[Congressional Record Volume 151, Number 85 (Thursday, June 23, 2005)]
[Senate]
[Pages S7296-S7318]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      Mr. McCAIN:
  S. 1291. A bill to provide for the acquisition of subsurface mineral 
interests in land owned by the Pascua Yaqui Tribe and land held in 
trust for the Tribe; to the Committee on Indian Affairs.
  Mr. McCAIN. Mr. President, I am pleased to introduce the Pascua Yaqui 
Mineral Rights Act of 2005 to provide for acquisition of subsurface 
mineral interests in land owned by the Pascua Yaqui tribe and land held 
in trust for the Tribe.
  The Pascua Yaqui tribe has purchased in fee four parcels of land, 
totaling approximately 436 acres, from the State of Arizona. These 
parcels are adjacent to the Tribe's reservation near Tucson, AZ. The 
Tribe subsequently applied to have these lands taken into trust 
pursuant to the 25 CFR Part 151 process. The Bureau of Indian Affairs 
approved the trust application. However, the State of Arizona objected 
because it still owns the subsurface mineral rights when it conveys its 
Trust lands. Based on the State of Arizona's objection, the Tribe's 
trust application was stayed pending resolution of the mineral rights 
title issue. Arizona law prevents the State from selling these mineral 
interests and I understand that the only way they can be acquired is 
through an act of condemnation brought by the United States pursuant to 
40 U.S.C. Sec. 3113. The State of Arizona has conditionally consented 
to a condemnation action.
  It has since been discovered that an additional 140 acres of the 
reservation was also former State of Arizona trust land that was 
purchased in fee by the Tribe and taken into trust without obtaining 
the mineral estate. The State of Arizona has also conditionally 
consented to a condemnation action with regard to these additional 140 
acres.
  In additional to the mineral interests condemnation, this legislation 
covers another subject. Under 360 acres of the reservation, the United 
States owns the mineral interests for itself, rather than in trust for 
the tribe. Although that acreage was originally purchased in fee, it 
was previously patented by the U.S. and the U.S. retained the mineral 
interests to that property for its own benefit, currently administered 
by the Bureau of Land Management. This legislation would authorize the 
Bureau of Land Management to transfer those mineral interests to the 
U.S., to be held in trust for the Pascua Yaqui tribe.
  The result of the legislation I introduce today would be to allow the 
United States to obtain and/or consolidate ownership of the mineral 
interest only, in its name, in trust for the Pascua Yaqui tribe. These 
mineral interests are under the surface of land already either owned by 
the Pascua Yaqui tribe, or held in trust for the Tribe by the United 
States.
  Finally, under the terms of its current gaming compact with the State 
of Arizona, the Tribe has already constructed the maximum number of 
casinos it can operate on its reservation at this time. This bill will 
not authorize additional reservation casinos.
  I look forward to working with my colleagues to enact this 
legislation.
  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. 1291

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Pascua Yaqui Mineral Rights 
     Act of 2005''.

     SEC. 2. DEFINITIONS.

       In this Act:
       (1) Secretary.--The term ``Secretary'' means the Secretary 
     of the Interior.
       (2) State.--The term ``State'' means the State of Arizona.
       (3) Tribe.--The term ``Tribe'' means the Pascua Yaqui 
     Tribe.

     SEC. 3. ACQUISITION OF SUBSURFACE MINERAL INTERESTS.

       (a) In General.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary, in coordination with 
     the Attorney General of the United States and with the 
     consent of the State, shall acquire through eminent domain 
     the following:
       (1) All subsurface rights, title, and interests (including 
     subsurface mineral interests) held by the State in the 
     following tribally-owned parcels:
       (A) Lot 2, sec. 13, T. 15 S., R. 12 E., Gila and Salt River 
     Meridian, Pima County Arizona.
       (B) Lot 4, W\1/2\SE\1/4\, sec. 13, T. 15 S., R. 12 E., Gila 
     and Salt River Base & Meridian, Pima County, Arizona.
       (C) NW\1/4\NW\1/4\, N\1/2\NE\1/4\NW\1/4\, SW\1/4\NE\1/
     4\NW\1/4\, sec. 24, T. 15 S., R. 12 E., Gila and Salt River 
     Base & Meridian, Pima County Arizona.
       (D) Lot 2 and Lots 45 through 76, sec. 19, T. 15 S., R. 13 
     E., Gila and Salt River Base & Meridian, Pima County, 
     Arizona.
       (2) All subsurface rights, title, and interests (including 
     subsurface mineral interests) held by the State in the 
     following parcels held in trust for the benefit of Tribe:
       (A) Lots 1 through 8, sec. 14, T. 15 S., R. 12 E., Gila and 
     Salt River Base & Meridian, Pima County, Arizona.
       (B) NE\1/4\SE\1/4\, E\1/2\NW\1/4\SE\1/4\, SW\1/4\NW\1/
     4\SE\1/4\, N\1/2\SE\1/4\SE\1/4\, SE\1/4\SE\1/4\SE\1/4\, sec. 
     14, T. 15 S., R. 12 E., Gila and Salt River Base & Meridian, 
     Pima County, Arizona.
       (b) Consideration.--Subject to subsection (c), as 
     consideration for the acquisition of subsurface mineral 
     interests under subsection (a), the Secretary shall pay to 
     the State an amount equal to the market value of the 
     subsurface mineral interests acquired, as determined by--
       (1) a mineral assessment that is--
       (A) completed by a team of mineral specialists agreed to by 
     the State and the Tribe; and
       (B) reviewed and accepted as complete and accurate by a 
     certified review mineral examiner of the Bureau of Land 
     Management;
       (2) a negotiation between the State and the Tribe to 
     mutually agree on the price of the subsurface mineral 
     interests; or
       (3) if the State and the Tribe cannot mutually agree on a 
     price under paragraph (2), an appraisal report that is--
       (A)(i) completed by the State in accordance with subsection 
     (d); and
       (ii) reviewed by the Tribe; and
       (B) on a request of the Tribe to the Bureau of Indian 
     Affairs, reviewed and accepted as complete and accurate by 
     the Office of the Special Trustee for American Indians of the 
     Department of the Interior.
       (c) Conditions of Acquisition.--The Secretary shall acquire 
     subsurface mineral interests under subsection (a) only if--
       (1) the payment to the State required under subsection (b) 
     is accepted by the State in full consideration for the 
     subsurface mineral interests acquired;
       (2) the acquisition terminates all right, title, and 
     interest of any party other than the United States in and to 
     the acquired subsurface mineral interests; and
       (3) the Tribe agrees to fully reimburse the Secretary for 
     costs incurred by the Secretary relating to the acquisition, 
     including payment to the State for the acquisition.
       (d) Determination of Market Value.--Notwithstanding any 
     other provision of law, unless the State and the Tribe 
     otherwise agree to the market value of the subsurface mineral 
     interests acquired by the Secretary under this section, the 
     market value of those subsurface mineral interests shall be 
     determined in accordance with the Uniform Appraisal Standards 
     for Federal Land Acquisition, as published by the Appraisal 
     Institute in 2000, in cooperation with the Department of 
     Justice and the Office of Special Trustee for American 
     Indians of the Department of Interior.

[[Page S7297]]

       (e) Additional Terms and Conditions.--The Secretary may 
     require such additional terms and conditions with respect to 
     the acquisition of subsurface mineral interests under this 
     section as the Secretary considers to be appropriate to 
     protect the interests of the United States and any valid 
     existing right.

     SEC. 4. INTERESTS TAKEN INTO TRUST.

       (a) Land Transferred.--Subject to subsections (b) and (c), 
     notwithstanding any other provision of law, not later than 
     180 days after the date on which the Tribe makes the payment 
     described in subsection (c), the Secretary shall take into 
     trust for the benefit of the Tribe the subsurface rights, 
     title, and interests, formerly reserved to the United States, 
     to the following parcels:
       (1) E\1/2\NE\1/4\, SW\1/4\NE\1/4\, sec. 14, T. 15 S., R. 12 
     E., Gila and Salt River Base & Meridian, Pima County, 
     Arizona.
       (2) W\1/2\SE\1/4\, SW\1/4\, sec. 24, T. 15 S., R. 12 E., 
     Gila and Salt River Base & Meridian, Pima County, Arizona.
       (b) Exceptions.--The parcels taken into trust under 
     subsection (a) shall not include--
       (1) NE\1/4\SW\1/4\, sec. 24, except the southerly 4.19 feet 
     thereof;
       (2) NW\1/4\SE\1/4\, sec. 24, except the southerly 3.52 feet 
     thereof; or
       (3) S\1/2\SE\1/4\, sec. 23, T. 15 S., R. 12 E., Gila and 
     Salt River Base & Meridian, Pima County, Arizona.
       (c) Consideration and Costs.--The Tribe shall pay to the 
     Secretary only the transaction costs relating to the 
     assessment, review, and transfer of the subsurface rights, 
     title, and interests taken into trust under subsection (a).
                                 ______
                                 
      By Mr. SANTORUM:
  S. 1292. A bill to amend the Internal Revenue Code of 1986 to allow a 
credit against income tax for expenses incurred in tele-working; to the 
Committee on Finance.
  Mr. SANTORUM. Mr. President, I rise to introduce legislation that 
would help people who ``telework'' or work from home, to receive a tax 
credit. Teleworkers are people who work on-line from home--whether a 
few days a week or their entire work schedule--using computers and 
other information technology tools. Nearly 40 million Americans 
telework today, and according to experts, 40 percent of the nation's 
jobs are compatible with telework.
  I am introducing the Telework Tax Incentive Act to provide a $500 tax 
credit for telework. The legislation provides an incentive to encourage 
more employers to consider telework for their employees. Telework 
should be a regular part of the 21st century workplace.
  The best part of telework is that it improves the quality of life for 
everyone--both the employee, the employer and the community. Telework 
reduces traffic congestion and air pollution. It reduces gas 
consumption and our dependency on foreign oil. Encouraging telework is 
good for families--giving working parents the flexibility to meet 
everyday demands. Telework provides people with disabilities greater 
job opportunities. It can also be a good option for retirees and others 
who choose to work part-time.
  A task force on telework initiated by former Virginia Governor James 
Gilmore recommended the establishment of a tax credit toward the 
purchase and installation of electronic and computer equipment that 
allow an employee to telework. For example, the cost of a computer, fax 
machine, modem, phone, printer, software, copier, and other expenses 
necessary to enable telework could count toward a tax credit, provided 
the person worked at home a minimum number of days per year.
  My legislation would provide a $500 tax credit ``for expenses paid or 
incurred under a teleworking arrangement for furnishings and electronic 
information equipment which are used to enable an individual to 
telework.'' An employee must telework a minimum of 75 days per year to 
qualify for the tax credit. Both the employer and employee are eligible 
for the tax credit, but the tax credit goes to whomever absorbs the 
expense for setting up the at-home worksite.
  On October 9, 1999, President Clinton signed into law legislation 
that I introduced in coordination with Representative Frank Wolf from 
Virginia as part of the annual Department of Transportation 
appropriations bill for Fiscal Year 2000. S. 1521, the National 
Telecommuting and Air Quality Act, created a pilot program to study the 
feasibility of providing incentives for companies to allow their 
employees to telework in five major metropolitan areas including 
Philadelphia, Washington, D.C., Los Angeles, Houston and Denver.
  President Bush signed legislation on July 14, 2000, that included an 
additional $2 million to continue telework efforts in the 5 pilot 
cities, including Philadelphia, to market, implement, and evaluate 
strategies for awarding telecommuting, emissions reduction, and 
pollution credits established through the National Telecommuting and 
Air Quality Act. I am excited that Philadelphia continues to use this 
opportunity to help to get the word out about the benefits of 
telecommuting for many employees and employers.
  Telecommuting improves air quality by reducing pollutants, provides 
employees and families flexibility, reduces traffic congestion, and 
increases productivity and retention rates for businesses while 
reducing their overhead costs. It's a growing opportunity and option 
which we should all include in our effort to maintain and improve 
quality of life issues in Pennsylvania and around the Nation. According 
to statistics available from 1996, the Greater Philadelphia area ranked 
number 10 in the country for annual person-hours of delay due to 
traffic congestion. Because of this reality, all options including 
telecommuting should be pursued to address this challenge.
  The 1999 Telework America National Telework Survey, conducted by Joan 
H. Pratt Associates, found that today's 19.6 million teleworkers 
typically work 9 days per month at home with an average of 3 hours per 
week during normal business hours. Teleworkers seek a blend of job-
related and personal benefits to enable them to better handle their 
work and life responsibilities; however these research findings 
demonstrate the impact on the bottom line for employers as well. 
Employers may save more than $10,000 per telework employee simply from 
reduced absenteeism and increased employee retention. Thus an 
organization with 100 employees, 20 of whom telework, could potentially 
realize a savings of $200,000 annually, or more, when productivity 
gains are added.
  When I introduced this legislation in the 107th Congress, it was 
endorsed by a number of groups including including the International 
Telework Association and Council (ITAC), Covad Communications, National 
Town Builders Association, Litton Industries, Orbital Sciences 
Corporation, Consumer Electronic Association, Capnet, BTG Corporation, 
Electonic Industries Alliance, Telecommunications Industry Association, 
American Automobile Association Mid-Atlantic, Dimensions International 
Inc., Capunet, TManage, Science Applications International Corporation, 
AT&T, Northern Virginia Technology Council, Computer Associates 
Incorporated, and Dyn Corp.
  Work is something you do, not someplace you go. There is nothing 
magical about strapping ourselves into a car and driving sometimes up 
to an hour and a half, arriving at a workplace and sitting before a 
computer, when we can access the same information from a computer in 
our homes. Wouldn't it be great if we could replace the evening rush 
hour commute with time spent with the family, coaching little league or 
volunteering at a local charity?
  I urge my colleagues to consider cosponsoring this legislation that 
promotes telework and helps encourage additional employee choices for 
the workplace.
                                 6_____
                                 
      By Mr. BUNNING (for himself, Mr. Conrad, Mr. Lott, Mr. Smith, and 
        Mrs. Lincoln):
  S. 1293. A bill to amend the Internal Revenue Code of 1986 to permit 
the consolidation of life insurance companies with other companies; to 
the Committee on Finance.
  Mr. BUNNING. Mr. President, I rise today to introduce legislation to 
allow affiliated life and non-life insurance companies to file 
consolidated tax returns. The current outdated rules do not allow such 
consolidation.
  Consolidated return provisions under current law were enacted so that 
the members of an affiliated group of corporations could file a single 
tax return. The right to file a ``consolidated'' return is generally 
available to businesses of all natures conducted by the affiliated 
corporations. The purpose behind consolidated returns is simply to tax 
a complete business as a whole rather than its component parts 
individually. Whether an enterprise's businesses are operated as 
divisions within

[[Page S7298]]

one corporation or as subsidiary corporations with a common parent 
company, a business entity should generally be taxed as a single entity 
and be allowed to file its return accordingly.
  Corporate groups which include life insurance companies are denied 
the ability to file a single consolidated return until they have been 
affiliated for at least 5 years. Even after this 5-year period, they 
are subject to two additional limitations that are not applicable to 
any other type of group. First, non-life insurance companies must be 
members of the affiliated group for five years before their losses may 
be used to offset life insurance company income. Second, non-life 
insurance affiliate losses, including current year losses and any 
carryover losses, that may offset life insurance company taxable income 
are limited to the lesser of 35 percent of life insurance company's 
taxable income or 35 percent of the non-life insurance company's 
losses.
  There are no clear reasons why affiliated groups that include life 
insurance companies are denied the same unrestricted ability to file 
consolidated returns that is available to other financial 
intermediaries, and corporations in general. Allowing members of an 
affiliated group of corporations to file a consolidated return prevents 
the business enterprise's structure from obscuring the fact that the 
true gain or loss of the business enterprise is the conglomeration of 
each of the members of the affiliated group. The limitations contained 
in current law are clearly without policy justification and should be 
repealed.
  Our legislation will repeal the two 5-year limitations for taxable 
years beginning after this year, and it will phase out the 35 percent 
limitation over 7 years. The staff of the Joint Committee on Taxation 
has recommended repeal of two of the three limitations addressed by my 
bill on the grounds of needless complexity. The third limitation is, in 
effect, merely a minimum tax on life insurance company income. That 
limitation should have been repealed when the alternative minimum tax 
was enacted, and certainly has no place in the current tax laws. I 
should also note that Congress included in the tax cut vetoed by then-
President Clinton in 1999 much of what is contained in this 
legislation.
  I thank Senators Conrad, Lott, Smith and Lincoln for joining me in 
sponsoring this legislation. We hope you will join us as cosponsors of 
this bipartisan, much-needed legislation.
                                 ______
                                 
      By Mr. LAUTENBERG (for himself and Mr. McCain):
  S. 1294. A bill to amend the Telecommunications Act of 1996 to 
preserve and protect the ability of local governments to provide 
broadband capability and services; to the Committee on Commerce, 
Science, and Transportation.
  Mr. LAUTENBERG. Mr. President, I rise to introduce the ``Community 
Broadband Act of 2005.'' I am pleased to be joined in this effort by 
Senator McCain of Arizona.
  This legislation will promote economic development, enhance public 
safety, increase educational opportunities, and improve the lives of 
citizens in areas of the country that either do not have access to 
broadband or live in a location where the cost for broadband is simply 
not affordable.
  A recent study by the Organization for Economic Cooperation and 
Development shows that the United States has dropped to 12th place 
worldwide in the percentage of people with broadband connections. Many 
of the countries ahead of the United States have successfully combined 
public and private efforts to deploy municipal networks that connect 
their citizens and businesses with high-speed Internet services.
  It is in this context that President Bush has called for universal 
and affordable broadband in the United States by the year 2007. If we 
are going to meet President Bush's goals, we must not enact barriers to 
broadband development and access. Unfortunately, fourteen States have 
passed legislation to prohibit or significantly restrict the ability of 
local municipalities and communities to offer high-speed Internet to 
their citizens. More States are considering such legislation. The 
``Community Broadband Act'' is in response to those efforts by States 
to tell local communities that they cannot establish networks for their 
citizens even in communities that either have no access to broadband or 
where access is prohibitively expensive.
  The ``Community Broadband Act'' is a simple bill. It says that no 
State can prohibit a municipality from offering high-speed Internet to 
its citizens; and when a municipality is a provider, it cannot abuse 
its governmental authority as regulator to discriminate against private 
competitors. Furthermore, a municipality must comply with Federal and 
state telecommunications laws.
  Mr. President, this bill will allow communities to make broadband 
decisions that could: Improve their economy and create jobs by serving 
as a medium for development, particularly in rural and underserved 
urban areas; aid public safety and first responders by ensuring access 
to network services while on the road and in the community; strengthen 
our country's international competitiveness by giving businesses the 
means to compete more effectively locally, nationally, and 
internationally; encourage long-distance education through video 
conferencing and other means of sharing knowledge and enhancing 
learning via the Internet; and create incentives for public-private 
partnerships.
  A century ago, there were efforts to prevent local governments from 
offering electricity. Opponents argued that local governments didn't 
have the expertise to offer something as complex as electricity. They 
also argued that businesses would suffer if they faced competition from 
cities and towns. But local community leaders recognized that their 
economic survival depended on electrifying their communities. They knew 
that it would take both private investment and public investment to 
bring electricity to all Americans.
  We face a similar situation today. Municipal networks can play an 
essential role in making broadband access universal and affordable. We 
must not put up barriers to this possibility of municipal involvement 
in broadband deployment.
  Some local governments will decide to do this; others will not. Let 
me be clear this is not going to be the right decision for every 
municipality. But there are clearly examples of municipalities that 
need to provide broadband, and those municipalities should have the 
power to do so.
  Today's Wall Street Journal notes the small town of Granbury, TX, 
population 6,400, that initiated a wireless network after waiting years 
for private industry to take an interest. In Scottsburg, IN, a city and 
its 6000 residents north of Louisville, KY, could not get broadband 
from an incumbent telephone company. When two important businesses 
threatened to leave unless they could obtain broadband connectivity, 
municipal officials stepped forward to provide wireless broadband 
throughout the town. The town retained the two businesses and gained 
much more. There are many Granburys and Scottsburgs across the country.
  There are also underserved urban areas, where private providers may 
exist, but many in the community simply cannot afford the high prices. 
Dianah Neff, Philadelphia's chief information officer, knows this all 
too well. ``The digital divide is local,'' Neff has said, commenting 
that while 90 percent Philadelphia's affluent neighborhoods have 
broadband, just 25 percent in low-income areas have broadband. When the 
city of Philadelphia announced plans for wireless access, it 
immediately faced opposition and the Pennsylvania legislature passed 
legislation to counter this municipal power.
  Community broadband networks have the potential to create jobs, spur 
economic development, and bring a 21st century utility to everyone. I 
hope my colleagues will join Senator McCain and me in our effort to 
enact the Community Broadband Act of 2005.
  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. 1294

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Community Broadband Act of 
     2005''.

[[Page S7299]]

     SEC. 2. COMMUNITY BROADBAND CAPABILITY AND SERVICES.

