[Congressional Record Volume 151, Number 139 (Thursday, October 27, 2005)]
[Senate]
[Pages S12009-S12016]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS
By Mr. WYDEN:
S. 1927. A bill to amend the Internal Revenue Code of 1986 to make
the Federal income tax system simpler, fairer, and more fiscally
responsible, and for other purposes; to the Committee on Finance.
Mr. WYDEN. Mr. President, today I am proposing a Fair Flat Tax Act
that will finally provide real tax relief to America's hurting middle
class. It will do so by making the tax system simpler, flatter and
fairer. And at the same time, it will begin to reduce the deficit that
is destabilizing our economy, our security and our future.
This tax reform proposal is simpler because it's easier to understand
and use. My legislation will include a new, simplified 1040 form that
is one page, 30 lines, for every individual taxpayer.
This plan is flatter because it collapses the current system of six
individual tax brackets down to three--15, 25 and 35 percent--and
creates a flat corporate rate of 35 percent.
Ultimately, this plan is fairer because it changes the laws that
disproportionately favor the most affluent Americans and corporations
at the expense of the middle class. Instead, it provides a major
middle-class tax cut--paid for by the elimination of scores of tax
breaks in the individual and corporate income tax breaks, and by
repealing the Bush tax cuts that favored the most fortunate few at the
expense of the many.
This plan is fairer for American taxpayers because it treats work and
wealth equally.
This is a radical statement about tax law: America can do better than
a two-tier system which forces a policeman to pay a higher effective
tax rate than an investor who makes his income on capital gains and
dividends.
Under the current Federal Tax Code, all income is not created equal
in this country. Americans who work for wages, in effect, subsidize the
tax cuts and credits and deferrals of those who make money through
unearned income--the dividends from investments. It's time to treat all
taxpayers the same.
Let me be clear: I am not interested in soaking investors. I am a
Democrat who believes in markets, and creating wealth. But what our
country is all about is equality, and our Tax Code should treat
everyone's income more equally too.
My legislation, The Fair Flat Tax Act of 2005, adapts the flat tax
idea to help reduce the deficit instead, through fewer exclusions,
exemptions, deductions, deferrals, credits and special rates for
certain businesses and activities, and through the setting of a single,
flat corporate rate of 35 percent. On the individual side, it ends
favoritism for itemizers while improving deductions across the board:
The standard deduction would be tripled for single filers from $5,000
to $15,000 and raised from $10,000 to $30,000 for married couples. Six
individual rates are collapsed into three progressive rates of 15
percent, 25 percent and 35 percent, and income from all sources is
taxed the same.
Several deductions used most frequently by individuals, those for
home mortgage interest and charitable contributions, and the credits
for children, education and earned income are retained. No one would
have to calculate their taxes twice: this proposal eliminates the
individual Alternative Minimum Tax (AMT), which could snare as many as
21 million American taxpayers in 2006.
This proposal would eliminate an estimated $20 billion each year in
special breaks for corporations, and direct the Treasury Secretary to
identify and report to Congress an additional $10 billion in savings
from tax expenditures that subsidize inefficiencies in the health care
system. Eliminating these breaks would sustain current benefits for our
men and women in uniform, our veterans and the elderly and disabled--as
well as breaks that promote savings and help families pay for health
care and education.
What makes the Fair Flat Tax Act truly unique is that it corrects one
of the most glaring inequities in the current tax system: regressive
State and local taxes. Under current law, low and middle income
taxpayers get hit with a double whammy: compared to wealthy Americans,
they pay more of their income in State and local taxes. Poor families
pay more than 11 percent and middle income families pay about 10
percent of their income in State and local taxes, while wealthier
taxpayers only pay five percent. And because many low and middle income
taxpayers don't itemize, they get no credit on their Federal form for
paying State and local taxes. In fact, two-thirds of the Federal
deduction for State and local taxes goes to those with incomes above
$100,000. Under the Fair Flat Tax Act for the first time the Federal
code would look at the entire picture, at an individual's combined
Federal, State and local tax burden, and give credit to low and middle
income individuals to correct for regressive State and local taxes.
[[Page S12010]]
Repealing some individual tax credits, deductions and exclusions from
income--along with some serious changes to the corporate Tax Code--
enables larger standard deductions and broader middle-class tax relief.
The deductions most important to most Americans remain in place: the
home mortgage deduction stays, as do child credits and charitable
contributions, higher education and health savings.
What all this means for American taxpayers is--the vast majority of
taxpayers will see a cut, particularly the middle class. Congressional
Research Service experts tell us that middle class families and
families with wage and salary incomes up to $150,000 will see tax
relief.
On the corporate side--this plan does something that may not be
popular, but it's right.
Each of us, including America's corporations, need to pay our fair
share. Corporations that have used tax loopholes to avoid paying their
fair share of taxes are going to see those loopholes close and they're
going to contribute.
This legislation makes concrete progress toward deficit reduction.
There's a long way to go to stop the hemorrhaging in the Federal
budget, but this legislation makes a real start by whittling the
deficit down approximately $100 billion over five years.
Some may wonder if what I am proposing today is a response to the
President's Tax Reform Advisory Panel. To date, the Panel hasn't
officially released its recommendations. I can't respond to something
that hasn't been introduced yet. But I am troubled by the fact that the
recommendations trickling out from the Panel would continue to twist
the Tax Code away from equal treatment of all income, widening the
chasm between people who get wages and people who collect dividends.
I am introducing The Fair Flat Tax Act of 2005 today to provide
Americans a plan based on common-sense principles that can make the Tax
Code work better.
Making the Tax Code simpler and flatter is going to make it fairer.
My legislation is going to provide real relief to the middle class. It
will treat work and wealth equally. It will make a start at reducing
the deficit. I am ready to get to work with my colleagues and move it
forward.
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. 1927
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE; TABLE OF
CONTENTS.
(a) Short Title.--This Act may be cited as the ``Fair Flat
Tax Act of 2005''.
(b) Amendment of 1986 Code.--Except as otherwise expressly
provided, whenever in this Act an amendment or repeal is
expressed in terms of an amendment to, or repeal of, a
section or other provision, the reference shall be considered
to be made to a section or other provision of the Internal
Revenue Code of 1986.
(c) Table of Contents.--The table of contents for this Act
is as follows:
Sec. 1. Short title; amendment of 1986 Code; table of contents.
Sec. 2. Purpose.
TITLE I--INDIVIDUAL INCOME TAX REFORMS
Sec. 101. 3 progressive individual income tax rates for all forms of
income.
Sec. 102. Increase in basic standard deduction.
Sec. 103. Refundable credit for State and local income, sales, and real
and personal property taxes.
Sec. 104. Earned income child credit and earned income credit for
childless taxpayers.
Sec. 105. Repeal of individual alternative minimum tax.
Sec. 106. Termination of various exclusions, exemptions, deductions,
and credits.
TITLE II--CORPORATE AND BUSINESS INCOME TAX REFORMS
Sec. 201. Corporate flat tax.
