[Congressional Record Volume 151, Number 5 (Tuesday, January 25, 2005)]
[Senate]
[Pages S437-S450]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




 STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS--MONDAY, JANUARY 
                                24, 2005

      By Ms. STABENOW (for herself, Mr. Reid, Mr. Corzine, Mr. Kennedy, 
        Mr. Inouye, Ms. Mikulski, Mr. Dorgan, Mr. Leahy, Mr. 
        Rockefeller, Mr. Schumer, Mr. Durbin, and Mr. Dayton):
  S. 14. A bill to provide fair wages for America's workers, to create 
new jobs through investment in America, to provide for fair trade and 
competitiveness, and for other purposes; to the Committee on Finance.
  Ms. STABENOW. Mr. President, I ask unanimous consent that the text of 
the bill be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 14

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Fair Wage, 
     Competition, and Investment Act of 2005''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents. 

               TITLE I--FAIR WAGES FOR AMERICA'S WORKERS

                 Subtitle A--Overtime Rights Protection

Sec. 111. Short title. 
Sec. 112. Clarification of regulations relating to overtime 
              compensation. 

                     Subtitle B--Fair Minimum Wage

Sec. 121. Short title. 
Sec. 122. Minimum wage. 

 Subtitle C--Sense of the Senate Regarding Multiemployer Pension Plans

Sec. 131. Sense of the Senate regarding multiemployer pension plans. 

       TITLE II--CREATING NEW JOBS THROUGH INVESTMENT IN AMERICA

           Subtitle A--Eliminating Incentives for Outsourcing

Sec. 211. Taxation of income of controlled foreign corporations 
              attributable to imported property. 
Sec. 212. Amendments to the Worker Adjustment and Retraining 
              Notification Act. 

                Subtitle B--Investment in Infrastructure

                Chapter 1--Transportation Infrastructure

Sec. 221. Transportation infrastructure funding. 

                    Chapter 2--Water Infrastructure

Sec. 231. Water infrastructure funding. 

                     Chapter 3--Rail Infrastructure

Sec. 241. Rail infrastructure funding.
Sec. 242. Grant authority.
Sec. 243. Grant conditions for right-of-way projects.
Sec. 244. Use of funds for near-term projects.
Sec. 245. Treatment of rail operators using grant-funded rail 
              infrastructure.

                   Chapter 4--Transit Infrastructure

Sec. 251. Transit.

                   Chapter 5--Aviation Infrastructure

Sec. 261. Authorization of appropriations.
Sec. 262. Distribution of funds.
Sec. 263. Nonapplicability of certain laws.
Sec. 264. Use of funds for near-term projects.

                 Chapter 6--Broadband Access Tax Credit

Sec. 271. Expensing of broadband Internet access expenditures.

             Chapter 7--Research And Development Tax Credit

Sec. 281. Findings. 
Sec. 282. Permanent extension of research credit. 
Sec. 283. Increase in rates of alternative incremental credit. 
Sec. 284. Alternative simplified credit for qualified research 
              expenses. 
Sec. 285. Expansion of research credit.

                    Subtitle C--Technology Programs

Sec. 291. Authorizations of appropriations for the Advanced Technology 
              Program and the Manufacturing Extension Partnership 
              Program. 
Sec. 292. Sense of the Senate promoting science and technology funding 
              for a strong economic future. 

               TITLE III--FAIR TRADE AND COMPETITIVENESS

               Subtitle A--Trade Enforcement Enhancement

Sec. 311. Identification of trade expansion priorities.
Sec. 312. Chief enforcement negotiator.
Sec. 313. Foreign debt. 
Sec. 314. Authorization of appropriations.

       Subtitle B--Exchange Rate Policy and Currency Manipulation

Sec. 321. Negotiations regarding currency valuation.

                Subtitle C--Trade Adjustment Assistance

                       Chapter 1--Service Workers

Sec. 331. Short title. 
Sec. 332. Extension of trade adjustment assistance to services sector. 
Sec. 333. Trade adjustment assistance for firms and industries. 
Sec. 334. Monitoring and reporting. 
Sec. 335. Alternative trade adjustment assistance. 
Sec. 336. Effective date. 

         Chapter 2--Trade Adjustment Assistance for Communities

Sec. 341. Short title. 
Sec. 342. Purpose. 
Sec. 343. Trade adjustment assistance for communities. 
Sec. 344. Conforming amendments. 
Sec. 345. Effective date. 

            Chapter 3--Office Of Trade Adjustment Assistance

Sec. 351. Short title. 
Sec. 352. Office of Trade Adjustment Assistance. 
Sec. 353. Effective date. 

Chapter 4--Improvement Of Credit for Health Insurance Costs of Eligible 
                              Individuals

Sec. 361. Improvement of the affordability of the credit. 
Sec. 362. Offering of Federal fallback coverage.
Sec. 363. Clarification of eligibility of spouse of certain individuals 
              entitled to medicare. 

        Subtitle D--Sense of the Senate on Free Trade Agreements

Sec. 371. Sense of the Senate on free trade agreements. 

               TITLE I--FAIR WAGES FOR AMERICA'S WORKERS

                 Subtitle A--Overtime Rights Protection

     SEC. 111. SHORT TITLE.

       This subtitle may be cited as the ``Overtime Rights 
     Protection Act of 2005''.

     SEC. 112. CLARIFICATION OF REGULATIONS RELATING TO OVERTIME 
                   COMPENSATION.

       Section 13 of the Fair Labor Standards Act of 1938 (29 
     U.S.C. 213) is amended by adding at the end the following:
       ``(k)(1) Notwithstanding the provisions of subchapter II of 
     chapter 5 and chapter 7 of title 5, United States Code 
     (commonly referred to as the Administrative Procedures Act) 
     or any other provision of law, any portion of the final rule 
     promulgated on April 23, 2004, revising part 541 of title 29, 
     Code of Federal Regulations, that exempts from the overtime 
     pay provision of section 7 of this Act any employee who would 
     not otherwise be exempt if the regulations in effect on March 
     31, 2003 remained in effect, shall have no force or effect 
     and that portion of such regulations (as in effect on March 
     31, 2003) that would prevent such employee from being exempt 
     shall be reinstated.
       ``(2) The Secretary shall adjust the minimum salary level 
     for exemption under section 13(a)(1) in the following manner:
       ``(A) Not later than 60 days after the date of enactment of 
     this subsection, the Secretary shall increase the minimum 
     salary level for exemption under subsection (a)(1) for 
     executive, administrative, and managerial occupations from 
     the level of $155 per week in 1975 to $591 per week (an 
     amount equal to the increase in the Employment Cost Index 
     (published by the Bureau of Labor Statistics) for executive, 
     administrative, and managerial occupations between 1975 and 
     2005).
       ``(B) Not later than December 31 of the calendar year 
     following the increase required in subparagraph (A), and each 
     December 31 thereafter, the Secretary shall increase the 
     minimum salary level for exemption under subsection (a)(1) by 
     an amount equal to the

[[Page S438]]

     increase in the Employment Cost Index for executive, 
     administrative, and managerial occupations for the year 
     involved.''.

                     Subtitle B--Fair Minimum Wage

     SEC. 121. SHORT TITLE.

       This subtitle may be cited as the ``Fair Minimum Wage Act 
     of 2005''.

     SEC. 122. MINIMUM WAGE.

       (a) In General.--Section 6(a)(1) of the Fair Labor 
     Standards Act of 1938 (29 U.S.C. 206(a)(1)) is amended to 
     read as follows:
       ``(1) except as otherwise provided in this section, not 
     less than--
       ``(A) $5.85 an hour, beginning on the 60th day after the 
     date of enactment of the Fair Minimum Wage Act of 2005;
       ``(B) $6.55 an hour, beginning 12 months after that 60th 
     day; and
       ``(C) $7.25 an hour, beginning 24 months after that 60th 
     day;''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall take effect 60 days after the date of enactment of this 
     Act.

 Subtitle C--Sense of the Senate Regarding Multiemployer Pension Plans

     SEC. 131. SENSE OF THE SENATE REGARDING MULTIEMPLOYER PENSION 
                   PLANS.

       (a) Findings.--The Senate makes the following findings:
       (1) Multiemployer pension plans have been a major force in 
     the delivery of employee benefits to active and retired 
     American workers and their dependents for over half a 
     century.
       (2) There are approximately 1,700 multiemployer defined 
     benefit pension plans in which approximately 9,700,000 
     workers and retirees participate.
       (3) Three-quarters of the approximately 60,000 to 65,000 
     employers that participate in multiemployer plans have fewer 
     that 100 employees.
       (4) Multiemployer plans allow for greater access and 
     affordability for smaller employers and pension portability 
     for their employees as they move from one job to another, and 
     permit workers to earn a pension where they might otherwise 
     not be able to do so.
       (5) The 2000-2002 drop in the stock market and decline in 
     equity values has affected all investors, including 
     multiemployer plans.
       (6) The decline in value sustained by multiemployer defined 
     benefit pension plans have threatened the stability of this 
     private sector source of secure retirement income.
       (7) Participating employers could face onerous excise taxes 
     and other penalties as a result of the serious, adverse 
     financial impact due to these market losses.
       (8) In 2004, the United States Senate recognized the 
     severity of this situation and passed by an overwhelmingly, 
     large bipartisan margin of 86 to 9 temporary relief 
     provisions for single and multiemployer defined benefit 
     pension plans.
       (b) Sense of the Senate.--It is the sense of the Senate 
     that the Senate--
       (1) expresses its strong support for multiemployer defined 
     benefit pension plans;
       (2) recognizes the importance of an environment in which 
     multiemployer plans can continue their vital role in 
     providing benefits to working men and women;
       (3) recognizes that multiemployer pension plan relief must 
     be designed for the multiemployer labor-relations environment 
     that supports the plans; and
       (4) supports legislation to strengthen and protect the 
     viability of multiemployer pension plans for the continued 
     benefit of current and retired members, and their families 
     and survivors, and to strengthen the ability of all plans to 
     address funding problems that occur.

       TITLE II--CREATING NEW JOBS THROUGH INVESTMENT IN AMERICA

           Subtitle A--Eliminating Incentives for Outsourcing

     SEC. 211. TAXATION OF INCOME OF CONTROLLED FOREIGN 
                   CORPORATIONS ATTRIBUTABLE TO IMPORTED PROPERTY.

       (a) General Rule.--Subsection (a) of section 954 of the 
     Internal Revenue Code of 1986 (defining foreign base company 
     income) is amended by striking ``and'' at the end of 
     paragraph (4), by striking the period at the end of paragraph 
     (5) and inserting ``, and'', and by adding at the end the 
     following new paragraph:
       ``(6) imported property income for the taxable year 
     (determined under subsection (j) and reduced as provided in 
     subsection (b)(5)).''.
       (b) Definition of Imported Property Income.--Section 954 of 
     the Internal Revenue Code of 1986 is amended by adding at the 
     end the following new subsection:
       ``(j) Imported Property Income.--
       ``(1) In general.--For purposes of subsection (a)(6), the 
     term `imported property income' means income (whether in the 
     form of profits, commissions, fees, or otherwise) derived in 
     connection with--
       ``(A) manufacturing, producing, growing, or extracting 
     imported property;
       ``(B) the sale, exchange, or other disposition of imported 
     property; or
       ``(C) the lease, rental, or licensing of imported property.

     Such term shall not include any foreign oil and gas 
     extraction income (within the meaning of section 907(c)) or 
     any foreign oil related income (within the meaning of section 
     907(c)).
       ``(2) Imported property.--For purposes of this subsection--
       ``(A) In general.--Except as otherwise provided in this 
     paragraph, the term `imported property' means property which 
     is imported into the United States by the controlled foreign 
     corporation or a related person.
       ``(B) Imported property includes certain property imported 
     by unrelated persons.--The term `imported property' includes 
     any property imported into the United States by an unrelated 
     person if, when such property was sold to the unrelated 
     person by the controlled foreign corporation (or a related 
     person), it was reasonable to expect that--
       ``(i) such property would be imported into the United 
     States; or
       ``(ii) such property would be used as a component in other 
     property which would be imported into the United States.
       ``(C) Exception for property subsequently exported.--The 
     term `imported property' does not include any property which 
     is imported into the United States and which--
       ``(i) before substantial use in the United States, is sold, 
     leased, or rented by the controlled foreign corporation or a 
     related person for direct use, consumption, or disposition 
     outside the United States; or
       ``(ii) is used by the controlled foreign corporation or a 
     related person as a component in other property which is so 
     sold, leased, or rented.
       ``(3) Definitions and special rules.--
       ``(A) Import.--For purposes of this subsection, the term 
     `import' means entering, or withdrawal from warehouse, for 
     consumption or use. Such term includes any grant of the right 
     to use intangible property (as defined in section 
     936(h)(3)(B)) in the United States.
       ``(B) United states.--For purposes of this subsection, the 
     term `United States' includes the Commonwealth of Puerto 
     Rico, the Virgin Islands of the United States, Guam, American 
     Samoa, and the Commonwealth of the Northern Mariana Islands.
       ``(C) Unrelated person.--For purposes of this subsection, 
     the term `unrelated person' means any person who is not a 
     related person with respect to the controlled foreign 
     corporation.
       ``(D) Coordination with foreign base company sales 
     income.--For purposes of this section, the term `foreign base 
     company sales income' shall not include any imported property 
     income.''.
       (c) Separate Application of Limitations on Foreign Tax 
     Credit for Imported Property Income.--
       (1) Before 2007.--
       (A) In general.--Paragraph (1) of section 904(d) of the 
     Internal Revenue Code of 1986 (relating to separate 
     application of section with respect to certain categories of 
     income), as in effect for taxable years beginning before 
     January 1, 2007, is amended by striking ``and'' at the end of 
     subparagraph (H), by redesignating subparagraph (I) as 
     subparagraph (J), and by inserting after subparagraph (H) the 
     following new subparagraph:
       ``(I) imported property income, and''.
       (B) Imported property income defined.--Paragraph (2) of 
     section 904(d) of such Code, as so in effect, is amended by 
     redesignating subparagraphs (H) and (I) as subparagraphs (I) 
     and (J), respectively, and by inserting after subparagraph 
     (G) the following new subparagraph:
       ``(H) Imported property income.--The term `imported 
     property income' means any income received or accrued by any 
     person which is of a kind which would be imported property 
     income (as defined in section 954(j)).''.
       (C) Look-thru rules to apply.--Subparagraph (F) of section 
     904(d)(3) of such Code, as so in effect, is amended by 
     striking ``or (D)'' and inserting ``(D), or (I)''.
       (2) After 2006.--
       (A) In general.--Paragraph (1) of section 904(d) of such 
     Code (relating to separate application of section with 
     respect to certain categories of income), as in effect for 
     taxable years beginning after December 31, 2006, is amended 
     by striking ``and'' at the end of subparagraph (A), by 
     redesignating subparagraph (B) as subparagraph (C), and by 
     inserting after subparagraph (A) the following new 
     subparagraph:
       ``(B) imported property income, and''.
       (B) Imported property income defined.--Paragraph (2) of 
     section 904(d) of such Code, as so in effect, is amended by 
     redesignating subparagraphs (I) and (J) as subparagraphs (J) 
     and (K), respectively, and by inserting after subparagraph 
     (H) the following new subparagraph:
       ``(I) Imported property income.--The term `imported 
     property income' means any income received or accrued by any 
     person which is of a kind which would be imported property 
     income (as defined in section 954(j)).''.
       (C) Conforming amendment.--Clause (ii) of section 
     904(d)(2)(A) of such Code, as so in effect, is amended by 
     inserting ``or imported property income'' after ``passive 
     category income''.
       (d) Technical Amendments.--
       (1) Clause (iii) of section 952(c)(1)(B) of the Internal 
     Revenue Code of 1986 (relating to certain prior year deficits 
     may be taken into account) is amended--
       (A) by redesignating subclauses (II), (III), (IV), and (V) 
     as subclauses (III), (IV), (V), and (VI), and
       (B) by inserting after subclause (I) the following new 
     subclause:

       ``(II) imported property income,''.

