[Congressional Record Volume 151, Number 166 (Tuesday, December 20, 2005)]
[Senate]
[Pages S14187-S14194]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. OBAMA (for himself and Ms. Mikulski):
  S. 2149. A bill to authorize resources to provide students with 
opportunities for summer learning through summer learning grants; to 
the Committee on Health, Education, Labor, and Pensions.
  Mr. OBAMA. Mr. President, I rise today to introduce a bill--the 
``STEP UP Act''--to establish grants for summer school enrichment 
programs to increase the academic skills of students in need.
  According to the 2005 Nation's Report Card of Educational Progress, 
the gap in reading scores between fourth grade children in poverty and 
their more affluent peers did not decrease between 1998 and 2005. Fewer 
than half of the fourth graders eligible for free or reduced priced 
lunch are able to read at even the basic level--a level attained by 
more than three-quarters of wealthier students. This data confirms that 
too many of our children are not attaining skills at levels that will 
lead to success, and too often, it is the children most in need who are 
left behind by the educational system.

[[Page S14188]]

  Teachers understand that students return to school in the fall at 
levels below their performance of the previous spring. Educators know 
this as summer learning loss. Research has shown that students, on 
average, lose more than one month of reading skills and two months of 
math skills over the summer. That is the average.
  But the impact of summer learning loss is greatest for children 
living in poverty, children with learning disabilities, and children 
who do not speak English at home. Achievement levels for such children 
often plummet during the summer, so that that the reading skills of 
disadvantaged students can fall more that three months behind the 
scores of their more affluent peers. The summer learning losses for 
children in poverty accumulate over the elementary school years, so 
these students end up falling further and further behind in school.
  Several programs have been successful in countering summer learning 
loss. The BELL programs and the Teach Baltimore Summer Academy provide 
evidence that students can achieve months of progress, rather than 
months of decline, when they participate in structured enrichment and 
education programs for several weeks during the summer. These programs 
are successful but reach too few of the students who need them.
  The bill I am introducing today establishes a grant program for 
states to support summer learning in selected local districts. These 
grants would be used to help students in the early elementary grades 
who are living in poverty, by supporting their participation in six 
weeks of summer school. These summer opportunities could be offered by 
a variety of providers, including the public schools, but also by other 
community organizations that have shown success in providing 
educational enrichment, such as youth development organizations, 
nonprofits, and summer enrichment camps. These summer programs would be 
aligned with the school year curriculum to increase the reading and 
math skills of students in need and to provide them with learning 
opportunities to avoid a path that might otherwise lead to failure in 
school--a path that too often ends, years later, with these students 
dropping out of the educational system.
  The achievement gap in education begins in the early grades and 
remains a burden for too many throughout their time in school. It is 
becoming increasingly clear that much of this early difference can be 
combated by structured summer learning opportunities. That is the 
purpose of this bill, and I hope my colleagues will support this 
important legislation.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2149

       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 ``Summer Term Education 
     Programs for Upward Performance Act of 2005'' or the ``STEP 
     UP Act of 2005''.

     SEC. 2. FINDINGS.

       Congress finds the following:
       (1) All students experience learning losses when they do 
     not engage in educational activities during the summer.
       (2) Students on average lose more than 1 month's worth of 
     reading skills, and 2 months or more in mathematics facts and 
     skills, during the summer.
       (3) The impact of summer learning loss is greatest for 
     children living in poverty, for children with learning 
     disabilities, and for children who do not speak English at 
     home.
       (4) While middle-class children's test scores plateau or 
     even rise during the summer months, scores plummet for 
     children living in poverty. Disparities grow, so that reading 
     scores of disadvantaged students can fall more than 3 months 
     behind the scores of their middle-class peers.
       (5) Summer learning losses by children living in poverty 
     accumulate over the elementary school years, so that their 
     achievement scores fall further and further behind the scores 
     of their more advantaged peers as the children progress 
     through school.
       (6) This summer slide is costly for American education. 
     Analysis by Professor Harris Cooper and his colleagues finds 
     that 2 months of the school year are lost: 1 month spent in 
     reteaching and 1 month spent not providing new instruction.
       (7) Analysis of summer learning programs has demonstrated 
     their effectiveness. In the BELL programs in Boston, New 
     York, and Washington, DC, students gained several months' 
     worth of reading and mathematics skills in 6 weeks, with a 
     majority of those students moving to a higher performance 
     category, as assessed by standardized mathematics and reading 
     tests. In the Center for Summer Learning's Teach Baltimore 
     Summer Academy, randomized studies show that students who 
     regularly attended the program for not less than 2 summers 
     gained advantages of 70 to 80 percent of 1 full grade level 
     in reading over control-group peers who did not attend summer 
     school.
       (8) Summer learning programs are proven to remedy, 
     reinforce, and accelerate learning, and can serve to close 
     the achievement gap in education.

     SEC. 3. PURPOSE.

       The purpose of this Act is to create opportunities for 
     summer learning by providing summer learning grants to 
     eligible students, in order to--
       (1) provide the students with access to summer learning;
       (2) facilitate the enrollment of students in elementary 
     schools or youth development organizations during the summer;
       (3) promote collaboration between teachers and youth 
     development professionals in order to bridge gaps between 
     schools and youth programs; and
       (4) encourage teachers to try new techniques, acquire new 
     skills, and mentor new colleagues.

     SEC. 4. DEFINITIONS.

       In this Act:
       (1) Educational service agency.--The term ``educational 
     service agency'' has the meaning given the term in section 
     9101 of the Elementary and Secondary Education Act of 1965 
     (20 U.S.C. 7801).
       (2) Eligible entity.--The term ``eligible entity'' means an 
     entity that--
       (A) desires to participate in a summer learning grant 
     program under this Act by providing summer learning 
     opportunities described in section 6(d)(1)(B) to eligible 
     students; and
       (B) is--
       (i) a local educational agency;
       (ii) a for-profit educational provider, nonprofit 
     organization, or summer enrichment camp, that has been 
     approved by the State educational agency to provide the 
     summer learning opportunity described in section 6(d)(1)(B), 
     including an entity that is in good standing that has been 
     previously approved by a State educational agency to provide 
     supplemental educational services; or
       (iii) a consortium consisting of a local educational agency 
     and 1 or more of the following entities:

       (I) Another local educational agency.
       (II) A community-based youth development organization with 
     a demonstrated record of effectiveness in helping students 
     learn.
       (III) An institution of higher education.
       (IV) An educational service agency.
       (V) A for-profit educational provider described in clause 
     (ii).
       (VI) A nonprofit organization described in clause (ii).
       (VII) A summer enrichment camp described in clause (ii)

