those 11
States, which does not include my State, and which does not include the
State of the Presiding Officer. We should not look at this parochially
from our own interests but, rather, what best serves our
responsibilities as Federalists.
Mr. President, I intend to speak at somewhat greater length tomorrow
as we get into the details of why we believe S. 150, as submitted, is
not in our tradition of federalism, and to suggest an alternative,
which will be offered by four of us who are now colleagues, but
previously in our life did have the responsibility of the chief
executive of one of our 50 States, and therefore know from personal
experience the challenges that States have in educating its young
people, providing critical law enforcement and emergency services to
our people, and the necessity of having the capacity to fund those
services, which is the equivalent of the responsibility itself. I
believe the proposal that will be offered tomorrow is a reasoned
proposal that assures that there will be no further encroachment on
access to the Internet through increased taxation, while at the same
time respecting the fact that taxation on telecommunications revenues
represents a significant capability of the States to meet their
obligations.
Mr. President, with that somewhat philosophical introduction, I look
forward to a debate on the specifics of this issue when we meet again
tomorrow.
The PRESIDING OFFICER (Mr. Voinovich). The Senator from Tennessee is
recognized.
Mr. ALEXANDER. Mr. President, I thank the Senator from Florida for
his remarks and say to him and the Presiding Officer and Senator Carper
how much I appreciate the opportunity to work with them on this issue.
They have been leaders in our country, in our States, among the best
Governors we have had over the last number of years, and I welcome the
chance to work with them. I thank Senators Allen and Wyden for their
hard work on this issue. They have been working at it for a long time.
I respect that and appreciate it. I thank Senator McCain for his
congeniality and his efforts to move things along. He and the majority
leader, last week, agreed to give us an opportunity, as they have done
tonight, and for tomorrow, to make our case, state our issues, have
votes that we want to have, and I am grateful for that during a busy
season. It would have been easier to just let this go by. There are a
lot of issues before the Senate, but there are a bipartisan group of us
who think this is very important as well. Each of you have stated
tonight--and I don't need to restate it--why that is so.
I think it is a part of the tradition of the Senate that it be the
saucer in which the coffee cools. What we have found over the last
several days is, as our colleagues on both sides of the aisle have
looked at this unfunded Federal mandate that affects internet access,
they have more questions about it. There are more people who are deeply
concerned about the proposal of the distinguished Senators from
Virginia and Oregon.
So I am appealing tonight, and will be doing so tomorrow, especially
to those Members of the Senate who have been mayors and Governors, who
have been legislators, city council men and women, to look at this and
the issues of Federalism. In sort of a reverse partisanship, I want to
appeal to my colleagues on this side of the aisle, for whom the idea of
unfunded Federal mandates has been a central part of our beliefs. It
was the center of our Republican resurgence in 1994, the heart of the
Contract With America. S. 1, the No. 1 Senate bill that the new
Republican majority leader, Bob Dole, introduced in 1995, was the
Unfunded Mandates Reform Act. So this is important stuff for the
Republican Party.
In listening, though, to the issues that are being discussed tonight,
let me see if I can summarize some of what I believe I have heard and
discuss for a moment the amendment that I will be sending to the desk,
or have already forwarded to the desk, on behalf of several of us.
The question tonight is whether and to what extent we will allow
State and local governments to tax Internet access. That is the issue.
There are really
[[Page S14168]]
two arguments among those of us who are arguing. The first one is--and
I may be alone in this, but I don't think so--I don't like any unfunded
Federal mandate. I supported the idea of a moratorium on State and
local taxation of access to the Internet when it all began. Most of us
did. That was in the mid-nineties. It is hard to think back that far.
The Internet was an infant in a crib then and none of us wanted it to
be squashed in its infancy.
Then after 3 years, along came various advocates who said: Let's give
it another 2 years. That very narrow ban on Internet access, which
didn't cost very much money--probably so little money during that time
it didn't qualify under the Unfunded Mandates Reform Act as an unfunded
Federal mandate--so it was extended 2 years.