       (2) Paragraph (5) of section 954(b) of such Code (relating 
     to deductions to be taken into account) is amended by 
     striking ``and the foreign base company oil related income''

[[Page S439]]

     and inserting ``the foreign base company oil related income, 
     and the imported property income''.
       (e) Effective Dates.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall apply to taxable years 
     of foreign corporations beginning after the date of the 
     enactment of this Act, and to taxable years of United States 
     shareholders within which or with which such taxable years of 
     such foreign corporations end.
       (2) Subsection (c).--The amendments made by subsection 
     (c)(1) shall apply to taxable years beginning after the date 
     of the enactment of this Act and before January 1, 2007, and 
     the amendments made by subsection (c)(2) shall apply to 
     taxable years beginning after December 31, 2006.

     SEC. 212. AMENDMENTS TO THE WORKER ADJUSTMENT AND RETRAINING 
                   NOTIFICATION ACT.

       (a) Definition.--Section 2(a) of the Worker Adjustment and 
     Retraining Notification Act (29 U.S.C. 2101(a)) is amended--
       (1) in paragraph (3)(B), by striking ``for--'' and all that 
     follows through ``500 employees'' in clause (ii), and 
     inserting ``for not less than 50 employees'';
       (2) in paragraph (7), by striking ``and'' after the 
     semicolon;
       (3) in paragraph (8), by striking the period and inserting 
     ``; and''; and
       (4) by adding at the end the following:
       ``(9) the term `offshoring of jobs' means any action taken 
     by an employer the effect of which is to create, shift, or 
     transfer employment positions or facilities outside the 
     United States and which results in an employment loss during 
     any 30-day period for 15 or more employees.''.
       (b) Notice.--Section 3 of the Worker Adjustment and 
     Retraining Notification Act (29 U.S.C. 2102) is amended--
       (1) in subsection (a)--
       (A) in the matter preceding paragraph (1), by striking 
     ``60-day'' and inserting ``90-day'';
       (B) in paragraph (1), by striking ``and'' after the 
     semicolon;
       (C) in paragraph (2), by striking the period and inserting 
     ``; and''; and
       (D) by inserting after paragraph (2), the following:
       ``(3) to the Secretary of Labor.'';
       (2) in subsection (b), by striking ``60-day'' both places 
     that such term appears and inserting ``90-day''; and
       (3) by adding at the end the following:
       ``(e) Notice for Offshoring of Jobs.--In the case of a 
     notice under subsection (a) regarding the offshoring of jobs, 
     the notice shall include, in addition to the information 
     otherwise required by the Secretary with respect to other 
     notices under such subsection, information concerning--
       ``(1) the number of jobs affected;
       ``(2) the location that the jobs are being shifted or 
     transferred to; and
       ``(3) the reasons that such shifting or transferring of 
     jobs is occurring.''.
       (c) Technical Amendments.--The Worker Adjustment and 
     Retraining Notification Act (29 U.S.C. 2101 et seq.) is 
     amended--
       (1) by striking ``plant closing or mass layoff'' each place 
     that such term appears and inserting ``plant closing, mass 
     layoff, or offshoring of jobs'';
       (2) by striking ``closing or layoff'' each place that such 
     term appears and inserting ``closing, layoff, or 
     offshoring'';
       (3) in section 3--
       (A) in the section heading by striking ``PLANT CLOSINGS AND 
     MASS LAYOFFS'' and inserting ``PLANT CLOSINGS, MASS LAYOFFS, 
     AND OFFSHORING OF JOBS'';
       (B) in subsection (b)(2)(A), by striking ``the closing or 
     mass layoff'' and inserting ``the closing, layoff, or 
     offshoring''; and
       (C) in subsection (d), by striking ``section 2(a) (2) or 
     (3)'' and inserting ``paragraph (2), (3), or (9) of section 
     2(a)''; and
       (4) in section 5(a)(1), in the matter following 
     subparagraph (B), by striking ``60 days'' and inserting ``90 
     days''.
       (d) Posting of Employee Rights.--The Worker Adjustment and 
     Retraining Notification Act (29 U.S.C. 2101 et seq.) is 
     amended by adding at the end the following:

     ``SEC. 12. POSTING OF NOTICE OF RIGHTS.

       ``(a) Development.--Not later than 60 days after the date 
     of enactment of this section, the Secretary of Labor shall 
     develop a notice of employee rights under this Act for 
     posting by employers.
       ``(b) Posting.--Each employer shall post in a conspicuous 
     place in places of employment the notice of the rights of 
     employees as developed by the Secretary under subsection 
     (a).''.
       (e) Annual Report.--The Worker Adjustment and Retraining 
     Notification Act (29 U.S.C. 2101 et seq.), as amended by 
     subsection (d), is further amended by adding at the end the 
     following:

     ``SEC. 13. CONTENTS OF ANNUAL REPORTS BY THE SECRETARY OF 
                   LABOR.

       ``(a) In General.--The Secretary of Labor shall collect and 
     compile statistics based on the information submitted to the 
     Secretary under subsections (a)(3) and (e) of section 3.
       ``(b) Report.--Not later than 120 days after the date on 
     which each regular session of Congress commences, the 
     Secretary of Labor shall prepare and submit to the President 
     and the appropriate committees of Congress a report on the 
     offshoring of jobs (as defined in section 2(a)(9)). Each such 
     report shall include information concerning--
       ``(1) the number of jobs affected by offshoring;
       ``(2) the locations to which jobs are being shifted or 
     transferred;
       ``(3) the reasons why such shifts and transfers are 
     occurring; and
       ``(4) any other relevant data compiled under subsection 
     (a).''.

                Subtitle B--Investment in Infrastructure

                CHAPTER 1--TRANSPORTATION INFRASTRUCTURE

     SEC. 221. TRANSPORTATION INFRASTRUCTURE FUNDING.

       (a) Funding.--
       (1) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this chapter for each of 
     fiscal years 2005 and 2006 $7,000,000,000, to remain 
     available until expended.
       (2) Distribution.--The Secretary of Transportation, acting 
     through the Administrator of the Federal Highway 
     Administration, shall distribute funds made available under 
     this subsection to States in accordance with section 105 of 
     title 23, United States Code.
       (b) Additional Requirements.--
       (1) Nonapplicability of certain provisions.--Funds made 
     available under this section shall not be subject to--
       (A) section 120 of title 23, United States Code; or
       (B) any limitation on obligations under any other provision 
     of law.
       (2) Use of funds for near-term projects.--The Secretary of 
     Transportation shall ensure, to the maximum extent 
     practicable, that funds made available under this section are 
     directed to projects that may be obligated in the near term, 
     as determined by the Secretary of Transportation.

                    CHAPTER 2--WATER INFRASTRUCTURE

     SEC. 231. WATER INFRASTRUCTURE FUNDING.

       (a) Authorization of Appropriations.--There is authorized 
     to be appropriated to the Administrator of the Environmental 
     Protection Agency to make grants to States under--
       (1) title VI of the Federal Water Pollution Control Act (33 
     U.S.C. 1381 et seq.), $3,000,000,000 for each of fiscal years 
     2005 and 2006; and
       (2) section 1452 of the Safe Drinking Water Act (42 U.S.C. 
     300j-12), $3,000,000,000 for each of fiscal years 2005 and 
     2006.
       (b) Availability of Funds.--Funds transferred under 
     subsection (a) shall remain available until expended.

                     CHAPTER 3--RAIL INFRASTRUCTURE

     SEC. 241. RAIL INFRASTRUCTURE FUNDING.

       (a) Amount for Capital Projects Grants.--There is 
     authorized to be appropriated to the Secretary of 
     Transportation for each of fiscal years 2005 and 2006, 
     $1,500,000,000, which shall be available for the Secretary of 
     Transportation to make grants to States, rail carriers, and 
     other entities as determined by the Secretary of 
     Transportation for intercity passenger and freight railroad 
     capital projects in accordance with this chapter.
       (b) Availability of Funds.--Funds transferred under 
     subsection (a) shall remain available until expended.
       (c) Nonapplicability of Certain Provisions.--Funds made 
     available under this chapter shall not be subject to any 
     limitation on obligations under any other provision of law.

     SEC. 242. GRANT AUTHORITY.

       (a) Public Benefit Projects.--The Secretary of 
     Transportation shall make grants to States, rail carriers, 
     and other entities, as determined by the Secretary, for 
     intercity passenger and freight railroad capital projects 
     that provide a public benefit, including projects involving 
     the following purposes:
       (1) Track and track structure rehabilitation, relocation, 
     improvement, and development.
       (2) Railroad safety and security improvements.
       (3) Communications and signaling improvements.
       (4) Intercity passenger rail equipment acquisition.
       (5) Rail station and intermodal facilities development.
       (b) Public Benefit Defined.--In this section, the term 
     ``public benefit'' means a benefit accrued to the public in 
     the form of enhanced mobility of people or goods, 
     environmental protection or enhancement, congestion 
     mitigation, enhanced trade and economic development, improved 
     air quality or land use, more efficient energy use, enhanced 
     public safety or security, reduction of public expenditures 
     due to improved transportation efficiency or infrastructure 
     preservation, and any other positive community effects (as 
     defined by the Secretary after any consultation with State 
     official and rail carriers that the Secretary determines 
     appropriate).

     SEC. 243. GRANT CONDITIONS FOR RIGHT-OF-WAY PROJECTS.

       The Secretary of Transportation shall require as a 
     condition of making any grant under this chapter that 
     includes the improvement or use of rights-of-way owned by a 
     railroad that--
       (1) a written agreement exist between the applicant and the 
     railroad regarding such use and ownership, including--
       (A) any compensation for such use;
       (B) assurances regarding the adequacy of infrastructure 
     capacity to accommodate both existing and future freight and 
     passenger operations; and
       (C) an assurance by the railroad that collective bargaining 
     agreements with the railroad's employees (including terms 
     regulating the contracting of work) will remain in full force 
     and effect according to their terms for

[[Page S440]]

     work performed by the railroad on the railroad transportation 
     corridor; and
       (2) the applicant agrees to comply with--
       (A) the standards under section 24312 of title 49, United 
     States Code, as such section was in effect on September 1, 
     2003, with respect to the project in the same manner that the 
     National Railroad Passenger Corporation is required to comply 
     with those standards for construction work financed under an 
     agreement made under section; and
       (B) the protective agreements established under section 504 
     of the Railroad Revitalization and Regulatory Reform Act of 
     1976 with respect to employees affected by actions taken in 
     connection with the project.

     SEC. 244. USE OF FUNDS FOR NEAR-TERM PROJECTS.

       The Secretary of Transportation shall ensure, to the 
     maximum extent practicable, that funds made available under 
     this chapter are directed to projects that may be obligated 
     in the near term, as determined by the Secretary of 
     Transportation.

     SEC. 245. TREATMENT OF RAIL OPERATORS USING GRANT-FUNDED RAIL 
                   INFRASTRUCTURE.

       A person that conducts rail operations over rail 
     infrastructure constructed or improved with funding provided 
     in whole or in part in a grant made under this chapter--
       (1) shall be considered an employer for purposes of the 
     Railroad Retirement Act of 1974 (45 20 U.S.C. 231 et seq.); 
     and
       (2) shall be considered a carrier for purposes of the 
     Railway Labor Act (43 U.S.C. 151 et seq.) unless such a 
     person is an operator with respect to commuter rail passenger 
     transportation (as defined in section 24102(4) of title 49, 
     United States Code) of a State or local government authority 
     (as such terms are defined in section 5302 of such title) 
     eligible to receive financial assistance under section 5307 
     of such title, a contractor performing services in connection 
     with the operations with respect to commuter rail passenger 
     transportation (as so defined), or the Alaska Railroad or its 
     contractors.

                   CHAPTER 4--TRANSIT INFRASTRUCTURE

     SEC. 251. TRANSIT.

       (a) Authorization of Appropriations.--
       (1) Amounts for fiscal years 2005 and 2006.--There is 
     authorized to be appropriated to the Secretary of 
     Transportation for each of the fiscal years 2005 and 2006, 
     $1,750,000,000.
       (2) Availability of funds.--Funds appropriated under 
     paragraph (1) shall remain available until expended.
       (b) Distribution of Funds.--
       (1) In general.--Of the funds authorized to be appropriated 
     under subsection (a)--
       (A) 50.18 percent shall be available to carry out section 
     5307 of title 49, United States Code;
       (B) 45 percent shall be available to carry out section 
     5309(a)(1) of title 49, United States Code, of which--
       (i) 40 percent shall be available to carry out subparagraph 
     (A) of such paragraph;
       (ii) 40 percent shall be available to carry out 
     subparagraph (E) of such paragraph; and
       (iii) 20 percent shall be available to carry out 
     subparagraph (F) of such paragraph;
       (C) 1.32 percent shall be available to carry out section 
     5310 of title 49, United States Code; and
       (D) 3.5 percent shall be available to carry out section 
     5311 of title 49, United States Code.
       (2) Formulas.--Funds made available under subparagraphs 
     (A), (C), and (D) of paragraph (1) shall be distributed in 
     accordance with the formulas established under sections 5307, 
     5310, and 5311, respectively, of title 49, United States 
     Code.
       (3) Determination by secretary.--
       (A) In general.--The Secretary of Transportation shall 
     determine the allocation of funds made available under 
     clauses (i) and (iii) of paragraph (1)(B).
       (B) Modernization of existing fixed guideway systems.--The 
     Secretary of Transportation shall determine the amount 
     apportioned to each urbanized area under paragraph (1)(B)(ii) 
     on a pro rata basis in accordance with the distribution 
     formula established under section 5337 of title 49, United 
     States Code.
       (C) Near term projects.--In allocating funds under this 
     paragraph, the Secretary of Transportation shall ensure, to 
     the maximum extent practicable, that funds are directed to 
     near term projects.
       (c) Limitation for Capital Projects.--Funds may be used 
     under this section only for capital projects.
       (d) Inapplicability of Certain Provisions.--Funds 
     distributed under subsection (b) shall not be subject to 
     sections 5307(e), 5309(h), or 5311(g) of title 49, United 
     States Code.

                   CHAPTER 5--AVIATION INFRASTRUCTURE

     SEC. 261. AUTHORIZATION OF APPROPRIATIONS FOR AVIATION 
                   INFRASTRUCTURE.

       There is authorized to be appropriated for each of fiscal 
     years 2005 and 2006 to carry out this chapter, 
     $1,500,000,000, to remain available until expended.

     SEC. 262. DISTRIBUTION OF FUNDS.

       The Secretary of Transportation, acting through the 
     Administrator of the Federal Aviation Administration, shall 
     distribute funds made available under this chapter to public 
     use airports for the purposes provided under chapter 471 of 
     title 49, United States Code, including for enhancement of 
     aviation safety, enhancement of aviation capacity, and 
     defrayal of the cost of security requirements imposed on 
     airport operators by the Administrator or by the 
     Administrator of the Transportation Security Administration.