Sec. 202. Treatment of travel on corporate aircraft.
Sec. 203. Termination of various preferential treatments.
Sec. 204. Elimination of tax expenditures that subsidize inefficiencies
in the health care system.
Sec. 205. Pass-through business entity transparency.
TITLE III--TECHNICAL AND CONFORMING AMENDMENTS; SUNSET
Sec. 301. Technical and conforming amendments.
Sec. 302. Sunset.
SEC. 2. PURPOSE.
The purpose of this Act is to amend the Internal Revenue
Code of 1986--
(1) to make the Federal individual income tax system
simpler, fairer, and more transparent by--
(A) recognizing the overall Federal, State, and local tax
burden on individual Americans, especially the regressive
nature of State and local taxes, and providing a Federal
income tax credit for State and local income, sales, and
property taxes,
(B) providing for an earned income tax credit for childless
taxpayers and a new earned income child credit,
(C) repealing the individual alternative minimum tax,
(D) increasing the basic standard deduction and maintaining
itemized deductions for principal residence mortgage interest
and charitable contributions,
(E) reducing the number of exclusions, exemptions,
deductions, and credits, and
(F) treating all income equally,
(2) to make the Federal corporate income tax rate a flat 35
percent and eliminate special tax preferences that favor
particular types of businesses or activities, and
(3) to partially offset the Federal budget deficit through
the increased revenues resulting from these reforms.
TITLE I--INDIVIDUAL INCOME TAX REFORMS
SEC. 101. 3 PROGRESSIVE INDIVIDUAL INCOME TAX RATES FOR ALL
FORMS OF INCOME.
(a) Married Individuals Filing Joint Returns and Surviving
Spouses.--The table contained in section 1(a) is amended to
read as follows:
The tax is:e income is:
15% of taxable income. ................................................
$3,750, plus 25% of the excess over $25,000 ...........................
$27,500, plus 35% of the excess over $120,000''........................
(b) Heads of Households.--The table contained in section
1(b) is amended to read as follows:
The tax is:e income is:
15% of taxable income. ................................................
$2,400, plus 25% of the excess over $16,000 ...........................
$24,650, plus 35% of the excess over $105,000''........................
(c) Unmarried Individuals (Other Than Surviving Spouses and
Heads of Households.--The table contained in section 1(c) is
amended to read as follows:
The tax is:e income is:
15% of taxable income. ................................................
$2,250, plus 25% of the excess over $15,000 ...........................
$16,000, plus 35% of the excess over $70,000''.........................
(d) Married Individuals Filing Separate Returns.--The table
contained in section 1(d) is amended to read as follows:
The tax is:e income is:
15% of taxable income. ................................................
$1,875, plus 25% of the excess over $12,500 ...........................
$13,750, plus 35% of the excess over $60,000''.........................
(e) Conforming Amendments to Inflation Adjustment.--Section
1(f) is amended--
(1) by striking ``1993''in paragraph (1) and inserting
``2006'',
(2) by striking ``except as provided in paragraph (8)'' in
paragraph (2)(A),
(3) by striking ``1992'' in paragraph (3)(B) and inserting
``2005'',
(4) by striking paragraphs (7) and (8), and
(5) by striking ``Phaseout of Marriage Penalty in 15-
Percent Bracket;'' in the heading thereof.
(f) Repeal of Rate Differential for Capital Gains and
Dividends.--
(1) Repeal of 2003 rate reduction.--Section 303 of the Jobs
and Growth Tax Relief Reconciliation Act of 2003 is amended
by striking ``December 3, 2008'' and inserting ``December 31,
2005''.
(2) Termination of pre-2003 capital gain rate differential
.--Section 1(h) is amended (after the application of
paragraph (1)) by adding at the end the following new
paragraph:
``(13) Termination.--This section shall not apply to
taxable years beginning after December 31, 2005.''.
(g) Additional Conforming Amendments.--
(1) Section 1 is amended by striking subsection (i).
(2) The Internal Revenue Code of 1986 is amended by
striking ``calendar year 1992'' each place it appears and
inserting ``calendar year 2005''.
(3) Section 1445(e)(1) (after the application of subsection
(g)(1)) is amended by striking ``(or, to the extent provided
in regulations, 20 percent)''.
(h) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2005.
SEC. 102. INCREASE IN BASIC STANDARD DEDUCTION.
(a) In General.--Paragraph (2) of section 63(c) (defining
standard deduction) is amended to read as follows:
``(2) Basic standard deduction.--For purposes of paragraph
(1), the basic standard deduction is--
``(A) 200 percent of the dollar amount in effect under
subparagraph (C) for the taxable year in the case of--
``(i) a joint return, or
``(ii) a surviving spouse (as defined in section 2(a)),
[[Page S12011]]
``(B) $26,250 in the case of a head of household (as
defined in section 2(b)), or
``(C) $15,000 in any other case.''.
(b) Conforming Amendment to Inflation Adjustment.--Section
63(c)(4)(B)(i) is amended by striking ``(2)(B), (2)(C), or''.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2005.
SEC. 103. REFUNDABLE CREDIT FOR STATE AND LOCAL INCOME,
SALES, AND REAL AND PERSONAL PROPERTY TAXES.
(a) General Rule.--Subpart C of part IV of subchapter A of
chapter 1 (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. CREDIT FOR STATE AND LOCAL INCOME, SALES, AND REAL
AND PERSONAL PROPERTY TAXES.
``(a) Allowance of Credit.--In the case of an individual,
there shall be allowed as a credit against the tax imposed by
this subtitle for the taxable year an amount equal to 10
percent of the qualified State and local taxes paid by the
taxpayer for such year.
``(b) Qualified State and Local Taxes.--For purposes of
this section, the term `qualified State and local taxes'
means--
``(1) State and local income taxes,
``(2) State and local general sales taxes,
``(3) State and local real property taxes, and
``(4) State and local personal property taxes.
``(c) Definitions and Special Rules.--For purposes of this
section--
``(1) State or local taxes.--A State or local tax includes
only a tax imposed by a State, a possession of the United
States, or a political subdivision of any of the foregoing,
or by the District of Columbia.
``(2) General sales taxes.--
``(A) In general.--The term `general sales tax' means a tax
imposed at one rate with respect to the sale at retail of a
broad range of classes of items.
``(B) Application of rules.--Rules similar to the rules
under subparagraphs (C), (D), (E), (F), (G), and (H) of
section 164(b)(5) shall apply.
``(3) Personal property taxes.--The term `personal property
tax' means an ad valorem tax which is imposed on an annual
basis in respect of personal property.
``(4) Application of rules to property taxes.--Rules
similar to the rules of subsections (c) and (d) of section
164 shall apply.
``(5) No credit for married individuals filing separate
returns.--If the taxpayer is a married individual (within the
meaning of section 7703), this section shall apply only if
the taxpayer and the taxpayer's spouse file a joint return
for the taxable year.