Now the advocates of the other position are coming along and saying:
We want to make this ban permanent, and we want to broaden the
definition of what we mean by ``Internet access,'' so what we have here
is not such a complex issue. We have really two questions: Do we want a
permanent ban, or do we want a 2-year ban? The second is, Do we want to
extend the same definition of ``Internet access'' we now have with a
minor change, or do we want a broad definition of ``Internet access''
that might cost State and local governments billions of dollars? That
is really the issue that will be presented when we vote most likely
tomorrow.
I send to the desk, but do not call up, an amendment on behalf of
myself, Mr. Carper, Mr. Hollings, Mr. Stevens, Mr. Voinovich, Mr.
Graham, Mr. Dorgan, Mrs. Feinstein, Mr. Lautenberg, and ask that it be
filed.
I wish to discuss three issues. One is the strange case of amnesia
that seems to have set in, especially on my side of the aisle, about
unfunded Federal mandates. The Presiding Officer made an eloquent
discussion of that issue. So did other speakers.
The second is, I would like to discuss specifically why this is an
unfunded Federal mandate under the specific terms of the budget law
which was amended in 1995.
Finally, I want to say a word about the amendment which we will
offer, which we believe is a better extension of the ban on Internet
access than that proposed by Senator Allen and Senator Wyden.
I very well remember 1994 and 1995. Senator Voinovich remembered he
was in Williamsburg, VA, when the Governors met. I remember that
Senator Voinovich, then a Governor, was the acknowledged leader of
State and local forces who were deeply concerned about the practice of
Washington politicians passing laws claiming credit and then sending
the bills to mayors and Governors. Nothing really made us Governors
much madder than that, people getting elected to Congress and presuming
they had suddenly arrived here in Washington, that they had a great
idea about children with disabilities, and they would order us to do it
and then order us to pay for it, or at least pay for half of it.
We cared about children with disabilities, too, and we felt as if we
were elected to make those decisions. We found nothing in our laws and
constitutions about how the Federal Government ought to define for us
what our tax base ought to be or ought to be telling us all of these
things.
I vividly remember the new Republican majority leader of the Senate,
Bob Dole, coming to Williamsburg that very meeting Senator Voinovich
mentioned. Governor Allen, now Senator, was presiding. Thirty
Republican Governors were there. Speaker Gingrich and Majority Leader
Bob Dole came. Speaker Gingrich talked about the Contract With America.
We Republicans can remember that--300 Republican candidates standing on
the steps of this U.S. Capitol saying: Here is our 10-point plan; elect
us, and if we break our promise, throw us out. That is what we said.
That is what we Republicans said. What was our promise? The heart of
that promise was no unfunded Federal mandates.
Senator Dole knew that. It wasn't just a matter of the House of
Representatives. He came to Williamsburg, VA. He pulled out a copy of
the Constitution. He must have done it 100 times in the next year
because I was with him 100 times in the next year when he did it. We
were both campaigning in Presidential primaries, and he would read the
tenth amendment. He would read:
The powers not delegated to the United States by the
Constitution, nor prohibited by it to the States, are
reserved to the States respectively, or to the people.
That was Bob Dole in 1994 and 1995. He was good to his word.
We have a practice of the Senate. The majority leader will pick the
most important bill and make it his bill and call it S. 1. S. 1 that
year for Senator Dole, the new Republican majority leader, was the
Unfunded Mandates Reform Act of 1995. As Senator Voinovich said
earlier, it passed 91 to 9. Sixty-three of the Senators who voted for
it then are serving in this body today. Twelve of them were House
Members then.
There was a lot of steam in that argument then. I would like to read
just a paragraph from a backgrounder put out by the Heritage Foundation
in December of 1994. This is just a little while after the Governors
met. This paragraph says:
Throughout much of American history, especially since the
New Deal--
This is how they were looking at it--
the Federal Government increasingly has encroached upon the
fiscal and constitutional prerogatives of State and local
government. Today this imbalance has reached a crisis point,
and the States are fighting back. Through a variety of
initiatives, they are demanding that Federal mandates be
funded and, in many cases, even are challenging the authority
of the Federal Government to impose these mandates, whether
funded or not. With the new more State friendly Congress--
That is us, the Republican Congress--
States and localities have a historic opportunity not only to
effect mandate relief, but also to restore balance in State-
Federal relations.
Then they begin to list in this Heritage Foundation document some of
the ways States and localities that seemed to have reached their limit
are fighting back. They are publicizing the costs of unfunded mandates.