       (3) Eligible student.--The term ``eligible student'' means 
     a student who--
       (A) is eligible for a free lunch under the Richard B. 
     Russell National School Lunch Act (42 U.S.C. 1751 et seq.);
       (B) is served by a local educational agency identified by 
     the State educational agency in the application described in 
     section 5(b); or
       (C)(i) in the case of a summer learning grant program 
     authorized under this Act for fiscal year 2006, 2007, or 
     2008, is eligible to enroll in any of the grades kindergarten 
     through grade 3 for the school year following participation 
     in the program; or
       (ii) in the case of a summer learning grant program 
     authorized under this Act for fiscal year 2009 or 2010, is 
     eligible to enroll in any of the grades kindergarten through 
     grade 5 for the school year following participation in the 
     program.
       (4) Institution of higher education.--The term 
     ``institution of higher education'' has the meaning given the 
     term in section 101(a) of the Higher Education Act of 1965 
     (20 U.S.C. 1001(a)).
       (5) Local educational agency.--The term ``local educational 
     agency'' has the meaning given the term in section 9101 of 
     the Elementary and Secondary Education Act of 1965 (20 U.S.C. 
     7801).
       (6) Secretary.--The term ``Secretary'' means the Secretary 
     of Education.
       (7) State.--The term ``State'' means each of the several 
     States of the United States, the District of Columbia, the 
     Commonwealth of Puerto Rico, Guam, American Samoa, the United 
     States Virgin Islands, the Commonwealth of the Northern 
     Mariana Islands, the Republic of the Marshall Islands, the 
     Federated States of Micronesia, and the Republic of Palau.
       (8) State educational agency.--The term ``State educational 
     agency'' has the meaning given the term in section 9101 of 
     the Elementary and Secondary Education Act of 1965 (20 U.S.C. 
     7801).

     SEC. 5. DEMONSTRATION GRANT PROGRAM.

       (a) Program Authorized.--
       (1) In general.--From the funds appropriated under section 
     8 for a fiscal year, the Secretary shall carry out a 
     demonstration grant program in which the Secretary awards 
     grants, on a competitive basis, to State educational agencies 
     to enable the

[[Page S14189]]

     State educational agencies to pay the Federal share of summer 
     learning grants for eligible students.
       (2) Number of grants.--For each fiscal year, the Secretary 
     shall award not more than 5 grants under this section.
       (b) Application.--A State educational agency that desires 
     to receive a grant under this section shall submit an 
     application to the Secretary at such time, in such manner, 
     and accompanied by such information as the Secretary may 
     require. Such application shall identify the areas in the 
     State where the summer learning grant program will be offered 
     and the local educational agencies that serve such areas.
       (c) Award Basis.--In awarding grants under this section, 
     the Secretary shall take into consideration an equitable 
     geographic distribution of the grants.

     SEC. 6. SUMMER LEARNING GRANTS.

       (a) Use of Grants for Summer Learning Grants.--
       (1) In general.--Each State educational agency that 
     receives a grant under section 5 for a fiscal year shall use 
     the grant funds to provide summer learning grants for the 
     fiscal year to eligible students in the State who desire to 
     attend a summer learning opportunity offered by an eligible 
     entity that enters into an agreement with the State 
     educational agency under subsection (d)(1).
       (2) Amount; federal and non-federal shares.--
       (A) Amount.--The amount of a summer learning grant provided 
     under this Act shall be--
       (i) for each of the fiscal years 2006 through 2009, $1,600; 
     and
       (ii) for fiscal year 2010, $1,800.
       (B) Federal share.--The Federal share of each summer 
     learning grant shall be not more than 50 percent of the 
     amount of the summer learning grant determined under 
     subparagraph (A).
       (C) Non-federal share.--The non-Federal share of each 
     summer learning grant shall be not less than 50 percent of 
     the amount of the summer learning grant determined under 
     subparagraph (A), and shall be provided from non-Federal 
     sources, such as State or local sources.
       (b) Designation of Summer Scholars.--Eligible students who 
     receive summer learning grants under this Act shall be known 
     as ``summer scholars''.
       (c) Selection of Summer Learning Opportunity.--
       (1) Dissemination of information.--A State educational 
     agency that receives a grant under section 5 shall 
     disseminate information about summer learning opportunities 
     and summer learning grants to the families of eligible 
     students in the State.
       (2) Application.--The parents of an eligible student who 
     are interested in having their child participate in a summer 
     learning opportunity and receive a summer learning grant 
     shall submit an application to the State educational agency 
     that includes a ranked list of preferred summer learning 
     opportunities.
       (3) Process.--A State educational agency that receives an 
     application under paragraph (2) shall--
       (A) process such application;
       (B) determine whether the eligible student shall receive a 
     summer learning grant;
       (C) coordinate the assignment of eligible students 
     receiving summer learning grants with summer learning 
     opportunities; and
       (D) if demand for a summer learning opportunity exceeds 
     capacity--
       (i) in a case where information on the school readiness 
     (based on school records and assessments of student 
     achievement) of the eligible students is available, give 
     priority for the summer learning opportunity to eligible 
     students with low levels of school readiness; or
       (ii) in a case where such information on school readiness 
     is not available, rely on randomization to assign the 
     eligible students.
       (4) Flexibility.--A State educational agency may assign a 
     summer scholar to a summer learning opportunity program that 
     is offered in an area served by a local educational agency 
     that is not the local educational agency serving the area 
     where such scholar resides.
       (5) Requirement of acceptance.--An eligible entity shall 
     accept, enroll, and provide the summer learning opportunity 
     of such entity to, any summer scholar assigned to such summer 
     learning opportunity by a State educational agency pursuant 
     to this subsection.
       (d) Agreement With Eligible Entity.--
       (1) In general.--A State educational agency shall enter 
     into an agreement with the eligible entity offering a summer 
     learning opportunity, under which--
       (A) the State educational agency shall agree to make 
     payments to the eligible entity, in accordance with paragraph 
     (2), for a summer scholar; and
       (B) the eligible entity shall agree to provide the summer 
     scholar with a summer learning opportunity that--
       (i) provides a total of not less than the equivalent of 30 
     full days of instruction (or not less than the equivalent of 
     25 full days of instruction, if the equivalent of an 
     additional 5 days is devoted to field trips or other 
     enrichment opportunities) to the summer scholar;
       (ii) employs small-group, research-based educational 
     programs, materials, curricula, and practices;
       (iii) provides a curriculum that--

       (I) emphasizes reading and mathematics;
       (II) is primarily designed to increase the literacy and 
     numeracy of the summer scholar; and
       (III) is aligned with the standards and goals of the school 
     year curriculum of the local educational agency serving the 
     summer scholar;

       (iv) applies assessments to measure the skills taught in 
     the summer learning opportunity and disaggregates the results 
     of the assessments for summer scholars by race and ethnicity, 
     economic status, limited English proficiency status, and 
     disability category, in order to determine the opportunity's 
     impact on each subgroup of summer scholars;
       (v) collects daily attendance data on each summer scholar; 
     and
       (vi) meets all applicable Federal, State, and local civil 
     rights laws.
       (2) Amount of payment.--
       (A) In general.--Except as provided in subparagraph (B), a 
     State educational agency shall make a payment to an eligible 
     entity for a summer scholar in the amount determined under 
     subsection (a)(2)(A).
       (B) Adjustment.--In the case in which a summer scholar does 
     not attend the full summer learning opportunity, the State 
     educational agency shall reduce the amount provided to the 
     eligible entity pursuant to subparagraph (A) by a percentage 
     that is equal to the percentage of the summer learning 
     opportunity not attended by such scholar.
       (e) Use of School Facilities.--State educational agencies 
     are encouraged to require local educational agencies in the 
     State to allow eligible entities, in offering summer learning 
     opportunities, to make use of school facilities in schools 
     served by such local educational agencies at reasonable or no 
     cost.
       (f) Access of Records.--An eligible entity offering a 
     summer learning opportunity under this Act is eligible to 
     receive, upon request, the school records and any previous 
     supplemental educational services assessment records of a 
     summer scholar served by such entity.
       (g) Administrative Costs.--A State educational agency or 
     eligible entity receiving funding under this Act may use not 
     more than 5 percent of such funding for administrative costs 
     associated with carrying out this Act.