``(6) Denial of credit to dependents.--No credit shall be
allowed under this section to any individual with respect to
whom a deduction under section 151 is allowable to another
taxpayer for a taxable year beginning in the calendar year in
which such individual's taxable year begins.
``(7) Denial of double benefit.--Any amount taken into
account in determining the credit allowable under this
section may not be taken into account in determining any
credit or deduction under any other provision of this
chapter.''.
(b) Technical Amendments.--
(1) Paragraph (2) of section 1324(b) of title 31, United
States Code, is amended by inserting ``or from section 36 of
such Code'' before the period at the end.
(2) The table of sections for subpart C of part IV of
subchapter A of chapter 1 is amended by striking the item
relating to section 36 and inserting the following:
``Sec. 36. Credit for state and local income, sales, and real and
personal property taxes.
``Sec. 37. Overpayments of tax.''.
(c) Report Regarding Use of Credit by Renters.--Not later
than 180 days after the date of the enactment of this Act,
the Secretary of the Treasury shall report to the Committee
on Finance of the Senate and the Committee on Ways and Means
of the House of Representatives recommendations regarding the
treatment of a portion of rental payments in a manner similar
to real property taxes under section 36 of the Internal
Revenue Code of 1986 (as added by this section).
(d) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2005.
SEC. 104. EARNED INCOME CHILD CREDIT AND EARNED INCOME CREDIT
FOR CHILDLESS TAXPAYERS.
(a) In General.--Subsection (a) of section 32 (relating to
earned income) is amended to read as follows:
``(a) Allowance of Earned Income Child Credit and Earned
Income Credit.--
``(1) In general.--There shall be allowed as a credit
against the tax imposed by this subtitle for the taxable
year--
``(A) in the case of any eligible individual with 1 or more
qualifying children, an amount equal to the earned income
child credit amount, and
``(B) in the case of any eligible individual with no
qualifying children, an amount equal to the earned income
credit amount.
``(2) Earned income child credit amount.--For purposes of
this section, the earned income child credit amount is equal
to the sum of--
``(A) the credit percentage of so much of the taxpayer's
earned income for the taxable year as does not exceed the
earned income limit amount, plus
``(B) the supplemental child credit amount determined under
subsection (n) for such taxable year.
``(3) Earned income credit amount.--For purposes of this
section, the earned income credit amount is equal to the
credit percentage of so much of the taxpayer's earned income
for the taxable year as does not exceed the earned income
limit amount.
``(4) Limitation.--The amount of the credit allowable to a
taxpayer under paragraph (2)(A) or (3) for any taxable year
shall not exceed the excess (if any) of--
``(A) the credit percentage of the earned income amount,
over
``(B) the phaseout percentage of so much of the adjusted
gross income (or, if greater, the earned income) of the
taxpayer for the taxable year as exceeds the phaseout
amount.''.
(b) Supplemental Child Credit Amount.--Section 32 is
amended by adding at the end the following new subsection:
``(n) Supplemental Child Credit Amount.--
``(1) In general.--For purposes of subsection (a)(2)(B),
the supplemental child credit amount for any taxable year is
equal to the lesser of--
``(A) the credit which would be allowed under section 24
for such taxable year without regard to the limitation under
section 24(b)(3) with respect to any qualifying child as
defined under subsection (c)(3), or
``(B) the amount by which the aggregate amount of credits
allowed by subpart A for such taxable year would increase if
the limitation imposed by section 24(b)(3) were increased by
the excess (if any) of--
``(i) 15 percent of so much of the taxpayer's earned income
which is taken into account in computing taxable income for
the taxable year as exceeds $10,000, or
``(ii) in the case of a taxpayer with 3 or more qualifying
children (as so defined), the excess (if any) of--
``(I) the taxpayer's social security taxes for the taxable
year, over
``(II) the credit allowed under this section for the
taxable year.
The amount of the credit allowed under this subsection shall
not be treated as a credit allowed under subpart A and shall
reduce the amount of credit otherwise allowable under section
24(a) without regard to section 24(b)(3).
``(2) Social security taxes.--For purposes of paragraph
(1)--
``(A) In general.--The term `social security taxes' means,
with respect to any taxpayer for any taxable year--
``(i) the amount of the taxes imposed by section 3101 and
3201(a) on amounts received by the taxpayer during the
calendar year in which the taxable year begins,
``(ii) 50 percent of the taxes imposed by section 1401 on
the self-employment income of the taxpayer for the taxable
year, and
``(iii) 50 percent of the taxes imposed by section
3211(a)(1) on amounts received by the taxpayer during the
calendar year in which the taxable year begins.
``(B) Coordination with special refund of social security
taxes.--The term `social security taxes' shall not include
any taxes to the extent the taxpayer is entitled to a special
refund of such taxes under section 6413(c).
``(C) Special rule.--Any amounts paid pursuant to an
agreement under section 3121(l) (relating to agreements
entered into by American employers with respect to foreign
affiliates) which are equivalent to the taxes referred to in
subparagraph (A)(i) shall be treated as taxes referred to in
such paragraph.
``(3) Inflation adjustment.--In the case of any taxable
year beginning in a calendar year after 2005, the $10,000
amount contained in paragraph (1)(B) shall be increased by an
amount equal to--
``(A) such dollar amount, multiplied by
``(B) 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 2000'
for `calendar year 1992' in subparagraph (B) thereof.
Any increase determined under the preceding sentence shall be
rounded to the nearest multiple of $50.''.
(c) Conforming Amendment.--Section 24(d) is amended by
adding at the end the following new paragraph:
``(4) Termination.--This subsection shall not apply with
respect to any taxable year beginning after December 31,
2005.''.
(d) Certain Treatment of Earned Income Made Permanent.--
Clause (vi) of section 32(c)(2)(B) is amended to read as
follows:
``(vi) a taxpayer may elect to treat amounts excluded from
gross income by reason of section 112 as earned income.''.
(e) Repeal of Disqualified Investment Income Test.--
Subsection (i) of section 32 is repealed.
(f) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2005.
SEC. 105. REPEAL OF INDIVIDUAL ALTERNATIVE MINIMUM TAX.
(a) In General.--Section 55(a) (relating to alternative
minimum tax imposed) is amended by adding at the end the
following new flush sentence:
``For purposes of this title, the tentative minimum tax on
any taxpayer other than a corporation for any taxable year
beginning after December 31, 2005, shall be zero.''.
(b) Modification of Limitation on Use of Credit for Prior
Year Minimum Tax Liability.--Subsection (c) of section 53
(relating to credit for prior year minimum tax liability) is
amended to read as follows:
[[Page S12012]]
``(c) Limitation.--
``(1) In general.--Except as provided in paragraph (2), the
credit allowable under subsection (a) for any taxable year
shall not exceed the excess (if any) of --
``(A) the regular tax liability of the taxpayer for such
taxable year reduced by the sum of the credits allowable
under subparts A, B, D, E, and F of this part, over
``(B) the tentative minimum tax for the taxable year.