They are holding their Congressmen accountable. They are challenging
Congress's authority to impose the mandates. They are suing the
Government for the violation of the tenth amendment. They are lobbying
Congress to pass mandate relief legislation--no-money, no-mandate
constitutional amendments.
They are considering a collective action to challenge the Federal
Government's right to pass laws that impose duties on States without
paying the bill.
This was the mood in 1994 and 1995, and this was a major reason why
the Republican majority was elected. I hope we don't forget that. I
know at the time a great many of our colleagues remember it because
they talked about it eloquently in their speeches when the Unfunded
Mandates Reform Act was enacted in 1995.
Senator Lott said:
It is things like unfunded mandates that drive good people
out of office.
Senator Thomas said: I served in the Wyoming Legislature and a good
deal of our budget was committed, before we ever got to Cheyenne, to
unfunded mandates.
Senator Feinstein, a cosponsor of our amendment, said: I was
president of the board of supervisors. I was mayor. I saw the
development of these unfunded mandates firsthand and in doing so I
probably speak for the mayors and local officials all across the
Nation.
Senator Nickles, chairman of the Budget Committee, said: I used to
serve in the State legislature and we really resented the idea that the
Federal Government would come in and mandate how we would spend our
resources.
I am reading speeches from the Congressional Record of Members of
this body in 1995, who voted to ban unfunded Federal mandates.
Senator Hutchison of Texas said: Almost one-third of the increase in
the Texas State budget over the past 3 years has been the result of
unfunded Federal mandates--one-third, she underlined.
Senator Burns talked about the impact of unfunded mandates.
Senator Bennett told a beautiful story about encountering a mayor
during a campaign in his State in Utah, and he ended up with the mayor
saying, well, if I had a U.S. Senator in front of me with his undivided
attention, the one thing I would say to him is stop the unfunded
mandates.
That is just a few of the things that were said. So the question now
then is,
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is this really an unfunded Federal mandate? Well, that is not too hard
to figure out. Some of my colleagues seemed surprised when I suggested
this might be, so I have put a letter on every Senator's desk.
I ask unanimous consent that the letter be printed in the Record.
U.S. Congress,
Congressional Budget Office,
Washington, DC, November 5, 2003.
Hon. Lamar Alexander,
U.S. Senate, Washington, DC.
Dear Senator: This letter responds to the three questions
you posed in your letter of November 4, 2003, regarding S.
150, the Internet Tax Nondiscrimination Act.
1. How much revenue is being collected by state and local
governments from taxes on DSL?
CBO estimates that state and local governments currently
collect at least $40 million per year in taxes on DSL service
(Digital Subscriber Line--a high-speed data transmission over
regular telephone wires). They are likely to collect revenues
totaling more than $80 million per year by 2008 due to growth
in the use of high-speed Internet access. These collections
are primarily sales and use taxes on DSL service.
2. What would be the revenue loss to state and local
governments under the managers' amendment to S. 150?
Based on the version of the proposed amendment CBO
received late this afternoon (S150MGR.6), CBO has determined
that the bill would create intergovernmental mandates as
defined in the Unfunded Mandates Reform Act. We estimate that
those mandates would impose costs on state and local
governments in at least one of the next five years that would
exceed the threshold established in that act ($60 million in
2004, increasing to $66 million in 2008). We have identified
three major impacts, each of which would, by itself, exceed
the threshold:
Revenue losses of $80 million to $120 million per year,
starting in 2007, to state and local governments that are
already taxing Internet access and were covered by the
``grandfather clause'' contained in the Internet Tax Freedom
Act. Some of these are taxes on DSL services. We have no
information to suggest that other states will impose taxes on
Internet access in the near term.
Other states are currently imposing taxes on charges for
the portions of DSL services they do not consider Internet
access. Those states would lose at least $40 million in sales
and use taxes on DSL services in 2004, and at least $75
million by 2008. The preemption of DSL taxes would stem from
section 2(c) of the amendment, which defines ``Internet
access.''