       Section 706 of the Telecommunications Act of 1996 (47 
     U.S.C. 157 note) is amended--
       (1) by redesignating subsection (c) as subsection (d) and 
     inserting after subsection (b) the following:
       ``(c) Local Government Provision of Advanced 
     Telecommunications Capability and Services.--
       ``(1) In general.--No State statute, regulation, or other 
     State legal requirement may prohibit or have the effect of 
     prohibiting any public provider from providing, to any person 
     or any public or private entity, advanced telecommunications 
     capability or any service that utilizes the advanced 
     telecommunications capability provided by such provider.
       ``(2) Antidiscrimination safeguards.--To the extent any 
     public provider regulates competing private providers of 
     advanced telecommunications capability or services, it shall 
     apply its ordinances and rules without discrimination in 
     favor of itself or any advanced telecommunications services 
     provider that it owns.
       ``(3) Savings clause.--Nothing in this section shall exempt 
     a public provider from any Federal or State 
     telecommunications law or regulation that applies to all 
     providers of advanced telecommunications capability or 
     services using such advanced telecommunications 
     capability.''; and
       (2) by adding at the end of subsection (d), as 
     redesignated, the following:
       ``(3) Public provider.--The term `public provider' means a 
     State or political subdivision thereof, any agency, 
     authority, or instrumentality of a State or political 
     subdivision thereof, or an Indian tribe (as defined in 
     section 4(e) of the Indian Self-Determination and Education 
     Assistance Act (25 U.S.C. 450b(e)), that provides advanced 
     telecommunications capability, or any service that utilizes 
     such advanced telecommunications capability, to any person or 
     public or private entity.''.
  Mr. McCAIN. Mr. President, I am pleased to join in sponsoring the 
Community Broadband Act of 2005. In the simplest of terms, this bill 
would ensure that any town, city, or county that wishes to offer high-
speed Internet services to its citizens can do so. The bill also would 
ensure fairness by requiring municipalities that offer high-speed 
Internet services do so in compliance with all Federal and State 
telecommunications laws and in a nondiscriminatory manner.
  This bill is needed if we are to meet President Bush's call for 
``universal, affordable access for broadband technology by the year 
2007.'' When President Bush announced this nationwide goal in 2004, the 
country was ranked 10th in the world for high-speed Internet 
penetration. Today, the country is ranked 16th. This is unacceptable 
for a country that should lead the world in technical innovation, 
economic development, and international competitiveness.
  Many of the countries outpacing the United States in the deployment 
of high-speed Internet services, including Canada, Japan, and South 
Korea, have successfully combined municipal systems with privately 
deployed networks to wire their countries. As a country, we cannot 
afford to cut off any successful strategy if we want to remain 
internationally competitive.
  I recognize that our Nation has a long and successful history of 
private investment in critical communications infrastructure. That 
history must be respected, protected, and continued. However, when 
private industry does not answer the call because of market failures or 
other obstacles, it is appropriate and even commendable, for the people 
acting through their local governments to improve their lives by 
investing in their own future. In many rural towns, the local 
government's high-speed Internet offering may be its citizens only 
option to access the World Wide Web.
  Despite this situation, a few incumbent providers of traditional 
telecommunications services have attempted to stop local government 
deployment of community high speed Internet services. The bill would do 
nothing to limit their ability to compete. In fact, the bill would 
provide them an incentive to enter more rural areas and deploy services 
in partnership with local governments. This partnership will not only 
reduce the costs to private firms, but also ensure wider deployment of 
rural services. Additionally, the bill would aid private providers by 
prohibiting a municipality when acting as both ``regulator'' and 
``competitor'' from discriminating against competitors in favor of 
itself.
  Several newspapers have endorsed the concept of allowing 
municipalities to choose whether to offer high speed Internet services. 
USA Today rightfully questioned in an editorial, ``Why shouldn't 
citizens be able to use their own resources to help themselves?'' The 
Washington Post editorialized that the offering of high speed Internet 
services by localities is, ``. . . the sort of municipal experiment we 
hope will spread.'' The San Jose Mercury News stated that a ban on 
localities ability to offer such services is ``bad for consumers, bad 
for technology and bad for America's hopes of catching up to other 
countries in broadband deployment.'' Finally, the Tampa Tribune 
lectured Federal and State legislators, ``don't prohibit local elected 
officials from providing a service their communities need.''
  My home State of Arizona boasts the largest approved municipal 
broadband system in the United States, for example. The city of Tempe's 
wireless system will serve all of the city's 40 square miles and a 
population of 159,000, including the campus of Arizona State 
University. Citizens will have Internet access from anywhere at any 
time, and police, fire, water and traffic services personnel will use 
the system to enhance their efficiency.
  In addition to Tempe, several Native American tribal governments 
offer high-speed Internet access services to their citizens. This bill 
would ensure that such offerings could continue to assist Indian 
country and their ability to connect to the Internet.
  Our country faces some real challenges. We need to find ways to use 
technology to help our citizens better compete. We need to help our 
businesses capitalize on their ingenuity so that they can become more 
internationally competitive. That is why we need to do all we can to 
eliminate barriers to competition and create incentives for the 
delivery of high-speed Internet services for public suppliers of 
broadband services, private suppliers of broadband services, and 
public-private partnerships as well.
  I hope my colleagues will join us in sponsoring the Community 
Broadband Act of 2005.
                                 ______
                                 
      By Mr. McCAIN:
  S. 1295. A bill to amend the Indian Gaming Regulatory Act to provide 
for accountability and funding of the National Indian Gaming 
Commission; to the Committee on Indian Affairs.
  Mr. McCAIN. Mr. President, I am pleased to introduce the National 
Indian Gaming Commission Accountability Act of 2005 to amend provisions 
of the Indian Gaming Regulatory Act regarding NIGC funding and 
accountability.
  The Indian gaming industry has undergone tremendous growth since the 
enactment of the Indian Gaming Regulatory Act in 1988. The regulatory 
responsibilities of the NIGC, the Federal agency responsible for 
oversight of the industry, has likewise grown. In recent years the 
NIGC's budgeting needs have consistently exceeded the $8 million 
statutory cap, necessitating short-term authorizations to exceed the 
cap to enable it to adequately enforce the Act.
  Rather than merely raising the cap on funding, this legislation 
amends IGRA's equation for funding the NIGC by allowing the funding to 
adjust in direct proportion to the revenues of the Indian gaming 
industry, with funding expanding or contracting as the Indian gaming 
industry grows or recedes. Under that equation--which provides that 
fees cannot exceed .08 percent of gross gaming revenues--the NIGC's 
budget for fiscal 2007 would be capped at approximately $14.5 million.
  As the agency's needs have grown, so has the scrutiny of the 
regulated community and affected parties. It is therefore appropriate 
that the agency's budgetary choices and program plans be subject to 
transparency. Therefore, this legislation increases not only the 
agency's funding, but also its accountability by directing that the 
NIGC be subject to the Government Performance and Results Act (GPRA). 
As a result, the agency would be required to develop a Strategic Plan, 
and annual performance plans and performance reports, all of which will 
provide critical information to the regulated stakeholders.
  I look forward to working with my colleagues on both sides of the 
aisle to enact this timely and balanced legislation. I ask unanimous 
consent that the full 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:

[[Page S7300]]

                                S. 1295

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``National Indian Gaming 
     Commission Accountability Act of 2005''.

     SEC. 2. COMMISSION ACCOUNTABILITY AND FUNDING.

       (a) Powers of the Commission.--Section 7 of the Indian 
     Gaming Regulatory Act (25 U.S.C. 2706) is amended by adding 
     at the end the following:
       ``(d) Application of Government Performance and Results 
     Act.--
       ``(1) In general.--In carrying out any action under this 
     Act, the Commission shall be subject to the Government 
     Performance and Results Act of 1993 (Public Law 1030962; 107 
     Stat. 285).
       ``(2) Plans.--In addition to any plan required under the 
     Government Performance and Results Act of 1993 (Public Law 
     1030962; 107 Stat. 285), the Commission shall submit a plan 
     to provide technical assistance to tribal gaming operations 
     in accordance with that Act.''.
       (b) Commission Funding.--Section 18(a)(2) of the Indian 
     Gaming Regulatory Act (25 U.S.C. 2717(a)(2)) is amended by 
     striking subparagraph (B) and inserting the following:
       ``(B) The total amount of all fees imposed during any 
     fiscal year under the schedule established under paragraph 
     (1) shall not exceed 0.080 percent of the gross gaming 
     revenues of all gaming operations subject to regulation under 
     this Act.''.
                                 ______
                                 
      By Ms. MURKOWSKI (for herself, Mr. Stevens, Mr. Burns, Mr. Craig, 
        Mr. Crapo, Mr. Kyl, and Mr. Smith):
  S. 1296. A bill to amend title 28, United States Code, to provide for 
the appointment of additional Federal circuit judges, to divide the 
Ninth Judicial Circuit of the United States into 2 circuits, and for 
other purposes; to the Committee on the Judiciary.
  Ms. MURKOWSKI. Mr. President, I ask unanimous consent that my bill, 
the Ninth Circuit Judgeship and Reorganization Act of 2005, be printed 
in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S, 1296

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Ninth Circuit Judgeship and 
     Reorganization Act of 2005''.

     SEC. 2. DEFINITIONS.

       In this Act:
       (1) Former ninth circuit.--The term ``former ninth 
     circuit'' means the ninth judicial circuit of the United 
     States as in existence on the day before the effective date 
     of this Act.
       (2) New ninth circuit.--The term ``new ninth circuit'' 
     means the ninth judicial circuit of the United States 
     established by the amendment made by section 3(2)(A).
       (3) Twelfth circuit.--The term ``twelfth circuit'' means 
     the twelfth judicial circuit of the United States established 
     by the amendment made by section 3(2)(B).

     SEC. 3. NUMBER AND COMPOSITION OF CIRCUITS.

       Section 41 of title 28, United States Code, is amended--
       (1) in the matter preceding the table, by striking 
     ``thirteen'' and inserting ``fourteen''; and
       (2) in the table--
       (A) by striking the item relating to the ninth circuit and 
     inserting the following:

California, Guam, Hawaii, Northern Marianas Islands.'';................

       and
       (B) by inserting after the item relating to the eleventh 
     circuit the following:

Alaska, Arizona, Idaho, Montana, Nevada, Oregon, Washington.''.........

     SEC. 4. JUDGESHIPS.

       (a) New Judgeships.--The President shall appoint, by and 
     with the advice and consent of the Senate, 5 additional 
     circuit judges for the new ninth circuit court of appeals, 
     whose official duty station shall be in California. The 
     judges authorized by this paragraph shall not be appointed 
     before January 21, 2006.
       (b) Temporary Judgeships.--
       (1) Appointment of judges.--The President shall appoint, by 
     and with the advice and consent of the Senate, 2 additional 
     circuit judges for the former ninth circuit court of appeals, 
     whose official duty stations shall be in California.
       (2) Effect of vacancies.--The first 2 vacancies occurring 
     on the new ninth circuit court of appeals 10 years or more 
     after judges are first confirmed to fill both temporary 
     circuit judgeships created by this subsection shall not be 
     filled.
       (c) Effective Date.--This section shall take effect on the 
     date of the enactment of this Act.

     SEC. 5. NUMBER OF CIRCUIT JUDGES.

       The table contained in section 44(a) of title 28, United 
     States Code, is amended--
       (1) by striking the item relating to the ninth circuit and 
     inserting the following:

``Ninth.......................................................19'';....

       and
       (2) by inserting after the item relating to the eleventh 
     circuit the following:

``Twelfth.....................................................14''.....

     SEC. 6. PLACES OF CIRCUIT COURT.

       The table contained in section 48(a) of title 28, United 
     States Code, is amended--
       (1) by striking the item relating to the ninth circuit and 
     inserting the following:

Honolulu, San Francisco.'';............................................

       and
       (2) by inserting after the item relating to the eleventh 
     circuit the following:

Phoenix, Portland, Missoula.''.........................................

     SEC. 7. LOCATION OF TWELFTH CIRCUIT HEADQUARTERS.

       The offices of the Circuit Executive of the Twelfth Circuit 
     and the Clerk of the Court of the Twelfth Circuit shall be 
     located in Phoenix, Arizona.

     SEC. 8. ASSIGNMENT OF CIRCUIT JUDGES.

       Each circuit judge of the former ninth circuit who is in 
     regular active service and whose official duty station on the 
     day before the effective date of this Act--
       (1) is in California, Guam, Hawaii, or the Northern 
     Marianas Islands shall be a circuit judge of the new ninth 
     circuit as of such effective date; and
       (2) is in Alaska, Arizona, Idaho, Montana, Nevada, Oregon, 
     or Washington shall be a circuit judge of the twelfth circuit 
     as of such effective date.

     SEC. 9. ELECTION OF ASSIGNMENT BY SENIOR JUDGES.

       Each judge who is a senior circuit judge of the former 
     ninth circuit on the day before the effective date of this 
     Act may elect to be assigned to the new ninth circuit or the 
     twelfth circuit as of such effective date and shall notify 
     the Director of the Administrative Office of the United 
     States Courts of such election.

     SEC. 10. SENIORITY OF JUDGES.

       The seniority of each judge--
       (1) who is assigned under section 8, or
       (2) who elects to be assigned under section 9,

     shall run from the date of commission of such judge as a 
     judge of the former ninth circuit.

     SEC. 11. APPLICATION TO CASES.

       The following apply to any case in which, on the day before 
     the effective date of this Act, an appeal or other proceeding 
     has been filed with the former ninth circuit:
       (1) Except as provided in paragraph (3), if the matter has 
     been submitted for decision, further proceedings with respect 
     to the matter shall be had in the same manner and with the 
     same effect as if this Act had not been enacted.
       (2) If the matter has not been submitted for decision, the 
     appeal or proceeding, together with the original papers, 
     printed records, and record entries duly certified, shall, by 
     appropriate orders, be transferred to the court to which the 
     matter would have been submitted had this Act been in full 
     force and effect at the time such appeal was taken or other 
     proceeding commenced, and further proceedings with respect to 
     the case shall be had in the same manner and with the same 
     effect as if the appeal or other proceeding had been filed in 
     such court.
       (3) If a petition for rehearing en banc is pending on or 
     after the effective date of this Act, the petition shall be 
     considered by the court of appeals to which it would have 
     been submitted had this Act been in full force and effect at 
     the time that the appeal or other proceeding was filed with 
     the court of appeals.

     SEC. 12. TEMPORARY ASSIGNMENT OF CIRCUIT JUDGES AMONG 
                   CIRCUITS.

       Section 291 of title 28, United States Code, is amended by 
     adding at the end the following:
       ``(c) The chief judge of the Ninth Circuit may, in the 
     public interest and upon request by the chief judge of the 
     Twelfth Circuit, designate and assign temporarily any circuit 
     judge of the Ninth Circuit to act as circuit judge in the 
     Twelfth Circuit.
       ``(d) The chief judge of the Twelfth Circuit may, in the 
     public interest and upon request by the chief judge of the 
     Ninth Circuit, designate and assign temporarily any circuit 
     judge of the Twelfth Circuit to act as circuit judge in the 
     Ninth Circuit.''.

     SEC. 13. TEMPORARY ASSIGNMENT OF DISTRICT JUDGES AMONG 
                   CIRCUITS.

       Section 292 of title 28, United States Code, is amended by 
     adding at the end the following:
       ``(f) The chief judge of the United States Court of Appeals 
     for the Ninth Circuit may in the public interest--
       ``(1) upon request by the chief judge of the Twelfth 
     Circuit, designate and assign 1 or more district judges 
     within the Ninth Circuit to sit upon the Court of Appeals of 
     the Twelfth Circuit, or a division thereof, whenever the 
     business of that court so requires; and
       ``(2) designate and assign temporarily any district judge 
     within the Ninth Circuit to hold a district court in any 
     district within the Twelfth Circuit.
       ``(g) The chief judge of the United States Court of Appeals 
     for the Twelfth Circuit may in the public interest--
       ``(1) upon request by the chief judge of the Ninth Circuit, 
     designate and assign 1 or more

[[Page S7301]]

     district judges within the Twelfth Circuit to sit upon the 
     Court of Appeals of the Ninth Circuit, or a division thereof, 
     whenever the business of that court so requires; and
       ``(2) designate and assign temporarily any district judge 
     within the Twelfth Circuit to hold a district court in any 
     district within the Ninth Circuit.
       ``(h) Any designations or assignments under subsection (f) 
     or (g) shall be in conformity with the rules or orders of the 
     court of appeals of, or the district within, as applicable, 
     the circuit to which the judge is designated or assigned.''.

     SEC. 14. ADMINISTRATION.

       The court of appeals for the ninth circuit as constituted 
     on the day before the effective date of this Act may take 
     such administrative action as may be required to carry out 
     this Act and the amendments made by this Act. Such court 
     shall cease to exist for administrative purposes 2 years 
     after the date of enactment of this Act.

     SEC. 15. EFFECTIVE DATE.

       Except as provided in section 4(c), this Act and the 
     amendments made by this Act shall take effect 12 months after 
     the date of enactment of this Act.
                                 ______
                                 
      By Mr. CORZINE (for himself, Mr. Bingaman, and Ms. Landrieu):
  S. 1297. A bill to amend title XVIII of the Social Security Act to 
reduce the work hours and increase the supervision of resident 
physicians to ensure the safety of patients and resident-physicians 
themselves; to the Committee on Finance.
  Mr. CORZINE. Mr. President, I rise today to reintroduce my 
legislation, the Patient and Physician Safety and Protection Act of 
2005, to limit medical resident work hours to 80 hours a week and to 
provide real protections for patients and resident physicians who are 
negatively affected by excessive work hours. I feel strongly that as 
Congress begins to consider proposals to reduce medical malpractice 
premiums and improve quality of care, we must consider the role that 
excessive work hours play in exacerbating medical liability problems 
and reducing quality of care.
  It is very troubling that hospitals across the Nation are requiring 
young doctors to work 36 hour shifts and as many as 120 hours a week in 
order to complete their residency programs. These long hours lead to a 
deterioration of cognitive function similar to the effects of blood 
alcohol levels of 0.1 percent. This is a level of cognitive impairment 
that would make these doctors unsafe to drive--yet these physicians are 
not only allowed but in fact are required to care for patients and 
perform procedures on patients under these conditions. In fact, a study 
by Harvard Medical School researchers published in the October 28, 2004 
issue of the New England Journal of Medicine found that medical 
residents made 35.9 percent more serious medical errors when they 
worked extended shifts of more than 24 hours.
  The Patient and Physician Safety and Protection Act of 2005 will 
limit medical resident work hours to 80 hours a week. Not 40 hours or 
60 hours--80 hours a week. It is hard to argue that this standard is 
excessively strict. In fact, it is unconscionable that we now have 
resident physicians, or any physicians for that matter, caring for very 
sick patients 120 hours a week and 36 hours straight with fewer than 10 
hours between shifts. This is an outrageous violation of a patient's 
right to quality care.
  In addition to limiting work hours to 80 hours week, my bill limits 
the length of any one shift to 24 consecutive hours, while allowing for 
up to three hours of patient transition time, and limits the length of 
an emergency room shift to 12 hours. The bill also ensures that 
residents have at least one out of seven days off and `on-call' shifts 
no more often than every third night.

  Since I first introduced the Patient and Physician Safety and 
Protection Act in the 107th Congress, the medical community and the 
Accreditation Council for Graduate Medical Education, ACGME, 
specifically have taken critical steps to address the problem of 
excessive work hours. On July 1, 2003, the ACGME issued resident work-
hour guidelines aimed at addressing this important issue. While I 
commend ACGME leadership for taking the initiative, I remain very 
concerned that the ACGME's policy lacks the enforcement mechanisms that 
are essential to ensure compliance with the new work hour rules. The 
ACGME's only sanction against hospitals that overwork residents or 
provide inadequate supervision is the threat of lost accreditation of 
residency programs. Medical residents who have already ``matched'' into 
a program and invested years there are understandably reluctant to 
report violations that might result in the closure of their residency. 
Furthermore, the ACGME usually gives hospital administrators 90-100 
days notice before inspecting a residency program. While the ACGME 
policy establishes more stringent work hours regulations, it fails to 
create effective enforcement and oversight tools. These rules are 
meaningless without enforcement mechanisms.
  That is why Federal legislation is necessary. The Patient and 
Physician Safety and Protection Act of 2005 not only recognizes the 
problem of excessive work hours, but also creates strong enforcement 
mechanisms. The bill also provides funding support to teaching 
hospitals to implement new work hour standards. Without enforcement and 
financial support, efforts to reduce work hours are not likely to be 
successful.
  Finally, my legislation provides meaningful enforcement mechanisms 
that will protect the identity of resident physicians who file 
complaints about work hour violations. The ACGME's guidelines do not 
contain any whistleblower protections for residents that seek to report 
program violations. Without this important protection, residents will 
be reluctant to report these violations, which in turn will weaken 
enforcement.
  My legislation also makes compliance with these work hour 
requirements a condition of Medicare participation. Each year, Congress 
provides $8 billion to teaching hospitals to train new physicians. 
While Congress must continue to vigorously support adequate funding so 
that teaching hospitals are able to carryout this important public 
service, these hospitals must also make a commitment to ensuring safe 
work conditions for these physicians and providing the highest quality 
of care to the patients they treat.
  In closing I would like to read a quote from an Orthopedic Surgery 
Resident from Northern California, which I think illustrates why we 
need this legislation.
  I quote, ``I was operating post-call after being up for over 36 hours 
and was holding retractors. I literally fell asleep standing up and 
nearly face-planted into the wound. My upper arm hit the side of the 
gurney, and I caught myself before I fell to the floor. I nearly put my 
face in the open wound, which would have contaminated the entire field 
and could have resulted in an infection for the patient.''
  This is a very serious problem that must be addressed before medical 
errors like this occur. I hope every member of the Senate will consider 
this legislation and the potential it has to reduce medical errors, 
improve patient care, and create a safer working environment for the 
backbone of our Nation's healthcare system.
  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. 1297

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Patient and Physician Safety 
     and Protection Act of 2005''.

     SEC. 2. FINDINGS.

       Congress finds the following:
       (1) The Federal Government, through the medicare program, 
     pays approximately $8,000,000,000 per year solely to train 
     resident-physicians in the United States, and as a result, 
     has an interest in assuring the safety of patients treated by 
     resident-physicians and the safety of resident-physicians 
     themselves.
       (2) Resident-physicians spend as much as 30 to 40 percent 
     of their time performing activities not related to the 
     educational mission of training competent physicians.
       (3) The excessive numbers of hours worked by resident-
     physicians is inherently dangerous for patient care and for 
     the lives of resident-physicians.
       (4) The scientific literature has consistently demonstrated 
     that the sleep deprivation of the magnitude seen in residency 
     training programs leads to cognitive impairment.
       (5) A substantial body of research indicates that excessive 
     hours worked by resident-physicians lead to higher rates of 
     medical error, motor vehicle accidents, depression, and 
     pregnancy complications.