``(2) Taxable years beginning after 2005.--In the case of
any taxable year beginning after 2005, the credit allowable
under subsection (a) to a taxpayer other than a corporation
for any taxable year shall not exceed 90 percent of the
regular tax liability of the taxpayer for such taxable year
reduced by the sum of the credits allowable under subparts A,
B, D, E, and F of this part.''.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2005.
SEC. 106. TERMINATION OF VARIOUS EXCLUSIONS, EXEMPTIONS,
DEDUCTIONS, AND CREDITS.
(a) In General.--Subchapter C of chapter 90 (relating to
provisions affecting more than one subtitle) is amended by
adding at the end the following new section:
``SEC. 7875. TERMINATION OF CERTAIN PROVISIONS.
``The following provisions shall not apply to taxable years
beginning after December 31, 2005:
``(1) Section 44 (relating to credit for expenditures to
provide access to disabled individuals).
``(2) Section 62(a)(2)(D) (relating to deduction for
certain expenses of elementary and secondary school
teachers).
``(3) Section 67 (relating to 2-percent floor on
miscellaneous itemized deductions).
``(4) Section 74(c) (relating to exclusion of certain
employee achievement awards).
``(5) Section 79 (relating to exclusion of group-term life
insurance purchased for employees).
``(6) Section 104(a)(1) (relating to exclusion of workmen's
compensation).
``(7) Section 104(a)(2) (relating to exclusion of damages
for physical injuries and sickness).
``(8) Section 107 (relating to exclusion of rental value of
parsonages).
``(9) Section 119 (relating to exclusion of meals or
lodging furnished for the convenience of the employer).
``(10) Section 125 (relating to exclusion of cafeteria plan
benefits).
``(11) Section 132 (relating to certain fringe benefits),
except with respect to subsection (a)(5) thereof (relating to
exclusion of qualified transportation fringe).
``(12) Section 163(h)(4)(A)(i)(II) (relating to definition
of qualified residence).
``(13) Section 165(d) (relating to deduction for wagering
losses).
``(14) Section 217 (relating to deduction for moving
expenses).
``(15) Section 454 (relating to deferral of tax on
obligations issued at discount).
``(16) Section 501(c)(9) (relating to tax-exempt status of
voluntary employees' beneficiary associations).
``(17) Section 911 (relating to exclusion of earned income
of citizens or residents of the United States living abroad).
``(18) Section 912 (relating to exemption for certain
allowances).''.
(b) Conforming Amendment.--The table of sections for
subchapter C of chapter 90 is amended by adding at the end
the following new item:
``Sec. 7875. Termination of certain provisions.''.
TITLE II--CORPORATE AND BUSINESS INCOME TAX REFORMS
SEC. 201. CORPORATE FLAT TAX.
(a) In General.--Subsection (b) of section 11 (relating to
tax imposed) is amended to read as follows:
``(b) Amount of Tax.--The amount of tax imposed by
subsection (a) shall be equal to 35 percent of the taxable
income.''.
(b) Conforming Amendments.--
(1) Section 280C(c)(3)(B)(ii)(II) is amended by striking
``maximum rate of tax under section 11(b)(1)'' and inserting
``rate of tax under section 11(b)''.
(2) Sections 860E(e)(2)(B), 860E(e)(6)(A)(ii),
860K(d)(2)(A)(ii), 860K(e)(1)(B)(ii), 1446(b)(2)(B), and
7874(e)(1)(B) are each amended by striking ``highest rate of
tax specified in section 11(b)(1)'' and inserting ``rate of
tax specified in section 11(b)''.
(3) Section 904(b)(3)(D)(ii) is amended by striking
``(determined without regard to the last sentence of section
11(b)(1))''.
(4) Section 962 is amended by striking subsection (c) and
by redesignating subsection (d) as subsection (c).
(5) Section 1201(a) is amended by striking ``(determined
without regard to the last 2 sentences of section
11(b)(1))''.
(6) Section 1561(a) is amended--
(A) by striking paragraph (1) and by redesignating
paragraphs (2), (3), and (4) as paragraphs (1), (2), and (3),
respectively,
(B) by striking ``The amounts specified in paragraph (1),
the'' and inserting ``The'',
(C) by striking ``paragraph (2)'' and inserting ``paragraph
(1)'',
(D) by striking ``paragraph (3)'' both places it appears
and inserting ``paragraph (2)'',
(E) by striking ``paragraph (4)'' and inserting ``paragraph
(3)'', and
(F) by striking the fourth sentence.
(7) Subsection (b) of section 1561 is amended to read as
follows:
``(b) Certain Short Taxable Years.--If a corporation has a
short taxable year which does not include a December 31 and
is a component member of a controlled group of corporations
with respect to such taxable year, then for purposes of this
subtitle, the amount to be used in computing the accumulated
earnings credit under section 535(c)(2) and (3) of such
corporation for such taxable year shall be the amount
specified in subsection (a)(1) divided by the number of
corporations which are component members of such group on the
last day of such taxable year. For purposes of the preceding
sentence, section 1563(b) shall be applied as if such last
day were substituted for December 31.''.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2005.
SEC. 202. TREATMENT OF TRAVEL ON CORPORATE AIRCRAFT.
(a) In General.--Section 162 (relating to trade or business
expenses) is amended by redesignating subsection (q) as
subsection (r) and b inserting after subsection (p) the
following new subsection:
``(q) Treatment of Travel on Corporate Aircraft.--The rate
at which an amount allowable as a deduction under this
chapter for the use of an aircraft owned by the taxpayer is
determined shall not exceed the rate at which an amount paid
or included in income by an employee of such taxpayer for the
personal use of such aircraft is determined.''.
(b) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2005.
SEC. 203. TERMINATION OF VARIOUS PREFERENTIAL TREATMENTS.
(a) In General.--Section 7875, as added by section 106, is
amended--
(1) by inserting ``(or transactions in the case of sections
referred to in paragraphs (21), (22), (23), (24), and (27))''
after ``taxable years beginning'', and
(2) by adding at the end the following new paragraphs:
``(19) Section 43 (relating to enhanced oil recovery
credit).
``(20) Section 263(c) (relating to intangible drilling and
development costs in the case of oil and gas wells and
geothermal wells).
``(21) Section 382(l)(5) (relating to exception from net
operating loss limitations for corporations in bankruptcy
proceeding).
``(22) Section 451(i) (relating to special rules for sales
or dispositions to implement Federal Energy Regulatory
Commission or State electric restructuring policy).
``(23) Section 453A (relating to special rules for
nondealers), but only with respect to the dollar limitation
under subsection (b)(1) thereof and subsection (b)(3) thereof
(relating to exception for personal use and farm property).
``(24) Section 460(e)(1) (relating to special rules for
long-term home construction contracts or other short-term
construction contracts).
``(25) Section 613A (relating to percentage depletion in
case of oil and gas wells).
``(26) Section 616 (relating to development costs).
``(27) Sections 861(a)(6), 862(a)(6), 863(b)(2), 863(b)(3),
and 865(b) (relating to inventory property sales source rule
exception).''.