     SEC. 263. NONAPPLICABILITY OF CERTAIN LAWS.

       Funds made available under this chapter shall not be 
     subject to--
       (1) a matching requirement under section 47109 of title 49, 
     United States Code; or
       (2) any limitation on obligation under any other provision 
     of law.

     SEC. 264. USE OF FUNDS FOR NEAR-TERM PROJECTS.

       The Secretary of Transportation shall ensure, to the 
     maximum extent practicable, that funds made available under 
     this chapter are directed to projects that may be obligated 
     in the near-term, as determined by the Secretary of 
     Transportation.

                 CHAPTER 6--BROADBAND ACCESS TAX CREDIT

     SEC. 271. EXPENSING OF BROADBAND INTERNET ACCESS 
                   EXPENDITURES.

       (a) In General.--Part VI of subchapter B of chapter 1 of 
     the Internal Revenue Code of 1986 (relating to itemized 
     deductions for individuals and corporations) is amended by 
     inserting after section 190 the following new section:

     ``SEC. 191. BROADBAND EXPENDITURES.

       ``(a) Treatment of Expenditures.--
       ``(1) In general.--A taxpayer may elect to treat any 
     qualified broadband expenditure which is paid or incurred by 
     the taxpayer as an expense which is not chargeable to capital 
     account. Any expenditure which is so treated shall be allowed 
     as a deduction.
       ``(2) Election.--An election under paragraph (1) shall be 
     made at such time and in such manner as the Secretary may 
     prescribe by regulation.
       ``(b) Qualified Broadband Expenditures.--For purposes of 
     this section--
       ``(1) In general.--The term `qualified broadband 
     expenditure' means, with respect to any taxable year, any 
     direct or indirect costs incurred and properly taken into 
     account with respect to--
       ``(A) the purchase or installation of qualified equipment 
     (including any upgrades thereto), and
       ``(B) the connection of such qualified equipment to any 
     qualified subscriber.
       ``(2) Certain satellite expenditures excluded.--Such term 
     shall not include any costs incurred with respect to the 
     launching of any satellite equipment.
       ``(3) Leased equipment.--Such term shall include so much of 
     the purchase price paid by the lessor of qualified equipment 
     subject to a lease described in subsection (c)(2)(B) as is 
     attributable to expenditures incurred by the lessee which 
     would otherwise be described in paragraph (1).
       ``(4) Limitation with regard to current generation 
     broadband services.--Only 50 percent of the amounts taken 
     into account under paragraph (1) with respect to qualified 
     equipment through which current generation broadband services 
     are provided shall be treated as qualified broadband 
     expenditures.
       ``(c) When Expenditures Taken Into Account.--For purposes 
     of this section--
       ``(1) In general.--Qualified broadband expenditures with 
     respect to qualified equipment shall be taken into account 
     with respect to the first taxable year in which--
       ``(A) current generation broadband services are provided 
     through such equipment to qualified subscribers, or
       ``(B) next generation broadband services are provided 
     through such equipment to qualified subscribers.
       ``(2) Limitation.--
       ``(A) In general.--Qualified expenditures shall be taken 
     into account under paragraph (1) only with respect to 
     qualified equipment--
       ``(i) the original use of which commences with the 
     taxpayer, and
       ``(ii) which is placed in service, after the date of the 
     enactment of this Act.
       ``(B) Sale-leasebacks.--For purposes of subparagraph (A), 
     if property--
       ``(i) is originally placed in service after the date of the 
     enactment of this Act by any person, and
       ``(ii) sold and leased back by such person within 3 months 
     after the date such property was originally placed in 
     service,

     such property shall be treated as originally placed in 
     service not earlier than the date on which such property is 
     used under the leaseback referred to in clause (ii).
       ``(d) Special Allocation Rules.--
       ``(1) Current generation broadband services.--For purposes 
     of determining the amount of qualified broadband expenditures 
     under subsection (a)(1) with respect to qualified equipment 
     through which current generation broadband services are 
     provided, if the qualified equipment is capable of serving 
     both qualified subscribers and other subscribers, the 
     qualified broadband expenditures shall be multiplied by a 
     fraction--
       ``(A) the numerator of which is the sum of the number of 
     potential qualified subscribers within the rural areas and 
     the underserved areas which the equipment is capable of 
     serving with current generation broadband services, and
       ``(B) the denominator of which is the total potential 
     subscriber population of the area which the equipment is 
     capable of serving with current generation broadband 
     services.
       ``(2) Next generation broadband services.--For purposes of 
     determining the amount of qualified broadband expenditures 
     under subsection (a)(1) with respect to qualified equipment 
     through which next generation broadband services are 
     provided, if the qualified equipment is capable of serving 
     both qualified subscribers and other subscribers, the 
     qualified expenditures shall be multiplied by a fraction--

[[Page S441]]

       ``(A) the numerator of which is the sum of--
       ``(i) the number of potential qualified subscribers within 
     the rural areas and underserved areas, plus
       ``(ii) the number of potential qualified subscribers within 
     the area consisting only of residential subscribers not 
     described in clause (i),

     which the equipment is capable of serving with next 
     generation broadband services, and
       ``(B) the denominator of which is the total potential 
     subscriber population of the area which the equipment is 
     capable of serving with next generation broadband services.
       ``(e) Definitions.--For purposes of this section--
       ``(1) Antenna.--The term `antenna' means any device used to 
     transmit or receive signals through the electromagnetic 
     spectrum, including satellite equipment.
       ``(2) Cable operator.--The term `cable operator' has the 
     meaning given such term by section 602(5) of the 
     Communications Act of 1934 (47 U.S.C. 522(5)).
       ``(3) Commercial mobile service carrier.--The term 
     `commercial mobile service carrier' means any person 
     authorized to provide commercial mobile radio service as 
     defined in section 20.3 of title 47, Code of Federal 
     Regulations.
       ``(4) Current generation broadband service.--The term 
     `current generation broadband service' means the transmission 
     of signals at a rate of at least 1,000,000 bits per second to 
     the subscriber and at least 128,000 bits per second from the 
     subscriber.
       ``(5) Multiplexing or demultiplexing.--The term 
     `multiplexing' means the transmission of 2 or more signals 
     over a single channel, and the term `demultiplexing' means 
     the separation of 2 or more signals previously combined by 
     compatible multiplexing equipment.
       ``(6) Next generation broadband service.--The term `next 
     generation broadband service' means the transmission of 
     signals at a rate of at least 22,000,000 bits per second to 
     the subscriber and at least 5,000,000 bits per second from 
     the subscriber.
       ``(7) Nonresidential subscriber.--The term `nonresidential 
     subscriber' means any person who purchases broadband services 
     which are delivered to the permanent place of business of 
     such person.
       ``(8) Open video system operator.--The term `open video 
     system operator' means any person authorized to provide 
     service under section 653 of the Communications Act of 1934 
     (47 U.S.C. 573).
       ``(9) Other wireless carrier.--The term `other wireless 
     carrier' means any person (other than a telecommunications 
     carrier, commercial mobile service carrier, cable operator, 
     open video system operator, or satellite carrier) providing 
     current generation broadband services or next generation 
     broadband service to subscribers through the radio 
     transmission of energy.
       ``(10) Packet switching.--The term `packet switching' means 
     controlling or routing the path of any digitized transmission 
     signal which is assembled into packets or cells.
       ``(11) Provider.--The term `provider' means, with respect 
     to any qualified equipment--
       ``(A) a cable operator,
       ``(B) a commercial mobile service carrier,
       ``(C) an open video system operator,
       ``(D) a satellite carrier,
       ``(E) a telecommunications carrier, or
       ``(F) any other wireless carrier,
     providing current generation broadband services or next 
     generation broadband services to subscribers through such 
     qualified equipment.
       ``(12) Provision of services.--A provider shall be treated 
     as providing services to 1 or more subscribers if--
       ``(A) such a subscriber has been passed by the provider's 
     equipment and can be connected to such equipment for a 
     standard connection fee,
       ``(B) the provider is physically able to deliver current 
     generation broadband services or next generation broadband 
     services, as applicable, to such a subscriber without making 
     more than an insignificant investment with respect to such 
     subscriber,
       ``(C) the provider has made reasonable efforts to make such 
     subscribers aware of the availability of such services,
       ``(D) such services have been purchased by 1 or more such 
     subscribers, and
       ``(E) such services are made available to such subscribers 
     at average prices comparable to those at which the provider 
     makes available similar services in any areas in which the 
     provider makes available such services.
       ``(13) Qualified equipment.--
       ``(A) In general.--The term `qualified equipment' means 
     equipment which provides current generation broadband 
     services or next generation broadband services--
       ``(i) at least a majority of the time during periods of 
     maximum demand to each subscriber who is utilizing such 
     services, and
       ``(ii) in a manner substantially the same as such services 
     are provided by the provider to subscribers through equipment 
     with respect to which no deduction is allowed under 
     subsection (a)(1).
       ``(B) Only certain investment taken into account.--Except 
     as provided in subparagraph (C) or (D), equipment shall be 
     taken into account under subparagraph (A) only to the extent 
     it--
       ``(i) extends from the last point of switching to the 
     outside of the unit, building, dwelling, or office owned or 
     leased by a subscriber in the case of a telecommunications 
     carrier,
       ``(ii) extends from the customer side of the mobile 
     telephone switching office to a transmission/receive antenna 
     (including such antenna) owned or leased by a subscriber in 
     the case of a commercial mobile service carrier,
       ``(iii) extends from the customer side of the headend to 
     the outside of the unit, building, dwelling, or office owned 
     or leased by a subscriber in the case of a cable operator or 
     open video system operator, or
       ``(iv) extends from a transmission/receive antenna 
     (including such antenna) which transmits and receives signals 
     to or from multiple subscribers, to a transmission/receive 
     antenna (including such antenna) on the outside of the unit, 
     building, dwelling, or office owned or leased by a subscriber 
     in the case of a satellite carrier or other wireless carrier, 
     unless such other wireless carrier is also a 
     telecommunications carrier.
       ``(C) Packet switching equipment.--Packet switching 
     equipment, regardless of location, shall be taken into 
     account under subparagraph (A) only if it is deployed in 
     connection with equipment described in subparagraph (B) and 
     is uniquely designed to perform the function of packet 
     switching for current generation broadband services or next 
     generation broadband services, but only if such packet 
     switching is the last in a series of such functions performed 
     in the transmission of a signal to a subscriber or the first 
     in a series of such functions performed in the transmission 
     of a signal from a subscriber.
       ``(D) Multiplexing and demultiplexing equipment.--
     Multiplexing and demultiplexing equipment shall be taken into 
     account under subparagraph (A) only to the extent it is 
     deployed in connection with equipment described in 
     subparagraph (B) and is uniquely designed to perform the 
     function of multiplexing and demultiplexing packets or cells 
     of data and making associated application adaptions, but only 
     if such multiplexing or demultiplexing equipment is located 
     between packet switching equipment described in subparagraph 
     (C) and the subscriber's premises.
       ``(14) Qualified subscriber.--The term `qualified 
     subscriber' means--
       ``(A) with respect to the provision of current generation 
     broadband services--
       ``(i) any nonresidential subscriber maintaining a permanent 
     place of business in a rural area or underserved area, or
       ``(ii) any residential subscriber residing in a dwelling 
     located in a rural area or underserved area which is not a 
     saturated market, and
       ``(B) with respect to the provision of next generation 
     broadband services--
       ``(i) any nonresidential subscriber maintaining a permanent 
     place of business in a rural area or underserved area, or
       ``(ii) any residential subscriber.
       ``(15) Residential subscriber.--The term `residential 
     subscriber' means any individual who purchases broadband 
     services which are delivered to such individual's dwelling.
       ``(16) Rural area.--The term `rural area' means any census 
     tract which--
       ``(A) is not within 10 miles of any incorporated or census 
     designated place containing more than 25,000 people, and
       ``(B) is not within a county or county equivalent which has 
     an overall population density of more than 500 people per 
     square mile of land.
       ``(17) Rural subscriber.--The term `rural subscriber' means 
     any residential subscriber residing in a dwelling located in 
     a rural area or nonresidential subscriber maintaining a 
     permanent place of business located in a rural area.
       ``(18) Satellite carrier.--The term `satellite carrier' 
     means any person using the facilities of a satellite or 
     satellite service licensed by the Federal Communications 
     Commission and operating in the Fixed-Satellite Service under 
     part 25 of title 47 of the Code of Federal Regulations or the 
     Direct Broadcast Satellite Service under part 100 of title 47 
     of such Code to establish and operate a channel of 
     communications for distribution of signals, and owning or 
     leasing a capacity or service on a satellite in order to 
     provide such point-to-multipoint distribution.
       ``(19) Saturated market.--The term `saturated market' means 
     any census tract in which, as of the date of the enactment of 
     this section--
       ``(A) current generation broadband services have been 
     provided by a single provider to 85 percent or more of the 
     total number of potential residential subscribers residing in 
     dwellings located within such census tract, and
       ``(B) such services can be utilized--
       ``(i) at least a majority of the time during periods of 
     maximum demand by each such subscriber who is utilizing such 
     services, and
       ``(ii) in a manner substantially the same as such services 
     are provided by the provider to subscribers through equipment 
     with respect to which no deduction is allowed under 
     subsection (a)(1).
       ``(20) Subscriber.--The term `subscriber' means any person 
     who purchases current generation broadband services or next 
     generation broadband services.
       ``(21) Telecommunications carrier.--The term 
     `telecommunications carrier' has the meaning given such term 
     by section 3(44) of the Communications Act of 1934 (47 U.S.C. 
     153(44)), but--
       ``(A) includes all members of an affiliated group of which 
     a telecommunications carrier is a member, and

[[Page S442]]

       ``(B) does not include a commercial mobile service carrier.
       ``(22) Total potential subscriber population.--The term 
     `total potential subscriber population' means, with respect 
     to any area and based on the most recent census data, the 
     total number of potential residential subscribers residing in 
     dwellings located in such area and potential nonresidential 
     subscribers maintaining permanent places of business located 
     in such area.
       ``(23) Underserved area.--The term `underserved area' 
     means--
       ``(A) any census tract which is located in--
       ``(i) an empowerment zone or enterprise community 
     designated under section 1391, or
       ``(ii) the District of Columbia Enterprise Zone established 
     under section 1400, or
       ``(B) any census tract--
       ``(i) the poverty level of which is at least 30 percent 
     (based on the most recent census data), and
       ``(ii) the median family income of which does not exceed--

       ``(I) in the case of a census tract located in a 
     metropolitan statistical area, 70 percent of the greater of 
     the metropolitan area median family income or the statewide 
     median family income, and
       ``(II) in the case of a census tract located in a 
     nonmetropolitan statistical area, 70 percent of the 
     nonmetropolitan statewide median family income.