     SEC. 7. EVALUATIONS; REPORT; WEBSITE.

       (a) Evaluation and Assessment.--For each year that an 
     eligible entity enters into an agreement under section 6(d), 
     the eligible entity shall prepare and submit to the Secretary 
     a report on the activities and outcomes of each summer 
     learning opportunity that enrolled a summer scholar, 
     including--
       (1) information on the design of the summer learning 
     opportunity;
       (2) the alignment of the summer learning opportunity with 
     State standards; and
       (3) data from assessments of student mathematics and 
     reading skills for the summer scholars and on the attendance 
     of the scholars, disaggregated by the subgroups described in 
     section 6(d)(1)(B)(iv).
       (b) Report.--For each year funds are appropriated under 
     section 8 for this Act, the Secretary shall prepare and 
     submit a report to Congress on the summer learning grant 
     programs, including the effectiveness of the summer learning 
     opportunities in improving student achievement.
       (c) Summer Learning Grants Website.--The Secretary shall 
     make accessible, on the Department of Education website, 
     information for parents and school personnel on successful 
     programs and curricula, and best practices, for summer 
     learning opportunities.

     SEC. 8. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated to carry out this 
     Act $100,000,000 for fiscal year 2006 and such sums as may be 
     necessary for each of the fiscal years 2007 through 2010.

                                 ______
                                 
      By Mr. WYDEN (for himself and Mr. Smith):
  S. 2150. A bill to direct the Secretary of the Interior to convey 
certain Bureau of Land Management Land to the City of Eugene, Oregon; 
to the Committee on Energy and Natural Resources.
  Mr. WYDEN. Mr. President, today I introduce, with my friend and 
colleague from Oregon, Senator Smith, a small bill that should pack a 
big score for ecological education in the City of Eugene. This bill 
authorizes the transfer of 12 acres from the Bureau of Land Management 
(BLM) to the City of Eugene on which the City of Eugene plans to 
construct the West Eugene Environmental Education Center (WEEEC). The 
WEEEC is a planned campus that will eventually hold laboratories, 
greenhouses, a reference library, and public gathering places including 
an exhibit hall, auditorium, and three classrooms. Transfer of this 
acreage by this bill is the first step towards making the promise of 
this educational center a reality.
  The WEEEC and this bill are supported by the West Eugene Wetland 
Partnership (Partnership). The Partnership is made up of the BLM, 
Eugene School Districts, Northwest Youth Corp, and the Willamette 
Resources and Educational Network (WREN) which was formed to assist in 
planning, funding, building, and operating portions of this education 
center. This bill

[[Page S14190]]

is also supported by the Oregon and California Counties (O&C counties) 
who originally had issue with the land transfer because they opposed 
loss of the 12 acres from the BLM land base. They are now in support of 
this bill because the City of Eugene has stepped up to the plate and is 
transferring land they currently own to the BLM to keep the public land 
roles consistent.
  The WEEEC will be the culmination of over a decade of work on the 
part of local folks to preserve the West Eugene Wetlands. I urge its 
swift passage.
  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. 2150

       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 ``Eugene Land Conveyance 
     Act''.

     SEC. 2. DEFINITIONS.

       In this Act:
       (1) City.--The term ``City'' means the city of Eugene, 
     Oregon.
       (2) Secretary.--The term ``Secretary'' means the Secretary 
     of the Interior.

     SEC. 3. CONVEYANCE TO THE CITY OF EUGENE, OREGON.

       (a) In General.--Not later than 60 days after the date of 
     enactment of this Act, the Secretary shall convey to the 
     City, without consideration and subject to all valid existing 
     rights, all right, title, and interest of the United States 
     in and to the land described in subsection (b)(1) for the 
     purposes of--
       (1) establishing a wildlife viewing area; and
       (2) the construction and operation of an environmental 
     education center.
       (b) Description of Land.--
       (1) In general.--The land referred to in subsection (a) is 
     the parcel of approximately 12 acres of land under the 
     administrative jurisdiction of the Bureau of Land Management 
     in Lane County, Oregon, as depicted on the map entitled ``Red 
     House Property'' and dated April 11, 2005.
       (2) Survey.--
       (A) In general.--The exact acreage and legal description of 
     the land described in paragraph (1) shall be determined by a 
     survey acceptable to the Secretary, including an existing 
     survey.
       (B) Cost.--If the Secretary determines that a new survey of 
     the land is required, the City shall be responsible for 
     paying the cost of the survey.
       (c) Reversion.--
       (1) In general.--If the Secretary determines that the land 
     conveyed under subsection (a) is not being used for the 
     purposes described in that subsection--
       (A) all right, title, and interest in and to the land 
     (including any improvements to the land) shall revert to the 
     United States; and
       (B) the United States shall have the right of immediate 
     entry to the land.
       (2) Hearing.--Any determination of the Secretary under 
     paragraph (1) shall be made on the record after an 
     opportunity for a hearing.
       (d) Additional Terms and Conditions.--The Secretary may 
     require such additional terms and conditions for the 
     conveyance under subsection (a) as the Secretary determines 
     to be appropriate to protect the interests of the United 
     States.
                                 ______
                                 
      By Mr. DURBIN (for himself and Mr. Obama):
  S. 2151. A bill to authorize full funding of payments for eligible 
federally connected children under title VIII of the Elementary and 
Secondary Education Act of 1965 by fiscal year 2011; to the Committee 
on Health, Education, Labor, and Pensions.
  Mr. DURBIN. Mr. President, I ask unanimous consent that the text of 
the bill be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2151

       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 ``Fair Share for Military 
     Children in Public Schools Act''.

     SEC. 2. PAYMENTS FOR ELIGIBLE FEDERALLY CONNECTED CHILDREN 
                   UNDER TITLE VIII OF THE ELEMENTARY AND 
                   SECONDARY EDUCATION ACT OF 1965.