Substantial revenue losses that could result from:
(a) The inability of state and local governments to collect
transactions taxes (including sales and use taxes and gross
receipts taxes) on certain types of telecommunications
services. For example, if technological change shifts
traditional telecommunications services to the Internet,
those services--for example local and long distance phone
calls--could be included, for free, when a customer purchases
Internet access;
(b) The free inclusion of content (movies, music, and
written works) with Internet access in response to the tax
exemption provided by this bill. Such content is subject to
sales and use taxes under current law but might increasingly
be available at no charge as part of an Internet access
package.
CBO does not have sufficient information to estimate these
revenue losses, but we believe they could grow to be large.
There is some question, however, as to what types of
transactions could not be taxed under the bill; under some
interpretations, these revenue losses could remain quite
small. The issue might ultimately have to be resolved in the
courts.
3. How much tax revenues do state and local governments
collect on telecommunication services?
Based on information from industry representatives, state
and local governments, and federal statistical sources, CBO
estimates that state and local governments currently collect
more than $20 billion annually from taxes on
telecommunications services. Such taxes generally fall into
two categories: transactions taxes and business taxes.
Transactions taxes (for example, gross receipts taxes, sales
taxes on consumers, and taxes on 911 service) account for
about two-thirds of the total.
In arriving at this estimate, CBO took into account the
fact that some companies are challenging the applicability of
taxes to their services, and thus may not be collecting such
taxes, even though states and local governments feel they are
obligated to do so. Such potential liabilities are not
included in the estimate.
If you would like further details on the information
provided in this letter, we would be pleased to provide it.
The staff contacts for this legislation are Sarah Puro and
Theresa Gullo.
Sincerely,
Robert A. Sunshine
(For Douglas-Holtz-Eakin, Director).
Mr. ALEXANDER. There is a letter that I received yesterday from the
Congressional Budget Office on every Senator's desk. It describes the
three ways in which the proposed ban on State and local Internet access
taxes by Senator Allen and Senator Wyden violate the Federal Budget
Act--specifically, the amendments of the Unfunded Mandates Reform Act
of 1995.
These are the three ways: One, there is a revenue loss of $80 million
to $120 million per year to State and local governments already taxing
Internet access. There are 11 such States.
Second, there are losses of $40 million to $75 million of taxes on
DSL services that States now collect. That is the second violation of
an unfunded mandate.
Third, and this makes the point it is not only an unfunded mandate,
it is potentially a great big unfunded mandate. The Congressional
Budget Office says in its letter that the third way this proposal
violates the Budget Act is ``substantial revenue losses that could
occur'' when technological change shifts traditional communication
services to the Internet--for example, local and long distance phone
calls--or when content, music, movies, written works is provided free
with Internet access.
This may sound complicated but it is not so complicated. Basically,
what this says is it already is happening, that your telephone company
or your cable TV company will provide your Internet access. CBO says
that State and local governments today now collect more than $20
billion annually from transaction sales and use taxes on
telecommunications services.
What this letter further says is that the Allen-Wyden proposal will
take an undetermined amount of this $20 billion and ban the ability of
State and local governments to include that as part of their tax base.
It is enough, according to the CBO letter, to define it as an unfunded
Federal mandate. But they say they cannot tell the exact amount of the
$20 billion that might be exempt from State and local taxation.
The Multistate Tax Commission said it could tell. It estimated $4
billion to $5 billion. That is an awful lot of money. The Senator from
Ohio, the Presiding Officer, in his argument read a list of what State
revenue officers have told him, and what they estimate it might take.
The problem is the broader definition of Internet access, which is
contained in the bill of the distinguished Senators from Virginia and
Oregon, raises the likelihood that some--maybe a lot--of the $20
billion that is now used by State and local governments to pay for
schools, State parks and to keep other taxes down, would be taken away
from their tax base.
What do we then do about it? Well, we think we have a suggestion
which we hope tomorrow our colleagues in the Senate, if we are able to
vote on it, then will agree with us. Our suggestion is an extension of
the current ban on Internet access for 2 years, with the same narrow
definition that we now have, with the exception that we would make sure
that in 23 States which do not now tax DSL, that is telephone service
that delivers broadband, they would not be allowed to do that.
So in taking the issues that I heard from the distinguished Senators
from Virginia and Oregon, I would summarize them this way: They argue
that the Internet is so valuable that we need to override this law we
have against unfunded Federal mandates. I agree it is valuable but it
is not an infant. It is a pretty big boy. It is out there in the world.