[[Page S7302]]

       (6) The medical community has not adequately addressed the 
     issue of excessive resident-physician work hours.
       (7) The Federal Government has regulated the work hours of 
     other industries when the safety of employees or the public 
     is at risk.
       (8) The Institute of Medicine has found that as many as 
     98,000 deaths occur annually due to medical errors and has 
     suggested that 1 necessary approach to reducing errors in 
     hospitals is reducing the fatigue of resident-physicians.

     SEC. 3. REVISION OF MEDICARE HOSPITAL CONDITIONS OF 
                   PARTICIPATION REGARDING WORKING HOURS OF 
                   MEDICAL RESIDENTS, INTERNS, AND FELLOWS.

       (a) In General.--Section 1866 of the Social Security Act 
     (42 U.S.C. 1395cc) is amended--
       (1) in subsection (a)(1)--
       (A) by striking ``and'' at the end of subparagraph (U);
       (B) by striking the period at the end of subparagraph (V) 
     and inserting ``, and''; and
       (C) by inserting after subparagraph (V) the following new 
     subparagraph:
       ``(W) in the case of a hospital that uses the services of 
     postgraduate trainees (as defined in subsection (k)(4)), to 
     meet the requirements of subsection (k).''; and
       (2) by adding at the end the following new subsection:
       ``(k)(1)(A) In order that the working conditions and 
     working hours of postgraduate trainees promote the provision 
     of quality medical care in hospitals, as a condition of 
     participation under this title, each hospital shall establish 
     the following limits on working hours for postgraduate 
     trainees:
       ``(i) Subject to subparagraphs (B) and (C), postgraduate 
     trainees may work no more than a total of 24 hours per shift.
       ``(ii) Subject to subparagraph (C), postgraduate trainees 
     may work no more than a total of 80 hours per week.
       ``(iii) Subject to subparagraph (C), postgraduate 
     trainees--
       ``(I) shall have at least 10 hours between scheduled 
     shifts;
       ``(II) shall have at least 1 full day out of every 7 days 
     off and 1 full weekend off per month;
       ``(III) subject to subparagraph (B), who are assigned to 
     patient care responsibilities in an emergency department 
     shall work no more than 12 continuous hours in that 
     department;
       ``(IV) shall not be scheduled to be on call in the hospital 
     more often than every third night; and
       ``(V) shall not engage in work outside of the educational 
     program that interferes with the ability of the postgraduate 
     trainee to achieve the goals and objectives of the program or 
     that, in combination with the program working hours, exceeds 
     80 hours per week.
       ``(B)(i) Subject to clause (ii), the Secretary shall 
     promulgate such regulations as may be necessary to ensure 
     quality of care is maintained during the transfer of direct 
     patient care from 1 postgraduate trainee to another at the 
     end of each shift.
       ``(ii) Such regulations shall ensure that, except in the 
     case of individual patient emergencies, the period in which a 
     postgraduate trainee is providing for the transfer of direct 
     patient care (as referred to in clause (i)) does not extend 
     such trainee's shift by more than 3 hours beyond the 24-hour 
     period referred to in subparagraph (A)(i) or the 12-hour 
     period referred to in subparagraph (A)(iii)(III), as the case 
     may be.
       ``(C) The work hour limitations under subparagraph (A) and 
     requirements of subparagraph (B) shall not apply to a 
     hospital during a state of emergency declared by the 
     Secretary that applies with respect to that hospital.
       ``(2) The Secretary shall promulgate such regulations as 
     may be necessary to monitor and supervise postgraduate 
     trainees assigned patient care responsibilities as part of an 
     approved medical training program, as well as to assure 
     quality patient care.
       ``(3) Each hospital shall inform postgraduate trainees of--
       ``(A) their rights under this subsection, including methods 
     to enforce such rights (including so-called whistle-blower 
     protections); and
       ``(B) the effects of their acute and chronic sleep 
     deprivation both on themselves and on their patients.
       ``(4) For purposes of this subsection, the term 
     `postgraduate trainee' means a postgraduate medical resident, 
     intern, or fellow.''.
       (b) Designation.--
       (1) In general.--The Secretary of Health and Human Services 
     (in this subsection referred to as the ``Secretary'') shall 
     designate an individual within the Department of Health and 
     Human Services to handle all complaints of violations that 
     arise from a postgraduate trainee (as defined in paragraph 
     (4) of section 1886(k) of the Social Security Act, as added 
     by subsection (a), who reports that the hospital operating 
     the medical residency training program for which the trainee 
     is enrolled is in violation of the requirements of such 
     section.
       (2) Grievance rights.--A postgraduate trainee may file a 
     complaint with the Secretary concerning a violation of the 
     requirements under such section 1886(k). Such a complaint may 
     be filed anonymously. The Secretary may conduct an 
     investigation and take corrective action with respect to such 
     a violation.
       (3) Enforcement.--
       (A) Civil money penalty enforcement.--Subject to 
     subparagraph (B), any hospital that violates the requirements 
     under such section 1886(k) is subject to a civil money 
     penalty not to exceed $100,000 for each medical residency 
     training program operated by the hospital in any 6-month 
     period. The provisions of section 1128A of the Social 
     Security Act (other than subsections (a) and (b)) shall apply 
     to civil money penalties under this paragraph in the same 
     manner as they apply to a penalty or proceeding under section 
     1128A(a) of such Act.
       (B) Corrective action plan.--The Secretary shall establish 
     procedures for providing a hospital that is subject to a 
     civil monetary penalty under subparagraph (A) with an 
     opportunity to avoid such penalty by submitting an 
     appropriate corrective action plan to the Secretary.
       (4) Disclosure of violations and annual reports.--The 
     individual designated under paragraph (1) shall--
       (A) provide for annual anonymous surveys of postgraduate 
     trainees to determine compliance with the requirements under 
     such section 1886(k) and for the disclosure of the results of 
     such surveys to the public on a medical residency training 
     program specific basis;
       (B) based on such surveys, conduct appropriate on-site 
     investigations;
       (C) provide for disclosure to the public of violations of 
     and compliance with, on a hospital and medical residency 
     training program specific basis, such requirements; and
       (D) make an annual report to Congress on the compliance of 
     hospitals with such requirements, including providing a list 
     of hospitals found to be in violation of such requirements.
       (c) Whistleblower Protections.--
       (1) In general.--A hospital covered by the requirements of 
     section 1866(k) of the Social Security Act, as added by 
     subsection (a), shall not penalize, discriminate, or 
     retaliate in any manner against an employee with respect to 
     compensation, terms, conditions, or privileges of employment, 
     who in good faith (as defined in paragraph (2)), individually 
     or in conjunction with another person or persons--
       (A) reports a violation or suspected violation of such 
     requirements to a public regulatory agency, a private 
     accreditation body, or management personnel of the hospital;
       (B) initiates, cooperates, or otherwise participates in an 
     investigation or proceeding brought by a regulatory agency or 
     private accreditation body concerning matters covered by such 
     requirements;
       (C) informs or discusses with other employees, with a 
     representative of the employees, with patients or patient 
     representatives, or with the public, violations or suspected 
     violations of such requirements; or
       (D) otherwise avails himself or herself of the rights set 
     forth in such section or this subsection.
       (2) Good faith defined.--For purposes of this subsection, 
     an employee is deemed to act ``in good faith'' if the 
     employee reasonably believes--
       (A) that the information reported or disclosed is true; and
       (B) that a violation has occurred or may occur.
       (d) Effective Date.--The amendments made by subsection (a) 
     shall take effect on the first July 1 that begins at least 1 
     year after the date of enactment of this Act.

     SEC. 4. ADDITIONAL FUNDING FOR HOSPITAL COSTS.

       There are hereby appropriated to the Secretary of Health 
     and Human Services such amounts as may be required to provide 
     for additional payments to hospitals for their reasonable 
     additional, incremental costs incurred in order to comply 
     with the requirements imposed by this Act (and the amendments 
     made by this Act).
  Mr. ENSIGN. Mr. President, I come before the Senate today about a 
very serious issue that is threatening the disbursal of justice in the 
western United States.
  My home State of Nevada, along with eight other States, has been part 
of an unbelievable population boom over the last several decades. As a 
result, we face the frustrating challenges of increased traffic 
congestion, crowded schools, and a shortage of many services. However, 
there is one consequence of that growth that has reached a critical 
level because it is delaying and denying justice for too many 
Americans.
  That is the situation with the Court of Appeals for the Ninth 
Circuit. The largest circuit in the country, it encompasses 20 percent 
of the entire Nation's population. The Ninth Circuit has the highest 
cases per jurist ratio. And the trend is not changing. The Circuit is 
just too large. Each of the States covered by the Ninth Circuit saw 
population growths over the last decade, and three of the States--
Nevada, Idaho, and Arizona--are in the top five in the country for 
population growth. Something must be done, or the Ninth Circuit will 
continue to bust at the seams.
  That is why I am introducing legislation today that would divide the 
current Ninth Circuit into 3 new circuits. The new Ninth Circuit would 
include California, Hawaii, Guam, and the Northern Marianas Islands. 
The new

[[Page S7303]]

Twelfth Circuit would be comprised of Arizona, Nevada, Idaho, and 
Montana. And the new Thirteenth Circuit would contain Oregon, 
Washington, and Alaska.
  This splitting of the Ninth Circuit is absolutely necessary if the 
residents of Nevada and the other western states are to have equal 
access to justice. Right now, citizens living under the Ninth Circuit 
face incomparable delays and judicial inconsistencies. Recently, the 
Ninth Circuit had more cases pending for more than one year than all 
other circuits combined.
  And because of the sheer magnitude of the number of judges in the 
Ninth Circuit, it has become increasingly difficult for judges to track 
the opinions of the other judges in the circuit. In fact, it happened 
that on the same day, 2 different 3-judge panels in the Ninth Circuit 
issued different legal standards to resolve the same issue. Can you 
imagine the headache this causes for district judges who are supposed 
to follow the standard set by the Ninth Circuit? It compromises the 
system of justice that is the cornerstone of our democracy.
  As a Nevadan, I am also angered by some of the decisions made by the 
Ninth Circuit Court. I know how Nevadans feel about issues such as the 
Pledge of Allegiance. Like me, they were outraged that the phrase 
``under God'' was ruled unconstitutional by the Ninth Circuit. This 
wasn't the only case of the Ninth Circuit misinterpreting the 
Constitution and our laws. In 1997 alone, the United States Supreme 
Court overruled 27 out of 28 Ninth Circuit decisions. I wish I could 
say that was just an ``off' year for the court, but their track record 
wasn't much better in the 6 years before that.
  Rather than continue down this path of judicial destruction, it is 
time to use a forward looking approach to the access of justice in the 
western United States. I urge my colleagues to join me in our 
Constitutional duty to establish courts for the sake of justice in this 
country. Failure to act will cost the citizens of my state, and many 
other western states, dearly.
                                 ______
                                 
      By Mr. DeMINT (for himself, Mr. Santorum, Mr. Graham, Mr. Crapo, 
        Mr. Coburn, Mr. Sununu, Mr. Isakson, Mr. Enzi, Mr. Cornyn, Mr. 
        Lott, Mr. Brownback, and Mr. Craig).
  S. 1302. A bill to amend the Social Security Act and the Internal 
Revenue Code of 1986 to stop the Congress from spending Social Security 
surpluses on other Government programs by dedicating those surpluses to 
personal accounts that can only be used to pay Social Security 
benefits; to the Committee on Finance.
  Mr. DeMINT. Mr. President, it's time to stop the raid on Social 
Security. For over twenty years, Congress has maintained the misguided 
practice of over-collecting Social Security taxes and spending them on 
other government programs. Congress has used the Social Security Trust 
Fund to promote the false notion that Social Security actually saves 
the money workers pay in, and it is time to end this abusive practice. 
It is time we start saving these resources in personal accounts that 
politicians cannot spend.
  Money cannot have 2 masters--it either belongs to the government or 
to individual Americans. The only way to prevent Congress from spending 
Social Security surpluses is to rebate these funds back to a worker in 
a personal account with their name on it. The only true lock-box is a 
personal account.
  President Bush has done a good job helping Americans understand the 
problem. Now it is up to Congress to build consensus around some 
solutions. Every American and nearly everyone in Congress agree on at 
least one core principle: Social Security money should only be spent on 
Social Security. Before we can have an honest debate on long-term 
solutions, we must restore trust with Americans.
  Stopping the raid will strengthen Social Security and is the first 
step toward long-term reform.
  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. 1302

       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 ``Stop the 
     Raid on Social Security Act of 2005''.

       (b) Table of Contents.--The table of contents is as 
     follows:
Sec. 1. Short title; table of contents.
Sec. 2. Findings.

     TITLE I--SOCIAL SECURITY PERSONAL RETIREMENT ACCOUNTS PROGRAM

Sec. 101. Establishment of the Social Security Personal Retirement 
              Accounts Program.

     ``Part B--Social Security Personal Retirement Accounts Program

``Sec. 251. Definitions.
``Sec. 252. Establishment of Program.
``Sec. 253. Participation in Program.
``Sec. 254. Social security personal retirement accounts .
``Sec. 255. Investment of accounts.
``Sec. 256. Distributions of account balance at retirement.
``Sec. 257. Additional rules relating to disposition of account assets.
``Sec. 258. Administration of the program.
Sec. 102. Annual account statements.

                        TITLE II--TAX TREATMENT

Sec. 201. Tax treatment of social security personal retirement 
              accounts.
Sec. 202. Benefits taxable as Social Security benefits.
``Sec. 2059. Social security personal retirement accounts.

     SEC. 2. FINDINGS.

       Congress makes the following findings:
       (1) President Franklin Roosevelt's January 17, 1935, 
     message on Social Security declared that, ``First, the system 
     adopted, except for the money necessary to initiate it, 
     should be self-sustaining in the sense that funds for the 
     payment of insurance benefits should not come from the 
     proceeds of general taxation.''.
       (2) Social Security's financial integrity is maintained by 
     requiring that benefit payments do not exceed the program's 
     dedicated tax revenues and the interest earned on the 
     balances in the Federal Old-Age and Survivors Insurance Trust 
     Fund and the Federal Disability Insurance Trust Fund over the 
     long term.
       (3) The separation of Social Security from other budget 
     accounts also serves to protect Social Security benefits from 
     competing against other Federal programs for its funding 
     resources.
       (4) Comprehensive reforms should be enacted to--
       (A) fix Social Security permanently;
       (B) ensure that any use of general revenues for the program 
     is temporary; and
       (C) provide for the eventual repayment of any revenue 
     transfers from the general fund to the Federal Old-Age and 
     Survivors Insurance Trust Fund and the Federal Disability 
     Insurance Trust Fund.

     TITLE I--SOCIAL SECURITY PERSONAL RETIREMENT ACCOUNTS PROGRAM

     SEC. 101. ESTABLISHMENT OF THE SOCIAL SECURITY PERSONAL 
                   RETIREMENT ACCOUNTS PROGRAM.

       (a) In General.--Title II of the Social Security Act is 
     amended--
       (1) by inserting before section 201 the following:

                    ``Part A--Insurance Benefits'';

     and
       (2) by adding at the end of such title the following new 
     part:

     ``Part B--Social Security Personal Retirement Accounts Program


                             ``DEFINITIONS

       ``Sec. 251. For purposes of this part--
       ``(1) Participating individual.--The term `participating 
     individual' has the meaning provided in section 253(a).
       ``(2) Account assets.--The term `account assets' means, 
     with respect to a social security personal retirement 
     account, the total amount transferred to such account, 
     increased by earnings credited under this part and reduced by 
     losses and administrative expenses under this part.
       ``(3) Certified account manager.--The term `certified 
     account manager' means a person who is certified under 
     section 258(b).
       ``(4) Board.--The term `Board' means the Social Security 
     Personal Savings Board established under section 258(a).
       ``(5) Commissioner.--The term `Commissioner' means the 
     Commissioner of Social Security.
       ``(6) Program.--The term `Program' means the Social 
     Security Personal Retirement Accounts Program established 
     under this part.


                       ``ESTABLISHMENT OF PROGRAM

       ``Sec. 252. There is hereby established a Social Security 
     Personal Retirement Accounts Program. The Program shall be 
     governed by regulations which shall be prescribed by the 
     Social Security Personal Savings Board. The Board, the 
     Executive Director appointed by the Board, the Commissioner, 
     and the Secretary of the Treasury shall consult with each 
     other in issuing regulations relating to their respective 
     duties under this part. Such regulations shall provide for 
     appropriate exchange of information to assist them in 
     performing their duties under this part.


                       ``PARTICIPATION IN PROGRAM

       ``Sec. 253. (a) Participating Individual.--For purposes of 
     this part, the term `participating individual' means any 
     individual--

[[Page S7304]]

       ``(1) who is credited under part A with wages paid after 
     December 31, 2005, or self-employment income derived in any 
     taxable year ending after such date,
       ``(2) who is born on or after January 1, 1950, and
       ``(3) who has not filed an election to renounce such 
     individual's status as a participating individual under 
     subsection (b).
       ``(b) Renunciation of Participation.--
       ``(1) In general.--An individual--
       ``(A) who has not attained retirement age (as defined in 
     section 216(l)(1)), and
       ``(B) with respect to whom no distribution has been made 
     from amounts credited to the individual's social security 
     personal retirement account,

     may elect, in such form and manner as shall be prescribed in 
     regulations of the Board, to renounce such individual's 
     status as a `participating individual' for purposes of this 
     part. Upon completion of the procedures provided for under 
     paragraph (2), any such individual who has made such an 
     election shall not be treated as a participating individual 
     under this part, effective as if such individual had never 
     been a participating individual. The Board shall provide for 
     immediate notification of such election to the Commissioner 
     of Social Security, the Secretary of the Treasury, and the 
     Executive Director.
       ``(2) Procedure.--The Board shall prescribe by regulation 
     procedures governing the termination of an individual's 
     status as `participating individual' pursuant to an election 
     under this subsection. Such procedures shall include--
       ``(A) prompt closing of the individual's social security 
     personal retirement account established under section 254, 
     and
       ``(B) prompt transfer to the Federal Old-Age and Survivors 
     Insurance Trust Fund as general receipts of any amount held 
     for investment in such individual's social security personal 
     retirement account.
       ``(3) Irrevocability.--An election under this subsection 
     shall be irrevocable.


             ``SOCIAL SECURITY PERSONAL RETIREMENT ACCOUNTS

       ``Sec. 254. (a) Establishment of Accounts.--Under 
     regulations which shall be prescribed by the Board in 
     consultation with the Secretary of the Treasury--
       ``(1) the Board shall establish a social security personal 
     retirement account for each participating individual (for 
     whom a social security personal retirement account has not 
     otherwise been established under this part) upon initial 
     receipt of a transfer under subsection (b) with respect to 
     such participating individual, and
       ``(2) in any case described in paragraph (2) of section 
     257(b), the Board shall establish a social security personal 
     retirement account for the divorced spouse referred to in 
     such paragraph (2).
       ``(b) Transfers to Social Security Personal Retirement 
     Accounts.--
       ``(1) In general.--Under regulations which shall be 
     prescribed by the Secretary of the Treasury in consultation 
     with the Board, as soon as practicable during the 1-year 
     period after each calendar year, the Secretary of the 
     Treasury shall transfer to each participating individual's 
     social security personal retirement account, from amounts 
     held in the Federal Old-Age and Survivors Insurance Trust 
     Fund, amounts equivalent to the personal retirement account 
     deposit with respect to such participating individual for 
     such calendar year.
       ``(2) Personal retirement account deposit.--
       ``(A) In general.--For purposes of paragraph (1), the 
     personal retirement account deposit for a calendar year with 
     respect to a participating individual is the product derived 
     by multiplying--
       ``(i) the sum of--

       ``(I) the total amount of wages paid to the participating 
     individual during such calendar year on which there was 
     imposed a tax under section 3101(a) of the Internal Revenue 
     Code of 1986, and
       ``(II) the total amount of self-employment income derived 
     by the participating individual during the taxable year 
     ending during such calendar year on which there was imposed a 
     tax under section 1401(a) of the Internal Revenue Code of 
     1986, by

       ``(ii) the surplus percentage for such calendar year 
     determined under subparagraph (B),

     increased by deemed interest on each amount transferred for 
     such calendar year for the period commencing with July 1 of 
     such calendar year and the ending on the date on which such 
     amount is transferred, computed at an annual rate equal to 
     the average annual rate of return on investments of amounts 
     in the Government Securities Investment Fund for such 
     calendar year and the preceding 2 calendar years (except 
     that, for purposes of the first 3 calendar years for which 
     deemed interest is computed, this sentence shall be applied 
     by substituting `Federal Old-Age and Survivors Insurance 
     Trust Fund' for `Government Securities Investment Fund') and 
     decreased by the administrative offset amount determined 
     under subparagraph (D).
       ``(B) Surplus percentage.--For purposes of subparagraph 
     (A)(ii), the surplus percentage for a calendar year is the 
     ratio (expressed as a percentage) of--
       ``(i) the net surplus in the Federal Old-Age and Survivors 
     Insurance Trust Fund for such year, to
       ``(ii) the sum of--

       ``(I) the total amount of wages paid to participating 
     individuals during such calendar year under section 3101(a) 
     of the Internal Revenue Code of 1986, and
       ``(II) the total amount of self-employment income derived 
     during taxable years ending during such calendar year by 
     participating individuals under section 1401(a) of such Code.