       Section 8014(b) of the Elementary and Secondary Education 
     Act of 1965 (20 U.S.C. 7714(b)) is amended to read as 
     follows:
       ``(b) Basic Payments; Payments for Heavily Impacted Local 
     Educational Agencies.--For the purpose of making payments 
     under section 8003(b), there are authorized to be 
     appropriated--
       ``(1) for fiscal year 2007, such sums as may be necessary 
     to pay to each local educational agency for such fiscal year 
     70.4 percent of the full amount computed for such agency for 
     such fiscal year under paragraphs (1) and (2) of section 
     8003(b);
       ``(2) for fiscal year 2008, such sums as may be necessary 
     to pay to each local educational agency for such fiscal year 
     77.8 percent of the full amount computed for such agency for 
     such fiscal year under paragraphs (1) and (2) of section 
     8003(b);
       ``(3) for fiscal year 2009, such sums as may be necessary 
     to pay to each local educational agency for such fiscal year 
     85.2 percent of the full amount computed for such agency for 
     such fiscal year under paragraphs (1) and (2) of section 
     8003(b);
       ``(4) for fiscal year 2010, such sums as may be necessary 
     to pay to each local educational agency for such fiscal year 
     92.6 percent of the full amount computed for such agency for 
     such fiscal year under paragraphs (1) and (2) of section 
     8003(b); and
       ``(5) for fiscal year 2011, such sums as may be necessary 
     to pay to each local educational agency for such fiscal year 
     the full amount computed for such agency for such fiscal year 
     under paragraphs (1) and (2) of section 8003(b).''.
                                 ______
                                 
      Mr. ENZI:
  S. 2152. A bill to promote simplification and fairness in the 
administration and collection of sales and use taxes; to the Committee 
on Finance.
  Mr. ENZI. Mr. President, I rise today to introduce the Sales Tax 
Fairness and Simplification Act, a bill that will level the playing 
field for all retailers--in-store, catalog, and online--so each 
retailer has the same sales tax collection responsibility. All retail 
sales should be treated equally. The bill will also help States begin 
to recover from years of budgetary shortfalls.
  This bill is not a disguised attempt to increase taxes or put a new 
tax on the Internet. Consumers are already supposed to pay sales and 
use taxes in most States for purchases made over the phone, by mail, or 
via the Internet. Unfortunately, most consumers are unaware they are 
required to pay this use tax on purchases the retailer does not choose 
to collect sales tax on at the time of purchase.
  That means consumers who buy products online are required to keep 
track of their purchases and then pay the outstanding use tax 
obligation on their State tax forms. This has proven to be unrealistic, 
but what is real is most people do not know this or do not comply with 
the requirement. As such, States are losing billions of dollars in 
annual revenue. This legislation will help both consumers and States by 
reducing the burden on consumers and providing a mechanism that will 
allow States to systematically and fairly collect the taxes already 
owed to them.
  This bill is not about new taxes. Simply put, if Congress continues 
to allow remote sales taxes to go uncollected and electronic commerce 
continues to grow as predicted, other taxes--such as income or property 
taxes--will have to be increased to offset the lost revenue. I want to 
avoid that. That is why we need to implement a plan that will allow 
States to generate revenue using mechanisms already approved by their 
local leaders.
  This bill is about economic growth. Sales and use taxes provide 
critical revenue to pay for our schools, our police officers, 
firefighters, road construction, and more. It will bring more money--
money that is already owed--into rural areas that are struggling 
economically. It will also help businesses comply with the complicated 
State sales tax systems. That means the business resources that have 
historically been spent on tax compliance could be used, among other 
things, to hire new people and buy new equipment.
  This bill is about tax simplification. As the Supreme Court 
identified in the Quill versus North Dakota decision in 1992, the 
complicated State and local sales tax systems across this country have 
created an undue burden on sellers. The Quill decision stated that a 
multitude of complicated and diverse State sales tax rules made it too 
onerous to require retailers to collect sales taxes unless they had a 
physical presence in the State of the buyer. Local brick-and-mortar 
retailers collect sales taxes, while many online and catalog retailers 
are exempt from collecting the same taxes. This is not only 
fundamentally unfair to Main Street retailers, but it is costing States 
and localities billions in lost revenue.
  The bill will help relieve this burden by requiring States to meet 
the simplification standards outlined in the Streamlined Sales and Use 
Tax Agreement. Working with the business community, the States 
developed the Agreement to harmonize State sales tax rules, bring 
uniformity to definitions of items in the sales tax base, significantly 
reduce the paperwork burden

[[Page S14191]]

on retailers, and incorporate new technology to modernize many 
administrative procedures. This unprecedented Agreement will increase 
our Nation's economic efficiency and facilitate the growth of commerce 
by dramatically reducing red-tape and administrative burdens on all 
businesses and consumers. However, most importantly, the Agreement 
removes the liability for collection errors from the retailer and 
places it with the State. This historic Agreement was approved by 34 
States and the District of Columbia on November 12, 2002.
  The States have made tremendous progress in changing their State tax 
laws to become compliant with the Agreement. Already, 19 States have 
enacted legislation to change their tax laws and implement the 
requirements of the Agreement. On October 3, 2005, the Streamlined 
Sales and Use Tax Agreement became effective.
  This bill requires States to implement and maintain these 
simplification measures before they can require any seller to collect 
and remit sales tax. The Streamlined Sales and Use Tax Agreement 
includes dramatic simplification in almost every aspect of sales and 
use tax collection and administration, especially for the sellers who 
sell their products in more than one State. Areas of simplification 
include exemption processing, uniform definitions, State level 
administration of local taxes, a reduced number of sales tax rates, 
determining the appropriate tax rate, and reduced audit burdens for 
sellers using the State-certified technology.
  While the States have made great progress, the Quill decision held 
that allowing States to require collection is an issue that, ``Congress 
may be better qualified to resolve, and one that it has the ultimate 
power to resolve.'' The States have acted. It is now time for Congress 
to provide States that enact the Streamlined Sales and Use Tax 
Agreement with the authority to require remote retailers to collect 
sales taxes just as Main Street retailers do today.
  Congress needs to ``level the playing field'' for all retailers--in-
store, catalog, and online--so each has the same sales tax collection 
responsibility. All retail sales should be treated equally. I believe 
Congressional action is needed to provide States that implement the 
Streamlined Sales and Use Tax Agreement with the authority to collect 
sales and use taxes from remote retailers. Adoption of the Agreement 
and Congressional authorization will provide a level playing field for 
brick and mortar and remote retailers.
  Senator Byron Dorgan of North Dakota and I have worked tirelessly to 
assist sellers and State and local governments to find true 
simplification in almost every aspect of sales and use tax collection 
and administration. I want to thank Senator Dorgan for working with me 
on this policy issue for so many years. We have been successful in 
moving this issue forward from discussing it at the Federal level with 
Members of Congress to the drafting of the Streamlined Sales and Use 
Tax Agreement to approving the Governing Board this year to push 
forward with implementation.
  For the past eleven months, Senator Dorgan and I have worked with all 
interested parties to try to find a mutually agreeable legislative 
package to introduce this year. Many hours have been dedicated in 
trying to find the right solution to address all concerns. I appreciate 
everyone's hard work on this piece of legislation and believe it is 
time to introduce the bill before the end of the year.
  Senator Dorgan and I will be introducing two separate bills this 
year, but will continue to work with each other and all interested 
parties to find compromise on the outstanding policy issues of concern 
to the stakeholders. Some of the issues that will be further discussed 
include, but are not limited to, modifications to the small business 
exception language, inclusion of tribal governments language, and 
modifications to the language about transactional taxes on 
telecommunications services. Bill introduction does not stop us from 
negotiating and working together to improve the final product that 
should be enacted into public law. I look forward to working with 
Senator Dorgan and all interested parties to produce a compromise bill 
in 2006 that addresses all concerns raised over the past year.
  The Sales Tax Fairness and Simplification Act provides States that 
implement the Streamlined Sales and Use Tax Agreement with the 
authority to collect sales or use taxes equally from all retailers. 
Adoption of the Agreement and Congressional authorization will provide 
a level playing field for brick and mortar and remote retailers.
  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. 2152

       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 ``Sales Tax Fairness and 
     Simplification Act''.