(b) Full Tax Rate on Nuclear Decommissioning Reserve
Fund.--Subparagraph (B) of section 468A(e)(2) is amended to
read as follows:
``(B) Rate of tax.--For purposes of subparagraph (A), the
rate set forth in this subparagraph is 35 percent.''.
(c) Deferral of Active Income of Controlled Foreign
Corporations.--Section 952 (relating to subpart F income
defined) is amended by adding at the end the following new
subsection:
``(e) Special Application of Subpart.--
``(1) In general.--For taxable years beginning after
December 31, 2005, notwithstanding any other provision of
this subpart, the term `subpart F income' means, in the case
of any controlled foreign corporation, the income of such
corporation derived from any foreign country.
``(2) Applicable rules.--Rules similar to the rules under
the last sentence of subsection (a) and subsection (d) shall
apply to this subsection.''.
(d) Deferral of Active Financing Income.--Section
953(e)(10) is amended--
(1) by striking ``2006'' and inserting ``2005'', and
(2) by striking ``2007'' and inserting ``2006''.
(e) Depreciation on Equipment in Excess of Alternative
Depreciation System.--Section 168(g)(1) (relating to
alternative depreciation system) is amended by striking
``and'' at the end of subparagraph (D), by adding ``and'' at
the end of subparagraph (E), and by inserting after
subparagraph (E) the following new subparagraph:
``(F) notwithstanding subsection (a), any tangible property
placed in service after December 31, 2005,''.
(f) Effective Date.--The amendments made by subsections
(b), (c), and (d) shall apply to taxable years beginning
after December 31, 2005.
SEC. 204. ELIMINATION OF TAX EXPENDITURES THAT SUBSIDIZE
INEFFICIENCIES IN THE HEALTH CARE SYSTEM.
Not later than 180 days after the date of the enactment of
this Act, the Secretary of the Treasury shall report to the
Committee on Finance of the Senate and the Committee on Ways
and Means of the House of Representatives recommendations
regarding the elimination of Federal tax incentives which
subsidize inefficiencies in the health care
[[Page S12013]]
system and if eliminated would result in Federal budget
savings of not less than $10,000,000,000 annually.
SEC. 205. PASS-THROUGH BUSINESS ENTITY TRANSPARENCY.
Not later than 90 days after the date of the enactment of
this Act, the Secretary of the Treasury shall report to the
Committee on Finance of the Senate and the Committee on Ways
and Means of the House of Representatives regarding the
implementation of additional reporting requirements with
respect to any pass-through entity with the goal of the
reduction of tax avoidance through the use of such entities,
In addition, the Secretary shall develop procedures to share
such report data with State revenue agencies under the
disclosure requirements of section 6103(d) of the Internal
Revenue Code of 1986.
TITLE III--TECHNICAL AND CONFORMING AMENDMENTS; SUNSET
SEC. 301. TECHNICAL AND CONFORMING AMENDMENTS.
The Secretary of the Treasury or the Secretary's delegate
shall not later than 90 days after the date of the enactment
of this Act, submit to the Committee on Ways and Means of the
House of Representatives and the Committee on Finance of the
Senate a draft of any technical and conforming changes in the
Internal Revenue Code of 1986 which are necessary to reflect
throughout such Code the purposes of the provisions of, and
amendments made by, this Act.
SEC. 302. SUNSET.
(a) In General.--All provisions of, and amendments made by,
this Act shall not apply to taxable years beginning after
December 31, 2010.
(b) Application of Code.--The Internal Revenue Code of 1986
shall be applied and administered to taxable years described
in subsection (a) as if the provisions of, and amendments
made by, this Act had never been enacted.
______
By Mr. REID (for himself and Mr. Cochran):
S. 1930. A bill to expand the research, prevention, and awareness
activities of the National Institute of Diabetes and Digestive and
Kidney Diseases and the Centers for Disease Control and Prevention with
respect to inflammatory bowel disease; to the Committee on Health,
Education, Labor, and Pensions.
Mr. REID. Mr. President, I rise today to introduce legislation
focused on a devastating condition known as inflammatory bowel disease
(IBD). I am pleased that Senator Cochran has once again joined me in
the fight against this painful and debilitating disease.
Crohn's disease and ulcerative colitis, collectively known as
inflammatory bowel disease, are chronic disorders of the
gastrointestinal tract which afflict approximately 1.4 million
Americans, 30 percent whom are diagnosed in their childhood years. IBD
can cause severe abdominal pain, fever, and intestinal bleeding.
Complications related to the disease include; arthritis, osteoporosis,
anemia, liver disease, growth and developmental challenges, and
colorectal cancer. Inflammatory bowel disease represents a major cause
of morbidity from digestive illness and has a devastating impact on
patients and families.
In the 108th Congress I was proud to sponsor bipartisan legislation
focused on IBD that attracted 36 co-sponsors. Several important
provisions of that bill were incorporated into legislation known as the
``Research Review Act'' which was signed into law by the President last
November. Specifically, the ``Research Review Act'' called on the
Government Accountability Office and the Centers for Disease Control
and Prevention to submit reports to Congress on three issues of
critical importance to the IBD community, 1. Social Security
Disability, 2. Medicare and Medicaid coverage, and 3. the epidemiology
of the disease in the United States.
The legislation I am introducing today builds upon the progress made
last year by calling for an increased Federal investment in biomedical
research on IBD. The hope for a better quality of life patients and
families depends on basic and clinical research sponsored by the
National Institute of Diabetes and Digestive and Kidney Diseases at the
National Institutes of Health (NIDDK). The ``Inflammatory Bowel Disease
Research Act'' calls for an expansion of NIDDK's research portfolio on
Crohn's disease and ulcerative colitis in order to capitalize on
several exciting discoveries that have broadened our understanding of
IBD in recent years. By increasing our investment in this area, we will
maximize the possibility that we will be able to offer hope to millions
of Americans who suffer from this debilitating disease. At the same
time, progress in this area could also mean we would save millions of
dollars in net health care expenditures through reduced
hospitalizations and surgeries.
In addition to biomedical research, this legislation also calls on
the Centers for Disease Control and Prevention to develop a ``National
Inflammatory Bowel Disease Action Plan.'' This plan will provide a
comprehensive approach to addressing the burden of IBD in the United
States, including strategies for raising awareness of the disease among
the general public and health care community, expanding epidemiological
research focused on the prevalence of IBD, and preventing the
progression of the disease and its complications.
The Crohn's and Colitis Foundation of America, an organization that
has been a leader in the battle against IBD, has strongly endorsed this
legislation. In addition to CCFA, the following organizations have
endorsed this bill: The North American Society for Pediatric
Gastroenterology, Hepatology and Nutrition, the American
Gastroenterological Association, the American Society for
Gastrointestinal Endoscopy, the Digestive Disease National Coalition,
the Society of Gastroenterology Nurses and Associates, and the
Pennsylvania Society of Gastroenterology.
I urge all Senators to join Senator Cochran and me in this important
cause by co-sponsoring the ``Inflammatory Bowel Disease Research Act.''