       ``(C) Net trust fund surplus.--For purposes of subparagraph 
     (B), the term `net surplus' in connection with the Federal 
     Old-Age and Survivors Insurance Trust Fund for a calendar 
     year means the excess, if any, of--
       ``(i) the sum of--

       ``(I) the total amounts which are appropriated to such 
     Trust Fund under clauses (3) and (4) of section 201(a) and 
     attributable to such calendar year, and
       ``(II) the total amounts which are appropriated to such 
     Trust Fund under section 121 of the Social Security 
     Amendments of 1983 and attributable to such calendar year, 
     over

       ``(ii) the amount estimated by the Commissioner of Social 
     Security to be the total amount to be paid from such Trust 
     Fund during such calendar year for all purposes authorized by 
     section 201 (other than payments of interest on, and 
     repayments of, loans from the Federal Hospital Insurance 
     Trust Fund under section 201(l)(1), but reducing the amount 
     of any transfer to the Railroad Retirement Account by the 
     amount of any transfers into such Trust Fund from such 
     Account).
       ``(D) Administrative offset amount.--For purposes of 
     subparagraph (A), the administrative offset amount determined 
     with respect to a personal retirement account deposit for a 
     calendar year is the amount equal to the product of--
       ``(i) the amount of such deposit determined for that year 
     without regard to a reduction under this subparagraph; and
       ``(ii) the administrative cost percentage attributable to 
     the Program determined by the Board for that year (including 
     reasonable administration fees charged by certified account 
     managers under the Program), but in no event to exceed 30 
     basis points per year of the assets under management).
       ``(3) Transition rule.--Notwithstanding paragraph (1), 
     amounts payable to social security personal retirement 
     accounts under paragraph (1) with respect to the first 
     calendar year described in paragraph (1) ending after the 
     date of the enactment of the Stop the Raid on Social Security 
     Act of 2005 shall be paid by the Secretary of the Treasury as 
     soon as practicable after such Secretary determines that the 
     administrative mechanisms necessary to provide for accurate 
     and efficient payment of such amounts have been established.
       ``(4) Transfer of general revenues to ensure continued 
     solvency of federal old-age and survivors insurance trust 
     fund.--Whenever the Secretary of the Treasury makes a 
     transfer under paragraph (1), the Secretary of the Treasury 
     also shall transfer, to the extent necessary, from amounts 
     otherwise available in the general fund of the Treasury, such 
     amounts as are necessary to maintain a 100 percent ratio of 
     assets of the Federal Old-Age and Survivors Insurance Trust 
     Fund and the Federal Disability Insurance Trust Fund to the 
     annual amount required to pay the full amount of benefits 
     payable under part A for each year occurring during the 
     period that begins with the year in which such transfer is 
     made and ends with 2041.
       ``(c) Requirements for Accounts.--The following 
     requirements shall be met with respect to each social 
     security personal retirement account:
       ``(1) Amounts transferred to the account consist solely of 
     amounts transferred pursuant to this part.
       ``(2) In accordance with section 255, the account assets 
     are held for purposes of investment under the Program by a 
     certified account manager designated by (or on behalf of) the 
     participating individual for whom such account is established 
     under the Program.
       ``(3) Disposition of the account assets is made solely in 
     accordance with sections 256 and 257.
       ``(d) Accounting of Receipts and Disbursements Under the 
     Program.--The Board shall provide by regulation for an 
     accounting system for purposes of this part--
       ``(1) which shall be maintained by or under the Executive 
     Director,
       ``(2) which shall provide for crediting of earnings from, 
     and debiting of losses and administrative expenses from, 
     amounts held in social security personal retirement accounts, 
     and
       ``(3) under which receipts and disbursements under the 
     Program which are attributable to each account are separately 
     accounted for with respect to such account.
       ``(e) Correction of Erroneous Transfers.--The Board, in 
     consultation with the Commissioner, shall provide by 
     regulation rules similar to paragraphs (4) through (7) and 
     (9) of section 205(c) and section 205(g) with respect to the 
     correction of erroneous or omitted transfers of amounts to 
     social security personal retirement accounts.


                        ``INVESTMENT OF ACCOUNTS

       ``Sec. 255. (a) Designation of Certified Account 
     Managers.--Under the Program, a certified account manager 
     shall be designated by or on behalf of each participating 
     individual to hold for investment under this section such 
     individual's social security personal retirement account 
     assets.
       ``(b) Procedure for Designation.--Any designation made 
     under subsection (a) shall

[[Page S7305]]

     be made in such form and manner as shall be prescribed in 
     regulations prescribed by the Board. Such regulations shall 
     provide for annual selection periods during which 
     participating individuals may make designations pursuant to 
     subsection (a). Designations made pursuant to subsection (a) 
     during any such period shall be irrevocable for the one-year 
     period following such period, except that such regulations 
     shall provide for such interim designations as may be 
     necessitated by the decertification of a certified account 
     manager. Such regulations shall provide for such designations 
     made by the Board on behalf of a participating individual in 
     any case in which a timely designation is not made by the 
     participating individual.
       ``(c) Investment.--Any balance held in a participating 
     individual's social security personal retirement account 
     under this part which is not necessary for immediate 
     withdrawal shall be invested on behalf of such participating 
     individual by the certified account manager as follows:
       ``(1) Investment in marketable government securities.--In a 
     representative mix of fixed marketable interest-bearing 
     obligations of the United States then forming a part of the 
     public debt which are not due or callable earlier than 4 
     years after the date of investment.
       ``(2) Additional and alternative investments.--Beginning 
     with 2008, in such additional and alternative investment 
     options in broad-based index funds that are similar to the 
     index fund investment options available within the Thrift 
     Savings Fund established under section 8437 of title 5, 
     United States Code, as the Board determines would be prudent 
     sources of retirement income that could yield greater amounts 
     of income than the investment described in paragraph (1) and 
     a participating individual may elect.


            ``DISTRIBUTIONS OF ACCOUNT BALANCE AT RETIREMENT

       ``Sec. 256. (a) Part a and Social Security Personal 
     Retirement Account Benefits Combined.--Upon the date on which 
     a participating individual becomes entitled to old-age 
     insurance benefits under section 202(a), the Executive 
     Director shall determine the total amount which would (but 
     for this section) be payable as benefits under subsection 
     (a), (b), (c), or (h) of section 202, subsection (e) or (f) 
     of section 202 other than on the basis of disability, or any 
     combination thereof, to any individual who is a participant 
     on the basis of the wages and self-employment income of such 
     individual or any other individual under part A for any month 
     and provide for the following distributions from the 
     individual's social security personal retirement account (in 
     accordance with regulations which shall be prescribed by the 
     Board):
       ``(1) Part a benefit provides at least a poverty-level 
     annual benefit.--If such total amount would be sufficient to 
     purchase a minimum annuity, the participating individual 
     shall elect to have the Executive Director provide for the 
     distribution of the balance in the participating individual's 
     social security personal retirement account in the form of--
       ``(A) a lump-sum payment; or
       ``(B) an annuity which meets the requirements of subsection 
     (b) (other than the requirement that the annuity provides for 
     payments which, on an annual basis, are equal to at least the 
     minimum annuity amount), the terms of which provide for a 
     monthly payment equal to the maximum amount that such account 
     can fund.
       ``(2) Part a benefit combined with account balance provides 
     at least a poverty-level benefit.--
       ``(A) In general.--If such total amount when combined with 
     all or a portion of the balance in the participating 
     individual's social security personal retirement account 
     would be sufficient to purchase a minimum annuity, the 
     Executive Director shall, subject to subparagraph (B)--
       ``(i) use such amount of the balance in a participating 
     individual's social security personal retirement account as 
     is necessary to purchase an annuity which meets the 
     requirements of subsection (b) (other than the requirement 
     that the annuity provides for payments which, on an annual 
     basis, are equal to at least the minimum annuity amount), the 
     terms of which provide for an annual payment that, when 
     combined with the total amount of annual old-age insurance 
     benefits payable to the participating individual, is equal to 
     the annual amount that a minimum annuity would pay to the 
     individual; and
       ``(ii) provide for the distribution of any remaining 
     balance in the participating individual's social security 
     personal retirement account in the form of a lump-sum 
     payment.
       ``(B) Option for Increased Annuity.--A participating 
     individual may elect to have the Executive Director use the 
     balance of the individual's social security personal 
     retirement account to purchase an annuity which meets the 
     requirements of subsection (b), the terms of which provide 
     for the maximum monthly payment that such account can fund, 
     in lieu of using only a portion of such balance to purchase 
     an annuity which provides a monthly payment equal to the 
     amount described in subparagraph (A)(i).
       ``(3) Distribution in event of failure to obtain at least a 
     poverty-level benefit.--If such total amount when combined 
     with all of the balance in the participating individual's 
     social security personal retirement account would not be 
     sufficient to purchase a minimum annuity, the participating 
     individual may elect to have the Executive Director--
       ``(A) distribute the balance in the participating 
     individual's social security personal retirement account in 
     the form of a lump-sum payment; or
       ``(B) if such balance is sufficient to purchase an annuity 
     which meets the requirements of subsection (b) (other than 
     the requirement that the annuity provides for payments which, 
     on an annual basis, are equal to at least the minimum annuity 
     amount), purchase such an annuity on behalf of the 
     individual.
       ``(b) Minimum Annuity Defined.--For purposes of this 
     subsection, the term `minimum annuity' means an annuity that 
     meets the following requirements:
       ``(1) The annuity starting date (as defined in section 
     72(c)(4) of the Internal Revenue Code of 1986) commences on 
     the first day of the month beginning after the date of the 
     purchase of the annuity.
       ``(2) The terms of the annuity provide for a series of 
     substantially equal annual payments, subject to adjustment as 
     provided in subsection (d), payable monthly to the 
     participating individual during the life of the participating 
     individual which are, on an annual basis, equal to at least 
     the minimum annuity amount.
       ``(c) Minimum Annuity Amount.--For purposes of this 
     subsection, the term `minimum annuity amount' means an amount 
     equal to 100 percent of the poverty line for an individual 
     (determined under the poverty guidelines of the Department of 
     Health and Human Services issued under sections 652 and 
     673(2) of the Omnibus Budget Reconciliation Act of 1981).
       ``(d) Cost of Living Adjustment.--The terms of any annuity 
     described in subsection (b) shall include provision for 
     increases in the monthly annuity amounts thereunder 
     determined in the same manner and at the same rate as primary 
     insurance amounts are increased under section 215(i).
       ``(e) Assumptions.--The assumptions under subsection (b) 
     include the probability of survival for persons born in the 
     same year as the participating individual (and the spouse, in 
     the case of a joint annuity), future projection of investment 
     earnings based on investment of the account assets, and 
     expected price inflation. Determinations under this 
     subsection shall be made in accordance with regulations which 
     shall be prescribed by the Board, otherwise using generally 
     accepted actuarial assumptions, except that no 
     differentiation shall be made in such assumptions on the 
     basis of sex, race, health status, or other characteristics 
     other than age. Such assumptions may include, for 
     determinations made prior to 2009, an assumed interest rate 
     reflecting investment earnings of the Federal Old-Age and 
     Survivors Insurance Trust Fund.
       ``(f) Offset of Part A Benefits.--Notwithstanding any other 
     provision of this title, in the case of a participating 
     individual to which subsection (a)(1) applies, the total 
     amount of monthly old-age insurance benefits payable as 
     benefits under subsection (a), (b), (c), or (h) of section 
     202, subsection (e) or (f) of section 202 other than on the 
     basis of disability, or any combination thereof, to such 
     individual determined under subsection (a) shall be reduced 
     so that the amount of such monthly old-age insurance benefits 
     payable to the individual does not exceed the amount equal to 
     the difference between--
       ``(i) such monthly old-age insurance benefits (determined 
     without regard to a reduction under this subsection); and
       ``(ii) the ratio of--

       ``(I) what would have been the monthly annuity payment 
     payable to the individual from an annuity if the individual's 
     personal retirement account balance had earned the rate of 
     return specified in section 254(b)(2)(A); to
       ``(II) the expected present value of all future potential 
     benefits payable under section 202 on the basis of the wages 
     or self-employment income of the participating individual 
     (determined as of the date the participating individual 
     becomes entitled to old-age benefits under section 202(a)).


       ``ADDITIONAL RULES RELATING DISPOSITION OF ACCOUNT ASSETS

       ``Sec. 257. (a) Splitting of Account Assets Upon Divorce 
     After 1 Year of Marriage.--
       ``(1) In general.--Upon the divorce of a participating 
     individual for whom a social security personal retirement 
     account has been established under this part, from a spouse 
     to whom the participating individual had been married for at 
     least 1 year, the Board shall direct the appropriate 
     certified account manager to transfer--
       ``(A) from the social security personal retirement account 
     of the participating individual,
       ``(B) to the social security personal retirement account of 
     the divorced spouse,
     an amount equal to one-half of the amount of net accruals 
     (including earnings) during the time of the marriage in the 
     social security personal retirement account of the 
     participating individual.
       ``(2) Treatment of divorced spouse who is not a 
     participating individual.--In the case of a divorced spouse 
     referred to in paragraph (1) who, as of the time of the 
     divorce, is not a participating individual and for whom a 
     social security personal retirement account has not been 
     established--
       ``(A) the divorced spouse shall be deemed a participating 
     individual for purposes of this part, and

[[Page S7306]]

       ``(B) the Board shall establish a social security personal 
     retirement account for the divorced spouse and shall direct 
     the appropriate certified account manager to perform the such 
     transfer.
       ``(3) Preemption.--The provisions of this subsection shall 
     supersede any provision of law of any State or political 
     subdivision thereof which is inconsistent with the 
     requirements of this subsection.
       ``(b) Closing of Account Upon the Death of the 
     Participating Individual.--
       ``(1) In general.--Upon the death of a participating 
     individual, the Executive Director shall close out any 
     remaining balance in the participating individual's social 
     security personal retirement account. In closing out the 
     account, the Executive Director shall certify to the 
     certified account manager the amount of the account assets, 
     and, upon receipt of such certification, the certified 
     account manager shall transfer from such account an amount 
     equal to such certified amount to the Secretary of the 
     Treasury for subsequent transfer to--
       ``(A) the social security personal retirement account of 
     the surviving spouse of such participating individual,
       ``(B) if there is no such surviving spouse, to such other 
     person as may be designated by the participating individual 
     in accordance with regulations which shall be prescribed by 
     the Board, or
       ``(C) if there is no such designated person, to the estate 
     of such participating individual.
       ``(2) Treatment of surviving spouse who is not a 
     participating individual.--In the case of a surviving spouse 
     referred to in paragraph (1) who, as of the time of the death 
     of the participating individual, is not a participating 
     individual and for whom a social security personal retirement 
     account has not been established--
       ``(A) the surviving spouse shall be deemed a participating 
     individual for purposes of this part, and
       ``(B) the Board shall establish a social security personal 
     retirement account for the surviving spouse and shall direct 
     the appropriate certified account manager to perform the such 
     transfer.
       ``(c) Closing of Account of Participating Individuals Who 
     Are Ineligible for Benefits Upon Attaining Retirement Age.--
     In any case in which, as of the date on which a participating 
     individual attains retirement age (as defined in section 
     216(l)), such individual is not eligible for an old-age 
     insurance benefit under section 202(a), the Commissioner 
     shall so certify to the Executive Director and, upon receipt 
     of such certification, the Executive Director shall close out 
     the participating individual's social security personal 
     retirement account. In closing out the account, the Executive 
     Director shall certify to the certified account manager the 
     amount of the account assets, and upon receipt of such 
     certification from the Executive Director, the account 
     manager shall transfer from such account an amount equal to 
     such certified amount to the Secretary of the Treasury for 
     subsequent transfer to the participating individual.
       ``(d) Administrative Expenses.--
       ``(1) In general.--Under regulations which shall be 
     prescribed by the Board, account assets are available in 
     accordance with section 254(b)(2)(D)(ii) for payment of the 
     reasonable administrative costs of the Program (including 
     reasonable administration fees charged by certified account 
     managers under the Program), but in no event to exceed 30 
     basis points per year of the assets under management.
       ``(2) Temporary authorization of appropriations for startup 
     administrative costs.--For any such administrative costs that 
     remain after applying paragraph (1) for each of the first 
     five fiscal years that end after the date of the enactment of 
     this part, there are authorized to be appropriated such sums 
     as may be necessary for each of such fiscal years.


                    ``ADMINISTRATION OF THE PROGRAM

       ``Sec. 258. (a) General Provisions.--
       ``(1) Establishment and duties of the social security 
     personal savings board.--
       ``(A) Establishment.--There is established within the 
     Social Security Administration a Social Security Personal 
     Savings Board.
       ``(B) Number and appointment.--The Board shall be composed 
     of 6 members as follows:
       ``(i) two members appointed by the President who may not be 
     of the same political party;
       ``(ii) one member appointed by the Speaker of the House of 
     Representatives, in consultation with the Chairman of the 
     Committee on Ways and Means of the House of Representatives;
       ``(iii) one member appointed by the minority leader of the 
     House of Representatives, in consultation with the ranking 
     member of the Committee on Ways and Means of the House of 
     Representatives;
       ``(iv) one member appointed by the majority leader of the 
     Senate, in consultation with the Chairman of the Committee on 
     Finance of the Senate; and
       ``(v) one member appointed by the minority leader of the 
     Senate, in consultation with the ranking member of the 
     Committee on Finance of the Senate.
       ``(C) Advice and consent.--Appointments under this 
     paragraph shall be made by and with the advice and consent of 
     the Senate.
       ``(D) Membership requirements.--Members of the Board shall 
     have substantial experience, training, and expertise in the 
     management of financial investments and pension benefit 
     plans.
       ``(E) Terms.--
       ``(i) In general.--Each member shall be appointed for a 
     term of 4 years, except as provided in clauses (ii) and 
     (iii). The initial members shall be appointed not later than 
     90 days after the date of the enactment of this section.
       ``(ii) Terms of initial appointees.--Of the members first 
     appointed under each clause of subparagraph (B), one of the 
     members appointed under subparagraph (B)(i) (as designated by 
     the President at the time of appointment) and the members 
     appointed under clauses (iii) and (v) of subparagraph (B) 
     shall be appointed for a term of 2 years, and the remaining 
     members shall be appointed for a term of 4 years.
       ``(iii) Vacancies.--Any member appointed to fill a vacancy 
     occurring before the expiration of the term for which the 
     member's predecessor was appointed shall be appointed only 
     for the remainder of that term. A member may serve after the 
     expiration of that member's term until a successor has taken 
     office. A vacancy in the Board shall be filled in the manner 
     in which the original appointment was made.
       ``(F) Powers and duties of the board.--
       ``(i) In general.--The Board shall have powers and duties 
     solely as provided in this part. The Board shall prescribe by 
     regulation the terms of the Social Security Personal 
     Retirement Accounts Program established under this part, 
     including policies for investment under the Program of 
     account assets, and policies for the certification and 
     decertification of account managers under the Program, which 
     shall include consideration of the appropriateness of the 
     marketing materials and plans of such person.
       ``(ii) Budgetary requirements.--The Board shall prepare and 
     submit to the President and to the appropriate committees of 
     Congress an annual budget of the expenses and other items 
     relating to the Board which shall be included as a separate 
     item in the budget required to be transmitted to the Congress 
     under section 1105 of title 31, United States Code. The Board 
     shall provide for low administrative costs such that, to the 
     extent practicable, overall administrative costs of the 
     Program do not exceed 30 basis points in relation to assets 
     under management under the Program.
       ``(iii) Additional authorities of the board.--The Board 
     may--

       ``(I) adopt, alter, and use a seal;
       ``(II) establish policies with which the Commissioner shall 
     comply under this part;
       ``(III) appoint and remove the Executive Director, as 
     provided in paragraph (2); and
       ``(IV) beginning with 2008, provide for such additional and 
     alternative investment options for participating individuals 
     as the Board determines would be prudent sources of 
     retirement income that would yield greater amounts of 
     retirement income than the investment described in section 
     255(c)(1).

       ``(iv) Independence of certified account managers.--The 
     policies of the Board may not require a certified account 
     manager to invest or to cause to be invested any account 
     assets in a specific asset or to dispose of or cause to be 
     disposed of any specific asset so held.
       ``(v) Meetings of the board.--The Board shall meet at the 
     call of the Chairman or upon the request of a quorum of the 
     Board. The Board shall perform the functions and exercise the 
     powers of the Board on a majority vote of a quorum of the 
     Board. Four members of the Board shall constitute a quorum 
     for the transaction of business.
       ``(vi) Compensation of board members.--

       ``(I) In general.--Each member of the Board who is not an 
     officer or employee of the Federal Government shall be 
     compensated at the daily rate of basic pay for level IV of 
     the Executive Schedule for each day during which such member 
     is engaged in performing a function of the Board. Any member 
     who is such an officer or employee shall not suffer any loss 
     of pay or deduction from annual leave on the basis of any 
     time used by such member in performing such a function.
       ``(II) Travel, per diem, and expenses.--A member of the 
     Board shall be paid travel, per diem, and other necessary 
     expenses under subchapter I of chapter 57 of title 5, United 
     States Code, while traveling away from such member's home or 
     regular place of business in the performance of the duties of 
     the Board.

       ``(vii) Standard for board's discharge of 
     responsibilities.--The members of the Board shall discharge 
     their responsibilities solely in the interest of 
     participating individuals and the Program.
       ``(viii) Annual report.--The Board shall submit an annual 
     report to the President, to each House of the Congress, and 
     to the Board of Trustees of the Federal Old-Age and Survivors 
     Insurance Trust Fund and the Federal Disability Insurance 
     Trust Fund regarding the financial and operating condition of 
     the Program.
       ``(ix) Public accountant.--

       ``(I) Definition.--For purposes of this subparagraph, the 
     term `qualified public accountant' shall have the same 
     meaning as provided in section 103(a)(3)(D) of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 
     1023(a)(3)(D)).
       ``(II) Engagement.--The Executive Director, in consultation 
     with the Board, shall annually engage, on behalf of all 
     individuals for whom a social security personal retirement 
     account is established under this part, an independent 
     qualified public accountant,

[[Page S7307]]

     who shall conduct an examination of all records maintained in 
     the administration of this part that the public accountant 
     considers necessary.
       ``(III) Duties.--The public accountant conducting an 
     examination under clause (ii) shall determine whether the 
     records referred to in such clause have been maintained in 
     conformity with generally accepted accounting principles. The 
     public accountant shall transmit to the Board a report on his 
     examination.
       ``(IV) Reliance on certified actuarial matters.--In making 
     a determination under clause (iii), a public accountant may 
     rely on the correctness of any actuarial matter certified by 
     an enrolled actuary if the public accountant states his 
     reliance in the report transmitted to the Board under such 
     clause.