     SEC. 2. CONSENT OF CONGRESS.

       The Congress consents to the Streamlined Sales and Use Tax 
     Agreement.

     SEC. 3. SENSE OF THE CONGRESS.

       (a) Sales and Use Tax System.--It is the sense of the 
     Congress that the sales and use tax system established by the 
     Streamlined Sales and Use Tax Agreement, to the extent that 
     it meets the minimum simplification requirements of section 
     6, provides sufficient simplification and uniformity to 
     warrant Federal authorization to Member States that are 
     parties to the Agreement to require remote sellers, subject 
     to the conditions provided in this Act, to collect and remit 
     the sales and use taxes of such Member States and of local 
     taxing jurisdictions of such Member States.
       (b) Purpose.--The purpose of this Act is to--
       (1) effectuate the limited authority granted to Member 
     States under the Streamlined Sales and Use Tax Agreement; and
       (2) not grant additional authority unrelated to the 
     accomplishment of the purpose described in paragraph (1).

     SEC. 4. AUTHORIZATION TO REQUIRE COLLECTION OF SALES AND USE 
                   TAXES.

       (a) Grant of Authority.--
       (1) In general.--Each Member State under the Streamlined 
     Sales and Use Tax Agreement is authorized, subject to the 
     requirements of this section, to require all sellers not 
     qualifying for the small business exception provided under 
     subsection (d) to collect and remit sales and use taxes with 
     respect to remote sales sourced to that Member State under 
     the Agreement.
       (2) Requirements for authority.--The authorization provided 
     under paragraph (1) shall be granted once all of the 
     following have occurred:
       (A) 10 States comprising at least 20 percent of the total 
     population of all States imposing a sales tax, as determined 
     by the 2000 Federal census, have petitioned for membership 
     and have become Member States under the Agreement.
       (B) The following necessary operational aspects of the 
     Agreement have been implemented by the Governing Board:
       (i) Provider and system certification.
       (ii) Setting of monetary allowance by contract with 
     providers.
       (iii) Implementation of an on-line multistate registration 
     system.
       (iv) Adoption of a standard form for claiming exemptions 
     electronically.
       (v) Establishment of advisory councils.
       (vi) Promulgation of rules and procedures for dispute 
     resolution.
       (vii) Promulgation of rules and procedures for audits.
       (viii) Provisions for funding and staffing the Governing 
     Board.
       (C) Each Member State has met the requirements to provide 
     and maintain the databases and the taxability matrix 
     described in the Agreement, pursuant to requirements of the 
     Governing Board.
       (3) Limitation of authority.--The authorization provided 
     under paragraph (1)--
       (A) shall be granted notwithstanding any other provision of 
     law; and
       (B) is dependent upon the Agreement, as amended, meeting 
     the minimum simplification requirements of section 6.
       (b) Termination of Authority.--
       (1) In general.--The authorization provided under 
     subsection (a) shall terminate for all States if--
       (A) the requirements contained in subsection (a) cease to 
     be satisfied; or
       (B) any amendment adopted to the Agreement after the date 
     of enactment of this Act is not within the scope of the 
     administration of sales and use taxes or taxes on 
     telecommunications services by the Member States.
       (2) Loss of member state status.--The authorization 
     provided under subsection (a) shall terminate for a Member 
     State, if such Member State no longer meets the requirements 
     for Member State status under the terms of the Agreement.
       (c) Determination of Status.--
       (1) In general.--The Governing Board shall determine if 
     Member States are in compliance with the requirements of 
     subsections (a) and (b).
       (2) Compliance determination.--Upon the determination of 
     the Governing Board that all the requirements of subsection 
     (a) have been satisfied, the authority of each Member

[[Page S14192]]

     State to require a seller to collect and remit sales and use 
     taxes shall commence on the first day of a calendar quarter 
     at least 6 months after the date the Governing Board makes 
     its determination.
       (d) Small Business Exception.--No seller shall be subject 
     to a requirement of any State to collect and remit sales and 
     use taxes with respect to a remote sale if--
       (1) the seller and its affiliates collectively had gross 
     remote taxable sales nationwide of less than $5,000,000 in 
     the calendar year preceding the date of such sale; or
       (2) the seller and its affiliates collectively meet the 
     $5,000,000 threshold of this subsection but the seller has 
     less than $100,000 in gross remote taxable sales nationwide.

     SEC. 5. DETERMINATIONS BY GOVERNING BOARD AND JUDICIAL REVIEW 
                   OF SUCH DETERMINATIONS.

       (a) Petition.--At any time after the Governing Board has 
     made the determination required under section 4(c)(2), any 
     person who may be affected by the Agreement may petition the 
     Governing Board for a determination on any issue relating to 
     the implementation of the Agreement.
       (b) Review in Court of Federal Claims.--Any person who 
     submits a petition under subsection (a) may bring an action 
     against the Governing Board in the United States Court of 
     Federal Claims for judicial review of the action of the 
     Governing Board on that petition if--
       (1) the petition relates to an issue of whether--
       (A) a Member State has satisfied or continues to satisfy 
     the requirements for Member State status under the Agreement;
       (B) the Governing Board has performed a nondiscretionary 
     duty of the Governing Board under the Agreement;
       (C) the Agreement continues to satisfy the minimum 
     simplification requirements set forth in section 6; or
       (D) any other requirement of section 4 has been satisfied; 
     and
       (2) the petition is denied by the Governing Board in whole 
     or in part with respect to that issue, or the Governing Board 
     fails to act on the petition with respect to that issue not 
     later than 6 months after the date on which the petition is 
     submitted.
       (c) Timing of Action for Review.--An action for review 
     under this section shall be initiated not later than 60 days 
     after the denial of the petition by the Governing Board, or, 
     if the Governing Board failed to act on the petition, not 
     later than 60 days after the end of the 6-month period 
     beginning on the day after the date on which the petition was 
     submitted.
       (d) Standard of Review.--
       (1) In general.--In any action for review under this 
     section, the court shall set aside the actions, findings, and 
     conclusions of the Governing Board found to be arbitrary, 
     capricious, an abuse of discretion, or otherwise not in 
     accordance with law.
       (2) Remand.--If the court sets aside any action, finding, 
     or conclusion of the Governing Board under paragraph (1), the 
     court shall remand the case to the Governing Board for 
     further action consistent with the decision of the court.
       (e) Jurisdiction.--
       (1) Generally.--Chapter 91 of title 28, United States Code, 
     is amended by adding at the end the following:

     ``Sec. 1510. Jurisdiction regarding the Streamlined Sales and 
       Use Tax Agreement

       ``The United States Court of Federal Claims shall have 
     exclusive jurisdiction over actions for judicial review of 
     determinations of the Governing Board of the Streamlined 
     Sales and Use Tax Agreement under the terms and conditions 
     provided in section 5 of the Sales Tax Fairness and 
     Simplification Act.''.
       (2) Conforming amendment to table of sections.--The table 
     of sections at the beginning of chapter 91 of title 28, 
     United States Code, is amended by adding at the end the 
     following new item:

``1510. Jurisdiction regarding the streamlined sales and use tax 
              agreement.''.