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. 1930
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 ``Inflammatory Bowel Disease
Research Act''.
SEC. 2. FINDINGS.
The Congress finds as follows:
(1) Crohn's disease and ulcerative colitis are serious
inflammatory diseases of the gastrointestinal tract.
(2) Crohn's disease may occur in any section of the
gastrointestinal tract but is predominately found in the
lower part of the small intestine and the large intestine.
Ulcerative colitis is characterized by inflammation and
ulceration of the innermost lining of the colon. Complete
removal of the colon in patients with ulcerative colitis can
potentially alleviate and cure symptoms.
(3) Because Crohn's disease and ulcerative colitis behave
similarly, they are collectively known as inflammatory bowel
disease. Both diseases present a variety of symptoms,
including severe diarrhea; abdominal pain with cramps; fever;
and rectal bleeding. There is no known cause of inflammatory
bowel disease, or medical cure.
(4) It is estimated that up to 1,400,000 people in the
United States suffer from inflammatory bowel disease, 30
percent of whom are diagnosed during their childhood years.
(5) Children with inflammatory bowel disease miss school
activities because of bloody diarrhea and abdominal pain, and
many adults who had onset of inflammatory bowel disease as
children had delayed puberty and impaired growth and have
never reached their full genetic growth potential.
(6) Inflammatory bowel disease patients are at high risk
for developing colorectal cancer.
(7) The total annual medical costs for inflammatory bowel
disease patients is estimated at more than $2,000,000,000.
SEC. 3. NATIONAL INSTITUTE OF DIABETES AND DIGESTIVE AND
KIDNEY DISEASES; INFLAMMATORY BOWEL DISEASE
RESEARCH EXPANSION.
(a) In General.--The Director of the National Institute of
Diabetes and Digestive and Kidney Diseases shall expand,
intensify, and coordinate the activities of the Institute
with respect to research on inflammatory bowel disease, with
particular emphasis on the following areas:
(1) Genetic research on susceptibility for inflammatory
bowel disease, including the interaction of genetic and
environmental factors in the development of the disease.
(2) Research targeted to increase knowledge about the
causes and complications of inflammatory bowel disease in
children.
(3) Animal model research on inflammatory bowel disease,
including genetics in animals.
(4) Clinical inflammatory bowel disease research, including
clinical studies and treatment trials.
(5) Expansion of the Institute's Inflammatory Bowel Disease
Centers program with a focus on pediatric research.
(6) Other research initiatives identified by the scientific
document entitled ``Challenges in Inflammatory Bowel
Disease'' and the research agenda for pediatric
gastroenterology, hepatology and nutrition entitled ``Chronic
Inflammatory Bowel Disease''.
(b) Authorization of Appropriations.--
[[Page S12014]]
(1) In general.--For the purpose of carrying out subsection
(a), there are authorized to be appropriated $75,000,000 for
fiscal year 2006, $85,000,000 for fiscal year 2007, and
$100,000,000 for fiscal year 2008.
(2) Reservation.--Of the amounts authorized to be
appropriated under paragraph (1), not more than 20 percent
shall be reserved for the training of qualified health
professionals in biomedical research focused on inflammatory
bowel disease, including pediatric investigators.
SEC. 4. CENTERS FOR DISEASE CONTROL AND PREVENTION; NATIONAL
INFLAMMATORY BOWEL DISEASE ACTION PLAN.
(a) In General.--
(1) Preparation of plan.--The Director of the Centers for
Disease Control and Prevention, in consultation with the
inflammatory bowel disease community, shall prepare a
comprehensive plan to address the burden of inflammatory
bowel disease in both adult and pediatric populations (which
plan shall be designated by the Director as the ``National
Inflammatory Bowel Disease Action Plan'').
(2) Report to congress.-- Not later than 12 months after
the date of the enactment of this Act, the Director of the
Centers for Disease Control and Prevention shall submit the
Plan referred to in paragraph (1) to the Committee on Energy
and Commerce and the Committee on Appropriations in the House
of Representatives and to the Committee on Health, Education,
Labor and Pensions and the Committee on Appropriations in the
Senate.
(b) Content.--
(1) In general.--The National Inflammatory Bowel Disease
Action Plan shall address strategies for determining the true
prevalence of inflammatory bowel disease in the United
States, and the unique demographic characteristics of the
patient community through the expansion of appropriate
epidemiological activities.
(2) Certain requirements.-- The Plan referred to in
paragraph (1) shall--
(A) focus on strategies for increasing awareness about
inflammatory bowel disease within the general public and the
health care community in order to facilitate more timely and
accurate diagnoses; and
(B) address mechanisms designed to prevent the progression
of the disease and the development of complications, such as
colorectal cancer, and other strategies and activities as
deemed appropriate.
(c) Authorization of Appropriations.--For the purpose of
carrying out this section, there is authorized to be
appropriated such sums as may be necessary for fiscal year
2006.
______
By Mr. SPECTER (for himself, Mr. Biden, Mr. Brownback, Mr.
Talent, Mr. DeWine, Mr. Corzine, Mr. Bingaman, Mr. Kyl, Mr.
Santorum, and Mr. Obama):
S. 1934. A bill to reauthorize the grant program of the Department of
Justice for reentry of offenders into the community, to establish a
task force on Federal programs and activities relating to the reentry
of offenders into the community, and for other purposes; to the
Committee on the Judiciary.
Mr. SPECTER. Mr. President, I have sought recognition to introduce,
along with Senators Biden and Brownback, the Second Chance Act of 2005:
Community Safety through Recidivism Prevention. This legislation is
designed to reduce recidivism among adult and juvenile ex-offenders.
Never before in our history have so many individuals been released from
prison and never before in our history have so many ex-offenders been
is prepared to reenter their communities. Each year, more than 650,000
individuals are released, which roughly equates to about 1,700
individuals returning communities each day. This number is expected to
grow in the near future as more inmates complete their prison terms.
For most offenders, the transition back into their communities is
difficult because many lack the necessary skill to ensure a successful
reentry. Many suffer from serious substance abuse addictions and mental
health issues. Many have difficulty securing a job or adequate housing
and often find themselves lured back to a life of crime. A study
conducted by the Bureau of Justice Statistics reported that over two-
thirds of released prisoners were rearrested within three years and
one-half of those rearrested were convicted and re-incarcerated. This
high rate of recidivism devastates our towns and communities and puts
an enormous strain on state and local budgets.
The Second Chance Act reauthorizes the Adult and Juvenile Offender
Reentry Demonstration projects, authorizing the Attorney General to
make grants to States and local governments to establish offender
reentry projects, with an enhanced focus on job training, housing,
substance abuse and mental health treatment, and working with children
and families. It also creates a new grant program available to
nonprofit organizations for the purpose of providing mentoring and
other transitional services essential to reintegrating ex-offenders.
The Second Chance Act encourages new community partnerships to help
educate, train, and employ these individuals who might otherwise return
to a life of crime.