       ``(2) Executive director.--
       ``(A) Appointment and removal.--The Board shall appoint, 
     without regard to the provisions of law governing 
     appointments in the competitive service, an Executive 
     Director by action agreed to by a majority of the members of 
     the Board. The Executive Director shall have substantial 
     experience, training, and expertise in the management of 
     financial investments and pension benefit plans. The Board 
     may, with the concurrence of 4 members of the Board, remove 
     the Executive Director from office for good cause shown.
       ``(B) Powers and duties of executive director.--The 
     Executive Director shall--
       ``(i) carry out the policies established by the Board,
       ``(ii) administer the provisions of this part in accordance 
     with the policies of the Board,
       ``(iii) in consultation with the Board, prescribe such 
     regulations (other than regulations relating to fiduciary 
     responsibilities) as may be necessary for the administration 
     of this part, and
       ``(iv) meet from time to time with the Board upon request 
     of the Board.
       ``(C) Administrative authorities of executive director.--
     The Executive Director may--
       ``(i) appoint such personnel as may be necessary to carry 
     out the provisions of this part,
       ``(ii) subject to approval by the Board, procure the 
     services of experts and consultants under section 3109 of 
     title 5, United States Code,
       ``(iii) secure directly from any agency or instrumentality 
     of the Federal Government any information which, in the 
     judgment of the Executive Director, is necessary to carry out 
     the provisions of this part and the policies of the Board, 
     and which shall be provided by such agency or instrumentality 
     upon the request of the Executive Director,
       ``(iv) pay the compensation, per diem, and travel expenses 
     of individuals appointed under clauses (i), (ii), and (v) of 
     this subparagraph, subject to such limits as may be 
     established by the Board,
       ``(v) accept and use the services of individuals employed 
     intermittently in the Government service and reimburse such 
     individuals for travel expenses, as authorized by section 
     5703 of title 5, United States Code, including per diem as 
     authorized by section 5702 of such title, and
       ``(vi) except as otherwise expressly prohibited by law or 
     the policies of the Board, delegate any of the Executive 
     Director's functions to such employees under the Board as the 
     Executive Director may designate and authorize such 
     successive redelegations of such functions to such employees 
     under the Board as the Executive Director may consider to be 
     necessary or appropriate.
       ``(3) Role of the commissioner of social security.--The 
     Commissioner shall--
       ``(A) prescribe such regulations (supplementary to and 
     consistent with the regulations prescribed by the Board and 
     the Executive Director) as may be necessary for carrying out 
     the duties of the Commissioner under this part,
       ``(B) meet from time to time with, and provide information 
     to, the Board upon request of the Board regarding matters 
     relating to the Social Security Personal Retirement Accounts 
     Program, and
       ``(C) in consultation with the Board and utilizing 
     available Federal agencies and resources, develop a campaign 
     to educate workers about the Program.
       ``(b) Certification and Oversight of Account Managers.--
       ``(1) Certification by the board.--
       ``(A) In general.--Any person that is a qualified 
     professional asset manager (as defined in section 8438(a)(8) 
     of title 5, United States Code) may apply to the Board (in 
     such form and manner as shall be provided by the Board by 
     regulation) for certification under this subsection as a 
     certified account manager. In making certification decisions, 
     the Board shall consider the applicant's general character 
     and fitness, financial history and future earnings prospects, 
     and ability to serve participating individuals under the 
     Program, and such other criteria as the Board deems necessary 
     to carry out this part. Certification of any person under 
     this subsection shall be contingent upon entry into a 
     contractual arrangement between the Board and such person.
       ``(B) Nondelegation requirement.--The authority of the 
     Board to make any determination to deny any application under 
     this subsection may not be delegated by the Board.
       ``(2) Oversight of certified account managers.--
       ``(A) Role of regulatory agencies.--The Board may enter 
     into cooperative arrangements with Federal and State 
     regulatory agencies identified by the Board as having 
     jurisdiction over persons eligible for certification under 
     this subsection so as to ensure that the provisions of this 
     part are enforced with respect to certified account managers 
     in a manner consistent with and supportive of the 
     requirements of other provisions of Federal law applicable to 
     them. Such Federal regulatory agencies shall cooperate with 
     the Board to the extent that the Board determines that such 
     cooperation is necessary and appropriate to ensure that the 
     provisions of this part are effectively implemented.
       ``(B) Access to records.--The Board may from time to time 
     require any certified account manager to file such reports as 
     the Board may specify by regulation as necessary for the 
     administration of this part. In prescribing such regulations, 
     the Board shall minimize the regulatory burden imposed upon 
     certified account managers while taking into account the 
     benefit of the information to the Board in carrying out its 
     functions under this part.
       ``(3) Revocation of certification.--The Board shall 
     provide, in the contractual arrangements entered into under 
     this subsection with each certified account manager, for 
     revocation of such person's status as a certified account 
     manager upon determination by the Board of such person's 
     failure to comply with the requirements of such contractual 
     arrangements. Such arrangements shall include provision for 
     notice and opportunity for review of any such revocation.
       ``(c) Fiduciary Responsibilities.--
       ``(1) In general.--Rules similar to the provisions of 
     section 8477 of title 5, United States Code (relating to 
     fiduciary responsibilities; liability and penalties) shall 
     apply in connection with account assets, in accordance with 
     regulations which shall be issued by the Board. The Board 
     shall issue regulations with respect to the investigative 
     authority of appropriate Federal agencies in cases involving 
     account assets.
       ``(2) Exculpatory provisions voided.--Any provision in an 
     agreement or instrument which purports to relieve a fiduciary 
     from responsibility or liability for any responsibility, 
     obligation, or duty under this part shall be void.
       ``(d) Civil Actions by Board.--If any person fails to meet 
     any requirement of this part or of any contract entered into 
     under this part, the Board may bring a civil action in any 
     district court of the United States within the jurisdiction 
     of which such person's assets are located or in which such 
     person resides or is found, without regard to the amount in 
     controversy, for appropriate relief to redress the violation 
     or enforce the provisions of this part, and process in such 
     an action may be served in any district.
       ``(e) Preemption of Inconsistent State Law.--A provision of 
     this part shall not be construed to preempt any provision of 
     the law of any State or political subdivision thereof, or 
     prevent a State or political subdivision thereof from 
     enacting any provision of law with respect to the subject 
     matter of this part, except to the extent that such provision 
     of State law is inconsistent with this part, and then only to 
     the extent of the inconsistency.''.
       (b) Conforming Amendment to Part A.--Section 202 of such 
     Act (42 U.S.C. 402) is amended by adding at the end the 
     following new subsection:

                       ``Adjustments Under Part B

       ``(z) The amount of benefits under subsection (a), (b), 
     (c), or (h), subsection (e) or (f) other than on the basis of 
     disability, or any combination thereof which are otherwise 
     payable under this part shall be subject to adjustment as 
     provided under section 256(f).''.
       (c) Additional Conforming Amendments.--(1) Section 701(b) 
     of the Social Security Act (42 U.S.C. 901(b)) is amended by 
     striking ``title II'' and inserting ``part A of title II, the 
     Social Security Personal Retirement Accounts Program under 
     part B of title II,''.
       (2) Section 702(a)(4) of the Social Security Act (42 U.S.C. 
     902(a)(4)) is amended by inserting ``other than those of the 
     Social Security Personal Savings Board'' after 
     ``Administration'', and by striking ``thereof'' and inserting 
     ``of the Administration in connection with the exercise of 
     such powers and the discharge of such duties''.

     SEC. 102. ANNUAL ACCOUNT STATEMENTS.

       Section 1143 of the Social Security Act (42 U.S.C. 
     1320b0913) is amended by adding at the end the following new 
     subsection:

     ``Performance of Social Security Personal Retirement Accounts

       ``(d) Beginning not later than 1 year after the date of the 
     first deposit is made to an eligible individual's Social 
     Security personal retirement account, each statement provided 
     to such eligible individual under this section shall include 
     information determined by the Social Security Personal 
     Savings Board as sufficient to fully inform such eligible 
     individual annually of the balance, investment performance, 
     and administrative expenses of such account.''.

                        TITLE II--TAX TREATMENT

     SEC. 201. TAX TREATMENT OF SOCIAL SECURITY PERSONAL 
                   RETIREMENT ACCOUNTS.

       Section 7701 of the Internal Revenue Code of 1986 (relating 
     to definitions) is amended by redesignating subsection (o) as 
     subsection (p) and by inserting after subsection (n) the 
     following new subsection:
       ``(o) Tax Treatment of Social Security Personal Retirement 
     Accounts.--All social

[[Page S7308]]

     security personal retirement accounts established under part 
     B of title II of the Social Security Act shall be exempt from 
     taxation under this title.''.

     SEC. 202. BENEFITS TAXABLE AS SOCIAL SECURITY BENEFITS.

       (a) Special Rules Relating to Distribution of Closed 
     Account Under Section 257(d) of Social Security Act.--Section 
     86(a) of such Code (as amended by paragraph (2)) is amended 
     by adding at the end the following new paragraph:
       ``(4) Extension of paragraph (2)(b) to distributions of 
     closed account under section 257(d) of social security act.--
     Notwithstanding any other provision of this subsection, in 
     the case of any amount received pursuant to the closing of an 
     account under section 257(d) of the Social Security Act, 
     paragraph (2)(B) shall apply to such amounts, and for such 
     purposes the amount allocated to the investment in the 
     contract shall be zero.''.
       (b) Effective Date.--The amendments made by this subsection 
     shall apply to taxable years beginning after the end of the 
     calendar year in which this Act is enacted.
       (c) Estate Tax Not to Apply to Assets of Social Security 
     Personal Retirement Accounts.--
       (1) In general.--Part IV of subchapter A of chapter 11 of 
     such Code (relating to taxable estate) is amended by adding 
     at the end the following new section:

     ``SEC. 2059. SOCIAL SECURITY PERSONAL RETIREMENT ACCOUNTS.

       ``For purposes of the tax imposed by section 2001, the 
     value of the taxable estate shall be determined by deducting 
     from the value of the gross estate an amount equal to the 
     value of the assets of a social security personal retirement 
     account transferred from such account by the Secretary under 
     section 257 of the Social Security Act.''.
       (2) Clerical amendment.--The table of sections for part IV 
     of subchapter A of chapter 11 of such Code is amended by 
     adding at the end the following new item:

``Sec. 2059. Social security personal retirement accounts''.

       (3) Effective date.--The amendments made by this subsection 
     shall apply to decedents dying in or after the calendar year 
     in which this Act is enacted.
                                 ______
                                 
      By Mr. ROCKEFELLER (for himself, Mr. Reed, Mr. Lautenberg, Mr. 
        Corzine, Mr. Sarbanes, and Mr. Kerry):
  S. 1303. A bill to amend the Social Security Act to guarantee 
comprehensive health care coverage for all children born after 2006; to 
the Committee on Finance.
  Mr. ROCKEFELLER. Mr. President, I rise today with my friends and 
colleagues--Senators Reed, Lautenberg, Corzine, Sarbanes, and Kerry--to 
introduce an important piece of legislation, the MediKids Health 
Insurance Act of 2005. This legislation will provide health insurance 
for every child in the United States by 2012, regardless of family 
income. My long-time friend from California, Congressman Stark, is 
introducing a companion bill in the House. He has worked tirelessly to 
improve access to health care for all Americans, and I am pleased to be 
joining him once again to advocate on behalf of America's children.
  We have introduced this legislation in each of the last three 
Congresses because we know how vital health insurance is to a child. 
Children with untreated illnesses are less likely to learn and 
therefore less likely to move out of poverty. Such children have an 
inherent disadvantage when it comes to being productive members of 
society. We can have a positive impact on our children's lives today as 
well as tomorrow by guaranteeing health insurance coverage for all. 
Children are inexpensive to insure, but the rewards for providing them 
with health care during their early education and development years are 
enormous.
  Despite the well-documented benefits of providing health insurance 
coverage for children, there are still over 8 million uninsured 
children in America. We can and must do better. Our children are our 
future. No child in this country should ever be without access to 
health care. This is why I am proud to reintroduce the MediKids Health 
Insurance Act of 2005.
  This legislation is a clear investment in our future--our children. 
Every child would be automatically enrolled at birth into a new, 
comprehensive Federal safety net health insurance program beginning in 
2007. The benefits would be tailored to meet the needs of children and 
would be similar to those currently available to children through the 
Medicaid Early and Periodic Screening, Diagnosis, and Treatment (EPSDT) 
program. Families below 150 percent of poverty would have no premiums 
or co-payments, and there would be no cost sharing for preventive or 
well-child visits for any child.
  MediKids children would remain enrolled in the program throughout 
childhood. When families move to another state, Medikids would be 
available until parents can enroll their children in a new insurance 
program. Between jobs or during family crises, Medikids would offer 
extra security and ensure continuous health coverage to our Nation's 
children. During that critical period when a family is just climbing 
out of poverty and out of the eligibility range for means-tested 
assistance programs, MediKids would fill in the gaps until the parents 
can move into jobs that provide reliable health insurance coverage. The 
key to our program is that whenever other sources of health insurance 
fail, MediKids would stand ready to cover the health needs of our next 
generation. Ultimately, every child in America would be able to grow up 
with consistent, continuous health insurance coverage.
  Like Medicare, MediKids would be independently financed, would cover 
benefits tailored to the needs of its target population, and would have 
the goal of achieving nearly 100 percent health insurance coverage for 
the children of this country--just as Medicare has done for our 
Nation's seniors and disabled population over its 40-year history. At 
the time we created Medicare, seniors were more likely to be living in 
poverty than any other age group. Most were unable to afford needed 
medical services and unable to find health insurance in the market even 
if they could afford it. Today, it is our Nation's children who 
shoulder the burden of poverty. Children in America are nearly twice as 
vulnerable to poverty as adults. It's time we make a significant 
investment in the future of America by guaranteeing all children the 
health coverage they need to make a healthy start in life.
  Congress cannot rest on the success we achieved by expanding Medicaid 
and passing the State Children's Health Insurance Program (CHIP). 
Although each was a remarkable step toward reducing the ranks of the 
uninsured, particularly uninsured children, we still have a long way to 
go. Even with perfect enrollment in CHIP and Medicaid, there would 
still be a great number of children without health insurance. What's 
more troubling is the fact that both Medicaid and CHIP are in serious 
jeopardy because of the budget cuts being proposed by the current 
Administration.
  It's long past time to rekindle the discussion about how we are going 
to provide health insurance for all Americans. The bill we are 
introducing today--the MediKids Health Insurance Act of 2005--is a step 
toward eliminating the irrational and tragic lack of health insurance 
for so many children and adults in our country. I urge my colleagues to 
move beyond partisan politics and to support this critical step toward 
universal coverage.
  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. 1303

       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; FINDINGS.

       (a) Short Title.--This Act may be cited as the ``MediKids 
     Health Insurance Act of 2005''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title; table of contents; findings
Sec. 2. Benefits for all children born after 2006

                     ``TITLE XXII--MEDIKIDS PROGRAM

``Sec. 2201. Eligibility
``Sec. 2202. Benefits
``Sec. 2203. Premiums
``Sec. 2204. MediKids Trust Fund
``Sec. 2205. Oversight and accountability
``Sec. 2206. Inclusion of care coordination services
``Sec. 2207. Administration and miscellaneous
Sec. 3. MediKids premium
Sec. 4. Refundable credit for cost-sharing expenses under MediKids 
              program
Sec. 5. Report on long-term revenues

       (c) Findings.--Congress finds the following:
       (1) More than 9 million American children are uninsured.
       (2) Children who are uninsured receive less medical care 
     and less preventive care and have a poorer level of health, 
     which result in

[[Page S7309]]

     lifetime costs to themselves and to the entire American 
     economy.
       (3) Although SCHIP and Medicaid are successfully extending 
     a health coverage safety net to a growing portion of the 
     vulnerable low-income population of uninsured children, they 
     alone cannot achieve 100 percent health insurance coverage 
     for our nation's children due to inevitable gaps during 
     outreach and enrollment, fluctuations in eligibility, 
     variations in access to private insurance at all income 
     levels, and variations in States' ability to provide required 
     matching funds.
       (4) As all segments of society continue to become more 
     transient, with many changes in employment over the working 
     lifetime of parents, the need for a reliable safety net of 
     health insurance which follows children across State lines, 
     already a major problem for the children of migrant and 
     seasonal farmworkers, will become a major concern for all 
     families in the United States.
       (5) The medicare program has successfully evolved over the 
     years to provide a stable, universal source of health 
     insurance for the nation's disabled and those over age 65, 
     and provides a tested model for designing a program to reach 
     out to America's children.
       (6) The problem of insuring 100 percent of all American 
     children could be gradually solved by automatically enrolling 
     all children born after December 31, 2006, in a program 
     modeled after Medicare (and to be known as ``MediKids''), and 
     allowing those children to be transferred into other 
     equivalent or better insurance programs, including either 
     private insurance, SCHIP, or Medicaid, if they are eligible 
     to do so, but maintaining the child's default enrollment in 
     MediKids for any times when the child's access to other 
     sources of insurance is lost.
       (7) A family's freedom of choice to use other insurers to 
     cover children would not be interfered with in any way, and 
     children eligible for SCHIP and Medicaid would continue to be 
     enrolled in those programs, but the underlying safety net of 
     MediKids would always be available to cover any gaps in 
     insurance due to changes in medical condition, employment, 
     income, or marital status, or other changes affecting a 
     child's access to alternate forms of insurance.
       (8) The MediKids program can be administered without 
     impacting the finances or status of the existing Medicare 
     program.
       (9) The MediKids benefit package can be tailored to the 
     special needs of children and updated over time.
       (10) The financing of the program can be administered 
     without difficulty by a yearly payment of affordable premiums 
     through a family's tax filing (or adjustment of a family's 
     earned income tax credit).
       (11) The cost of the program will gradually rise as the 
     number of children using MediKids as the insurer of last 
     resort increases, and a future Congress always can accelerate 
     or slow down the enrollment process as desired, while the 
     societal costs for emergency room usage, lost productivity 
     and work days, and poor health status for the next generation 
     of Americans will decline.
       (12) Over time 100 percent of American children will always 
     have basic health insurance, and we can therefore expect a 
     healthier, more equitable, and more productive society.

     SEC. 2. BENEFITS FOR ALL CHILDREN BORN AFTER 2006.

       (a) In General.--The Social Security Act is amended by 
     adding at the end the following new title:

                     ``TITLE XXII--MEDIKIDS PROGRAM

     ``SEC. 2201. ELIGIBILITY.

       ``(a) Eligibility of Individuals Born After December 31, 
     2006; All Children Under 23 Years of Age in Fifth Year.--An 
     individual who meets the following requirements with respect 
     to a month is eligible to enroll under this title with 
     respect to such month:
       ``(1) Age.--
       ``(A) First year.--As of the first day of the first year in 
     which this title is effective, the individual has not 
     attained 6 years of age.
       ``(B) Second year.--As of the first day of the second year 
     in which this title is effective, the individual has not 
     attained 11 years of age.
       ``(C) Third year.--As of the first day of the third year in 
     which this title is effective, the individual has not 
     attained 16 years of age.
       ``(D) Fourth year.--As of the first day of the fourth year 
     in which this title is effective, the individual has not 
     attained 21 years of age.
       ``(E) Fifth and subsequent years.--As of the first day of 
     the fifth year in which this title is effective and each 
     subsequent year, the individual has not attained 23 years of 
     age.
       ``(2) Citizenship.--The individual is a citizen or national 
     of the United States or is permanently residing in the United 
     States under color of law.
       ``(b) Enrollment Process.--An individual may enroll in the 
     program established under this title only in such manner and 
     form as may be prescribed by regulations, and only during an 
     enrollment period prescribed by the Secretary consistent with 
     the provisions of this section. Such regulations shall 
     provide a process under which--
       ``(1) individuals who are born in the United States after 
     December 31, 2006, are deemed to be enrolled at the time of 
     birth and a parent or guardian of such an individual is 
     permitted to pre-enroll in the month prior to the expected 
     month of birth;
       ``(2) individuals who are born outside the United States 
     after such date and who become eligible to enroll by virtue 
     of immigration into (or an adjustment of immigration status 
     in) the United States are deemed enrolled at the time of 
     entry or adjustment of status;
       ``(3) eligible individuals may otherwise be enrolled at 
     such other times and manner as the Secretary shall specify, 
     including the use of outstationed eligibility sites as 
     described in section 1902(a)(55)(A) and the use of 
     presumptive eligibility provisions like those described in 
     section 1920A; and
       ``(4) at the time of automatic enrollment of a child, the 
     Secretary provides for issuance to a parent or custodian of 
     the individual a card evidencing coverage under this title 
     and for a description of such coverage.