       ``(24) Underserved subscriber.--The term `underserved 
     subscriber' means any residential subscriber residing in a 
     dwelling located in an underserved area or nonresidential 
     subscriber maintaining a permanent place of business located 
     in an underserved area.
       ``(f) Special Rules.--
       ``(1) Property used outside the united states, etc., not 
     qualified.--No expenditures shall be taken into account under 
     subsection (a)(1) with respect to the portion of the cost of 
     any property referred to in section 50(b) or with respect to 
     the portion of the cost of any property specified in an 
     election under section 179.
       ``(2) Basis reduction.--
       ``(A) In general.--For purposes of this title, the basis of 
     any property shall be reduced by the portion of the cost of 
     such property taken into account under subsection (a)(1).
       ``(B) Ordinary income recapture.--For purposes of section 
     1245, the amount of the deduction allowable under subsection 
     (a)(1) with respect to any property which is of a character 
     subject to the allowance for depreciation shall be treated as 
     a deduction allowed for depreciation under section 167.
       ``(3) Coordination with section 38.--No credit shall be 
     allowed under section 38 with respect to any amount for which 
     a deduction is allowed under subsection (a)(1).''.
       (b) Special Rule for Mutual or Cooperative Telephone 
     Companies.--Section 512(b) of the Internal Revenue Code of 
     1986 (relating to modifications) is amended--
       (1) by redesignating paragraph (18) as added by section 
     702(a) of the American Jobs Creation Act of 2004 as paragraph 
     (19), and
       (2) by adding at the end the following new paragraph:
       ``(20) Special rule for mutual or cooperative telephone 
     companies.--A mutual or cooperative telephone company which 
     for the taxable year satisfies the requirements of section 
     501(c)(12)(A) may elect to reduce its unrelated business 
     taxable income for such year, if any, by an amount that does 
     not exceed the qualified broadband expenditures which would 
     be taken into account under section 191 for such year by such 
     company if such company was not exempt from taxation. Any 
     amount which is allowed as a deduction under this paragraph 
     shall not be allowed as a deduction under section 191 and the 
     basis of any property to which this paragraph applies shall 
     be reduced under section 1016(a)(32).''.
       (c) Conforming Amendments.--
       (1) Section 263(a)(1) of the Internal Revenue Code of 1986 
     (relating to capital expenditures) is amended by striking 
     ``or'' at the end of subparagraph (H), by striking the period 
     at the end of subparagraph (I) and inserting ``, or'', and by 
     adding at the end the following new subparagraph:
       ``(J) expenditures for which a deduction is allowed under 
     section 191.''.
       (2) Section 1016(a) of such Code is amended by striking 
     ``and'' at the end of paragraph (30), by striking the period 
     at the end of paragraph (31) and inserting ``, and'', and by 
     adding at the end the following new paragraph:
       ``(32) to the extent provided in section 191(f)(2).''.
       (3) The table of sections for part VI of subchapter A of 
     chapter 1 of such Code is amended by inserting after the item 
     relating to section 190 the following new item:

``Sec. 191. Broadband expenditures.''.

       (d) Designation of Census Tracts.--
       (1) In general.--The Secretary of the Treasury shall, not 
     later than 90 days after the date of the enactment of this 
     Act, designate and publish those census tracts meeting the 
     criteria described in paragraphs (16), (22), and (23) of 
     section 191(e) of the Internal Revenue Code of 1986 (as added 
     by this section). In making such designations, the Secretary 
     of the Treasury shall consult with such other departments and 
     agencies as the Secretary determines appropriate.
       (2) Saturated market.--
       (A) In general.--For purposes of designating and publishing 
     those census tracts meeting the criteria described in 
     subsection (e)(19) of such section 191--
       (i) the Secretary of the Treasury shall prescribe not later 
     than 30 days after the date of the enactment of this Act the 
     form upon which any provider which takes the position that it 
     meets such criteria with respect to any census tract shall 
     submit a list of such census tracts (and any other 
     information required by the Secretary) not later than 60 days 
     after the date of the publication of such form, and
       (ii) the Secretary of the Treasury shall publish an 
     aggregate list of such census tracts and the applicable 
     providers not later than 30 days after the last date such 
     submissions are allowed under clause (i).
       (B) No subsequent lists required.--The Secretary of the 
     Treasury shall not be required to publish any list of census 
     tracts meeting such criteria subsequent to the list described 
     in subparagraph (A)(ii).
       (e) Other Regulatory Matters.--
       (1) Prohibition.--No Federal or State agency or 
     instrumentality shall adopt regulations or ratemaking 
     procedures that would have the effect of eliminating or 
     reducing any deduction or portion thereof allowed under 
     section 191 of the Internal Revenue Code of 1986 (as added by 
     this section) or otherwise subverting the purpose of this 
     section.
       (2) Treasury regulatory authority.--It is the intent of 
     Congress in providing the election to deduct qualified 
     broadband expenditures under section 191 of the Internal 
     Revenue Code of 1986 (as added by this section) to provide 
     incentives for the purchase, installation, and connection of 
     equipment and facilities offering expanded broadband access 
     to the Internet for users in certain low income and rural 
     areas of the United States, as well as to residential users 
     nationwide, in a manner that maintains competitive neutrality 
     among the various classes of providers of broadband services. 
     Accordingly, the Secretary of the Treasury shall prescribe 
     such regulations as may be necessary or appropriate to carry 
     out the purposes of section 191 of such Code, including--
       (A) regulations to determine how and when a taxpayer that 
     incurs qualified broadband expenditures satisfies the 
     requirements of section 191 of such Code to provide broadband 
     services, and
       (B) regulations describing the information, records, and 
     data taxpayers are required to provide the Secretary to 
     substantiate compliance with the requirements of section 191 
     of such Code.
       (f) Effective Date.--The amendments made by this section 
     shall apply to expenditures incurred after the date of the 
     enactment of this Act and before the date which is 60 months 
     after the date of the enactment of this Act.

             CHAPTER 7--RESEARCH AND DEVELOPMENT TAX CREDIT

     SEC. 281. FINDINGS.

       Congress finds the following:
       (1) Research and development performed in the United States 
     results in quality jobs, better and safer products, increased 
     ownership of technology-based intellectual property, and 
     higher productivity in the United States.
       (2) Since 1994, private sector research and development 
     employment has grown at a faster rate than overall private 
     sector employment in the United States. From 1994 to 2000, 
     there was an average annual growth rate of 5.4 percent in 
     research and development employment, compared with 2.7 
     percent in total employment.
       (3) The extent to which companies perform and increase 
     research and development activities in the United States is 
     in part dependent on Federal tax policy.
       (4) The private sector performed most of the Nation's 
     research and development and accounted for more than two-
     thirds of total research and development performance in 2003. 
     Of the $194,000,000,000 in industrial research and 
     development performed in 2003, more than 90 percent was 
     funded by industry.
       (5) Many of the countries with which the United States 
     competes have introduced new or revised national plans for 
     science, technology, and innovation policy, and a growing 
     number of countries have established targets for increased 
     research and development spending. Virtually all countries 
     are seeking ways to enhance the quality and efficiency of 
     public research, stimulate business investments in research 
     and development, and strengthen linkages between the public 
     and private sectors.
       (6) Direct government support to business research and 
     development has declined, both in absolute terms and as a 
     share of business research and development, and greater 
     emphasis is being placed on indirect measures, such as tax 
     incentives for research and development.
       (7) Congress should make permanent a research and 
     development credit that provides a meaningful incentive to 
     all types of taxpayers.

     SEC. 282. PERMANENT EXTENSION OF RESEARCH CREDIT.

       (a) In General.--Section 41 of the Internal Revenue Code of 
     1986 (relating to credit for increasing research activities) 
     is amended by striking subsection (h).
       (b) Conforming Amendment.--Paragraph (1) of section 45C(b) 
     of such Code is amended by striking subparagraph (D).
       (c) Effective Date.--The amendments made by this section 
     shall apply to amounts paid or incurred after the date of the 
     enactment of this Act, in taxable years ending after such 
     date.

[[Page S443]]

     SEC. 283. INCREASE IN RATES OF ALTERNATIVE INCREMENTAL 
                   CREDIT.

       (a) In General.--Subparagraph (A) of section 41(c)(4) of 
     the Internal Revenue Code of 1986 (relating to election of 
     alternative incremental credit) is amended--
       (1) by striking ``2.65 percent'' and inserting ``3 
     percent'',
       (2) by striking ``3.2 percent'' and inserting ``4 
     percent'', and
       (3) by striking ``3.75 percent'' and inserting ``5 
     percent''.
       (b) Effective Date.--The amendments made by this section 
     shall apply to taxable years ending after the date of the 
     enactment of this Act.

     SEC. 284. ALTERNATIVE SIMPLIFIED CREDIT FOR QUALIFIED 
                   RESEARCH EXPENSES.

       (a) In General.--Subsection (c) of section 41 of the 
     Internal Revenue Code of 1986 (relating to base amount) is 
     amended by redesignating paragraphs (5) and (6) as paragraphs 
     (6) and (7), respectively, and by inserting after paragraph 
     (4) the following new paragraph:
       ``(5) Election of alternative simplified credit.--
       ``(A) In general.--At the election of the taxpayer, the 
     credit determined under subsection (a)(1) shall be equal to 
     12 percent of so much of the qualified research expenses for 
     the taxable year as exceeds 50 percent of the average 
     qualified research expenses for the 3 taxable years preceding 
     the taxable year for which the credit is being determined.
       ``(B) Special rule in case of no qualified research 
     expenses in any of 3 preceding taxable years.--
       ``(i) Taxpayers to which subparagraph applies.--The credit 
     under this paragraph shall be determined under this 
     subparagraph if the taxpayer has no qualified research 
     expenses in any 1 of the 3 taxable years preceding the 
     taxable year for which the credit is being determined.
       ``(ii) Credit rate.--The credit determined under this 
     subparagraph shall be equal to 6 percent of the qualified 
     research expenses for the taxable year.
       ``(C) Election.--An election under this paragraph shall 
     apply to the taxable year for which made and all succeeding 
     taxable years unless revoked with the consent of the 
     Secretary. An election under this paragraph may not be made 
     for any taxable year to which an election under paragraph (4) 
     applies.''.
       (b) Coordination With Election of Alternative Incremental 
     Credit.--
       (1) In general.--Section 41(c)(4)(B) of the Internal 
     Revenue Code of 1986 (relating to election) is amended by 
     adding at the end the following: ``An election under this 
     paragraph may not be made for any taxable year to which an 
     election under paragraph (5) applies.''.
       (2) Transition rule.--In the case of an election under 
     section 41(c)(4) of the Internal Revenue Code of 1986 which 
     applies to the taxable year which includes the date of the 
     enactment of this Act, such election shall be treated as 
     revoked with the consent of the Secretary of the Treasury if 
     the taxpayer makes an election under section 41(c)(5) of such 
     Code (as added by subsection (a)) for such year.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years ending after the date of the 
     enactment of this Act.

     SEC. 285. EXPANSION OF RESEARCH CREDIT.

       (a) Credit for Expenses Attributable to Certain 
     Collaborative Research Consortia.--
       (1) In general.--Section 41(a) of the Internal Revenue Code 
     of 1986 (relating to credit for increasing research 
     activities) is amended by striking ``and'' at the end of 
     paragraph (1), by striking the period at the end of paragraph 
     (2) and inserting ``, and'', and by adding at the end the 
     following new paragraph:
       ``(3) 20 percent of the amounts paid or incurred by the 
     taxpayer in carrying on any trade or business of the taxpayer 
     during the taxable year (including as contributions) to a 
     research consortium.''.
       (2) Research consortium defined.--Section 41(f) of such 
     Code (relating to special rules) is amended by adding at the 
     end the following new paragraph:
       ``(6) Research consortium.--
       ``(A) In general.--The term `research consortium' means any 
     organization--
       ``(i) which is--

       ``(I) described in section 501(c)(3) or 501(c)(6) and is 
     exempt from tax under section 501(a) and is organized and 
     operated primarily to conduct research, or
       ``(II) organized and operated primarily to conduct research 
     in the public interest (within the meaning of section 
     501(c)(3)),

       ``(ii) which is not a private foundation,
       ``(iii) to which at least 5 unrelated persons paid or 
     incurred during the calendar year in which the taxable year 
     of the organization begins amounts (including as 
     contributions) to such organization for research, and
       ``(iv) to which no single person paid or incurred 
     (including as contributions) during such calendar year an 
     amount equal to more than 50 percent of the total amounts 
     received by such organization during such calendar year for 
     research.
       ``(B) Treatment of persons.--All persons treated as a 
     single employer under subsection (a) or (b) of section 52 
     shall be treated as related persons for purposes of 
     subparagraph (A)(iii) and as a single person for purposes of 
     subparagraph (A)(iv).''.
       (3) Conforming amendment.--Section 41(b)(3)(C)(ii) of such 
     Code is amended by inserting ``(other than a research 
     consortium)'' after ``organization''.
       (b) Repeal of Limitation on Contract Research Expenses Paid 
     to Small Businesses, Universities, and Federal 
     Laboratories.--Section 41(b)(3) of the Internal Revenue Code 
     of 1986 (relating to contract research expenses) is amended 
     by adding at the end the following new subparagraph:
       ``(D) Amounts paid to eligible small businesses, 
     universities, and federal laboratories.--
       ``(i) In general.--In the case of amounts paid by the 
     taxpayer to--

       ``(I) an eligible small business,
       ``(II) an institution of higher education (as defined in 
     section 3304(f)), or
       ``(III) an organization which is a Federal laboratory,

     for qualified research, subparagraph (A) shall be applied by 
     substituting `100 percent' for `65 percent'.
       ``(ii) Eligible small business.--For purposes of this 
     subparagraph, the term `eligible small business' means a 
     small business with respect to which the taxpayer does not 
     own (within the meaning of section 318) 50 percent or more 
     of--

       ``(I) in the case of a corporation, the outstanding stock 
     of the corporation (either by vote or value), and
       ``(II) in the case of a small business which is not a 
     corporation, the capital and profits interests of the small 
     business.

       ``(iii) Small business.--For purposes of this 
     subparagraph--

       ``(I) In general.--The term `small business' means, with 
     respect to any calendar year, any person if the annual 
     average number of employees employed by such person during 
     either of the 2 preceding calendar years was 500 or fewer. 
     For purposes of the preceding sentence, a preceding calendar 
     year may be taken into account only if the person was in 
     existence throughout the year.
       ``(II) Startups, controlled groups, and predecessors.--
     Rules similar to the rules of subparagraphs (B) and (D) of 
     section 220(c)(4) shall apply for purposes of this clause.

       ``(iv) Federal laboratory.--For purposes of this 
     subparagraph, the term `Federal laboratory' has the meaning 
     given such term by section 4(6) of the Stevenson-Wydler 
     Technology Innovation Act of 1980 (15 U.S.C. 3703(6)), as in 
     effect on the date of the enactment of this subparagraph.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to amounts paid or incurred after the date of the 
     enactment of this Act, in taxable years ending after such 
     date.

                    Subtitle C--Technology Programs

     SEC. 291. AUTHORIZATIONS OF APPROPRIATIONS FOR THE ADVANCED 
                   TECHNOLOGY PROGRAM AND THE MANUFACTURING 
                   EXTENSION PARTNERSHIP PROGRAM.