Many ex-offenders are often stigmatized by their incarceration, and
must face the reality that many employers are reluctant to hire them. A
National Adult Literacy Study determined that a majority of prisoners
are either illiterate or have marginal reading, writing, and math
skills. Following the repeal of Pell Grant eligibility for incarcerated
individuals, I worked to create the Grants to States for Workplace and
Community Transition Training for Incarcerated Youth Offenders program.
This program is aimed at providing post-secondary education, employment
counseling, and workplace and community transition training for
incarcerated youth offenders while in prison, which continue for up to
one year after the individual is released. The current program limits
expenditures per youth offender to $1,500 for tuition and books, and
only allows an additional $300 for other related services. The Second
Chance Act builds upon my earlier efforts by increasing State's
flexibility and accountability within the grant program. It removes the
cap and raises the allowable expenditure permitted for each youth
offender to the maximum level of Pell Grants. One of the keys to
preventing recidivism is access to education an in recognizing the
impact that education an job training can have on incarcerated
offenders. It is my sincere hope that this legislation will encourage
incarcerated individuals to achieve their independence and to gain the
necessary skills to become productive members of society.
Another crisis that well face is the growing populations of prisoners
who are parents. More than half of those currently incarcerated are
parents of minor children. Female incarceration rates are increasing
faster than those men, totaling 7 percent of the prison population. Of
those incarcerated, 80 percent are mothers with, on average two
dependent children. What is most troubling is that two-thirds of their
children are younger the the age of 10. The incarceration of a parent
can have a tremendous impact on childhood development. Prison presents
a unique opportunity to improve a prisoner's ability to become a better
part once they are released. Unfortunately, many of our prisons do not
employ such programs, due to fiscal constraints as well as a shift in
priorities. The Second Chance Act of 2005 encourages the creating of
programs that facilitate visitation, if it is in the best interest of
the child. It also directs the Secretary of Health and Human Services
to establish services to help preserve family units, with special
attention paid to the impact on the child of an incarcerated parent.
There is ample evident that well-designed reentry programs reduce
recidivism. Programs such as aftercare for substance abusers and adult
vocational education have shown to reduce recidivism up to 15 percent.
These programs pay for themselves by reducing future correction costs
associated with re-housing these individuals upon their return back
into the institution. The revolving door of prisons not only hurts
those who are caught up in the process, but hurts their families and
our communities. If we fail to address this problem, 1e are burdening
our communities not only with greater expenditures, but in the risk of
increased crime and unsafe neighborhoods. The more we can do to prepare
these individuals when they return home, the better off we will all be.
I urge my colleagues to join me in cosponsoring this legislation, and
urge its swift adoption.
Mr. BIDEN. Mr. President, Senator Specter, Senator Brownback, and I
introduce today the Second Chance Act of 2005, which takes direct aim
at reducing recidivism rates for our nation's ex-offenders and
improving the transition for these offenders from prison back into the
community.
All too often we think about today, but not tomorrow. We look to
short-
[[Page S12015]]
term solutions for long-term problems. We need to have a change in
thinking and approach. It's time we face the dire situation of
prisoners reentering our communities with insufficient monitoring,
little nor no job skills, inadequate drug treatment, insufficient
housing, lack of positive influences, a pap city of basic physical and
mental health services, and deficient basic life skills.
The bill we introduce today is about providing a second chance for
these ex-offenders, and the children and families that depend on them.
It's about strengthening communities and ensuring safe neighborhoods.
Since my 1994 Crime Bill passed, we've had great success in cutting
down on crime rates in this country. Under the Community Oriented
Policing Services, COPS, program, we've funded over 100,000 officers
all across the country. And our crime rate has plummeted.
But there's a record number of people currently serving time in our
country--over 2 million in our federal and state prisons; with millions
more in local jails. And 95 percent of all prisoners we lock up today
will eventually get out. That equals nearly 650,000 being released from
federal or state prisons to communities each year.
If we are going to continue the downward trend of crime rates, we
simply have to make strong, concerted, and common-sense efforts now to
help ex-prisoners successfully reenter and reintegrate to their
communities.
And right now, we're not doing a good enough job. A staggering two-
thirds of released State prisoners are expected to be rearrested for a
felony or serious misdemeanor within 3 years of release. Two out of
every three. You're talking about hundreds of thousands of reoffending,
ex-offenders each year and hundreds of thousands of serious crimes
being committed by people who have already served time in jail.
And, unfortunately, it's too difficult to see why such a huge portion
of our released prisoners recommit serious crimes. Up to 60 percent of
former inmates are not employed; 15-27 percent of prisoners expect to
go to homeless shelters upon release; and 57 percent of federal and 70
percent of state inmates used drugs regularly before prison, with some
estim1tes of involvement with drugs or alcohol around the time of the
offense as high as 84 percent.
These huge numbers or released prisoners each year and the out-of-
control recidivism rates are a recipe for diaster--leading to untold
damage, hardship, and death for victims; ruined futures and lost
potential for re-offenders; and a huge drain on society at large. One
particularly vulnerable group is the children of these offenders. We
simply cannot be resigned to allowing generation after generation
entering and reentering our prisons. This pernicious cycle must come to
an end.
My 1994 Crime Bill recognized these extraordinarily high rates of
recidivism as a real problem. My bill, for example, created innovative
drug treatment programs for State and Federal inmates to help them kick
their habit.
But this is only one piece of the puzzle. I introduced a bill in 2000
that would have built on my 1994 Crime Bill--the ``Offender Reentry and
Community Safety Act of 2000'' (S. 2908). This bill would have created
demonstration reentry programs for Federal, State, and local prisoners.
These programs were designed to assist high-risk, high-need offenders
who served their prison sentences, but who posed the greatest risk of
reoffending upon release because they lacked the education, job skills,
stable family or living arrangements, and the health services they
needed to successfully reintegrate into society.
While we have made some progress on offender reentry efforts since
1994, much more needs to be done. In the current session of Congress, I
am pleased that colleagues of mine--from both sides of Capitol Hill and
from both sides of the aisle--are also focusing their attention and
this vital issue.
Senators Specter and Brownback have been dedicated and tireless
leaders on crime and public safety issues throughout their careers, and
I am proud to join efforts with them today. Other Senators have also
taken a leadership role on these issues, including Senators Leahy,
Kennedy, Brownback, Hatch, Specter, Grassley, Feinstein, DeWine,
Santorum, Landrieu, Bingaman, Coburn, Durbin, and Obama.
The Second Chance Act of 2005 provides a competitive grant program to
promote innovative programs to this out a variety of methods aimed at
reducing recidivism rates. Efforts would be focus on post-release
housing, education and job training, substance abuse and mental health
services, and mentoring programs, just to name a few.
Because the scope of the problem is so large--with 650,000 prisoners
being released from state and federal prisons each year--our bill
provides $100 million per year in competitive grant funding . This
isn't being wasteful with our scarce federal resources, it's just an
acknowledgement of the scope of the problem we're faced with.