     The provisions of section 1837(h) apply with respect to 
     enrollment under this title in the same manner as they apply 
     to enrollment under part B of title XVIII. An individual who 
     is enrolled under this title is not eligible to be enrolled 
     under an MA or MA-PD plan under part C of title XVIII.
       ``(c) Date Coverage Begins.--
       ``(1) In general.--The period during which an individual is 
     entitled to benefits under this title shall begin as follows, 
     but in no case earlier than January 1, 2007:
       ``(A) In the case of an individual who is enrolled under 
     paragraph (1) or (2) of subsection (b), the date of birth or 
     date of obtaining appropriate citizenship or immigration 
     status, as the case may be.
       ``(B) In the case of another individual who enrolls 
     (including pre-enrolls) before the month in which the 
     individual satisfies eligibility for enrollment under 
     subsection (a), the first day of such month of eligibility.
       ``(C) In the case of another individual who enrolls during 
     or after the month in which the individual first satisfies 
     eligibility for enrollment under such subsection, the first 
     day of the following month.
       ``(2) Authority to provide for partial months of 
     coverage.--Under regulations, the Secretary may, in the 
     Secretary's discretion, provide for coverage periods that 
     include portions of a month in order to avoid lapses of 
     coverage.
       ``(3) Limitation on payments.--No payments may be made 
     under this title with respect to the expenses of an 
     individual enrolled under this title unless such expenses 
     were incurred by such individual during a period which, with 
     respect to the individual, is a coverage period under this 
     section.
       ``(d) Expiration of Eligibility.--An individual's coverage 
     period under this section shall continue until the 
     individual's enrollment has been terminated because the 
     individual no longer meets the requirements of subsection (a) 
     (whether because of age or change in immigration status).
       ``(e) Entitlement to MediKids Benefits for Enrolled 
     Individuals.--An individual enrolled under this title is 
     entitled to the benefits described in section 2202.
       ``(f) Low-income Information.--
       ``(1) Inquiry of income.--At the time of enrollment of a 
     child under this title, the Secretary shall make an inquiry 
     as to whether the family income (as determined for purposes 
     of section 1905(p)) of the family that includes the child is 
     within any of the following income ranges:
       ``(A) Up to 150 percent of poverty.--The income of the 
     family does not exceed 150 percent of the poverty line for a 
     family of the size involved.
       ``(B) Between 150 and 200 percent of poverty.--The income 
     of the family exceeds 150 percent, but does not exceed 200 
     percent, of such poverty line.
       ``(C) Between 200 and 300 percent of poverty.--The income 
     of the family exceeds 200 percent, but does not exceed 300 
     percent, of such poverty line.
       ``(2) Coding.--If the family income is within a range 
     described in paragraph (1), the Secretary shall encode in the 
     identification card issued in connection with eligibility 
     under this title a code indicating the range applicable to 
     the family of the child involved.
       ``(3) Provider verification through electronic system.--The 
     Secretary also shall provide for an electronic system through 
     which providers may verify which income range described in 
     paragraph (1), if any, is applicable to the family of the 
     child involved.
       ``(g) Construction.--Nothing in this title shall be 
     construed as requiring (or preventing) an individual who is 
     enrolled under this title from seeking medical assistance 
     under a State medicaid plan under title XIX or child health 
     assistance under a State child health plan under title XXI.

     ``SEC. 2202. BENEFITS.

       ``(a) Secretarial Specification of Benefit Package.--
       ``(1) In general.--The Secretary shall specify the benefits 
     to be made available under this title consistent with the 
     provisions of this section and in a manner designed to meet 
     the health needs of enrollees.
       ``(2) Updating.--The Secretary shall update the 
     specification of benefits over time to ensure the inclusion 
     of age-appropriate benefits to reflect the enrollee 
     population.
       ``(3) Annual updating.--The Secretary shall establish 
     procedures for the annual review and updating of such 
     benefits to account for changes in medical practice, new 
     information from medical research, and other relevant 
     developments in health science.

[[Page S7310]]

       ``(4) Input.--The Secretary shall seek the input of the 
     pediatric community in specifying and updating such benefits.
       ``(5) Limitation on updating.--In no case shall updating of 
     benefits under this subsection result in a failure to provide 
     benefits required under subsection (b).
       ``(b) Inclusion of Certain Benefits.--
       ``(1) Medicare core benefits.--Such benefits shall include 
     (to the extent consistent with other provisions of this 
     section) at least the same benefits (including coverage, 
     access, availability, duration, and beneficiary rights) that 
     are available under parts A and B of title XVIII.
       ``(2) All required medicaid benefits.--Such benefits shall 
     also include all items and services for which medical 
     assistance is required to be provided under section 
     1902(a)(10)(A) to individuals described in such section, 
     including early and periodic screening, diagnostic services, 
     and treatment services.
       ``(3) Inclusion of prescription drugs.--Such benefits also 
     shall include (as specified by the Secretary) benefits for 
     prescription drugs and biologicals which are not less than 
     the benefits for such drugs and biologicals under the 
     standard option for the service benefit plan described in 
     section 8903(1) of title 5, United States Code, offered 
     during 2005.
       ``(4) Cost-sharing.--
       ``(A) In general.--Subject to subparagraph (B), such 
     benefits also shall include the cost-sharing (in the form of 
     deductibles, coinsurance, and copayments) which is 
     substantially similar to such cost-sharing under the health 
     benefits coverage in any of the four largest health benefits 
     plans (determined by enrollment) offered under chapter 89 of 
     title 5, United States Code, and including an out-of-pocket 
     limit for catastrophic expenditures for covered benefits, 
     except that no cost-sharing shall be imposed with respect to 
     early and periodic screening and diagnostic services included 
     under paragraph (2).
       ``(B) Reduced cost-sharing for low income children.--Such 
     benefits shall provide that--
       ``(i) there shall be no cost-sharing for children in 
     families the income of which is within the range described in 
     section 2201(f)(1)(A);
       ``(ii) the cost-sharing otherwise applicable shall be 
     reduced by 75 percent for children in families the income of 
     which is within the range described in section 2201(f)(1)(B); 
     or
       ``(iii) the cost-sharing otherwise applicable shall be 
     reduced by 50 percent for children in families the income of 
     which is within the range described in section 2201(f)(1)(C).
       ``(C) Catastrophic limit on cost-sharing.--For a refundable 
     credit for cost-sharing in the case of cost-sharing in excess 
     of a percentage of the individual's adjusted gross income, 
     see section 36 of the Internal Revenue Code of 1986.
       ``(c) Payment Schedule.--The Secretary, with the assistance 
     of the Medicare Payment Advisory Commission, shall develop 
     and implement a payment schedule for benefits covered under 
     this title. To the extent feasible, such payment schedule 
     shall be consistent with comparable payment schedules and 
     reimbursement methodologies applied under parts A and B of 
     title XVIII.
       ``(d) Input.--The Secretary shall specify such benefits and 
     payment schedules only after obtaining input from appropriate 
     child health providers and experts.
       ``(e) Enrollment in Health Plans.--The Secretary shall 
     provide for the offering of benefits under this title through 
     enrollment in a health benefit plan that meets the same (or 
     similar) requirements as the requirements that apply to 
     Medicare Advantage plans under part C of title XVIII (other 
     than any such requirements that relate to part D of such 
     title). In the case of individuals enrolled under this title 
     in such a plan, the payment rate shall be based on payment 
     rates provided for under section 1853(c) in effect before the 
     date of the enactment of the Medicare Prescription Drug, 
     Modernization, and Improvement Act of 2003 (Public Law 108-
     173), except that such payment rates shall be adjusted in an 
     appropriate manner to reflect differences between the 
     population served under this title and the population under 
     title XVIII.

     ``SEC. 2203. PREMIUMS.

       ``(a) Amount of Monthly Premiums.--
       ``(1) In general.--The Secretary shall, during September of 
     each year (beginning with 2006), establish a monthly MediKids 
     premium for the following year. Subject to paragraph (2), the 
     monthly MediKids premium for a year is equal to \1/12\ of the 
     annual premium rate computed under subsection (b).
       ``(2) Elimination of monthly premium for demonstration of 
     equivalent coverage (including coverage under low-income 
     programs).--The amount of the monthly premium imposed under 
     this section for an individual for a month shall be zero in 
     the case of an individual who demonstrates to the 
     satisfaction of the Secretary that the individual has basic 
     health insurance coverage for that month. For purposes of the 
     previous sentence enrollment in a medicaid plan under title 
     XIX, a State child health insurance plan under title XXI, or 
     under the medicare program under title XVIII is deemed to 
     constitute basic health insurance coverage described in such 
     sentence.
       ``(b) Annual Premium.--
       ``(1) National per capita average.--The Secretary shall 
     estimate the average, annual per capita amount that would be 
     payable under this title with respect to individuals residing 
     in the United States who meet the requirement of section 
     2201(a)(1) as if all such individuals were eligible for (and 
     enrolled) under this title during the entire year (and 
     assuming that section 1862(b)(2)(A)(i) did not apply).
       ``(2) Annual premium.--Subject to subsection (d), the 
     annual premium under this subsection for months in a year is 
     equal to 25 percent of the average, annual per capita amount 
     estimated under paragraph (1) for the year.
       ``(c) Payment of Monthly Premium.--
       ``(1) Period of payment.--In the case of an individual who 
     participates in the program established by this title, 
     subject to subsection (d), the monthly premium shall be 
     payable for the period commencing with the first month of the 
     individual's coverage period and ending with the month in 
     which the individual's coverage under this title terminates.
       ``(2) Collection through tax return.--For provisions 
     providing for the payment of monthly premiums under this 
     subsection, see section 59B of the Internal Revenue Code of 
     1986.
       ``(3) Protections against fraud and abuse.--The Secretary 
     shall develop, in coordination with States and other health 
     insurance issuers, administrative systems to ensure that 
     claims which are submitted to more than one payor are 
     coordinated and duplicate payments are not made.
       ``(d) Reduction in Premium for Certain Low-income 
     Families.--For provisions reducing the premium under this 
     section for certain low-income families, see section 59B(d) 
     of the Internal Revenue Code of 1986.

     ``SEC. 2204. MEDIKIDS TRUST FUND.

       ``(a) Establishment of Trust Fund.--
       ``(1) In general.--There is hereby created on the books of 
     the Treasury of the United States a trust fund to be known as 
     the `MediKids Trust Fund' (in this section referred to as the 
     `Trust Fund'). The Trust Fund shall consist of such gifts and 
     bequests as may be made as provided in section 201(i)(1) and 
     such amounts as may be deposited in, or appropriated to, such 
     fund as provided in this title.
       ``(2) Premiums.--Premiums collected under section 59B of 
     the Internal Revenue Code of 1986 shall be periodically 
     transferred to the Trust Fund.
       ``(3) Transitional funding before receipt of premiums.--In 
     order to provide for funds in the Trust Fund to cover 
     expenditures from the fund in advance of receipt of premiums 
     under section 2203, there are transferred to the Trust Fund 
     from the general fund of the United States Treasury such 
     amounts as may be necessary.
       ``(b) Incorporation of Provisions.--
       ``(1) In general.--Subject to paragraph (2), subsection (b) 
     (other than the last sentence) and subsections (c) through 
     (i) of section 1841 shall apply with respect to the Trust 
     Fund and this title in the same manner as they apply with 
     respect to the Federal Supplementary Medical Insurance Trust 
     Fund and part B, respectively.
       ``(2) Miscellaneous references.--In applying provisions of 
     section 1841 under paragraph (1)--
       ``(A) any reference in such section to `this part' is 
     construed to refer to title XXII;
       ``(B) any reference in section 1841(h) to section 1840(d) 
     and in section 1841(i) to sections 1840(b)(1) and 1842(g) are 
     deemed references to comparable authority exercised under 
     this title;
       ``(C) payments may be made under section 1841(g) to the 
     Trust Funds under sections 1817 and 1841 as reimbursement to 
     such funds for payments they made for benefits provided under 
     this title; and
       ``(D) the Board of Trustees of the MediKids Trust Fund 
     shall be the same as the Board of Trustees of the Federal 
     Supplementary Medical Insurance Trust Fund.

     ``SEC. 2205. OVERSIGHT AND ACCOUNTABILITY.

       ``(a) Periodic GAO Reports.--The Comptroller General of the 
     United States shall periodically submit to Congress reports 
     on the operation of the program under this title, including 
     on the financing of coverage provided under this title.
       ``(b) Periodic MedPAC Reports.--The Medicare Payment 
     Advisory Commission shall periodically report to Congress 
     concerning the program under this title.

     ``SEC. 2206. INCLUSION OF CARE COORDINATION SERVICES.

       ``(a) In General.--
       ``(1) Program authority.--The Secretary, beginning in 2007, 
     may implement a care coordination services program in 
     accordance with the provisions of this section under which, 
     in appropriate circumstances, eligible individuals under 
     section 2201 may elect to have health care services covered 
     under this title managed and coordinated by a designated care 
     coordinator.
       ``(2) Administration by contract.--The Secretary may 
     administer the program under this section through a contract 
     with an appropriate program administrator.
       ``(3) Coverage.--Care coordination services furnished in 
     accordance with this section shall be treated under this 
     title as if they were included in the definition of medical 
     and other health services under section 1861(s) and benefits 
     shall be available under this title with respect to such 
     services without the application of any deductible or 
     coinsurance.
       ``(b) Eligibility Criteria; Identification and Notification 
     of Eligible Individuals.--
       ``(1) Individual eligibility criteria.--The Secretary shall 
     specify criteria to be used in making a determination as to 
     whether an individual may appropriately be enrolled in

[[Page S7311]]

     the care coordination services program under this section, 
     which shall include at least a finding by the Secretary that 
     for cohorts of individuals with characteristics identified by 
     the Secretary, professional management and coordination of 
     care can reasonably be expected to improve processes or 
     outcomes of health care and to reduce aggregate costs to the 
     programs under this title.
       ``(2) Procedures to facilitate enrollment.--The Secretary 
     shall develop and implement procedures designed to facilitate 
     enrollment of eligible individuals in the program under this 
     section.
       ``(c) Enrollment of Individuals.--
       ``(1) Secretary's determination of eligibility.--The 
     Secretary shall determine the eligibility for services under 
     this section of individuals who are enrolled in the program 
     under this section and who make application for such services 
     in such form and manner as the Secretary may prescribe.
       ``(2) Enrollment period.--
       ``(A) Effective date and duration.--Enrollment of an 
     individual in the program under this section shall be 
     effective as of the first day of the month following the 
     month in which the Secretary approves the individual's 
     application under paragraph (1), shall remain in effect for 
     one month (or such longer period as the Secretary may 
     specify), and shall be automatically renewed for additional 
     periods, unless terminated in accordance with such procedures 
     as the Secretary shall establish by regulation. Such 
     procedures shall permit an individual to disenroll for cause 
     at any time and without cause at re-enrollment intervals.
       ``(B) Limitation on reenrollment.--The Secretary may 
     establish limits on an individual's eligibility to reenroll 
     in the program under this section if the individual has 
     disenrolled from the program more than once during a 
     specified time period.
       ``(d) Program.--The care coordination services program 
     under this section shall include the following elements:
       ``(1) Basic care coordination services.--
       ``(A) In general.--Subject to the cost-effectiveness 
     criteria specified in subsection (b)(1), except as otherwise 
     provided in this section, enrolled individuals shall receive 
     services described in section 1905(t)(1) and may receive 
     additional items and services as described in subparagraph 
     (B).
       ``(B) Additional benefits.--The Secretary may specify 
     additional benefits for which payment would not otherwise be 
     made under this title that may be available to individuals 
     enrolled in the program under this section (subject to an 
     assessment by the care coordinator of an individual's 
     circumstance and need for such benefits) in order to 
     encourage enrollment in, or to improve the effectiveness of, 
     such program.
       ``(2) Care coordination requirement.--Notwithstanding any 
     other provision of this title, the Secretary may provide that 
     an individual enrolled in the program under this section may 
     be entitled to payment under this title for any specified 
     health care items or services only if the items or services 
     have been furnished by the care coordinator, or coordinated 
     through the care coordination services program. Under such 
     provision, the Secretary shall prescribe exceptions for 
     emergency medical services as described in section 
     1852(d)(3), and other exceptions determined by the Secretary 
     for the delivery of timely and needed care.
       ``(e) Care Coordinators.--
       ``(1) Conditions of participation.--In order to be 
     qualified to furnish care coordination services under this 
     section, an individual or entity shall--
       ``(A) be a health care professional or entity (which may 
     include physicians, physician group practices, or other 
     health care professionals or entities the Secretary may find 
     appropriate) meeting such conditions as the Secretary may 
     specify;
       ``(B) have entered into a care coordination agreement; and
       ``(C) meet such criteria as the Secretary may establish 
     (which may include experience in the provision of care 
     coordination or primary care physician's services).
       ``(2) Agreement term; payment.--
       ``(A) Duration and renewal.--A care coordination agreement 
     under this subsection shall be for one year and may be 
     renewed if the Secretary is satisfied that the care 
     coordinator continues to meet the conditions of participation 
     specified in paragraph (1).
       ``(B) Payment for services.--The Secretary may negotiate or 
     otherwise establish payment terms and rates for services 
     described in subsection (d)(1).
       ``(C) Liability.--Care coordinators shall be subject to 
     liability for actual health damages which may be suffered by 
     recipients as a result of the care coordinator's decisions, 
     failure or delay in making decisions, or other actions as a 
     care coordinator.
       ``(D) Terms.--In addition to such other terms as the 
     Secretary may require, an agreement under this section shall 
     include the terms specified in subparagraphs (A) through (C) 
     of section 1905(t)(3).

     ``SEC. 2207. ADMINISTRATION AND MISCELLANEOUS.

       ``(a) In General.--Except as otherwise provided in this 
     title--
       ``(1) the Secretary shall enter into appropriate contracts 
     with providers of services, other health care providers, 
     carriers, and fiscal intermediaries, taking into account the 
     types of contracts used under title XVIII with respect to 
     such entities, to administer the program under this title;
       ``(2) beneficiary protections for individuals enrolled 
     under this title shall not be less than the beneficiary 
     protections (including limits on balance billing) provided 
     medicare beneficiaries under title XVIII;
       ``(3) benefits described in section 2202 that are payable 
     under this title to such individuals shall be paid in a 
     manner specified by the Secretary (taking into account, and 
     based to the greatest extent practicable upon, the manner in 
     which they are provided under title XVIII); and
       ``(4) provider participation agreements under title XVIII 
     shall apply to enrollees and benefits under this title in the 
     same manner as they apply to enrollees and benefits under 
     title XVIII.
       ``(b) Coordination With Medicaid and SCHIP.--
     Notwithstanding any other provision of law, individuals 
     entitled to benefits for items and services under this title 
     who also qualify for benefits under title XIX or XXI or any 
     other Federally funded health care program that provides 
     basic health insurance coverage described in section 
     2203(a)(2) may continue to qualify and obtain benefits under 
     such other title or program, and in such case such an 
     individual shall elect either--
       ``(1) such other title or program to be primary payor to 
     benefits under this title, in which case no benefits shall be 
     payable under this title and the monthly premium under 
     section 2203 shall be zero; or
       ``(2) benefits under this title shall be primary payor to 
     benefits provided under such title or program, in which case 
     the Secretary shall enter into agreements with States as may 
     be appropriate to provide that, in the case of such 
     individuals, the benefits under titles XIX and XXI or such 
     other program (including reduction of cost-sharing) are 
     provided on a `wrap-around' basis to the benefits under this 
     title.''.
       (b) Conforming Amendments to Social Security Act 
     Provisions.--
       (1) Section 201(i)(1) of the Social Security Act (42 U.S.C. 
     401(i)(1)) is amended by striking ``or the Federal 
     Supplementary Medical Insurance Trust Fund'' and inserting 
     ``the Federal Supplementary Medical Insurance Trust Fund, and 
     the MediKids Trust Fund''.
       (2) Section 201(g)(1)(A) of such Act (42 U.S.C. 
     401(g)(1)(A)) is amended by striking ``and the Federal 
     Supplementary Medical Insurance Trust Fund established by 
     title XVIII'' and inserting ``, the Federal Supplementary 
     Medical Insurance Trust Fund, and the MediKids Trust Fund 
     established by title XVIII''.
       (c) Maintenance of Medicaid Eligibility and Benefits for 
     Children.--
       (1) In general.--In order for a State to continue to be 
     eligible for payments under section 1903(a) of the Social 
     Security Act (42 U.S.C. 1396b(a))--
       (A) the State may not reduce standards of eligibility, or 
     benefits, provided under its State medicaid plan under title 
     XIX of the Social Security Act or under its State child 
     health plan under title XXI of such Act for individuals under 
     23 years of age below such standards of eligibility, and 
     benefits, in effect on the date of the enactment of this Act; 
     and
       (B) the State shall demonstrate to the satisfaction of the 
     Secretary of Health and Human Services that any savings in 
     State expenditures under title XIX or XXI of the Social 
     Security Act that results from children enrolling under title 
     XXII of such Act shall be used in a manner that improves 
     services to beneficiaries under title XIX of such Act, such 
     as through expansion of eligibility, improved nurse and nurse 
     aide staffing and improved inspections of nursing facilities, 
     and coverage of additional services.
       (2) Medikids as primary payor.--In applying title XIX of 
     the Social Security Act, the MediKids program under title 
     XXII of such Act shall be treated as a primary payor in cases 
     in which the election described in section 2207(b)(2) of such 
     Act, as added by subsection (a), has been made.
       (d) Expansion of Medpac Membership to 19.--
       (1) In general.--Section 1805(c) of the Social Security Act 
     (42 U.S.C. 1395b-6(c)) is amended--
       (A) in paragraph (1), by striking ``17'' and inserting 
     ``19''; and
       (B) in paragraph (2)(B), by inserting ``experts in 
     children's health,'' after ``other health professionals,''.
       (2) Initial terms of additional members.--
       (A) In general.--For purposes of staggering the initial 
     terms of members of the Medicare Payment Advisory Commission 
     under section 1805(c)(3) of the Social Security Act (42 
     U.S.C. 1395b-6(c)(3)), the initial terms of the 2 additional 
     members of the Commission provided for by the amendment under 
     subsection (a)(1) are as follows:
       (i) One member shall be appointed for 1 year.
       (ii) One member shall be appointed for 2 years.
       (B) Commencement of terms.--Such terms shall begin on 
     January 1, 2006.
       (3) Duties.--Section 1805(b)(1)(A) of such Act (42 U.S.C. 
     1395b-6(b)(1)(A)) is amended by inserting before the 
     semicolon at the end the following: ``and payment policies 
     under title XXII''.

     SEC. 3. MEDIKIDS PREMIUM.