     SEC. 6. MINIMUM SIMPLIFICATION REQUIREMENTS.

       (a) In General.--The minimum simplification requirements 
     for the Agreement, which shall relate to the conduct of 
     Member States under the Agreement and to the administration 
     and supervision of such conduct, are as follows:
       (1) A centralized, one-stop, multistate registration system 
     that a seller may elect to use to register with the Member 
     States, provided a seller may also elect to register directly 
     with a Member State, and further provided that privacy and 
     confidentiality controls shall be placed on the multistate 
     registration system so that it may not be used for any 
     purpose other than the administration of sales and use taxes. 
     Furthermore, no taxing authority within a Member State or a 
     Member State that has withdrawn or been expelled from the 
     Agreement may use registration with the centralized 
     registration system for the purpose of, or as a factor in 
     determining, whether a seller has a nexus with that Member 
     State for any tax at any time.
       (2) Uniform definitions of products and product-based 
     exemptions from which a Member State may choose its 
     individual tax base, provided, however, that all local 
     jurisdictions in that Member State shall have a common tax 
     base identical to the State tax base of that Member State. A 
     Member State may enact other product-based exemptions without 
     restriction if the Agreement does not have a definition for 
     the product or for a term that includes the product. A Member 
     State shall relax the good faith requirement for acceptance 
     of exemption certificates in accordance with section 317 of 
     the Agreement, as amended through the date of enactment of 
     this Act.
       (3) Uniform rules for sourcing and attributing transactions 
     to particular taxing jurisdictions.
       (4) Uniform procedures for the certification of service 
     providers and software on which a seller may elect to rely in 
     order to determine Member State sales and use tax rates and 
     taxability.
       (5) Uniform rules for bad debts and rounding.
       (6) Uniform requirements for tax returns and remittances.
       (7) Consistent electronic filing and remittance methods.
       (8) Single, State-level administration of all Member State 
     and local sales and use taxes, including a requirement for a 
     State-level filing of tax returns in each Member State.
       (9) A single sales and use tax rate per taxing 
     jurisdiction, except that a State may impose a single 
     additional rate, which may be zero, on food, food 
     ingredients, and drugs, provided that this limitation does 
     not apply to the items identified in section 308 C of the 
     Agreement, as amended through the date of enactment of this 
     Act.
       (10) A Member State shall eliminate caps and thresholds on 
     the application of sales and use tax rates and exemptions 
     based on value, provided that this limitation does not apply 
     to the items identified in section 308 C of the Agreement, as 
     amended through the date of enactment of this Act.
       (11) A provision requiring each Member State to complete a 
     taxability matrix, as adopted by the Governing Board. The 
     matrix shall include information regarding terms defined by 
     the Agreement in the Library of Definitions. The matrix shall 
     also include, pursuant to the requirements of the Governing 
     Board, information on use, entity, and product based 
     exemptions.
       (12) A provision requiring that each Member State relieves 
     a seller or service provider from liability to that Member 
     State and local jurisdiction for collection of the incorrect 
     amount of sales or use tax, and relieves the purchaser from 
     penalties stemming from such liability, provided that 
     collection of the improper amount is the result of relying on 
     information provided by that Member State regarding tax 
     rates, boundaries, or taxing jurisdiction assignments, or in 
     the taxability matrix regarding terms defined by the 
     Agreement in the Library of Definitions.
       (13) Audit procedures for sellers, including an option 
     under which a seller not qualifying for the small business 
     exception in section 4(d) may request, by notifying the 
     Governing Board, to be subject to a single audit on behalf of 
     all Member States for sales and use taxes (other than use 
     taxes on goods and services purchased for the consumption of 
     the seller). The Governing Board, in its discretion, shall 
     authorize such a single audit.
       (14) As of the day that authority to require collection 
     commences under section 4, each Member State shall provide 
     reasonable compensation for expenses incurred by a seller 
     directly in administering, collecting, and remitting sales 
     and use taxes (other than use taxes on goods and services 
     purchased for the consumption of the seller) to that Member 
     State. Such compensation may vary in each Member State 
     depending on the complexity of the sales and use tax laws in 
     that Member State and may vary by the characteristics of 
     sellers in order to reflect differences in collection costs. 
     Such compensation may be provided to a seller or a third 
     party service provider whom a seller has contracted with to 
     perform all the sales and use tax responsibilities of a 
     seller.
       (15) Appropriate protections for consumer privacy.
       (16) Governance procedures and mechanisms to ensure timely, 
     consistent, and uniform implementation and adherence to the 
     principles of the streamlined system and the terms of the 
     Agreement.
       (17) Each Member State shall apply the simplification 
     requirements of the Agreement to taxes on telecommunications 
     services, except as provided herein. This requirement is 
     applicable to Member States as of July 1, 2008, except that 
     sales and use taxes on telecommunications services shall be 
     subject to the Agreement and the authority granted to the 
     Member States when the requirements of section 4(a) are met. 
     On or after July 1, 2008, for those Member States which meet 
     the requirements of this paragraph, the authority granted 
     such Member States under section 4 may be exercised by such 
     Member States, pursuant to the terms of section 4 and section 
     5, with respect to taxes on telecommunications services other 
     than sales and use taxes on such services. The following are 
     exceptions to the requirement established under this 
     paragraph:
       (A) The requirement for one uniform return shall not apply, 
     provided, however, there shall be one uniform return for each 
     type of tax on telecommunications services within a State.
       (B) The requirements for rate simplification are modified 
     to require that each taxing jurisdiction shall have only one 
     rate for each type of tax on telecommunications services.
       (C) The requirements for tax base uniformity in section 302 
     of the Agreement shall apply to each type of tax on 
     telecommunications services within a State, but shall not be 
     construed to require that the tax base for

[[Page S14193]]

     different types of taxes on telecommunications services must 
     be identical to the tax base for sales and use taxes imposed 
     on telecommunications services.
       (18) Uniform rules and procedures for ``sales tax 
     holidays''.
       (19) Uniform rules and procedures to address refunds and 
     credits for sales taxes relating to customer returns, 
     restocking fees, discounts and coupons, and rules to address 
     allocations of shipping and handling and discounts applied to 
     multiple item and multiple seller orders.
       (b) Requirement to Provide Simplified Tax Systems.--
       (1) In general.--The requirements of this section are 
     intended to ensure that each Member State provides and 
     maintains the necessary simplifications to its sales and use 
     tax system to warrant the collection authority granted to it 
     in section 4.
       (2) Reduction of administrative burdens.--The requirements 
     of this section should be construed--
       (A) to require each Member State to substantially reduce 
     the administrative burdens associated with sales and use 
     taxes; and
       (B) as allowing each Member State to exercise flexibility 
     in how these requirements are satisfied.
       (3) Exception.--In instances where exceptions to the 
     requirements of this section can be exercised in a manner 
     that does not materially increase the administrative burden 
     on a seller obligated to collect or pay the taxes, such 
     exceptions are permissible.