       (a) Advanced Technology Program.--
       (1) Findings.--Congress makes the following findings:
       (A) The Advanced Technology Program (ATP) has played an 
     important role in helping United States companies develop 
     new, breakthrough technologies. ATP has funded research 
     ranging from cancer vaccines, to hi-tech flexible displays, 
     to composite materials, to fuel cells, all of which are the 
     kinds of technological advances that give the United States a 
     competitive advantage globally.
       (B) The National Academy of Science has found it to be an 
     effective program that could use more funding wisely, and the 
     National Association of Manufacturers (NAM), the 
     Biotechnology Industry Organization (BIO), the Industrial 
     Research Institute, the Alliance for Science and Technology 
     Research in America, and the American Chemical Society 
     support ATP.
       (C) Businesses need this type of program more than ever as 
     venture capital funds have become more scarce in the current 
     economy. ATP bridges this gap between the research lab and 
     market capital, facilitating the critical transfer of 
     technology to the private sector that leads to the 
     development of products and services that make use of new, 
     technological breakthroughs.
       (D) Not only does ATP promote economic security and global 
     competitiveness for the nation as a whole, it is an important 
     program for generating jobs domestically. Last year nearly 80 
     percent of ATP awards went to small businesses, an essential 
     job-creating sector in the United States economy.
       (E) ATP is also vital to the homeland security of the 
     United States. ATP has funded many projects in detection, 
     preparedness, prevention and response with significant 
     applications for homeland security. With continued financial 
     support through ATP to develop these projects and their 
     security applications, the United States will become more 
     secure.
       (F) Despite the importance and success of ATP, current 
     funding levels do not meet the demand. Over 1,000 proposals 
     for ATP funding that were submitted in 2002 yielded enough 
     high quality projects for the ATP funding that was available 
     in both fiscal years 2002 and 2003. The 870 applications for 
     ATP funding received in fiscal year 2004 made the second 
     highest number of applications for ATP funding that were 
     received in any fiscal year, but funding was only available 
     for 59 awards. No funding for new awards is available in 
     fiscal year 2005.
       (G) According to the 2004 annual report on the ATP, returns 
     from just 41 of the 736 ATP

[[Page S444]]

     projects have exceeded $17,000,000,000 in economic benefits, 
     more than 8 times the amount of money spent on all 736 
     projects.
       (2) Authorization of appropriations.--There are authorized 
     to be appropriated to the Secretary of Commerce for the 
     Advanced Technology Program of the National Institute of 
     Standards and Technology--
       (A) $247,200,000 for fiscal year 2005;
       (B) $254,616,000 for fiscal year 2006;
       (C) $262,254,000 for fiscal year 2007; and
       (D) $270,122,000 for fiscal year 2008.
       (b) Manufacturing Extension Partnership Program.--
       (1) Findings.--Congress makes the following findings:
       (A) Small- and medium-sized manufacturers in the United 
     States employ 7,000,000 people and contribute 
     $711,000,000,000, or 7 percent of the Gross Domestic Product 
     to the United States economy. The Hollings Manufacturing 
     Extension Partnership (MEP) Program supports a network of 
     locally run centers that provide technical advice and 
     consulting to these firms in all fifty States and Puerto 
     Rico. Since its inception, the Hollings MEP Program has 
     assisted 149,000 of the 380,000 small and medium-sized 
     manufacturers in the United States.
       (B) The Hollings MEP Program is a proven program. Studies 
     show that Hollings MEP Program manufacturers have four times 
     more productivity growth than non-MEP firms, and the program 
     has proven to lead to increased sales, increased capital 
     investment, cost savings and the creation or retention of 
     jobs in the United States.
       (C) The Hollings MEP Program is more important today than 
     ever as the Nation faces a looming current account deficit. 
     The United States has lost over 880,000 manufacturing jobs 
     during 2003 and 2004. Such manufacturing jobs pay on average 
     19 percent higher wages than the industry average.
       (D) The Hollings MEP Program is not just about economic 
     security. Manufacturers with fewer than 500 employees 
     comprise more than 80 percent of the suppliers in key defense 
     sectors. Helping such manufacturers helps the national 
     security of the United States.
       (2) Authorization of appropriations.--There are authorized 
     to be appropriated to the Secretary of Commerce for the 
     Hollings Manufacturing Extension Partnership Program of the 
     National Institute of Standards and Technology--
       (A) $110,210,000 for fiscal year 2005;
       (B) $113,516,000 for fiscal year 2006;
       (C) $116,921,000 for fiscal year 2007; and
       (D) $120,429,000 for fiscal year 2008.
       (3) Manufacturing extension partnership program defined.--
     In this subsection, the term ``Hollings Manufacturing 
     Extension Partnership Program'' means the program of Hollings 
     Manufacturing Extension Partnership carried out by the 
     National Institute of Standards and Technology under section 
     26 of the National Institute of Standards and Technology Act 
     (15 U.S.C. 278l), as provided in part 292 of title 15, Code 
     of Federal Regulations.

     SEC. 292. SENSE OF THE SENATE PROMOTING SCIENCE AND 
                   TECHNOLOGY FUNDING FOR A STRONGER ECONOMIC 
                   FUTURE.

       (a) Findings.--The Senate makes the following findings:
       (1) Leading economists have consistently attributed more 
     than 50 percent of the growth in the economy of the United 
     States to scientific and technological innovation. The 
     economic future of the United States, thus, depends on the 
     United States remaining the world leader in science and 
     technology.
       (2) If the United States loses its leadership in science 
     and technology, its capacity for economic growth and high-
     wage job creation will soon atrophy, with deleterious effects 
     on the national security of the United States. In 2001, the 
     Hart-Rudman Commission on National Security for the 21st 
     Century characterized the failure of the United States to 
     invest in science and to reform science and mathematics 
     education as the second biggest threat to national security, 
     stating that ``[s]econd only to a weapon of mass destruction 
     detonating in an American city, we can think of nothing more 
     dangerous than a failure to manage properly science, 
     technology, and education for the common good over the next 
     quarter century''.
       (3) The United States has reaped enormous economic benefits 
     from being the first country to lead in the development of 
     the Internet and the harnessing of biotechnology. These 
     developments, though, are far from being the last 
     technological revolutions to influence the economy of the 
     United States. Technological changes that promise major 
     economic effects are now being made in areas such as--
       (A) microelectronics, including the continued 
     miniaturization of electronic devices and the increasingly 
     widespread diffusion of data processing power;
       (B) high-end supercomputing;
       (C) telecommunications technologies;
       (D) artificial materials, including materials in which the 
     structure has been designed and built at the atomic or 
     molecular level, the essence of nanotechnology;
       (E) robotics; and
       (F) new energy technologies, particular including renewable 
     energy technologies that are as inexpensive as traditional 
     fossil sources of energy, technologies using hydrogen as an 
     energy carrier, and technologies for energy efficiencies.
       (4) Because of the interconnected nature of modern science 
     and technology, advances in one field depend on research 
     results in other, seemingly unrelated fields. Biomedical 
     science has been consistently shown to rely on advances in 
     fields such as chemistry, materials science, mathematics, 
     computer science, and physics. Without basic advances in 
     chemistry, computer science, and mathematics, the sequencing 
     of the human genome could not have been successfully 
     undertaken.
       (5) In the 60 years since World War II, other countries and 
     regions of the world have built science and technology 
     capabilities that rival those of the United States today, or 
     that could rival such capabilities of the United States in 
     the future. The governments of China, India, Japan, and the 
     countries of the European Union have all targeted significant 
     advancements in research and innovation as central elements 
     of the plans for future national and regional economic 
     prosperity.
       (6) President George W. Bush has largely ignored this 
     challenge, proposing budgets that have under-funded or 
     terminated key programs promoting United States scientific 
     and technological strength, including cuts to--
       (A) basic and applied research in the Department of 
     Defense;
       (B) agricultural research;
       (C) transportation research; and
       (D) fundamental research in the physical sciences and 
     engineering at the Department of Energy and elsewhere.
       (7) For other programs that have been proposed for small 
     increases, such as the National Science Foundation, the 
     amount of funding provided to individual grantees is well 
     below the amounts that would lead to optimal scientific 
     productivity and continued United States leadership in 
     science and technology. In fiscal year 2004, the National 
     Science Foundation's stringent peer review evaluation process 
     judged approximately 12,000 out of some 40,000 proposals as 
     ``very good to excellent'' or ``excellent,'' yet, due to 
     budget constraints, only 56 percent of such proposals were 
     funded.
       (8) The National Science Foundation and the Office of 
     Science in the Department of Energy are among the greatest 
     assets of the United States for the advancement of science, 
     mathematical, engineering, and technology research and 
     education. Although the National Science Foundation accounts 
     for only 4 percent of Federal research and development 
     spending, it provides nearly 50 percent of all Federal 
     support for non-medical basic research conducted in United 
     States colleges and universities. Similarly, the Office of 
     Science of the Department of Energy funds over half of all 
     university research in disciplines such as physics and 
     materials science, and has played a crucial role in national 
     science and technology initiatives such as advancing high-
     performance computing and the sequencing of the human genome. 
     Both the National Science Foundation and the Office of 
     Science fund research in new frontiers of scientific inquiry 
     and contribute to creating a highly skilled, competitive 
     workforce in science and engineering.
       (9) President Bush has also consistently proposed 
     terminating the Advanced Technology Program at the Department 
     of Commerce, which helps stimulate companies to participate 
     in high-risk, high-payoff research and development and is 
     perhaps one of the most successful programs in directly 
     stimulating industrial innovation in the United States. 
     Projects supported by the Advanced Technology Program span a 
     broad range of key technology areas, such as oil exploration, 
     automobile manufacturing, and new medical diagnostic and 
     therapeutic technologies and investments made by the program 
     accelerate the development process for innovative 
     technologies that promise significant commercial payoff and 
     widespread benefits.
       (10) The continual cycle of basic research, applied 
     research, and development gives rise to new products and 
     processes, new ideas and understanding, and new researchers 
     and educators. Each link in this chain depends on the others. 
     Basic research produces the fundamental understandings that 
     underpin applications and the development process. The 
     resulting technologies and innovations create economic growth 
     through new products and job creation and stimulate new 
     thinking and advances in scientific instrumentation, which in 
     turn stimulate new inquiries that lead to new fundamental 
     research. All of this activity improves the quality of life 
     in the United States, and when adequately supported, 
     contributes to the continued leadership of the United States 
     in science and technology.
       (11) A revitalized science and technology policy focused on 
     advancing all of the links of this chain, from basic research 
     through technology deployment, is necessary if the United 
     States is to maintain its technological preeminence over the 
     next decade and beyond. Applications stemming from basic 
     research can take over 20 years to evolve into next 
     generation technologies. Inadequate funding of basic research 
     may not seem acute today, but 20 years from now, it will be 
     extremely difficult to correct an inability of the United 
     States to compete scientifically and technologically, which 
     could be caused by inadequate funding now.
       (12) In order to ensure strength in these areas, it is 
     necessary for the United States Government to ensure that 
     scientists and technology experts in the United States 
     receive the best education possible. After the Russians 
     launched Sputnik, Congress passed the National Defense 
     Education Act of 1958

[[Page S445]]

     (Public Law 85-864), which declared ``an educational 
     emergency'' and led to the more than doubling of Federal 
     expenditures for education. The programs authorized under 
     that Act helped the United States to improve rapidly in the 
     areas of science and technology, and led to United States 
     dominance in the arms race and the global economy.
       (13) The United States would be well served by the 
     enactment of a new National Defense Education Act. Third in 
     the world in 1975, America now ranks 15th in the development 
     of new scientists and engineers. Today, India and China 
     annually produce 10 times as many new engineers as the United 
     States. Out of over 15,000,000 college students in the United 
     States, fewer than 400,000 individuals graduate with a 
     bachelor's degree in math, science, engineering, or 
     technology each year, and only 75,000 postgraduate students 
     go on to obtain a master's degree in math, science, 
     engineering, or technology.
       (b) Sense of the Senate.--It is the sense of the Senate 
     that--
       (1) Congress and the President should direct significant 
     new investments in the National Science Foundation, the 
     Office of Science at the Department of Energy, the National 
     Institutes of Health, and the National Institute of Standards 
     and Technology to increase federally funded research in basic 
     science and technology so that the United States can better 
     compete in the international economy; and
       (2) Congress and the President should direct significant 
     new investments into the enhancement of elementary and 
     secondary education programs related to math, science, and 
     technology and substantially expand access to postsecondary 
     education for United States students seeking degrees in math, 
     science, and technology.

               TITLE III--FAIR TRADE AND COMPETITIVENESS

               Subtitle A--Trade Enforcement Enhancement

     SEC. 311. IDENTIFICATION OF TRADE EXPANSION PRIORITIES.

       Section 310 of the Trade Act of 1974 (19 U.S.C. 2420) is 
     amended to read as follows:

     ``SEC. 310. IDENTIFICATION OF TRADE EXPANSION PRIORITIES.

       ``(a) Identification.--
       ``(1) Identification and report.--Within 30 days after the 
     submission in each of calendar year 2005 through 2009 of the 
     report required by section 181(b), the Trade Representative 
     shall--
       ``(A) review United States trade expansion priorities;
       ``(B) identify priority foreign country practices, the 
     elimination of which is likely to have the most significant 
     potential to increase United States exports, either directly 
     or through the establishment of a beneficial precedent; and
       ``(C) submit to the Committee on Finance of the Senate and 
     the Committee on Ways and Means of the House of 
     Representatives and publish in the Federal Register a report 
     on the priority foreign country practices identified.
       ``(2) Factors.--In identifying priority foreign country 
     practices under paragraph (1), the Trade Representative shall 
     take into account all relevant factors, including--
       ``(A) the major barriers and trade distorting practices 
     described in the National Trade Estimate Report required 
     under section 181(b);
       ``(B) the trade agreements to which a foreign country is a 
     party and its compliance with those agreements;
       ``(C) the medium- and long-term implications of foreign 
     government procurement plans; and
       ``(D) the international competitive position and export 
     potential of United States products and services.
       ``(3) Contents of report.--The Trade Representative may 
     include in the report, if appropriate--
       ``(A) a description of foreign country practices that may 
     in the future warrant identification as priority foreign 
     country practices; and
       ``(B) a statement about other foreign country practices 
     that were not identified because they are already being 
     addressed by provisions of United States trade law, by 
     existing bilateral trade agreements, or as part of trade 
     negotiations with other countries and progress is being made 
     toward the elimination of such practices.
       ``(b) Initiation of Consultations.--By no later than the 
     date that is 21 days after the date on which a report is 
     submitted to the appropriate congressional committees under 
     subsection (a)(1), the Trade Representative shall seek 
     consultations with each foreign country identified in the 
     report as engaging in priority foreign country practices for 
     the purpose of reaching a satisfactory resolution of such 
     priority practices.
       ``(c) Initiation of Investigation.--If a satisfactory 
     resolution of priority foreign country practices has not been 
     reached under subsection (b) within 90 days after the date on 
     which a report is submitted to the appropriate congressional 
     committees under subsection (a)(1), the Trade Representative 
     shall initiate under section 302(b)(1) an investigation under 
     this chapter with respect to such priority foreign country 
     practices.
       ``(d) Agreements for the Elimination of Barriers.--In the 
     consultations with a foreign country that the Trade 
     Representative is required to request under section 303(a) 
     with respect to an investigation initiated by reason of 
     subsection (c), the Trade Representative shall seek to 
     negotiate an agreement that provides for the elimination of 
     the practices that are the subject of the investigation as 
     quickly as possible or, if elimination of the practices is 
     not feasible, an agreement that provides for compensatory 
     trade benefits.
       ``(e) Reports.--The Trade Representative shall include in 
     the semiannual report required by section 309 a report on the 
     status of any investigations initiated pursuant to subsection 
     (c) and, where appropriate, the extent to which such 
     investigations have led to increased opportunities for the 
     export of products and services of the United States.''.

     SEC. 312. CHIEF ENFORCEMENT NEGOTIATOR.