       (a) General Rule.--Subchapter A of chapter 1 of the 
     Internal Revenue Code of 1986 (relating to determination of 
     tax liability) is amended by adding at the end the following 
     new part:

[[Page S7312]]

                     ``PART VIII--MEDIKIDS PREMIUM

``Sec. 59B. MediKids premium

     ``SEC. 59B. MEDIKIDS PREMIUM.

       ``(a) Imposition of Tax.--In the case of a taxpayer to whom 
     this section applies, there is hereby imposed (in addition to 
     any other tax imposed by this subtitle) a MediKids premium 
     for the taxable year.
       ``(b) Individuals Subject to Premium.--
       ``(1) In general.--This section shall apply to a taxpayer 
     if a MediKid is a dependent of the taxpayer for the taxable 
     year.
       ``(2) Medikid.--For purposes of this section, the term 
     `MediKid' means any individual enrolled in the MediKids 
     program under title XXII of the Social Security Act.
       ``(c) Amount of Premium.--For purposes of this section, the 
     MediKids premium for a taxable year is the sum of the monthly 
     premiums (for months in the taxable year) determined under 
     section 2203 of the Social Security Act with respect to each 
     MediKid who is a dependent of the taxpayer for the taxable 
     year.
       ``(d) Exceptions Based on Adjusted Gross Income.--
       ``(1) Exemption for very low-income taxpayers.--
       ``(A) In general.--No premium shall be imposed by this 
     section on any taxpayer having an adjusted gross income not 
     in excess of the exemption amount.
       ``(B) Exemption amount.--For purposes of this paragraph, 
     the exemption amount is--
       ``(i) $19,245 in the case of a taxpayer having 1 MediKid,
       ``(ii) $24,135 in the case of a taxpayer having 2 MediKids,
       ``(iii) $29,025 in the case of a taxpayer having 3 
     MediKids, and
       ``(iv) $33,915 in the case of a taxpayer having 4 or more 
     MediKids.
       ``(C) Phaseout of exemption.--In the case of a taxpayer 
     having an adjusted gross income which exceeds the exemption 
     amount but does not exceed twice the exemption amount, the 
     premium shall be the amount which bears the same ratio to the 
     premium which would (but for this subparagraph) apply to the 
     taxpayer as such excess bears to the exemption amount.
       ``(D) Inflation adjustment of exemption amounts.--In the 
     case of any taxable year beginning in a calendar year after 
     2005, each dollar amount contained in subparagraph (C) shall 
     be increased by an amount equal to the product of--
       ``(i) such dollar amount, and
       ``(ii) the cost-of-living adjustment determined under 
     section 1(f)(3) for the calendar year in which the taxable 
     year begins, determined by substituting `calendar year 2004' 
     for `calendar year 1992' in subparagraph (B) thereof.

     If any increase determined under the preceding sentence is 
     not a multiple of $50, such increase shall be rounded to the 
     nearest multiple of $50.
       ``(2) Premium limited to 5 percent of adjusted gross 
     income.--In no event shall any taxpayer be required to pay a 
     premium under this section in excess of an amount equal to 5 
     percent of the taxpayer's adjusted gross income.
       ``(e) Coordination With Other Provisions.--
       ``(1) Not treated as medical expense.--For purposes of this 
     chapter, any premium paid under this section shall not be 
     treated as expense for medical care.
       ``(2) Not treated as tax for certain purposes.--The premium 
     paid under this section shall not be treated as a tax imposed 
     by this chapter for purposes of determining--
       ``(A) the amount of any credit allowable under this 
     chapter, or
       ``(B) the amount of the minimum tax imposed by section 55.
       ``(3) Treatment under subtitle f.--For purposes of subtitle 
     F, the premium paid under this section shall be treated as if 
     it were a tax imposed by section 1.''.
       (b) Technical Amendments.--
       (1) Subsection (a) of section 6012 of such Code is amended 
     by inserting after paragraph (9) the following new paragraph:
       ``(10) Every individual liable for a premium under section 
     59B.''.
       (2) The table of parts for subchapter A of chapter 1 of 
     such Code is amended by adding at the end the following new 
     item:

                    ``Part VIII. MediKids Premium''.

       (c) Effective Date.--The amendments made by this section 
     shall apply to months beginning after December 2006, in 
     taxable years ending after such date.

     SEC. 4. REFUNDABLE CREDIT FOR CERTAIN COST-SHARING EXPENSES 
                   UNDER MEDIKIDS PROGRAM.

       (a) In General.--Subpart C of part IV of subchapter A of 
     chapter 1 of the Internal Revenue Code of 1986 (relating to 
     refundable credits) is amended by redesignating section 36 as 
     section 37 and by inserting after section 35 the following 
     new section:

     ``SEC. 36. CATASTROPHIC LIMIT ON COST-SHARING EXPENSES UNDER 
                   MEDIKIDS PROGRAM.

       ``(a) In General.--
       ``In the case of a taxpayer who has a MediKid (as defined 
     in section 59B) at any time during the taxable year, there 
     shall be allowed as a credit against the tax imposed by this 
     subtitle an amount equal to the excess of--
       ``(1) the amount paid by the taxpayer during the taxable 
     year as cost-sharing under section 2202(b)(4) of the Social 
     Security Act, over
       ``(2) 5 percent of the taxpayer's adjusted gross income for 
     the taxable year.''.
       (b) Coordination With Other Provisions.--The excess 
     described in subsection (a) shall not be taken into account 
     in computing the amount allowable to the taxpayer as a 
     deduction under section 162(l) or 213(a).
       (c) Technical Amendments.--
       (1) The table of sections for subpart C of part IV of 
     subchapter A of chapter 1 of such Code is amended by 
     redesignating the item relating to section 36 as an item 
     relating to section 37 and by inserting before such item the 
     following new item:

``Sec. 36. Catastrophic limit on cost-sharing expenses under MediKids 
              program''.

       (2) Paragraph (2) of section 1324(b) of title 31, United 
     States Code, is amended by inserting ``or 36'' after 
     ``section 35''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2006.

     SEC. 5. REPORT ON LONG-TERM REVENUES.

       Within one year after the date of the enactment of this 
     Act, the Secretary of the Treasury shall propose a gradual 
     schedule of progressive tax changes to fund the program under 
     title XXII of the Social Security Act, as the number of 
     enrollees grows in the out-years.
                                 ______
                                 
      By Mr. HARKIN (for himself, Mr. Kennedy, Mr. Durbin, Mr. 
        Feingold, Mrs. Boxer, and Mr. Dayton):
  S. 1304. A bill to amend the Employee Retirement Income Security Act 
of 1974 and the Internal Revenue Code of 1986 to protect pension 
benefits of employees in defined benefit plans and to direct the 
Secretary of the Treasury to enforce the age discrimination 
requirements of the Internal Revenue Code of 1986; to the Committee on 
Health, Education, Labor, and Pensions.
  Mr. HARKIN. Mr. President, I rise today to introduce a piece of 
legislation to fix a huge oversight in pension policy.
  In the early 1990s, a large number of U.S. companies began a process 
of switching their traditional defined benefit pension plans to what's 
referred to as ``cash balance'' pension plans. A cash balance pension 
is insured, like a traditional plan, through the PBGC. However, it 
looks more like a defined contribution plan to participants because the 
benefit is expressed as some percent of play plus some guaranteed 
interest rate. This isn't necessarily a bad idea, in and of itself. 
However, in practice, many of the employees working for these companies 
were not told what these changes would mean for them. Some companies 
had their employees work for years without earning any more benefits. 
Many of those employees didn't figure that out for a very long time. 
Unfortunately, their lack of understanding in this situation was a key 
benefit to management. However, once they figured out what was 
happening, the retirees were furious.
  As two consultants who helped put these plans together said at an 
Actuaries conference in 1998:

       ``I've been involved in cash balance plans five or six 
     years down the road and what I have found is that while 
     employees understand it, it is not until they are actually 
     ready to retire that they understand how little they are 
     actually getting.''
       ``Right, but they're happy while they're employed.''

  One of the most abusive practices in cash balance conversions is 
known as ``wear away. `` The company freezes the value of the benefits 
employees already earned, which by law cannot be taken away once given. 
However, the employer opens a cash balance account for that worker at a 
much lower dollar level. So they end up working for years contributing 
to this lower cash balance account, not realizing that contribution is 
meaningless because their old benefits were higher. At the same time, 
younger workers do get money added to their account every day. This is 
clearly age discrimination, and bad pension policy.
  In 1999, I introduced a bill to make it illegal for corporations to 
wear away the benefits of older workers during conversions to cash 
balance plans. I offered my bill as an amendment. Forty-eight Senators, 
including 3 Republicans, voted to waive the budget point of order so we 
could consider this amendment. We did not have enough votes then, but I 
believe the tide is turning.
  After that vote, more and more stories came out about how many 
workers were losing their pensions. In September of 1999, the Secretary 
of the Treasury put a moratorium on conversions from defined benefit 
plans to cash balance plans. That moratorium has

[[Page S7313]]

been in effect now for over three years. In April of 2000, I offered a 
Sense-of-the-Senate resolution to stop this practice, and it passed the 
Senate unanimously.
  There are hundreds of age discrimination complaints currently pending 
before the EEOC based on some of these abusive cash balance 
conversions. Clearly, something must be done to address this issue 
that's been floating around now unresolved for over five years.
  Before, I said that wear-away is the least fair practice during 
conversion. And I have to say that now, public sentiment is really 
coming around to acknowledge that unfairness. However, aside from wear-
away, there's another problem in shifting from a traditional pension to 
cash balance. In a traditional plan, you accrue most of the benefits 
toward the end of your career, because there's usually some kind of 
formula that multiplies top pay times years of service. People tend to 
earn more salary toward the end of their careers, and if that is 
multiplied times more years served, the pension grows quickly in later 
years. But in a cash balance plan, younger workers do better because 
they are given a flat percent of pay plus some guaranteed interest 
credit. Interest is good for young people, they have many years to 
accrue and compound it. So if you get caught in mid-life, mid-career in 
one of these transitions, you get the downside of both plans.
  Before I go any further, I want to be clear on one point--cash 
balance pensions can be a great deal for workers. Some. And they may 
help fill a needed niche in the pension world to cover the half of the 
workforce that currently has no pension. But I will continue my long 
battle to oppose the unilateral decision of a company to cut off a 
promise for an older worker, give that money to a younger worker, and 
not view it as age discrimination.
  That is what this issue is all about. It is fairness. It is equity. I 
know discussion of pension law can become very convoluted. But this can 
be boiled down pretty simply. It is about what we think a promise from 
an employer ought to mean.
  There is one thing that has distinguished the American workplace from 
others around the world. We have valued loyalty. At least we used to. 
That is one of the reasons pension plans exist--the longer you work 
somewhere, the more you earn in your pension program. Obviously, the 
longer you work someplace, the better you do your job, the more you 
learn about it, the more productive you are. We should value that 
loyalty.
  But here, companies are able to take away the benefits of the longest 
serving workers. What kind of a signal does that send to the workers? 
It tells workers they are fools if they are loyal because if you put in 
20 or 25 years, the boss can just change the rules of the game, and 
break their promise. It tells younger workers that it would be crazy to 
work for a company for a long time, that it's best to hedge your bets 
and move on as soon as it is convenient. It's crazy to trade current 
pay for the promise of future benefits. So why even take into account 
the fact that you're being offered a pension plan? This is a very 
dangerous road to go down.
  This destroys the kind of work ethic we have come to value and that 
we know built this country. But some of these cash balance conversions 
counter all of that. Here is an analogy. Imagine I hire someone for 5 
years with a promise of a $50,000 bonus at the end of 5 years of 
service. At the end of 3 years, however, I renege on the $50,000 bonus. 
But the employee has 3 years invested. Had they known that the deal was 
going to be off, perhaps they would not have gone to work for me. They 
could have gone to work someplace else for a total higher compensation 
package. Now imagine that they hire a new guy to join the team, and 
they give him part of that $50,000 bonus they promised me. Is that the 
way we want to treat workers in this country, where the employer has 
all the cards and employees have none, and employers can make whatever 
deal they want, but can change the rules at any time?

  That is why I am introducing this legislation. It is simple. It says 
that you have to give older, longer serving employees a choice, at 
retirement, when their pension plan is converted to a cash balance plan 
to get the benefits earned in the old plan instead. It also says that 
employers must start counting the new cash balance benefits where the 
old defined benefit plan left off, instead of starting the cash balance 
plan at a lower level than an employee had already earned.
  This isn't a radical idea. I was very pleased that in February of 
2004, the Administration came out with a cash balance proposal that 
recognized that these transitions are hard on workers. It not only 
prohibits wear-away but provides for 5 year transition credits for 
workers caught in the middle of a conversion. Treasury reaffirmed its 
commitment to this approach in this year's budget request.
  I was excited when Treasury first came to the table with a proposal 
to do more to protect workers here. I was so encouraged by this that I 
convened a series of meetings over the course of last summer to get all 
interested parties to the table--everyone from participant rights 
advocates to industry groups to consultants. I heard some really great 
ideas, and some that I didn't agree with. But I think there is still 
room to find answers to this problem. So I'm putting my plan back on 
the table today. And I really hope that we can continue a meaningful 
dialog on this issue.
  If we do that, this year, we can enact meaningful participant 
protections moving forward so that there is another pension option out 
there to cover the roughly half of Americans with no pension at all. 
But I also want to make it clear that this Senator will never sit idly 
by as older workers get the rug pulled out from under them just as they 
thought they were on solid ground for their retirement. I won't stand 
idly by and watch their money redistributed in an age-discriminatory 
way. We can have this dialog and we can find a way to fix what's broken 
here, but not by blessing some of these blatant abuses.
                                 ______
                                 
      By Mr. BROWNBACK:
  S. 1305. A bill to amend the Internal Revenue Code of 1986 to 
increase tax benefits for parents with children, and for other 
purposes; to the Committee on Finance.
  Mr. BROWNBACK. Mr. President, I rise today to introduce the Parents 
Tax Relief Act.
  The Parents Tax Relief Act would help restore to families the pride-
of-place, which they enjoyed during the early days of the income tax.
  This important legislation would relieve the growing tax burden on 
families with children; provide a realistic option for one parent to 
stay at home and care for the children; and acknowledge the 
indispensable social value of the time and effort that parents put into 
rearing and forming their children.
  Letting parents keep more of their hard-earned money for family-
related expenses leaves the childcare decision to parents. Given this 
opportunity to make their own decision about childcare, many will 
choose to stay at home and care for their children themselves.
  This legislation is necessary because parents have been hit 
especially hard by increasing taxes over the past half-century. In 
1948, the average family with children paid 3 percent of its income in 
Federal taxes; today, that same average family with children pays 
almost 25 percent of its income in Federal taxes.
  It is time for the Federal Government to step back and recognize the 
contributions of the American family. As a matter of policy, I believe 
we should work to further reduce taxes on families with children in 
order to make it easier for parents to be parents and care for their 
own children at home. Outside of abusive situations, nothing is better 
for our children than spending time with their parents.
  The Parents Tax Relief Act takes a modest step towards empowering and 
strengthening the family. It builds on Marriage Penalty Tax Relief and 
the Child Tax Credit, making both permanent. While the Child Tax Credit 
was significant in leveling a three-decade trend of an increasing 
percentage of married mothers with preschool children who work outside 
the home full-time, more needs to be done to give parents the chance to 
decrease this percentage.
  To accomplish this end, the Parents Tax Relief Act would increase 
deductions for young and elderly dependents.

[[Page S7314]]

It would equalize existing Federal preferences between parents who 
choose to stay at home with their children and parents Who choose to 
work outside of the home and place their children in paid daycare.
  The bill would make it easier for a parent to spend more time with 
their children through provisions that encourage telecommuting and home 
businesses. And it recognizes the societal contributions of parents by 
granting 10 years worth of Social Security credits to a spouse who 
leaves the workforce during their prime-earning years to care for a 
young child.
  The Parents Tax Relief Act is about investing in human capital. The 
hard-working American family, instilling traditional values to 
children, has been the bedrock of American society. As the family goes, 
so goes the Nation.
  In recent years, the Federal Government has engaged in a massive 
experiment with paid, out-of-home daycare. As a national policy, 
through Federal subsidies, we have encouraged parents to place their 
children in daycare, and further, we have increasingly become a Nation 
where it is necessary for both husband and wife to be in the workforce 
just to cover a family's basic needs. The end result is that children 
are getting less of their parents' time when they need their parents 
the most.
  Make no mistake, both men and women have made valuable contributions 
to our national workforce. Our Nation's productivity is strong, and we 
have enjoyed a great period of national prosperity. But how long will 
it last when our children are spending less time with mom and dad? 
Sociological data confirms time and again that children do best when 
raised by a mother and a father, where one spouse works and the other 
spouse stays at home with the children.
  Unfortunately--and I believe that most mothers, especially, would 
tend to agree--we have reached a point where a family has to make a 
truly great sacrifice for one parent to stay at home to raise the 
children. I have heard so many stories of mothers wanting to stay home 
with their children, but between paying a mortgage and taxes, they feel 
helpless. They feel that they must work in order that their family can 
enjoy and maintain a middle-class lifestyle.
  It is time for us to acknowledge, through Federal policy, the 
sacrifices that parents make to invest in the upbringing of their 
children when they stay at home. That is goal of the Parents Tax Relief 
Act, and it is the reason why I am introducing this important measure.
  It costs a great sum to raise children these days, and it is 
essential to our Nation's social and economic welfare that we ensure 
Federal tax policy does not infringe on a parent's ability to afford 
that great sum.
  The Parents Tax Relief Act would establish a new national tax policy 
that would allow parents to invest more time and effort in the 
formation of their children. In the end, this type of investment in 
human capital may be the most effective way for the Federal Government 
to ensure our future economic growth and competitiveness.
  The legislative road to this new policy begins today, and I look 
forward to working with my colleagues on both sides of the aisle to 
make it a reality.
                                 ______
                                 
      By Ms. MURKOWSKI:
  S. 1306. A bill to provide for the recognition of certain Native 
communities and the settlement of certain claims under the Alaska 
Native Claims Settlement Act, and for other purposes; to the Committee 
on Energy and Natural Resources.
  Ms. MURKOWSKI. Mr. President, at the very beginning of the Alaska 
Native Claims Settlement Act of 1971 there are a series of findings and 
declarations of Congressional policy which explain the underpinnings of 
this landmark legislation.
  The first clause reads, ``There is an immediate need for a fair and 
just settlement of all claims by Natives and Native groups of Alaska, 
based on aboriginal land claims.'' The second clause states, ``The 
settlement should be accomplished rapidly, with certainty, in 
conformity with the real economic and social needs of Natives.''
  Thirty three years have passed since the Alaska Native Claims 
Settlement Act became law and still the Native peoples of five 
communities in Southeast Alaska--Haines, Ketchikan, Petersburg, Tenakee 
and Wrangell--the five ``landless communities'' are still waiting for 
their fair and just settlement.
  The Alaska Native Claims Settlement Act awarded approximately $1 
billion and 44 million acres of land to Alaska Natives and provided for 
the establishment of Native Corporations to receive and manage such 
funds and lands. The beneficiaries of the settlement were issued stock 
in one of 13 regional Alaska Native Corporations. Most beneficiaries 
also had the option to enroll and receive stock in a village, group or 
urban corporation.
  For reasons that still defy explanation the Native peoples of the 
``landless communities,'' were not permitted by the Alaska Native 
Claims Settlement Act to form village or urban corporations. These 
communities were excluded from this benefit even though they did not 
differ significantly from other communities in Southeast Alaska that 
were permitted to form village or urban corporations under the Alaska 
Native Claims Settlement Act. This finding was confirmed in a February 
1994 report submitted by the Secretary of the Interior at the direction 
of the Congress. That study was conducted by the Institute of Social 
and Economic Research at the University of Alaska.
  The Native people of Southeast Alaska have recognized the injustice 
of this oversight for more than 33 years. An independent study issued 
more than 11 years ago confirms that the grievance of the landless 
communities is legitimate. Legislation has been introduced in the past 
sessions of Congress to remedy this injustice. Hearings have been held 
and reports written. Yet legislation to right the wrong has inevitably 
stalled out. This December marks the 34th anniversary of Congress' 
promise to the Native peoples of Alaska--the promise of a rapid and 
certain settlement. And still the landless communities of Southeast 
Alaska are landless.
  I am convinced that this cause is just, it is right, and it is about 
time that the Native peoples of the five landless communities receive 
what has been denied them for more than 30 years.
  The legislation that I am introducing today would enable the Native 
peoples of the five ``landless communities'' to organize five ``urban 
corporations,'' one for each unrecognized community. These newly formed 
corporations would be offered and could accept the surface estate to 
approximately 23,000 acres of land. Sealaska Corporation, the regional 
Alaska Native Corporation for Southeast Alaska would receive title to 
the subsurface estate to the designated lands. The urban corporations 
would each receive a lump sum payment to be used as start-up funds for 
the newly established corporation. The Secretary of the Interior would 
determine other appropriate compensation to redress the inequities 
faced by the unrecognized communities.
  It is long past time that we return to the Native peoples of 
Southeast Alaska a small slice of the aboriginal lands that were once 
theirs alone. It is time that we open our minds and open our hearts to 
correcting this injustice which has gone on far too long and finally 
give the Native peoples of Southeast Alaska the rapid and certain 
settlement for which they have been waiting.
  I ask unanimous consent that the text of the legislation be printed 
in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1306

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Unrecognized Southeast 
     Alaska Native Communities Recognition and Compensation Act''.

     SEC. 2. FINDINGS AND PURPOSE.

       (a) Findings.--Congress finds the following:
       (1) In 1971, Congress enacted the Alaska Native Claims 
     Settlement Act (43 U.S.C. 1601 et seq.) (referred to in this 
     section as the ``Act'') to recognize and settle the 
     aboriginal claims of Alaska Natives to the lands Alaska 
     Natives had used for traditional purposes.
       (2) The Act awarded approximately $1,000,000,000 and 
     44,000,000 acres of land to Alaska Natives and provided for 
     the establishment of Native Corporations to receive and 
     manage such funds and lands.
       (3) Pursuant to the Act, Alaska Natives have been enrolled 
     in one of 13 Regional Corporations.