A relatively modest investment in offender reentry efforts compares
very well with the alternative, building more and more prisons for
these ex-offenders to return to if they are unable to successfully
reenter their communities and instead are rearrested and reconvicted of
more cries. We must remember that the average cost of incarcerating
each prisoner exceeds 20,000 per year, with expenditures on corrections
alone having increased from $9 billion in 1982 to $60 billion in 2002.
We simply can't be penny-wise but pound-foolish.
The Second Chance Act of 2005 also requires that federal departments
with a role in offender reentry efforts coordinate and work together;
to make sure there aren't duplicative efforts or funding gaps; and to
coordinate reentry research. Our bill would raise the profile of this
issue within the executive branch and secure the sustained and
coordinated federal attention offender reentry efforts deserve.
We also need to examine existing Federal and State reentry barriers--
laws, regulations, rules, and practices that make it more difficult for
former inmates to successfully reintegrate back into their communities;
laws that confine ex-offenders to society's margins, making it even
more likely that they will recommit serious crimes and return to
prison.
Turning over a new leaf and going from a life of crime to becoming a
productive member of society is tough enough. We shouldn't have Federal
and State laws on the books that make this even more challenging.
That's not say that we don't want to restrict former drug addicts from
working in pharmacies, for example, or to bar sex offenders from
working it day care centers. But many communities across the country
currently exclude ex-prisoners from virtually every occupation
requiring a state license, like chiropractic care, engineering, and
real estate. Lifting these senselessly punitive bans would make it
easier for ex-offenders to stay out of prison.
Our bill provides for a roust analysis of these federal and state
barriers with recommendations on what next steps we need to take. And
these reviews are mandated to take place out in the open under public
scrutiny.
The Second Chance Act also spurs state-of-the-art research and study
on offender reentry issues. We need to know who is most likely to
recommit crimes when they are released, to better target our limited
resources where they can do the most good. We need to study why some
ex-offenders who seem to have the entire deck stacked against them are
able to become successful and productive members of our society. We
need to know what, works and how we can replicate what works for
others.
Our bill also provides a whole slew of common-sense proposals in the
areas of job training, employment, education, post-release housing,
substance abuse, and prisoner mentoring--efforts and changes in law
that we can do now.
Our Second Chance Act is a next, natural step in our campaign against
crime. Making a dent in recidivism rate is an enormous undertaking; one
that requires action now and continued focus in the future. I commit to
vigorously pushing this legislation as well as keeping an eye on what
steps we need to take in the future. We need to realize that the
problems facing ex-offenders are enormous and will need sustained
focus. The safety of our neighbors, our children, and our communities
depends on it.
I am proud today to join with Senator Specter and Senator Brownback
in introducing the Second Chance Act and ask our colleagues to join
with us in this vital effort.
[[Page S12016]]
Mr. BROWNBACK. Mr. President, I am please to join with Chairman
Specter and Senator Biden today as we introduce a bill that will have a
dramatic and positive effect in the lives of individuals re-entering
society after incarceration. The Second Chance Act: Community Safety
Through Recidivism Prevention is a bill that will not only protect our
Nation's citizens but will more importantly help to reduce recidivism
in our Nation.
A hallmark of any just society lies in its ability to protect the
interest of all its citizens and I am proud that the United States is a
leader in this regard. Yet, while we continue to strive toward this
lofty goal, we must realize that there are areas in which we, as a
society and as government, must do more to improve. No where is that
more apparent than in our Nation's pension system.
Today, we have challenges within the prison system that range from
high recidivism rates to budgetary and safety concerns. With this bill,
we will be able to address this pressing problem within our society.
Already we have seen innovative and model programs within the states
and the faith community, and I am proud to say that Kansas is a leader
in this regard, as well a such faith organizations as Prison Fellowship
Ministries, Catholic Charities U.S.A., and the Salvation Army. However,
we must stimulate innovation in this area on a national level and that
is what this bill will accomplish. It is paramount that we ensure the
safety of our communities and ensure that those incarcerated have the
tools necessary to succeed after they rejoin society.
With this bill, we wil1 be able to combat the extremely high
recidivism rates plaguing the prison system, currently as high as 70
percent, as well as address the financial burdens that hinder many of
our state penitentiaries. State prison operating expenditures totaled
$28.4 billion in fiscal year 2001, or a nationwide average annual
operating cost of $22,650 per inmate. Today, it is more likely than
ever that a person released from prison will be rearrested--two-thirds
of state prisoners are rearrested within 3 years of release. Depending
of the expert consulted, between one-third and two-thirds of all prison
re-admissions are related to probation or parole violations and at
least half of those violations are technical.
We must stop subsiding programs that do not work and that lead, in
turn, to negative behavior.
I am confident that the bill we are putting forward today will indeed
take the much needed steps to reduce the recidivism rate in this
Nation, which will in turn help those incarcerated make positive
changes within their lives so that when they do rejoin society, they
will be able to do so with the confidence of knowing that they can
contribute to society in a positive manner. As an added incentive to
recidivism reduction, each grant application submitted under this
program must have as its strategic plan a goal to reduce recidivism by
50 percent in 5 years and in order to receive continued funding under
this program, each granted must show a reduction in the recidivism rate
of participants by 10 percent over 2 years.
Specifically, this bill facilitates change within our current
correctional system, and promotes coordination with the Federal
Government to better assist those returning to our communities after
incarceration their children. The bill reauthorizes the Re-Entry
Demonstration Project with an enhanced focus on jobs, housing,
substance abuse treatment, mental health, and the children and families
of those incarcerated. The bill authorizes $200 million over a period
of two years to fund these demonstration programs and creates
performance outcome standards and deliverables. It will also encourage
states to enhance their re-entry services and systems with grants to
fund the creation or enhancement of state re-entry councils for
strategic planning and review the state barriers and resources that
exit.
Additionally, the bill creates a Federal interagency taskforce to
facilitate collaboration and identify innovative programs initiatives.
The taskforce will review and report to Congress on the Federal
barriers that exist to successful re-entry.
Furthermore, the bill create a $50 million 2 year mentoring program
geared toward reducing recidivism and the societal costs of recidivism.
This mentoring program will help ex-offenders re-integrate into their
communities. This initiative will specifically harness the resources
and experience of community-based organizations in helping returning
ex-offender.
Finally, the bill amends the Workplace and Community Transition
Training for Incarcerated Youth Offenders Act by improving the existing
grants to States under this program and provides $60 million for the
administration of the program. This youth program calls for expanding
the eligibility age from 25 to 35 years, increases accountability by
requiring State correctional education agencies to track specific and
quantified student outcomes referenced to non-program participants, and
increases the allowable expenditure per youth offender up to the level
of the maximum Federal Pell Grant award for tuition, books and
essential materials; and related services, such as career development.
We have an incredible opportunity to re-shape the way in which this
nation's prison systems operate. Much like welfare reform in the mid
1990s, we have a chance to make real and effective change in an area
where change is sorely needed. I look forward to pushing this
legislation forward.
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