       (a) Establishment of Position.--Section 141(b)(2) of the 
     Trade Act of 1974 (19 U.S.C. 2171(b)(2)) is amended to read 
     as follows:
       ``(2) There shall be in the Office 3 Deputy United States 
     Trade Representatives, 1 Chief Agricultural Negotiator, and 1 
     Chief Enforcement Negotiator. The 3 Deputy United States 
     Trade Representatives and the 2 Chief Negotiators shall be 
     appointed by the President, by and with the advice and 
     consent of the Senate. As an exercise of the rulemaking power 
     of the Senate, any nomination of a Deputy United States Trade 
     Representative, the Chief Agricultural Negotiator, or the 
     Chief Enforcement Negotiator submitted to the Senate for its 
     advice and consent, and referred to a committee, shall be 
     referred to the Committee on Finance. Each Deputy United 
     States Trade Representative, the Chief Agricultural 
     Negotiator, and the Chief Enforcement Negotiator shall hold 
     office at the pleasure of the President and shall have the 
     rank of Ambassador.''.
       (b) Functions of Position.--Section 141(c) of the Trade Act 
     of 1974 (19 U.S.C. 2171(c)) is amended by adding at the end 
     the following new paragraph:
       ``(6) The principal function of the Chief Enforcement 
     Negotiator shall be to conduct negotiations to ensure 
     compliance with trade agreements relating to United States 
     manufactured goods and services. The Chief Enforcement 
     Negotiator shall recommend investigating and prosecuting 
     cases before the World Trade Organization and under trade 
     agreements to which the United States is a party. The Chief 
     Enforcement Negotiator shall recommend administering United 
     States trade laws relating to foreign government barriers to 
     United States goods and services. The Chief Enforcement 
     Negotiator shall perform such other functions as the United 
     States Trade Representative may direct.''.

     SEC. 313. FOREIGN DEBT.

       (a) Short Title.--This section may be cited as the 
     ``Foreign Debt Ceiling Act of 2005''.
       (b) Foreign Debt Ceiling.--
       (1) Findings.--Congress makes the following findings:
       (A) The United States has become the world's largest net 
     debtor Nation, having run up massive trade deficits since the 
     1990s.
       (B) At the end of 2002, the net United States foreign debt 
     stood at $2,553,000,000,000.
       (C) The United States foreign debt position worsened in 
     2003, when the United States had a record trade deficit of 
     $489,000,000,000, equivalent to 4.4 percent of the United 
     States GDP that year.
       (D) The large and growing United States foreign debt 
     represents claims on United States assets by foreign 
     nationals, which will eventually have to be repaid. If 
     unchecked, the foreign debt could seriously undermine our 
     children's future standard of living.
       (E) Moreover, the growing accumulation of foreign claims on 
     United States assets, including over $1,200,000,000,000 in 
     United States Treasury securities, makes the United States 
     economy vulnerable to the whims of foreign investors.
       (F) Congress presently places a ceiling on United States 
     public debt, but does not place a ceiling on United States 
     foreign debt.
       (G) Just as Congress recognized the importance of placing a 
     ceiling on the United States public debt, it is appropriate 
     that Congress place a limit on the United States foreign 
     debt.
       (2) Actions triggered by united states foreign debt.--
       (A) In general.--Not later than the 15th day of the second 
     month after the date of enactment of this Act, and every 3 
     months thereafter, the United States Trade Representative 
     shall determine if--
       (i) the net United States foreign debt for the preceding 
     12-month period is more than 25 percent of United States GDP 
     for the same period; or
       (ii) the United States trade deficit for the preceding 12-
     month period is more than 5 percent of United States GDP for 
     the same period.
       (B) Action by ustr.--Whenever an affirmative determination 
     is made under subparagraph (A) (i) or (ii), the United States 
     Trade Representative shall--
       (i) within 15 days of the determination, convene an 
     emergency meeting of the Trade Policy Review Group to develop 
     a plan of action to reduce the United States trade deficit; 
     and
       (ii) within 45 days of the determination, present to 
     Congress a report detailing the Trade Policy Review Group's 
     trade deficit reduction plan.
       (3) Measurement of foreign debt.--
       (A) Statistical sources.--For purposes of the calculations 
     described in paragraph (2)(A), the United States Trade 
     Representative shall rely on the most recent period for

[[Page S446]]

     which the following data, published by the Department of 
     Commerce, is available:
       (i) In the case of United States foreign debt, the United 
     States Trade Representative shall use the net international 
     investment position of the United States, with direct 
     investment positions determined at market value, as compiled 
     by the Bureau of Economic Analysis.
       (ii) In the case of the United States trade deficit, the 
     United States Trade Representative shall use the goods and 
     services trade deficit data compiled by the United States 
     Census Bureau.
       (iii) In the case of the United States GDP, the United 
     States Trade Representative shall use the nominal gross 
     domestic product data compiled by the Bureau of Economic 
     Analysis.
       (B) Adjustment.--The United States Trade Representative may 
     adjust the data described in subparagraph (A) to ensure that 
     the determination is made for comparable time period.

     SEC. 314. AUTHORIZATION OF APPROPRIATIONS.

       (a) Authorization of Appropriations for the Office of the 
     General Counsel and the Office of Monitoring and 
     Enforcement.--There are authorized to be appropriated to the 
     Office of the United States Trade Representative for the 
     appointment of additional staff in the Office of the General 
     Counsel and the Office of Monitoring and Enforcement--
       (1) $2,000,000 for fiscal year 2005; and
       (2) $2,000,000 for fiscal year 2006.
       (b) Responsibilities of Additional Staff.--The 
     responsibilities of the additional staff appointed under 
     subsection (a) shall include--
       (1) investigating, prosecuting, and defending cases before 
     the World Trade Organization and under trade agreements to 
     which the United States is a party;
       (2) administering United States trade laws, including title 
     III of the Trade Act of 1974 (19 U.S.C. 2411 et seq.) and 
     other trade laws relating to foreign government barriers to 
     United States goods and services, including barriers 
     involving intellectual property rights, government 
     procurement, and telecommunications; and
       (3) monitoring compliance with the Uruguay Round Agreements 
     (as defined in section 2 of the Uruguay Round Agreements Act 
     (19 U.S.C. 3501)) and other trade agreements, particularly by 
     the People's Republic of China.

       Subtitle B--Exchange Rate Policy and Currency Manipulation

     SEC. 321. NEGOTIATIONS REGARDING CURRENCY VALUATION.

       (a) Findings.--Congress makes the following findings:
       (1) The currency of the People's Republic of China, known 
     as the yuan or renminbi, is artificially pegged at a level 
     significantly below its market value. Economists estimate the 
     yuan to be undervalued by between 15 percent and 40 percent 
     or an average of 27.5 percent.
       (2) The undervaluation of the yuan provides the People's 
     Republic of China with a significant trade advantage by 
     making exports less expensive for foreign consumers and by 
     making foreign products more expensive for Chinese consumers. 
     The effective result is a significant subsidization of 
     China's exports and a virtual tariff on foreign imports.
       (3) The Government of the People's Republic of China has 
     intervened in the foreign exchange markets to hold the value 
     of the yuan within an artificial trading range. China's 
     foreign reserves are estimated to be over $609,900,000,000 as 
     of January 12, 2004, and have increased by over 
     $206,700,000,000 in the last 12 months.
       (4) China's undervalued currency, China's trade advantage 
     from that undervaluation, and the Chinese Government's 
     intervention in the value of its currency violates the spirit 
     and letter of the world trading system of which the People's 
     Republic of China is now a member.
       (5) The Government of the People's Republic of China has 
     failed to promptly address concerns or to provide a 
     definitive timetable for resolution of these concerns raised 
     by the United States and the international community 
     regarding the value of its currency.
       (6) Article XXI of the GATT 1994 (as defined in section 
     2(1)(B) of the Uruguay Round Agreements Act (19 U.S.C. 
     3501(1)(B))) allows a member of the World Trade Organization 
     to take any action which it considers necessary for the 
     protection of its essential security interests. Protecting 
     the United States manufacturing sector is essential to the 
     interests of the United States.
       (b) Negotiations and Certification Regarding the Currency 
     Valuation Policy of the People's Republic of China.--
       (1) In general.--Notwithstanding the provisions of title I 
     of Public Law 106-286 (19 U.S.C. 2431 note), on and after the 
     date that is 180 days after the date of enactment of this 
     Act, unless a certification described in paragraph (2) has 
     been made to Congress, in addition to any other duty, there 
     shall be imposed a rate of duty of 27.5 percent ad valorem on 
     any article that is the growth, product, or manufacture of 
     the People's Republic of China, imported directly or 
     indirectly into the United States.
       (2) Certification.--The certification described in this 
     paragraph means a certification by the President to Congress 
     that the People's Republic of China is no longer acquiring 
     foreign exchange reserves to prevent the appreciation of the 
     rate of exchange between its currency and the United States 
     dollar for purposes of gaining an unfair competitive 
     advantage in international trade. The certification shall 
     also include a determination that the currency of the 
     People's Republic of China has undergone a substantial upward 
     revaluation placing it at or near its fair market value.
       (3) Alternative certification.--If the President certifies 
     to Congress 180 days after the date of enactment of this Act 
     that the People's Republic of China has made a good faith 
     effort to revalue its currency upward placing it at or near 
     its fair market value, the President may delay the imposition 
     of the tariffs described in paragraph (1) for an additional 
     180 days. If at the end of the 180-day period the President 
     determines that China has developed and started actual 
     implementation of a plan to revalue its currency, the 
     President may delay imposition of the tariffs for an 
     additional 12 months, so that the People's Republic of China 
     shall have time to implement the plan.
       (4) Negotiations.--Beginning on the date of enactment of 
     this Act, the Secretary of the Treasury, in consultation with 
     the United States Trade Representative, shall begin 
     negotiations with the People's Republic of China to ensure 
     that the People's Republic of China adopts a process that 
     leads to a substantial upward currency revaluation within 180 
     days after the date of enactment of this Act. Because various 
     Asian governments have also been acquiring substantial 
     foreign exchange reserves in an effort to prevent 
     appreciation of their currencies for purposes of gaining an 
     unfair competitive advantage in international trade, and 
     because the People's Republic of China has concerns about the 
     value of those currencies, the Secretary shall also seek to 
     convene a multilateral summit to discuss exchange rates with 
     representatives of various Asian governments and other 
     interested parties, including representatives of other G-7 
     nations.

                Subtitle C--Trade Adjustment Assistance

                       CHAPTER 1--SERVICE WORKERS

     SEC. 331. SHORT TITLE.

       This chapter may be cited as the ``Trade Adjustment 
     Assistance Equity for Service Workers Act of 2005''.

     SEC. 332. EXTENSION OF TRADE ADJUSTMENT ASSISTANCE TO 
                   SERVICES SECTOR.

       (a) Adjustment Assistance for Workers.--Section 
     221(a)(1)(A) of the Trade Act of 1974 (19 U.S.C. 
     2271(a)(1)(A)) is amended by striking ``agricultural firm)'' 
     and inserting ``agricultural firm, and workers in a service 
     sector firm or subdivision of a service sector firm or public 
     agency)''.
       (b) Group Eligibility Requirements.--Section 222 of the 
     Trade Act of 1974 (19 U.S.C. 2272) is amended--
       (1) in subsection (a)--
       (A) in the matter preceding paragraph (1), by striking 
     ``agricultural firm)'' and inserting ``agricultural firm, and 
     workers in a service sector firm or subdivision of a service 
     sector firm or public agency)'';
       (B) in paragraph (1), by inserting ``or public agency'' 
     after ``of the firm''; and
       (C) in paragraph (2)--
       (i) in subparagraph (A)(ii), by striking ``like or directly 
     competitive with articles produced'' and inserting ``or 
     services like or directly competitive with articles produced 
     or services provided''; and
       (ii) by striking subparagraph (B) and inserting the 
     following:
       ``(B)(i) there has been a shift, by such workers' firm, 
     subdivision, or public agency to a foreign country, of 
     production of articles, or in provision of services, like or 
     directly competitive with articles which are produced, or 
     services which are provided, by such firm, subdivision, or 
     public agency; or
       ``(ii) such workers' firm, subdivision, or public agency 
     has obtained or is likely to obtain such services from a 
     foreign country.'';
       (2) in subsection (b)--
       (A) in the matter preceding paragraph (1), by striking 
     ``agricultural firm)'' and inserting ``agricultural firm, and 
     workers in a service sector firm or subdivision of a service 
     sector firm or public agency)'';
       (B) in paragraph (2), by inserting ``or service'' after 
     ``related to the article''; and
       (C) in paragraph (3)(A), by inserting ``or services'' after 
     ``component parts'';
       (3) in subsection (c)--
       (A) in paragraph (3)--
       (i) by inserting ``or services'' after ``value-added 
     production processes'';
       (ii) by striking ``assembly or finishing'' and inserting 
     ``assembly, finishing, or testing'';
       (iii) by inserting ``or services'' after ``for articles''; 
     and
       (iv) by inserting ``(or subdivision)'' after ``such other 
     firm''; and
       (B) in paragraph (4)--
       (i) by striking ``for articles'' and inserting ``, or 
     services, used in the production of articles or in the 
     provision of services''; and
       (ii) by inserting ``(or subdivision)'' after ``such other 
     firm''; and
       (4) by adding at the end the following new subsection:
       ``(d) Basis for Secretary's Determinations.--
       ``(1) Increased imports.--For purposes of subsection 
     (a)(2)(A)(ii), the Secretary may determine that increased 
     imports of like or directly competitive articles or services 
     exist if the workers' firm or subdivision or customers of the 
     workers' firm or subdivision accounting for not less than 20 
     percent of the sales of the workers' firm or subdivision 
     certify to the Secretary that they are obtaining such 
     articles or services from a foreign country.

[[Page S447]]

       ``(2) Obtaining services abroad.--For purposes of 
     subsection (a)(2)(B)(ii), the Secretary may determine that 
     the workers' firm, subdivision, or public agency has obtained 
     or is likely to obtain like or directly competitive services 
     from a firm in a foreign country based on a certification 
     thereof from the workers' firm, subdivision, or public 
     agency.
       ``(3) Authority of the secretary.--The Secretary may obtain 
     the certifications under paragraphs (1) and (2) through 
     questionnaires or in such other manner as the Secretary 
     determines is appropriate.''.
       (c) Training.--Section 236(a)(2)(A) of the Trade Act of 
     1974 (19 U.S.C. 2296(a)(2)(A)) is amended by striking 
     ``$220,000,000'' and inserting ``$440,000,000''.
       (d) Definitions.--Section 247 of the Trade Act of 1974 (19 
     U.S.C. 2319) is amended--
       (1) in paragraph (1)--
       (A) by inserting ``or public agency'' after ``of a firm''; 
     and
       (B) by inserting ``or public agency'' after ``or 
     subdivision'';
       (2) in paragraph (2)(B), by inserting ``or public agency'' 
     after ``the firm'';
       (3) by redesignating paragraphs (8) through (17) as 
     paragraphs (9) through (18), respectively; and
       (4) by inserting after paragraph (6) the following:
       ``(7) The term `public agency' means a department or agency 
     of a State or local government or of the Federal Government.
       ``(8) The term `service sector firm' means an entity 
     engaged in the business of providing services.''.
       (e) Technical Amendment.--Section 245(a) of the Trade Act 
     of 1974 (19 U.S.C. 2317(a)) is amended by striking ``, other 
     than subchapter D''.

     SEC. 333. TRADE ADJUSTMENT ASSISTANCE FOR FIRMS AND 
                   INDUSTRIES.