[[Page S7315]]

       (4) Most Alaska Natives reside in communities that are 
     eligible under the Act to form a Village or Urban Corporation 
     within the geographical area of a Regional Corporation.
       (5) Village or Urban Corporations established under the Act 
     received cash and surface rights to the settlement land 
     described in paragraph (2) and the corresponding Regional 
     Corporation received cash and land which includes the 
     subsurface rights to the land of the Village or Urban 
     Corporation.
       (6) The southeastern Alaska communities of Haines, 
     Ketchikan, Petersburg, Tenakee, and Wrangell are not listed 
     under the Act as communities eligible to form Village or 
     Urban Corporations, even though the population of such 
     villages comprises greater than 20 percent of the 
     shareholders of the Regional Corporation for Southeast Alaska 
     and display historic, cultural, and traditional qualities of 
     Alaska Natives.
       (7) The communities described in paragraph (6) have sought 
     full eligibility for lands and benefits under the Act for 
     more than three decades.
       (8) In 1993, Congress directed the Secretary of the 
     Interior to prepare a report examining the reasons why the 
     communities listed in paragraph (6) had been denied 
     eligibility to form Village or Urban Corporations and receive 
     land and benefits pursuant to the Act.
       (9) The report described in paragraph (8), published in 
     February, 1994, indicates that--
       (A) the communities listed in paragraph (6) do not differ 
     significantly from the southeast Alaska communities that were 
     permitted to form Village or Urban Corporations under the 
     Act;
       (B) such communities are similar to other communities that 
     are eligible to form Village or Urban Corporations under the 
     Act and receive lands and benefits under the Act--
       (i) in actual number and percentage of Native Alaskan 
     population; and
       (ii) with respect to the historic use and occupation of 
     land;
       (C) each such community was involved in advocating the 
     settlement of the aboriginal claims of the community; and
       (D) some of the communities appeared on early versions of 
     lists of Native Villages prepared before the date of the 
     enactment of the Act, but were not included as Native 
     Villages in the Act.
       (10) The omissions described in paragraph (9) are not 
     clearly explained in any provision of the Act or the 
     legislative history of the Act.
       (11) On the basis of the findings described in paragraphs 
     (1) through (10), Alaska Natives who were enrolled in the 
     five unlisted communities and their heirs have been 
     inadvertently and wrongly denied the cultural and financial 
     benefits of enrollment in Village or Urban Corporations 
     established pursuant to the Act.
       (b) Purpose.--The purpose of this Act is to redress the 
     omission of the communities described in subsection (a)(6) 
     from eligibility by authorizing the Native people enrolled in 
     the communities--
       (1) to form Urban Corporations for the communities of 
     Haines, Ketchikan, Petersburg, Tenakee, and Wrangell under 
     the Act; and
       (2) to receive certain settlement lands and other 
     compensation pursuant to the Act.

     SEC. 3. ESTABLISHMENT OF ADDITIONAL NATIVE CORPORATIONS.

       Section 16 of the Alaska Native Claims Settlement Act (43 
     U.S.C. 1615) is amended by adding at the end thereof the 
     following new subsection:
       ``(e)(1) The Native residents of each of the Native 
     Villages of Haines, Ketchikan, Petersburg, Tenakee, and 
     Wrangell, Alaska, may organize as Urban Corporations.
       ``(2) Nothing in this subsection shall affect any 
     entitlement to land of any Native Corporation previously 
     established pursuant to this Act or any other provision of 
     law.''.

     SEC. 4. SHAREHOLDER ELIGIBILITY.

       Section 8 of the Alaska Native Claims Settlement Act (43 
     U.S.C. 1607) is amended by adding at the end thereof the 
     following new subsection:
       ``(d)(1) The Secretary of the Interior shall enroll to each 
     of the Urban Corporations for Haines, Ketchikan, Petersburg, 
     Tenakee, or Wrangell those individual Natives who enrolled 
     under this Act to the Native Villages of Haines, Ketchikan, 
     Petersburg, Tenakee, or Wrangell, respectively.
       ``(2) Those Natives who are enrolled to an Urban 
     Corporation for Haines, Ketchikan, Petersburg, Tenakee, or 
     Wrangell pursuant to paragraph (1) and who were enrolled as 
     shareholders of the Regional Corporation for Southeast Alaska 
     on or before March 30, 1973, shall receive 100 shares of 
     Settlement Common Stock in such Urban Corporation.
       ``(3) A Native who has received shares of stock in the 
     Regional Corporation for Southeast Alaska through inheritance 
     from a decedent Native who originally enrolled to the Native 
     Villages of Haines, Ketchikan, Petersburg, Tenakee, or 
     Wrangell, which decedent Native was not a shareholder in a 
     Village or Urban Corporation, shall receive the identical 
     number of shares of Settlement Common Stock in the Urban 
     Corporation for Haines, Ketchikan, Petersburg, Tenakee, or 
     Wrangell as the number of shares inherited by that Native 
     from the decedent Native who would have been eligible to be 
     enrolled to such Urban Corporation.
       ``(4) Nothing in this subsection shall affect entitlement 
     to land of any Regional Corporation pursuant to section 12(b) 
     or section 14(h)(8).''.

     SEC. 5. DISTRIBUTION RIGHTS.

       Section 7 of the Alaska Native Claims Settlement Act (43 
     U.S.C. 1606) is amended--
       (1) in subsection (j), by adding at the end thereof the 
     following new sentence: ``Native members of the Native 
     Villages of Haines, Ketchikan, Petersburg, Tenakee, and 
     Wrangell who become shareholders in an Urban Corporation for 
     such a community shall continue to be eligible to receive 
     distributions under this subsection as at-large shareholders 
     of the Regional Corporation for Southeast Alaska.''; and
       (2) by adding at the end thereof the following new 
     subsection:
       ``(s) No provision of or amendment made by the Unrecognized 
     Southeast Alaska Native Communities Recognition and 
     Compensation Act shall affect the ratio for determination of 
     revenue distribution among Native Corporations under this 
     section and the `1982 Section 7(i) Settlement Agreement' 
     among the Regional Corporations or among Village Corporations 
     under subsection (j).''.

     SEC. 6. COMPENSATION.

       The Alaska Native Claims Settlement Act (43 U.S.C. 1601 et 
     seq.) is amended by adding at the end thereof the following 
     new section:


 ``Urban Corporations for Haines, Ketchikan, Petersburg, Tenakee, and 
                                Wrangell

       ``Sec. 43. (a) Upon incorporation of the Urban Corporations 
     for Haines, Ketchikan, Petersburg, Tenakee, and Wrangell, the 
     Secretary, in consultation and coordination with the 
     Secretary of Commerce, and in consultation with 
     representatives of each such Urban Corporation and the 
     Regional Corporation for Southeast Alaska, shall offer as 
     compensation, pursuant to this Act, one township of land 
     (23,040 acres) to each of the Urban Corporations for Haines, 
     Ketchikan, Petersburg, Tenakee, and Wrangell, and other 
     appropriate compensation, including the following:
       ``(1) Local areas of historical, cultural, traditional, and 
     economic importance to Alaska Natives from the Villages of 
     Haines, Ketchikan, Petersburg, Tenakee, or Wrangell. In 
     selecting the lands to be withdrawn and conveyed pursuant to 
     this section, the Secretary shall give preference to lands 
     with commercial purposes and may include subsistence and 
     cultural sites, aquaculture sites, hydroelectric sites, 
     tidelands, surplus Federal property and eco-tourism sites. 
     The lands selected pursuant to this section shall be 
     contiguous and reasonably compact tracts wherever possible. 
     The lands selected pursuant to this section shall be subject 
     to all valid existing rights and all other provisions of 
     section 14(g), including any lease, contract, permit, right-
     of-way, or easement (including a lease issued under section 
     6(g) of the Alaska Statehood Act).
       ``(2) $650,000 for capital expenses associated with 
     corporate organization and development, including--
       ``(A) the identification of forest and land parcels for 
     selection and withdrawal;
       ``(B) making conveyance requests, receiving title, 
     preparing resource inventories, land and resource use, and 
     development planning;
       ``(C) land and property valuations;
       ``(D) corporation incorporation and start-up;
       ``(E) advising and enrolling shareholders;
       ``(F) issuing stock; and
       ``(G) seed capital for resource development.
       ``(3) Such additional forms of compensation as the 
     Secretary deems appropriate, including grants and loan 
     guarantees to be used for planning, development and other 
     purposes for which Native Corporations are organized under 
     the Act, and any additional financial compensation, which 
     shall be allocated among the five Urban Corporations on a pro 
     rata basis based on the number of shareholders in each Urban 
     Corporation.
       ``(b) The Urban Corporations for Haines, Ketchikan, 
     Petersburg, Tenakee, and Wrangell, shall have one year from 
     the date of the offer of compensation from the Secretary to 
     each such Urban Corporation provided for in this section 
     within which to accept or reject the offer. In order to 
     accept or reject the offer, each such Urban Corporation shall 
     provide to the Secretary a properly executed and certified 
     corporate resolution that states that the offer proposed by 
     the Secretary was voted on, and either approved or rejected, 
     by a majority of the shareholders of the Urban Corporation. 
     In the event that the offer is rejected, the Secretary, in 
     consultation with representatives of the Urban Corporation 
     that rejected the offer and the Regional Corporation for 
     Southeast Alaska, shall revise the offer and the Urban 
     Corporation shall have an additional six months within which 
     to accept or reject the revised offer.
       ``(c) Not later than 180 days after receipt of a corporate 
     resolution approving an offer of the Secretary as required in 
     subsection (b), the Secretary shall withdraw the lands and 
     convey to the Urban Corporation title to the surface estate 
     of the lands and convey to the Regional Corporation for 
     Southeast Alaska title to the subsurface estate as 
     appropriate for such lands.
       ``(d) The Secretary shall, without consideration of 
     compensation, convey to the Urban Corporations of Haines, 
     Ketchikan, Petersburg, Tenakee, and Wrangell, by quitclaim 
     deed or patent, all right, title, and interest of the United 
     States in all roads, trails, log transfer facilities, leases, 
     and appurtenances on or related to the land conveyed to the 
     corporations pursuant to subsection (c).
       ``(e)(1) The Urban Corporations of Haines, Ketchikan, 
     Petersburg, Tenakee, and Wrangell may establish a settlement 
     trust in

[[Page S7316]]

     accordance with the provisions of section 39 for the purposes 
     of promoting the health, education, and welfare of the trust 
     beneficiaries and preserving the Native heritage and culture 
     of the communities of Haines, Ketchikan, Petersburg, Tenakee, 
     and Wrangell, respectively.
       ``(2) The proceeds and income from the principal of a trust 
     established under paragraph (1) shall first be applied to the 
     support of those enrollees and their descendants who are 
     elders or minor children and then to the support of all other 
     enrollees.''.

     SEC. 7. AUTHORIZATION OF APPROPRIATIONS.

       There is authorized to be appropriated such sums as shall 
     be necessary to carry out this Act and the amendments made by 
     this Act.
                                 ______
                                 
      By Mr. BAUCUS:
  S. 1308. A bill to establish an Office of Trade Adjustment 
Assistance, and for other purposes; to the Committee on Finance.
  Mr. BAUCUS. Mr. President, today I introduce the Trade Adjustment 
Assistance for Firms Reorganization Act.
  The Trade Adjustment Assistance for Firms program assists hundreds of 
mostly small and medium-sized manufacturing and agricultural companies 
in Montana and nationwide when they face layoffs and lost sales due to 
import competition. Qualifying companies develop adjustment plans and 
receive technical assistance to become more competitive, so that they 
can retain and expand employment.
  The program is very cost effective. It requires the firms being 
helped to match the Federal assistance with their own funds, and it 
pays the government back in federal and State tax revenues when the 
firms succeed.
  For example, TAA for Firms is helping Montola Growers from 
Culbertson, Montana, to develop cosmetic applications for its safflower 
oil. And it is helping Porterbilt Company of Hamilton to expand its 
product line.
  Currently, TAA for Firms clients receive assistance preparing 
petitions and adjustment plans from twelve Trade Adjustment Assistance 
Centers, which are Commerce Department contractors. Program and policy 
decisions are made by a small headquarters staff in the Commerce 
Department's Economic Development Administration.
  In the Trade Act of 2002, Congress voted to reauthorize this 
important program for seven years and to increase its authorized 
funding level. The program seemed headed toward some years of smooth 
sailing. But it turns out that is not the case.
  For reasons unrelated to TAA for Firms, EDA began more than a year 
ago to move all its headquarters programs to its six regional offices. 
For TAA for Firms, that means clients will still get the same local 
services from the TAACs, but decisions will be made in six regional 
offices plus a national policy office. The likely result is more 
personnel needed to run the program, more layers of government, less 
centralized and consistent decision making, and less accountability--
all without any likely improvement in customer service.
  In preparation for this reorganization, EDA transferred or otherwise 
eliminated most of its experienced TAA staff in the Washington office. 
But to date it has not completed the transfer and hired or trained the 
necessary regional staff. So the program is in limbo.
  Meanwhile, the President recently announced a multi-agency 
consolidation of economic development programs that will eliminate EDA 
and its regional offices. Not surprisingly, the latest word from EDA is 
that plans to complete the move of TAA for Firms to the regional 
offices are now on indefinite hold. The President's fiscal year 2006 
budget zeroes out TAA for Firms, even though Congress has authorized 
the program through fiscal year 2007. With funding in doubt and the 
Washington-based management structure for TAA for Firms already largely 
dismantled, this program is on the verge of a crisis.
  TAA for Firms was not broken until someone decided to fix it. Now it 
is doomed to stay in limbo unless Congress acts to clean up the mess.
  The bill I am introducing today solves these problems by moving 
administration of the TAA for Firms program from EDA into a different 
part of the Commerce Department--the International Trade 
Administration. I introduced this same bill last year with 15 co-
sponsors.
  Relocating the program to ITA makes sense. ITA has experience running 
this program, which was located there prior to 1990. Relocating TAA for 
Firms to ITA will result in fewer lays of government and more 
centralized and accountable program management than running it through 
EDA's regional offices or some new economic development agency.
  Relocating the program also creates synergies by allowing better 
coordination of the TAA for Firms program with other trade and trade 
remedy programs administered by ITA. And it enhances the ability of the 
Finance Committee to carry out its oversight responsibilities for this 
program and for trade policy in general.
  I do not want to see this important TAA program die of neglect. This 
legislation is a simple matter of good, sensible government. I 
encourage my colleagues to lend it their support.
  I ask unanimous consent that the text of this bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1308

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

     SECTION 1. SHORT TITLE.

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

     SEC. 2. 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. 3. AUTHORIZATION OF APPROPRIATIONS.

       Section 256(b) of the Trade Act of 1974 (19 U.S.C. 2346(b)) 
     is amended by striking ``2007'' and inserting ``2012''.
                                 ______
                                 
      By Mr. BAUCUS (for himself, Mr. Coleman, and Mr. Wyden):
  S. 1309. A bill to amend the Trade Act of 1974 to extend the trade 
adjustment assistance program to the services sector, and for other 
purposes; to the Committee on Finance.
  Mr. BAUCUS. Mr. President, today I introduce the Trade Adjustment 
Assistance Equity for Service Workers Act.
  Frankly, I am disappointed to be here introducing this bill yet 
again.
  Just last week, the substance of the bill was adopted by a majority 
of members of the Finance Committee as an amendment to the implementing 
legislation for the United States-Central America-Dominican Republic 
Free Trade Agreement. But today, the administration sent us the final 
implementing bill with the amendment stripped out.
  President Bush likes to say that trade is for everyone. That we all 
share the benefits, including workers. And he claims to care a lot 
about having a skilled workforce that can keep American businesses 
competitive in global markets.
  This amendment presented the President with the perfect opportunity 
to put his money where his mouth is.
  He could have said to the American people--as President Clinton did 
when Congress considered the NAFTA--that just as all Americans share in 
the benefits of trade, we all bear a responsibility for its costs. 
Trade liberalization and trade adjustment go hand in hand. And then he 
could have provided America's service sector workers with access to the 
one program designed to make that happen--Trade Adjustment Assistance.
  But by submitting the CAFTA implementing bill stripped of the Trade 
Adjustment Assistance amendment passed by the Finance Committee, he 
chose not to.

[[Page S7317]]

  Since 1962, Trade Adjustment Assistance--what we call ``TAA''--has 
provided retraining, income support, and other benefits so that workers 
who lose their jobs due to trade can make a new start.
  The rationale for TAA is simple. When our government pursues trade 
liberalization, we create benefits for the economy as a whole. But 
there is always some dislocation from trade.
  When he created the TAA program, President Kennedy explained that the 
Federal Government has an obligation ``to render assistance to those 
who suffer as a result of national trade policy.''
  For more than 40 years, we have met that obligation through TAA, 
which is principally a retraining program designed to update worker 
skills.
  The TAA program has not been static over time. Congress periodically 
revises the program to meet new economic realities. Most recently, in 
the Trade Act of 2002, Congress completed the most comprehensive 
overhaul and expansion of the TAA program since its inception.
  I am proud to have played a leading role in passing this landmark 
legislation. But I am also the first to admit that our work is not 
done. Economic realities continue to change, and TAA must continue to 
change with them.
  One fundamental aspect of TAA that has remained unchanged since 1962 
is its focus on manufacturing. We only give TAA benefits to workers who 
make ``articles.''
  Excluding service workers from TAA may have made sense in 1962, when 
most non-farm jobs were in manufacturing and most services were not 
traded across national borders.
  But today, most American jobs are in the service sector. And the 
market for many services is becoming just as global as the market for 
manufactured goods.
  In 2002, the service sector accounted for three quarters of U.S. 
private sector gross domestic product and nearly 80 percent of non-farm 
private employment.
  Trade in services is a net plus for the U.S. economy. Although trade 
in goods continues to dominate, services accounted for 29 percent of 
the value of total U.S. exports in 2002 and the service sector 
generated a trade surplus of $74 billion.
  Just as we have seen with trade in manufactured goods, however, there 
are winners and losers from trade. Trade in services will inevitably 
cost some workers their jobs.
  Indeed, there have been some well-publicized examples in the papers. 
Software sign. Technical support. Accounting and tax preparation 
services. Not long ago, a group of call center workers in Kalispell, MT 
saw their jobs move to Canada and India.
  Examples abound of service sector jobs--even high tech jobs--
relocating overseas. A series of studies estimate that between a half 
million and over 3 million U.S. service sector jobs would be moved 
offshore in the next 5 to 10 years.
  That doesn't mean the total number of jobs in the U.S. economy is 
shrinking. But the fact that jobs may be available in a different field 
is cold comfort to a worker whose own skills are no longer in demand.
  That is why this legislation is so important. It is a simple matter 
of equity.
  When a factory relocates to another country, those workers are 
eligible for TAA. But when a call center moves to another country, 
those workers are not eligible for TAA. They should be.
  The benefits service workers will receive under this legislation 
would be exactly the same as those that trade-impacted manufacturing 
workers now receive. They include retraining, income support, job 
search and relocation allowance, and a health coverage tax credit.
  Hard working American service workers deserve this safety net. These 
benefits will always be second best to a job. But they can really make 
a difference in helping workers make a new start.
  Truthfully, I am mystified by why the President so cavalierly dropped 
the TAA for Services amendment and let this opportunity pass him by. 
His actions are entirely inconsistent with his stated desire to make 
trade benefit all Americans. But, sadly, this has become a pattern.
  Despite the obvious benefits of the TAA program, the Bush 
Administration fought tooth and nail against every penny, and against 
every provision in what became the Trade Adjustment Assistance Reform 
Act of 2002. Extending TAA to service workers was one of many needed 
improvements that was struck in the final version of the bill.
  Again in the last Congress, the extension of TAA to service workers 
was offered as an amendment to the JOBS Act and opposed by the 
Administration. It garnered 54 votes from both sides ofthe aisle--
failing only on a technicality.
  The world is changing and TAA must keep up with the times. Last 
year's Senate vote and this year's Finance Committee vote make clear 
that there is wide support for extending TAA to service workers. I 
truly believe this bill's time has come. I will work hard to move this 
legislation this year.
  I want to thank Senators Coleman and Wyden for co-sponsoring this 
legislation. They have been stalwart supporters in the fight to bring 
equity to service workers. I look forward to working with them to make 
TAA for service workers a reality.
  I ask unanimous consent that the text of this bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1309

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

     SECTION 1. SHORT TITLE.

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

     SEC. 2. 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 ``firm)'' and inserting 
     ``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'';
       (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 ``or finishing'' and inserting ``, 
     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 S7318]]

       ``(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 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. 3. 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 ``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) Definition.--Section 261 of the Trade Act of 1974 (19 
     U.S.C. 2351) is amended--
       (A) by striking ``For purposes of'' and inserting ``(a) 
     FIRM.--For purposes of''; and
       (B) by adding at the end the following:
       ``(b) Service Sector Firm.--For purposes of this chapter, 
     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''.
       (c) Technical Amendments.--
       (1) In general.--Section 249 of the Trade Act of 1974 (19 
     U.S.C. 2321) is amended by striking ``subpena'' and inserting 
     ``subpoena'' each place it appears in the heading and the 
     text.
       (2) Table of contents.--The table of contents for the Trade 
     Act of 1974 is amended by striking ``Subpena'' in the item 
     relating to section 249 and inserting ``Subpoena''.

     SEC. 4. 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. 5. EFFECTIVE DATE.

       (a) In General.--Except as provided in subsection (b), the 
     amendments made by this Act shall take effect on the date 
     that is 60 days after the date of the 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 2(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 such Act 
     within 6 months after the date of the enactment of this Act, 
     shall be eligible for certification under section 223 of the 
     Trade Act of 1974 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 that is 60 days after the date of the enactment of this 
     Act.

                          ____________________