     SEC. 7. LIMITATION.

       (a) In General.--Nothing in this Act shall be construed 
     as--
       (1) subjecting a seller to franchise taxes, income taxes, 
     or licensing requirements of a Member State or political 
     subdivision thereof; or
       (2) affecting the application of such taxes or requirements 
     or enlarging or reducing the authority of any Member State to 
     impose such taxes or requirements.
       (b) No Effect on Nexus, Etc.--
       (1) In general.--No obligation imposed by virtue of the 
     authority granted by section 4 shall be considered in 
     determining whether a seller has a nexus with any Member 
     State for any other tax purpose.
       (2) Permissible member state authority.--Except as provided 
     in subsection (a), and in section 4, nothing in this Act 
     permits or prohibits a Member State from--
       (A) licensing or regulating any person;
       (B) requiring any person to qualify to transact intrastate 
     business;
       (C) subjecting any person to State taxes not related to the 
     sale of goods or services; or
       (D) exercising authority over matters of interstate 
     commerce.

     SEC. 8. EXPEDITED JUDICIAL REVIEW.

       (a) Three-Judge District Court Hearing.--Notwithstanding 
     any other provision of law, any civil action challenging the 
     constitutionality of this Act, or any provision thereof, 
     shall be heard by a district court of three judges convened 
     pursuant to the provisions of section 2284 of title 28, 
     United States Code.
       (b) Appellate Review.--
       (1) In general.--Notwithstanding any other provision of 
     law, an interlocutory or final judgment, decree, or order of 
     the court of three judges in an action under subsection (a) 
     holding this Act, or any provision thereof, unconstitutional 
     shall be reviewable as a matter of right by direct appeal to 
     the Supreme Court.
       (2) 30-day time limit.--Any appeal under paragraph (1) 
     shall be filed not more than 30 days after the date of entry 
     of such judgment, decree, or order.

     SEC. 9. DEFINITIONS.

       For the purposes of this Act the following definitions 
     apply:
       (1) Affiliate.--The term ``affiliate'' means any entity 
     that controls, is controlled by, or is under common control 
     with a seller.
       (2) Governing board.--The term ``Governing Board'' means 
     the governing board established by the Streamlined Sales and 
     Use Tax Agreement.
       (3) Member state.--The term ``Member State''--
       (A) means a Member State as that term is used under the 
     Streamlined Sales and Use Tax Agreement as of the date of 
     enactment of this Act; and
       (B) does not include associate members under the Agreement.
       (4) Nationwide.--The term ``nationwide'' means throughout 
     each of the several States and the District of Columbia, the 
     Commonwealth of Puerto Rico, Guam, American Samoa, the Virgin 
     Islands, the Northern Mariana Islands, and any other 
     territory or possession of the United States.
       (5) Nondiscretionary duty of the governing board.--The 
     phrase ``nondiscretionary duty of the Governing Board'' means 
     any duty of the Governing Board specified in the Agreement as 
     a requirement for action by use of the term ``shall'', 
     ``will'', or ``is required to''.
       (6) Person.--The term ``person'' means an individual, 
     trust, estate, fiduciary, partnership, corporation, or any 
     other legal entity, and includes a State or local government.
       (7) Remote sale.--The term ``remote sale'' refers to a sale 
     of goods or services attributed to a particular Member State 
     with respect to which a seller does not have adequate 
     physical presence to establish nexus under the law existing 
     on the day before the date of enactment of this Act so as to 
     allow such Member State to require, without regard to the 
     authority granted by this Act, the seller to collect and 
     remit sales or use taxes with respect to such sale.
       (8) Remote seller.--The term ``remote seller'' means any 
     seller who makes a remote sale.
       (9) State.--The term ``State'' means any State of the 
     United States of America and includes the District of 
     Columbia, Puerto Rico, and any other territory or possession 
     of the United States.
       (10) Streamlined sales and use tax agreement.--The term 
     ``Streamlined Sales and Use Tax Agreement'' (or ``the 
     Agreement'') means the multistate agreement with that title 
     adopted on November 12, 2002, as amended through the date of 
     enactment of this Act and unless the context otherwise 
     indicates as further amended from time to time.
       (11) Tax on telecommunications services.--The term ``tax on 
     telecommunications services'' or ``taxes on telecommunication 
     services'' shall encompass the same taxes, charges, or fees 
     as are included in section 116 of title 4, United States 
     Code, except that ``telecommunication services'' shall 
     replace ``mobile telecommunications services'' whenever such 
     term appears.
       (12) Telecommunications service.--
       (A) In general.--The term ``telecommunications service'' 
     means the electronic transmission, conveyance, or routing of 
     voice, data, audio, video, or any other information or 
     signals to a point, or between or among points.
       (B) Inclusion.--The term ``telecommunication service''--
       (i) includes transmission services in which computer 
     processing applications are used to act on the form, code, or 
     protocol of the content for purposes of transmission, 
     conveyance, or routing without regard to whether such 
     services are referred to as voice over Internet protocol 
     services or are classified by the Federal Communications 
     Commission as enhanced or value added services; and
       (ii) does not include the data processing and information 
     services that allow data to be generated, acquired, stored, 
     processed, or retrieved and delivered by an electronic 
     transmission to a purchaser where the primary purpose of such 
     purchaser for the underlying transaction is the processed 
     data or information.

     SEC. 10. SENSE OF THE CONGRESS ON DIGITAL GOODS AND SERVICES.