       (a) Firms.--
       (1) Assistance.--Section 251 of the Trade Act of 1974 (19 
     U.S.C. 2341) is amended--
       (A) in subsection (a), by inserting ``or service sector 
     firm'' after ``(including any agricultural firm'';
       (B) in subsection (c)(1)--
       (i) in the matter preceding subparagraph (A), by inserting 
     ``or service sector firm'' after ``(including any 
     agricultural firm'';
       (ii) in subparagraph (B)(ii), by inserting ``or service'' 
     after ``of an article''; and
       (iii) in subparagraph (C), by striking ``articles like or 
     directly competitive with articles which are produced'' and 
     inserting ``articles or services like or directly competitive 
     with articles or services which are produced or provided''; 
     and
       (C) by adding at the end the following:
       ``(e) Basis for Secretary Determination.--
       ``(1) Increased imports.--For purposes of subsection 
     (c)(1)(C), the Secretary may determine that increases of 
     imports of like or directly competitive articles or services 
     exist if customers accounting for not less than 20 percent of 
     the sales of the workers' firm certify to the Secretary that 
     they are obtaining such articles or services from a foreign 
     country.
       ``(2) Authority of the secretary.--The Secretary may obtain 
     the certifications under paragraph (1) through questionnaires 
     or in such other manner as the Secretary determines is 
     appropriate. The Secretary may exercise the authority under 
     section 249 in carrying out this subsection.''.
       (2) Authorization of appropriations.--Section 256(b) of the 
     Trade Act of 1974 (19 U.S.C. 2346(b)) is amended by striking 
     ``$16,000,000'' and inserting ``$32,000,000''.
       (3) Definitions.--Section 261 of the Trade Act of 1974 (19 
     U.S.C. 2351) is amended to read as follows:

     ``SEC. 261. DEFINITIONS.

       ``For purposes of this chapter:
       ``(1) Firm.--The term `firm' includes an individual 
     proprietorship, partnership, joint venture, association, 
     corporation (including a development corporation), business 
     trust, cooperative, trustee in bankruptcy, and receiver under 
     decree of any court. A firm, together with any predecessor or 
     successor firm, or any affiliated firm controlled or 
     substantially beneficially owned by substantially the same 
     persons, may be considered a single firm where necessary to 
     prevent unjustifiable benefits.
       ``(2) Service sector firm.--The term `service sector firm' 
     means a firm engaged in the business of providing 
     services.''.
       (b) Industries.--Section 265(a) of the Trade Act of 1974 
     (19 U.S.C. 2355(a)) is amended by inserting ``or service'' 
     after ``new product''.

     SEC. 334. MONITORING AND REPORTING.

       Section 282 of the Trade Act of 1974 (19 U.S.C. 2393) is 
     amended--
       (1) in the first sentence--
       (A) by striking ``The Secretary'' and inserting ``(a) 
     Monitoring Programs.--The Secretary'';
       (B) by inserting ``and services'' after ``imports of 
     articles'';
       (C) by inserting ``and domestic provision of services'' 
     after ``domestic production'';
       (D) by inserting ``or providing services'' after 
     ``producing articles''; and
       (E) by inserting ``, or provision of services,'' after 
     ``changes in production''; and
       (2) by adding at the end the following:
       ``(b) Collection of Data and Reports on Services Sector.--
       ``(1) Secretary of labor.--Not later than 3 months after 
     the date of the enactment of the Trade Adjustment Assistance 
     Equity for Service Workers Act of 2005, the Secretary of 
     Labor shall implement a system to collect data on adversely 
     affected service workers that includes the number of workers 
     by State, industry, and cause of dislocation of each worker.
       ``(2) Secretary of commerce.--Not later than 6 months after 
     such date of enactment, the Secretary of Commerce shall, in 
     consultation with the Secretary of Labor, conduct a study and 
     report to the Congress on ways to improve the timeliness and 
     coverage of data on trade in services, including methods to 
     identify increased imports due to the relocation of United 
     States firms to foreign countries, and increased imports due 
     to United States firms obtaining services from firms in 
     foreign countries.''.

     SEC. 335. ALTERNATIVE TRADE ADJUSTMENT ASSISTANCE.

       (a) In General.--Section 246(a)(3) of the Trade Act of 1974 
     (19 U.S.C. 2318(a)(3)) is amended to read as follows:
       ``(3) Eligibility.--A worker in the group that the 
     Secretary has certified as eligible for the alternative trade 
     adjustment assistance program may elect to receive benefits 
     under the alternative trade adjustment assistance program if 
     the worker--
       ``(A) is covered by a certification under subchapter A of 
     this chapter;
       ``(B) obtains reemployment not more than 26 weeks after the 
     date of separation from the adversely affected employment;
       ``(C) is at least 40 years of age;
       ``(D) earns not more than $50,000 a year in wages from 
     reemployment;
       ``(E) is employed on a full-time basis as defined by State 
     law in the State in which the worker is employed; and
       ``(F) does not return to the employment from which the 
     worker was separated.''.
       (b) Conforming Amendments.--Section 246 of the Trade Act of 
     1974 (19 U.S.C. 2318) is amended--
       (1) in subsection (a)(2)(A), by striking ``paragraph 
     (3)(B)'' and inserting ``paragraph (3)'';
       (2) in subsection (a)(2)(B), by striking ``paragraph 
     (3)(B)'' and inserting ``paragraph (3)''; and
       (3) in subsection (b)(2), by striking ``subsection 
     (a)(3)(B)'' and inserting ``subsection (a)(3)''.

     SEC. 336. EFFECTIVE DATE.

       (a) In General.--Except as provided in subsection (b), the 
     amendments made by this chapter shall take effect on the date 
     of enactment of this Act.
       (b) Special Rule for Certain Service Workers.--A group of 
     workers in a service sector firm, or subdivision of a service 
     sector firm, or public agency (as defined in section 247 (7) 
     and (8) of the Trade Act of 1974, as added by section 332(d) 
     of this Act) who--
       (1) would have been certified eligible to apply for 
     adjustment assistance under chapter 2 of title II of the 
     Trade Act of 1974 if the amendments made by this Act had been 
     in effect on November 4, 2002; and
       (2) file a petition pursuant to section 221 of the Trade 
     Act of 1974 (19 U.S.C. 2271) not later than 6 months after 
     the date of enactment of this Act, shall be eligible for 
     certification under section 223 of the Trade Act of 1974 (19 
     U.S.C. 2273) if the workers' last total or partial separation 
     from the firm or subdivision of the firm or public agency 
     occurred on or after November 4, 2002 and before the date of 
     enactment of this Act.

         CHAPTER 2--TRADE ADJUSTMENT ASSISTANCE FOR COMMUNITIES

     SEC. 341. SHORT TITLE.

       This chapter may be cited as the ``Trade Adjustment 
     Assistance for Communities Act of 2005''.

     SEC. 342. PURPOSE.

       The purpose of this chapter is to assist communities 
     negatively impacted by trade with economic adjustment through 
     the integration of political and economic organizations, the 
     coordination of Federal, State, and local resources, the 
     creation of community-based development strategies, and the 
     provision of economic transition assistance.

     SEC. 343. TRADE ADJUSTMENT ASSISTANCE FOR COMMUNITIES.

       (a) Repeal of Terminated Provisions.--Chapter 4 of the 
     Trade Act of 1974 (19 U.S.C. 2371 et seq.) is repealed.
       (b) Trade Adjustment Assistance for Communities.--Title II 
     of the Trade Act of 1974 (19 U.S.C. 2251 et seq.) is amended 
     by inserting after chapter 3 the following new chapter:

        ``CHAPTER 4--TRADE ADJUSTMENT ASSISTANCE FOR COMMUNITIES

     ``SEC. 271. DEFINITIONS.

       ``In this chapter:
       ``(1) Affected domestic producer.--The term `affected 
     domestic producer' means any manufacturer, producer, service 
     provider, farmer, rancher, fisherman or worker representative 
     (including associations of such persons) that was affected by 
     a finding under the Antidumping Act, 1921 (title II of the 
     Act of May 27, 1921; 42 Stat. 11, chapter 14), or by an 
     antidumping or countervailing duty order issued under title 
     VII of the Tariff Act of 1930 (19 U.S.C. 1671 et seq.).
       ``(2) Agricultural commodity producer.--The term 
     `agricultural commodity producer' has the same meaning as the 
     term `person' as prescribed by regulations promulgated under 
     section 1001(e) of the Food Security Act of 1985 (7 U.S.C. 
     1308(e)).
       ``(3) Community.--The term `community' means a city, 
     county, or other political subdivision of a State or a 
     consortium of political subdivisions of a State that the 
     Secretary certifies as being negatively impacted by trade.

[[Page S448]]

       ``(4) Community negatively impacted by trade.--A community 
     negatively impacted by trade means a community with respect 
     to which a determination has been made under section 273.
       ``(5) Eligible community.--The term `eligible community' 
     means a community certified under section 273 for assistance 
     under this chapter.
       ``(6) Fisherman.--
       ``(A) In general.--The term `fisherman' means any person 
     who--
       ``(i) is engaged in commercial fishing; or
       ``(ii) is a United States fish processor.
       ``(B) Commercial fishing, fish, fishery, fishing, fishing 
     vessel, person, and united states fish processor.--The terms 
     `commercial fishing', `fish', `fishery', `fishing', `fishing 
     vessel', `person', and `United States fish processor' have 
     the same meanings as given such terms in section 3 of the 
     Magnuson-Stevens Fishery Conservation and Management Act (16 
     U.S.C. 1802).
       ``(7) Job loss.--The term `job loss' means the total 
     separation or partial separation of an individual, as those 
     terms are defined in section 247.
       ``(8) Secretary.--Except as otherwise provided, the term 
     `Secretary' means the Secretary of Commerce.

     ``SEC. 272. COMMUNITY TRADE ADJUSTMENT ASSISTANCE PROGRAM.

       ``(a) Establishment.--Not later than 6 months after the 
     date of enactment of the Trade Adjustment Assistance for 
     Communities Act of 2005, the Secretary shall establish a 
     Trade Adjustment Assistance for Communities Program at the 
     Department of Commerce.
       ``(b) Personnel.--The Secretary shall designate such staff 
     as may be necessary to carry out the responsibilities 
     described in this chapter.
       ``(c) Coordination of Federal Response.--The Secretary 
     shall--
       ``(1) provide leadership, support, and coordination for a 
     comprehensive management program to address economic 
     dislocation in eligible communities;
       ``(2) coordinate the Federal response to an eligible 
     community--
       ``(A) by identifying all Federal, State, and local 
     resources that are available to assist the eligible community 
     in recovering from economic distress;
       ``(B) by ensuring that all Federal agencies offering 
     assistance to an eligible community do so in a targeted, 
     integrated manner that ensures that an eligible community has 
     access to all available Federal assistance;
       ``(C) by assuring timely consultation and cooperation 
     between Federal, State, and regional officials concerning 
     economic adjustment for an eligible community; and
       ``(D) by identifying and strengthening existing agency 
     mechanisms designed to assist eligible communities in their 
     efforts to achieve economic adjustment and workforce 
     reemployment;
       ``(3) provide comprehensive technical assistance to any 
     eligible community in the efforts of that community to--
       ``(A) identify serious economic problems in the community 
     that are the result of negative impacts from trade;
       ``(B) integrate the major groups and organizations 
     significantly affected by the economic adjustment;
       ``(C) access Federal, State, and local resources designed 
     to assist in economic development and trade adjustment 
     assistance;
       ``(D) diversify and strengthen the community economy; and
       ``(E) develop a community-based strategic plan to address 
     economic development and workforce dislocation, including 
     unemployment among agricultural commodity producers, and 
     fishermen;
       ``(4) establish specific criteria for submission and 
     evaluation of a strategic plan submitted under section 
     274(d);
       ``(5) establish specific criteria for submitting and 
     evaluating applications for grants under section 275;
       ``(6) administer the grant programs established under 
     sections 274 and 275; and
       ``(7) establish an interagency Trade Adjustment Assistance 
     for Communities Working Group, consisting of the 
     representatives of any Federal department or agency with 
     responsibility for economic adjustment assistance, including 
     the Department of Agriculture, the Department of Education, 
     the Department of Labor, the Department of Housing and Urban 
     Development, the Department of Health and Human Services, the 
     Small Business Administration, the Department of the 
     Treasury, the Department of Commerce, and any other Federal, 
     State, or regional department or agency the Secretary 
     determines necessary or appropriate.

     ``SEC. 273. CERTIFICATION AND NOTIFICATION.

       ``(a) Certification.--Not later than 45 days after an event 
     described in subsection (c)(1), the Secretary shall determine 
     if a community described in subsection (b)(1) is negatively 
     impacted by trade, and if a positive determination is made, 
     shall certify the community for assistance under this 
     chapter.
       ``(b) Determination That Community Is Eligible.--
       ``(1) Community described.--A community described in this 
     paragraph means a community with respect to which on or after 
     October 1, 2005--
       ``(A) the Secretary of Labor certifies a group of workers 
     (or their authorized representative) in the community as 
     eligible for assistance pursuant to section 223;
       ``(B) the Secretary of Commerce certifies a firm located in 
     the community as eligible for adjustment assistance under 
     section 251;
       ``(C) the Secretary of Agriculture certifies a group of 
     agricultural commodity producers (or their authorized 
     representative) in the community as eligible for adjustment 
     assistance under section 293;
       ``(D) an affected domestic producer is located in the 
     community; or
       ``(E) the Secretary determines that a significant number of 
     fishermen in the community is negatively impacted by trade.
       ``(2) Negatively impacted by trade.--The Secretary shall 
     determine that a community is negatively impacted by trade, 
     after taking into consideration--
       ``(A) the number of jobs affected compared to the size of 
     the workforce in the community;
       ``(B) the severity of the rates of unemployment in the 
     community and the duration of the unemployment in the 
     community;
       ``(C) the income levels and the extent of underemployment 
     in the community;
       ``(D) the outmigration of population from the community and 
     the extent to which the outmigration is causing economic 
     injury in the community; and
       ``(E) the unique problems and needs of the community.
       ``(c) Events Described.--
       ``(1) In general.--An event described in this paragraph 
     means one of the following:
       ``(A) A notification described in paragraph (2).
       ``(B) A certification of a firm under section 251.
       ``(C) A finding under the Antidumping Act, 1921, or an 
     antidumping or countervailing duty order issued under title 
     VII of the Tariff Act of 1930.
       ``(D) A determination by the Secretary that a significant 
     number of fishermen in a community have been negatively 
     impacted by trade.
       ``(2) Notification.--The Secretary of Labor, immediately 
     upon making a determination that a group of workers is 
     eligible for trade adjustment assistance under section 223, 
     (or the Secretary of Agriculture, immediately upon making a 
     determination that a group of agricultural commodity 
     producers is eligible for adjustment assistance under section 
     293, as the case may be) shall notify the Secretary of the 
     determination.
       ``(d) Notification to Eligible Communities.--Immediately 
     upon certification by the Secretary that a community is 
     eligible for assistance under subsection (b), the Secretary 
     shall notify the community--
       ``(1) of the determination under subsection (b);
       ``(2) of the provisions of this chapter;
       ``(3) how to access the clearinghouse established by the 
     Department of Commerce regarding available economic 
     assistance;
       ``(4) how to obtain technical assistance provided under 
     section 272(c)(3); and
       ``(5) how to obtain grants, tax credits, low income loans, 
     and other appropriate economic assistance.

     ``SEC. 274. STRATEGIC PLANS.