We know what it is and it should stand on its own now.
The telephone is also a magnificent invention. We do not exempt it
from taxation. The television is a magnificent invention. We do not
exempt it from taxation.
If we really think in the Congress that the Internet deserves to be
completely exempt from State and local taxation, then why do we not pay
for it? Why do we not pass a law that we might call the Unfunded
Federal Mandate Reimbursement Act and just let every mayor and every
Governor send us a bill every year and we will send them a check. If it
turns out to be $20 billion, we will send them $20 billion. If it turns
out to be $4 billion, we will send them $4 billion because we will have
said the Internet is so important that we in Congress think it ought to
be subsidized, that there should be relief from taxation, and so we are
going to pay for it. That would be the honest thing to do, rather than
just to say we think it is important but you pay for it.
That is what we said with how we helped disabled children. That is
what
[[Page S14170]]
we said with stormwater runoff. That is what we said with clean water.
We think it is a great idea, you pay for it. That is why we are in
Washington. We print money. You balance budgets. We think it is a good
idea, you pay for it. That is what the fuss is about.
The second thing I have heard is it is in interstate commerce and we
could not touch it. Telephones are in interstate commerce. We do not
keep States and local governments from taxing telephones. Televisions
are in interstate commerce. Buses are in interstate commerce. Planes
are in interstate commerce. Catalog sales are in interstate commerce.
Severance taxes are in interstate commerce. A great big part of every
State and local government's budget is made up of a tax base that
included items that are in interstate commerce. So that argument does
not wash at all.
Taxing broadband, that is a good point. Broadband is coming fast. We
do not want to interfere with that so our conclusion is, let us stop it
in the 23 States that do not now tax broadband. Let us put DSL and
cable--that is the broadband is delivered--on an equal playing field.
In the States that do tax DSL, they can continue that for the 2 years
of the ban.
Multiple taxation, that was raised by the Senator from Virginia.
Well, we are extending the current language and it bans multiple
taxation. Discriminatory taxation, we propose to extend the current
language, and that bans discriminatory taxation.
State and local taxation on Internet access, we would propose to
extend the ban on Internet access taxation for 2 years so we can think
this through. So we have taken care of that as well. Tomorrow, when
hopefully we will be voting on this, we will have this choice: Do you
want a permanent ban on Internet access taxation, or do you want a 2-
year ban? Do you want a broad definition of what we mean by Internet
access, a definition that could cost States a significant share of
their State or local tax base, or do you want a narrow definition,
virtually the same one we have today?
I believe the prudent thing for us to do is to take the law that we
have today, slightly modify it to put DSL and cable on an equal playing
field, extend it for 2 years, and let us continue the debate we are
having about how to define the two words ``Internet access.'' That is
really the problem. I agree with the Senator from Oregon. He has worked
long and hard on this. There have been many meetings. We just don't
agree on what the definition of Internet access is.
But until we can agree, we should not put this potentially huge
unfunded Federal mandate into the law. So tomorrow I hope to bring up
this amendment I have filed tonight. I hope our colleagues will compare
it with the proposal of the Senator from Virginia and Oregon, and I
hope they will adopt ours.
I also have a point of order I could raise, which would cause the
Senate to consider whether the Allen-Wyden amendment is an unfunded
Federal mandate. If there is a motion to waive the point of order,
which I believe would be sustained by the Chair, then Senators would
have an opportunity to cast a vote for or against an unfunded Federal
mandate. But I am going to reserve that option and hope that sometime
tomorrow we can have a clear up-or-down vote on the amendment which I
offer with a number of other Senators.
I look forward to the debate tomorrow.
Mr. WYDEN. Mr. President, very briefly, because Senator Lautenberg
has not had a chance to speak and he has been gracious enough to just
give me a couple of minutes to respond to our friend from Tennessee, I
think he knows we have a difference of opinion on this issue, but I
want him to know how much I appreciate the way he has worked with this
Senator. I think he is going to be a great addition to the Senate. I
look forward to the many issues where we are going to find common
ground, even though this is not one of them.