       It is the sense of the Congress that each State that is a 
     party to the Agreement should work with other States that are 
     also party to the Agreement to prevent double taxation in 
     situations where a foreign country has imposed a transaction 
     tax on a digital good or service.
                                 ______
                                 
      By Mr. DORGAN:
  S. 2153. A bill to promote simplification and fairness in the 
administration and colleciton of sales and use taxes; to the Committee 
on Finance.
  Mr. DORGAN. Mr. President, I have been working closely with Senator 
Mike Enzi of Wyoming for several years now on Federal legislation that 
encourages and rewards State and local governments that radically 
simplify their sales tax systems by granting them authority to require 
large sellers to collect taxes on remote sales after substantial 
simplifications are implemented. This year we have delayed 
reintroducing related legislation that we cosponsored in the last 
Congress, S. 1736, primarily due to concerns that some parties have 
raised about the bill's small business exemption language.
  After months of negotiation, there's still disagreement among the 
stakeholders about how the bill should define small remote sellers who 
would be exempted from the bill's sales tax collection requirements. 
Regrettably, the small business exemption issues have not been resolved 
to the satisfaction of all parties and Senator Enzi is re-introducing 
essentially our same proposal from the 108th Congress as he promised. I 
certainly respect his right and decision to do so.
  However, I have been working on small business language that I think 
is a fair approach and will greatly improve the odds that this bill 
will become law.
  The bill I am introducing today is identical to the bill that Senator 
Enzi is introducing today in every respect--except one. Instead of 
putting a small business exemption in the bill with a specific dollar 
threshold, my proposal sets up a process that I believe will help us 
get to the right answer. Under my proposal, the Small Business 
Administration (SBA) is required, after considering all relevant 
factors and soliciting input from the Treasury Department, the 
Streamlined Sales Tax Governing Board and others, to develop a 
rulemaking and propose to Congress a definition of those small sellers, 
including small businesses, which would not be required to collect and 
remit sales and use taxes. My bill provides

[[Page S14194]]

for the expedited consideration of SBA's proposal by the U.S. House and 
Senate and takes steps to ensure that a small sellers' exemption will 
ultimately be approved by Congress. States would be allowed to require 
impacted remote sellers to collect sales taxes only after federally 
mandated simplification is accomplished and a small business exemption 
is approved by Congress.
  All of the other parts of my bill are identical to those included in 
Senator Enzi's bill. These provisions also deserve our immediate 
attention. There are over 7,000 tax jurisdictions across the country 
that rely on sales taxes to fund a range of local activities, from 
education and fire suppression to police protection and road 
construction. But billions of dollars in needed sales tax revenues go 
uncollected year after year in many jurisdictions due to a ruling by 
the U.S. Supreme Court in 1992 that said current State and local sales 
tax systems impose an undue burden on sellers without a physical 
presence in each State.
  Internet and catalog sellers have argued that collecting and 
remitting sales taxes for thousands of different tax authorities is 
exceedingly complex. This is a legitimate complaint. And I understand 
why the U.S. Supreme Court in its Quill decision said that States and 
localities could not require sellers to collect sales tax on remote 
sales until the States and localities have first dramatically reduced 
the complexity and burden of collecting sales taxes.
  The States and localities have stepped up to the challenge outlined 
in the Quill decision. For five years now, the States have been working 
with the retail community and local governments to develop a 
streamlined and uniform sales tax system agreement that will alleviate 
the burden of sales tax collection on local retailers and remote 
sellers.
  The Streamlined Sales and Use Tax Agreement, which was approved by 34 
States and the District of Columbia in November 2002, requires 
participating States to comply with dozens of stringent simplification 
requirements that streamline how State sales and use taxes are 
identified and collected. By early next year, 19 States will have 
enacted legislation to bring them into compliance with the Agreement 
and will be members of its Governing Board.
  By harmonizing their State sales and use tax rules, bringing 
uniformity to definitions in the sales tax base, significantly reducing 
the paperwork burden on retailers, and incorporating a seamless 
electronic reporting process, compliance with the Agreement will result 
in a significantly reduced tax collection burden on all sellers.
  As the volume of remote on-line retail sales grow, states are losing 
more and more sales tax revenues. An estimated $15 billion in sales and 
use taxes will go uncollected in 2005. This threatens the future 
ability of states and localities to make critical investments in even 
the most basic community services, while forcing local retailers who 
are required to collect sales taxes today to compete with large remote 
competitors who are not. Senator Enzi and I are determined to address 
this problem.
  I think that the legislation I am introducing today strikes a 
reasonable balance between the interests of consumers, local retailers, 
remote sellers and the states. Having said that, I will be working with 
Senator Enzi early in the next session to see if we can put together a 
single approach that would address any remaining concerns about the 
small business exemption and help us move this legislative effort 
forward in the next session.
  We will also have an opportunity to more fully examine some issues 
raised by the representatives of local governments and some Indian 
tribes about the impact of our initiative on their constituencies.
                                 ______
                                 
      By Mr. KERRY (for himself and Mr. Isakson):
  S. 2155. A bill to provide meaningful civil remedies for victims of 
the sexual exploitation of children; to the Committee on the Judiciary.
  Mr. KERRY. Mr. President, today Senator Isakson and I introduce 
legislation to increase civil penalties for child exploitation. Our 
legislation is a small piece of a larger battle that we believe will 
stop would-be child predators and protect our children. Predators like 
the ones who exploited Masha, a little girl who was featured on Prime 
Time Live a few weeks ago, and the thousands of other children who are 
victims of these horrific crimes.
  According to the National Center for Missing and Exploited Children, 
child pornography has become a multi-billion dollar internet business. 
With the increasingly sophisticated technology of digital media, child 
pornography has become easier to produce and purchase. Countless people 
around the world have instant access to pictures and videos posted on 
the Internet and, unfortunately, millions of these images are 
pornographic depictions of infants and children. Masha is one of these 
children, whose images--hundreds of them--are on the Internet and being 
downloaded around the world. And while the man who sexually abused 
Masha and posted the pictures on the web is in jail, the damage has 
been done and will continue until people stop downloading pictures of 
her off the internet.
  Under current law, a victim of child exploitation is entitled to 
civil statutory damages in U.S. District Court in the amount of 
$50,000--less than the civil penalty for illegally downloading music 
off the internet. This penalty is far too low to effectively deter 
would-be child pornographers. This legislation increases the civil 
penalties recoverable by victims of child sexual exploitation, 
including internet child pornography, to at least $150,000. This 
increased penalty will serve as a deterrent to those who disseminate 
and possess child pornography, as well as a means of compensating 
victims of this terrible abuse. If someone downloads a song off the 
Internet, Federal copyright law provides for statutory damages to be 
awarded to the copyright holder in the amount of $150,000. Downloading 
child pornography is far more detrimental to the victim than 
downloading copyrighted music and, as a result, the penalty should 
reflect that.
  But it is not only the statutory damages that are flawed. The current 
statute states that ``Any minor who is a victim of a violation [of the 
act] may sue in United States District Court''. This language has been 
interpreted literally by a Federal district court to restrict recovery 
to plaintiffs whose injuries occurred while they were minors. Thus, 
when victims turn 18 they cannot recover against their perpetrators 
even if pornographic images of them as children are still distributed 
via the internet. Our legislation would clarify the statute to include 
victims of child pornography who are injured as adults by the 
downloading of their pornographic images.
  This bill takes an important step towards ensuring justice for 
victims of child exploitation. I would urge speedy passage of this 
legislation as a stand alone bill or encourage its inclusion in a 
larger child protection package. It is the very least Congress can do 
for Masha and the thousands of children like her who have suffered at 
the hands of these criminals. I thank Senator Isakson for his co-
sponsorship, and I look forward to working with him and all my 
colleagues to see that it passes the Senate.

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