       ``(a) In General.--An eligible community may develop a 
     strategic plan for community economic adjustment and 
     diversification.
       ``(b) Requirements for Strategic Plan.--A strategic plan 
     shall contain, at a minimum, the following:
       ``(1) A description and justification of the capacity for 
     economic adjustment, including the method of financing to be 
     used.
       ``(2) A description of the commitment of the community to 
     the strategic plan over the long term and the participation 
     and input of groups affected by economic dislocation.
       ``(3) A description of the projects to be undertaken by the 
     eligible community.
       ``(4) A description of how the plan and the projects to be 
     undertaken by the eligible community will lead to job 
     creation and job retention in the community.
       ``(5) A description of how the plan will achieve economic 
     adjustment and diversification.
       ``(6) A description of how the plan and the projects will 
     contribute to establishing or maintaining a level of public 
     services necessary to attract and retain economic investment.
       ``(7) A description and justification for the cost and 
     timing of proposed basic and advanced infrastructure 
     improvements in the eligible community.
       ``(8) A description of how the plan will address the 
     occupational and workforce conditions in the eligible 
     community.
       ``(9) A description of the educational programs available 
     for workforce training and future employment needs.
       ``(10) A description of how the plan will adapt to changing 
     markets and business cycles.
       ``(11) A description and justification for the cost and 
     timing of the total funds required by the community for 
     economic assistance.
       ``(12) A graduation strategy through which the eligible 
     community demonstrates that the community will terminate the 
     need for Federal assistance.
       ``(c) Grants To Develop Strategic Plans.--The Secretary, 
     upon receipt of an application from an eligible community, 
     may award a grant to that community to be used to develop the 
     strategic plan.
       ``(d) Submission of Plan.--A strategic plan developed under 
     subsection (a) shall be submitted to the Secretary for 
     evaluation and approval.

     ``SEC. 275. GRANTS FOR ECONOMIC DEVELOPMENT.

       ``(a) In General.--The Secretary, upon approval of a 
     strategic plan from an eligible

[[Page S449]]

     community, may award a grant to that community to carry out 
     any project or program that is certified by the Secretary to 
     be included in the strategic plan approved under section 
     274(d), or consistent with that plan.
       ``(b) Additional Grants.--
       ``(1) In general.--Subject to paragraph (2), in order to 
     assist eligible communities to obtain funds under Federal 
     grant programs, other than the grants provided for in section 
     274(c) or subsection (a), the Secretary may, on the 
     application of an eligible community, make a supplemental 
     grant to the community if--
       ``(A) the purpose of the grant program from which the grant 
     is made is to provide technical or other assistance for 
     planning, constructing, or equipping public works facilities 
     or to provide assistance for public service projects; and
       ``(B) the grant is one for which the community is eligible 
     except for the community's inability to meet the non-Federal 
     share requirements of the grant program.
       ``(2) Use as non-federal share.--A supplemental grant made 
     under this subsection may be used to provide the non-Federal 
     share of a project, unless the total Federal contribution to 
     the project for which the grant is being made exceeds 80 
     percent and that excess is not permitted by law.
       ``(c) Rural Community Preference.--The Secretary shall 
     develop guidelines to ensure that rural communities receive 
     preference in the allocation of resources.

     ``SEC. 276. GENERAL PROVISIONS.

       ``(a) Regulations.--The Secretary shall prescribe such 
     regulations as are necessary to carry out the provisions of 
     this chapter. Before implementing any regulation or guideline 
     proposed by the Secretary with respect to this chapter, the 
     Secretary shall submit the regulation or guideline to the 
     Committee on Finance of the Senate and the Committee on Ways 
     and Means of the House of Representatives for approval.
       ``(b) Supplement Not Supplant.--Funds appropriated under 
     this chapter shall be used to supplement and not supplant 
     other Federal, State, and local public funds expended to 
     provide economic development assistance for communities.
       ``(c) Authorization of Appropriations.--There are 
     authorized to be appropriated to the Secretary $100,000,000 
     for each of fiscal years 2005 through 2008, to carry out this 
     chapter. Amounts appropriated pursuant to this subsection 
     shall remain available until expended.''.

     SEC. 344. CONFORMING AMENDMENTS.

       (a) Termination.--Section 285(b) of the Trade Act of 1974 
     (19 U.S.C. 2271 note) is amended by adding at the end the 
     following new paragraph:
       ``(3) Assistance for communities.--Technical assistance and 
     other payments may not be provided under chapter 4 after 
     September 30, 2008.''.
       (b) Table of Contents.--The table of contents for title II 
     of the Trade Act of 1974 is amended by striking the items 
     relating to chapter 4 of title II and inserting after the 
     items relating to chapter 3 the following new items:

        ``Chapter 4--TRADE ADJUSTMENT ASSISTANCE FOR COMMUNITIES

``Sec. 271. Definitions.
``Sec. 272. Community Trade Adjustment Assistance Program.
``Sec. 273. Certification and notification.
``Sec. 274. Strategic plans.
``Sec. 275. Grants for economic development.
``Sec. 276. General provisions.''.

       (c) Judicial Review.--Section 284(a) of the Trade Act of 
     1974 (19 U.S.C. 2395(a)) is amended by striking ``section 
     271'' and inserting ``section 273''.

     SEC. 345. EFFECTIVE DATE.

       The amendments made by this chapter shall take effect on 
     the date of enactment of this Act.

            CHAPTER 3--OFFICE OF TRADE ADJUSTMENT ASSISTANCE

     SEC. 351. SHORT TITLE.

       This chapter may be cited as the ``Trade Adjustment 
     Assistance for Firms Reorganization Act''.

     SEC. 352. OFFICE OF TRADE ADJUSTMENT ASSISTANCE.

       (a) In General.--Chapter 3 of title II of the Trade Act of 
     1974 (19 U.S.C. 2341 et seq.) is amended by inserting after 
     section 255 the following new section:

     ``SEC. 255A. OFFICE OF TRADE ADJUSTMENT ASSISTANCE.

       ``(a) Establishment.--Not later than 90 days after the date 
     of enactment of the Trade Adjustment Assistance for Firms 
     Reorganization Act, there shall be established in the 
     International Trade Administration of the Department of 
     Commerce an Office of Trade Adjustment Assistance.
       ``(b) Personnel.--The Office shall be headed by a Director, 
     and shall have such staff as may be necessary to carry out 
     the responsibilities of the Secretary of Commerce described 
     in this chapter.
       ``(c) Functions.--The Office shall assist the Secretary of 
     Commerce in carrying out the Secretary's responsibilities 
     under this chapter.''.
       (b) Conforming Amendment.--The table of contents for the 
     Trade Act of 1974 is amended by inserting after the item 
     relating to section 255, the following new item:

``Sec. 255A. Office of Trade Adjustment Assistance.''.

     SEC. 353. EFFECTIVE DATE.

       The amendments made by this chapter shall take effect on 
     the date of enactment of this Act.

CHAPTER 4--IMPROVEMENT OF CREDIT FOR HEALTH INSURANCE COSTS OF ELIGIBLE 
                              INDIVIDUALS

     SEC. 361. IMPROVEMENT OF THE AFFORDABILITY OF THE CREDIT.

       (a) Improvement of Affordability.--
       (1) In General.--Section 35(a) of the Internal Revenue Code 
     of 1986 (relating to credit for health insurance costs of 
     eligible individuals) is amended to read as follows:
       ``(a) Amount of Credit.--
       ``(1) In general.--In the case of an individual, there 
     shall be allowed as a credit against the tax imposed by 
     subtitle A an amount equal to the excess of--
       ``(A) the amount paid by the taxpayer for coverage of the 
     taxpayer and qualifying family members under qualified health 
     insurance for eligible coverage months beginning in the 
     taxable year, over
       ``(B) the amount described in paragraph (2).
       ``(2) Amount described.--For purposes of paragraph (1), the 
     amount described in this paragraph is the lesser of--
       ``(A) the amount equal to 20 percent of the amount 
     determined under paragraph (1)(A) for the taxable year, or
       ``(B) the amount equal to 5 percent of the taxpayer's 
     certified income (as determined under subsection (g)(9)) for 
     such taxable year.''.
       (2) Conforming amendment.--Section 7527(b) of such Code 
     (relating to advance payment of credit for health insurance 
     costs of eligible individuals) is amended by striking ``65 
     percent of the amount'' and all that follows through the 
     period at the end and inserting ``the amount determined under 
     section 35(a)(1) for such taxable year.''.
       (b) Determination of Certified Income.--Section 35(g) of 
     such Code (relating to special rules), is amended--
       (1) by redesignating paragraph (9) as paragraph (10), and
       (2) by inserting after paragraph (8) the following new 
     paragraph:
       ``(9) Certified income.--
       ``(A) In general.--The Secretary shall enter into 
     agreements with States to determine an individual's certified 
     income for purposes of subsection (a)(2)(B) for any taxable 
     year.
       ``(B) Requirements.--An agreement under subparagraph (A) 
     with a State shall--
       ``(i) permit an individual to complete an application for 
     certification of income for a taxable year (in such form and 
     manner as the Secretary shall determine) and to submit the 
     application to the State,
       ``(ii) require the State to determine the individual's 
     income for the taxable year on the basis of the individual's 
     monthly family income as of the month preceding the month in 
     which the application is submitted, and
       ``(iii) require the State to issue a certification of 
     income to the individual upon receipt of an application under 
     clause (i), which shall apply for purposes of determining the 
     taxpayer's certified income for purposes of subsection 
     (a)(2)(B) for the taxable year unless the State determines 
     upon completion of the processing of the application that the 
     certification is erroneous.
       ``(C) Notification of change in income.--An individual 
     issued a certification of income shall notify the State of 
     any substantial change in income that applies for at least 60 
     days and the taxpayer's certified income for the taxable year 
     shall be adjusted accordingly. An individual who fails to so 
     notify the State shall remit the difference (if any) between 
     the amount described in subsection (a)(2) for the taxable 
     year and such amount which would have been described under 
     such subsection for such taxable year if the notification had 
     been made as an addition to tax, plus interest at the 
     underpayment rate established under section 6621.''.
       (c) Effective Date.--The amendments made by this section 
     apply to taxable years beginning after December 31, 2004.

     SEC. 362. OFFERING OF FEDERAL FALLBACK COVERAGE.

       (a) Provision of Fallback Coverage.--
       (1) In general.--The Director of the Office of Personnel 
     Management jointly with the Secretary of the Treasury shall 
     establish a program under which eligible individuals (as 
     defined in section 35(c) of the Internal Revenue Code of 
     1986) are offered enrollment under health benefit plans that 
     are made available under FEHBP.
       (2) Terms and conditions.--The terms and conditions of 
     health benefits plans offered under paragraph (1) shall be 
     the same as the terms and coverage offered under FEHBP, 
     except that the percentage of the premium charged to eligible 
     individuals (as so defined) for such health benefit plans 
     shall be equal to the percentage that an employee would be 
     required to contribute for coverage under FEHBP.
       (3) Study.--The Director of the Office of Personnel 
     Management jointly with the Secretary of the Treasury shall 
     conduct a study of the impact of the offering of health 
     benefit plans under this subsection on the terms and 
     conditions, including premiums, for health benefit plans 
     offered under FEHBP and shall submit to Congress, not later 
     than 2 years after the date of the enactment of this Act, a 
     report on such study. Such report may contain such 
     recommendations regarding the establishment of separate risk 
     pools for individuals covered under FEHBP and eligible 
     individuals covered under health benefit plans offered under 
     paragraph (1) as may

[[Page S450]]

     be appropriate to protect the interests of individuals 
     covered under FEHBP and alleviate any adverse impact on FEHBP 
     that may result from the offering of such health benefit 
     plans.
       (4) FEHBP defined.--In this section, the term ``FEHBP'' 
     means the Federal Employees Health Benefits Program offered 
     under chapter 89 of title 5, United States Code.
       (b) Conforming Amendments.--
       (1) Paragraph (1) of section 35(e) of the Internal Revenue 
     Code of 1986 is amended by adding at the end the following 
     new subparagraph:
       ``(K) Coverage under a health benefits plan offered under 
     section 362(a)(1) of the Fair Wage, Competition, and 
     Investment Act of 2005.''.
       (2) Section 173(f)(2)(A) of the Workforce Investment Act of 
     1998 (29 U.S.C. 2918(f)(2)(A)) is amended by adding at the 
     end the following new clause:
       ``(xi) Coverage under a health benefits plan offered under 
     section 362(a)(1) of the Fair Wage, Competition, and 
     Investment Act of 2005.''.

     SEC. 363. CLARIFICATION OF ELIGIBILITY OF SPOUSE OF CERTAIN 
                   INDIVIDUALS ENTITLED TO MEDICARE.

       (a) In General.--Subsection (b) of section 35 of the 
     Internal Revenue Code of 1986 (defining eligible coverage 
     month) is amended by adding at the end the following:
       ``(3)  Special rule for spouse of individual entitled to 
     medicare.--Any month which would be an eligible coverage 
     month with respect to a taxpayer (determined without regard 
     to subsection (f)(2)(A)) shall be an eligible coverage month 
     for any spouse of such taxpayer.''.
       (b) Conforming Amendment.--Section 173(f)(5)(A)(i) of the 
     Workforce Investment Act of 1998 (29 U.S.C. 2918(f)(5)(A)(i)) 
     is amended by inserting ``(including with respect to any 
     month for which the eligible individual would have been 
     treated as such but for the application of paragraph 
     (7)(B)(i))'' before the comma.

        Subtitle D--Sense of the Senate on Free Trade Agreements

     SEC. 371. SENSE OF THE SENATE ON FREE TRADE AGREEMENTS.

       (a) Findings.--The Senate makes the following findings:
       (1) The United States is participating in the Doha Round of 
     World Trade Organization (``WTO'') negotiations, which seeks 
     to lower trade barriers for all members of the WTO.
       (2) In addition to participating in the Doha Round of WTO 
     negotiations, the United States is negotiating bilateral free 
     trade agreements with 20 countries.
       (3) Only 1 of those 20 countries is among the top 30 
     trading partners of the United States.
       (4) During the debate on the legislation that was enacted 
     as the Trade Act of 2002 (Public Law 107-210; 116 Stat. 933), 
     a representative of the President argued that ``[i]ncreased 
     trade will help our workers, farmers, businesses, and economy 
     by enhancing employment opportunities, opening more markets 
     to American goods and services, and increasing choices and 
     lowering costs for consumers''.
       (5) During that debate and on other occasions, the 
     President and individuals in the Executive Branch of the 
     United States have repeatedly argued that increased trade 
     means an increase in the number of jobs in the United States 
     and a higher standard of living for people in the United 
     States.
       (6) The President and individuals in the Executive Branch 
     of the United States have also argued that trade expands 
     markets for United States goods and services, creates higher-
     paying jobs in the United States, and invigorates local 
     communities and their economies.
       (7) Trade agreements between the United States and 
     countries with small economies have little impact on creating 
     jobs in the United States or a higher standard of living for 
     people in the United States.
       (b) Sense of the Senate.--It is the sense of the Senate 
     that--
       (1) the trade policy of the United States should focus on 
     creating more jobs in the United States and a higher standard 
     of living for people in the United States; and
       (2) to best accomplish these goals, the United States 
     should focus its efforts on trade negotiations occurring at 
     the WTO and, when negotiating trade agreements on a bilateral 
     basis, focus on agreements with countries that have large 
     economies that will provide meaningful export opportunities 
     for United States farmers, workers, and businesses.

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