Just briefly on this unfunded mandate question, I think it is clear
that, with the more than 7,000 taxing jurisdictions in our country, if
ever there was something that was inherently interstate in nature, it
is the Internet. I think we can just imagine the kind of chaos if even
a small fraction of these 7,600 taxing jurisdictions took a bite out of
the Internet. We would have a crazy quilt of laws with respect to the
Internet.
There are a whole host of activities where the Federal Government has
essentially made it clear they were inherently interstate in nature and
you do not hear the States expressing any grievances. You don't hear
States complaining that they can't tax airline tickets or mail or a
variety of other things because we are talking about something that is
so crystal clear in terms of its very nature--in effect, the essence of
article I, section 8, of the Constitution--that this has been an area
where the Federal Government has said it is not appropriate to let
thousands of local and State jurisdictions simply make a mishmash out
of a regulatory regime that needs to be uniform in nature.
I know we are going to talk more about that tomorrow. I am going to
go through, tomorrow, the history of the Unfunded Mandates Act that
supports the position Senator Allen and I have taken.
Two other points very quickly and then I do want to let our friend
from New Jersey have some time for which he has been patiently waiting.
With respect to the telecommunications services issue which the Senator
from Tennessee has discussed, I want to make it clear that Senator
Allen and I have done everything but hire a sky writer to fly over the
Capitol, to make it clear that telecommunications services, which can
be taxed today, would and should be taxed in the future. It is
absolutely clear with respect to all the work we have tried to do, both
in the committee and working with various State and local officials, we
feel very strongly about it. It is what the bundling issue has been all
about in terms of separating out Internet access, which should not be
taxed, and telecommunications services, which ought to be taxed.
Senator Allen and I continue to be interested in working with
colleagues to try to find common ground in this area, but the two of us
have done everything except march down the street with a sandwich
board, trying to argue that telecommunications services must be taxed
and that it is Internet access about which we are concerned.
Finally, the last point I would make is we need to have a discussion
in the Senate with respect to what the competitive playing field will
look like under the amendment at least as outlined tonight by the
Senator from Tennessee. We have already seen a competitive disadvantage
established, given the developments in the last few years between cable
and telecommunications. It is the view of the Senator from Virginia and
I, as two Members of the Commerce Committee who have focused on this
issue for many months, that we think the competitive disadvantage,
which has been established in the last few years between cable and
telecommunications, will widen under the proposal the Senate is going
to be asked to look at tomorrow as an alternative. We are going to have
a chance to discuss it.
Again, I express my appreciation to the Senator from Tennessee with
respect to how he has handled this issue. We have a difference of
opinion on it, but I admire the Senator from Tennessee very much and I
look forward to working closely with him.
I yield the floor.
The PRESIDING OFFICER. The Senator from Nevada.
Unanimous Consent Request--H.R. 2559
Mr. REID. Mr. President, I direct the attention of my friend from
Tennessee to Homeland Security and to Leave No Child Behind. If he
wants to find some unfunded mandates, have him come to Nevada and find
out what those two pieces of legislation have done--I should say that
piece of legislation, Leave No Child Behind, and what we have done to
the State of Nevada and every other State by not properly funding the
Leave No Child Behind Act and what we have done with all of our demands
on State and local government with our unfunded mandates relating to
homeland security. That is the subject of another speech.
Mr. President, I ask unanimous consent that the Senate proceed to the
conference report to accompany H.R. 2559, the Military Construction
appropriations bill.
[[Page S14171]]
I do this because, in the State of Nevada, Nellis Air Force Base and
the Fallon Naval Air Training Center are desperately in need of
construction starts and completion of jobs that are already underway.
So I hope my friends on the other side will allow this very important
conference report to be agreed to and the motion to reconsider be laid
upon the table, and that be done with no intervening action or debate.
I so move.
The PRESIDING OFFICER. Is there objection?
Mr. ALEXANDER. I object.
The PRESIDING OFFICER. Objection is heard.
The PRESIDING OFFICER. The Senator from New Jersey.
Mr. LAUTENBERG. Mr. President, first I thank my colleague from Oregon
and my colleague from Virginia for the hard work they did to get us to
this point where we have an opportunity to review some of the problems
we have seen in the Internet tax area. I had an early opportunity to
review and carefully consider S. 150, and I support the stated purpose
of this legislation. I agree that the American consumer should be
encouraged and not taxed to access the Internet.
I also agree with the stated purpose of this legislation, that the
Federal Government should ensure tax-free access to the Internet,
irrespective of the technology the consumer uses, whether it is the
regular dial-up modem, cable modem, DSL, wireless, or satellite.
My concerns with this legislation don't stem from its stated
purposes. My concerns are with the legislation's unstated purposes and
unintended consequences which most State, county, and local tax experts
believe would jeopardize important revenue streams, such as the gross
receipts tax, that were permitted under the first two iterations of the
Internet tax moratorium.
The Internet tax moratorium bill was conceived in 1998 as a
proconsumer legislative attempt aimed at increasing American access to
the Internet. Now that the bill has been rewritten and greatly
expanded, it has as a result become another corporate giveaway of
potentially enormous and devastating proportions.
According to the Commerce Committee report accompanying S. 150, the
original enactment of this legislation in 1998 imposed a temporary
moratorium on ``certain taxes that could have a detrimental effect on
the continued expansion of Internet use in the United States.''
In 1999, only 26 percent of United States households had Internet
access, according to the Department of Commerce. In September 2001, 51
percent of United States households had Internet access. In 2002,
according to the Forrester Research firm, 64 percent--quite a jump in a
year--of U.S. households had Internet.
The number of households with Internet access has more than doubled
in 4 years, from 26 percent in 1998 to 64 percent in 2002. I am sure
the rate of Internet access today is even higher.
Many households, however, only have basic dial-up access to the
Internet and haven't moved to the faster broadband access services.
Clearly, the supporters of this bill can't blame an access tax that
isn't being imposed for the digital divide that exists between people
who have Internet access and those who do not, or between households
which can afford broadband or wireless Internet access service and
those households which still use the narrowband dial-up.
Nevertheless, I would support an extension of the moratorium on
Internet access taxes. By temporary, I am talking about a couple of
years. But to make the moratorium permanent, as this bill would do, in
my view is an abdication of responsibility on our part.
I cannot and will not support a permanent moratorium that is so
poorly defined that it won't just apply to access taxes. I cannot and
will not support a moratorium that will deprive the States of $4
billion to $9 billion in revenues by the year 2006, according to the
Multi-State Tax Commission and the National Governors Association.
Based on the language in the bill reported out of the Commerce
Committee, my home State of New Jersey by itself stands to lose $833
million in annual revenues. Other States also stand to lose hundreds of
millions of dollars as well. Maybe some Senators are willing to look
the other way and not address the problems with this bill. So be it.
But I cannot do that. Even under the managers' amendment, which is a
modest improvement, the annual revenue loss for New Jersey is believed
to be somewhere around $600 million. My question is: Why are we doing
this to States when they are facing the biggest fiscal crisis they have
seen since World War II or even the Depression years?
A permanent, poorly crafted moratorium? No way. I cannot in good
conscience support something so far reaching.
That is why I support an amendment I believe will be offered by some
of my colleagues, Senators Alexander, Carper, and Voinovich, to extend
the existing moratorium for only 2 years, and to fix the discrepancy in
the way DSL and cable modem are treated for tax purposes.
I realize even if this amendment is offered and agreed to, States
such as New Jersey will still lose much-needed revenue, but at least we
can and must minimize the impact.
I yield the floor.
Mr. WYDEN. Mr. President, 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. McCAIN. 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. McCAIN. Mr. President, prior to wrap-up, this completes the
debate and discussion for this evening. It is my understanding that
Senators from Tennessee, Ohio, and Delaware have an amendment that has
been filed and they will call it up when we begin our continued debate
on this legislation tomorrow morning at 9:30. I hope we can limit our
debate on that amendment and have a vote on it and then take up other
amendments. It is still the intention of the majority leader to finish
this legislation tomorrow. I hope we can achieve that goal.
I know everybody would like to go home on Friday afternoon, but I
have been assured by the majority leader we will remain until
completion of the legislation.
I think it has been a good debate tonight. I thank all of my
colleagues. I look forward to disposing of the amendments tomorrow when
we reconvene at 9:30.
I yield the floor to the distinguished Senator from Nevada.
____________________