[Congressional Record Volume 152, Number 109 (Thursday, September 7, 2006)]
[Senate]
[Pages S9127-S9129]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. AKAKA (for himself, Mr. Lautenberg, Ms. Stabenow, Mr. 
        Sarbanes, and Mr. Baucus):
  S. 3866. A bill to establish a grant program to enhance the economic 
and financial literacy of midlife and older Americans so as to enhance 
their retirement security and to reduce financial abuse and fraud among 
such Americans, and for other purposes; to the Committee on Health, 
Education, Labor, and Pensions.
  Mr. AKAKA. Mr. President, today, I am introducing the Education for 
Retirement Security Act of 2006, with my colleagues Senators 
Lautenberg, Stabenow, Sarbanes and Baucus. I thank our former 
colleague, Senator Corzine, for initiating this important financial and 
economic literacy bill, of which I had been an original cosponsor. This 
bill is a product of revisions suggested by the Jump$tart Coalition for 
Personal Financial Literacy and the American Savings and Education 
Council, as well as consultation with other community groups such as 
the National Association of Securities Dealers and National Council on 
Economic Education.
  Americans are not saving enough for retirement. Longer life spans, 
combined with low savings and high consumer debt, are putting many mid-
life and older Americans on the path to entering retirement years with 
a lower quality of life, delaying their retirement to catch up with 
inadequate savings, or becoming a significant financial burden on their 
loved ones. In 2005, only 42 percent of workers or their spouses 
calculated the amount they needed to save for retirement a major 
decrease from 53 percent in 2000. Only about half of working Americans 
are covered by a pension plan.
  Inadequacy of retirement nest eggs and other preparation for 
retirement will certainly impact the U.S. economy and government 
services, as we know that the number of older individuals in the U.S. 
is projected to more than double over the next 30 years, from 35 
million to 75 million people. We will inevitably see serious increases 
in long-term care and other health costs.
  Furthermore, individuals of questionable moral character are 
determined to erode older Americans' lifetime savings through fraud or 
aggressive marketing tactics selling unnecessary products or those with 
exorbitant and hidden fees. The Federal Trade Commission Identity Theft 
Data Clearinghouse reported that incidents of identity theft targeting 
individuals age 60 and older increase from 1,821 victims in 2000 to a 
startling 21,084 victims in 2004. More people in the U.S. should have 
basic competency in money management to avoid becoming victims of 
financial fraud and abuse.
  The Education for Retirement Security Act is intended to address both 
the lagging savings rate and increases in fraud and abuse by 
establishing a grant program to arm midlife and older individuals with 
critical information and knowledge. It would do this by authorizing a 
grant program similar in structure to one which has proven successful 
in the Excellence in Economic Education Act, which awards a grant to a 
national entity that provides subgrants to community organizations to 
carry out programs that enhance economic, financial, and retirement 
literacy, and reduce financial abuse and fraud among the target 
population. The national entity would evaluate subgrantees on the 
performance and effectiveness of their programs, identify best 
practices and programs for replication, and assess any behavioral 
change, including asset accumulation, made by program participants. The 
bill would also create a national training and technical assistance 
grant program toward creating and making available instructional 
materials and information promoting economic and financial education, 
and providing training and other related assistance to subgrantees.
  Economic and financial education can lead individuals to avoid scams 
and bad decisions about investments, mortgages, and pension plans, and 
ensure that they have access to tools they need to make sound financial 
decisions and prepare adequately for retirement. The limited timeframe 
that midlife and older Americans have in which to assess the realities 
of their individual circumstances, recover from bad economic choices, 
and benefit from more informed financial practices, makes critical the 
type of education that this bill would support.
  I thank my cosponsors for joining me in introducing this bill, and I 
urge other colleagues to support this legislation. I ask unanimous 
consent that the text of the bill be printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 3866

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

[[Page S9128]]

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Education for Retirement 
     Security Act of 2006''.

     SEC. 2. FINDINGS.

       Congress finds the following:
       (1) Improving economic and financial literacy is a critical 
     and complex task for Americans of all ages.
       (2) Low levels of savings and high levels of personal and 
     real estate debt are serious problems for many households 
     nearing retirement.
       (3) Historically, Americans are living longer than ever 
     before. However, most Americans are retiring before the age 
     of 65.
       (4) Research suggests that many Americans are not prepared 
     to plan for their retirement and may have to work far longer 
     than they expect in order to be financially secure in 
     retirement.
       (5) In 2005, only 42 percent of workers or their spouses 
     calculated the amount they needed to save for retirement, 
     down from 53 percent in 2000.
       (6) Only 53 percent of working Americans have any form of 
     pension coverage. Three out of 4 women aged 65 or older 
     receive no income from employer-provided pensions.
       (7) The limited timeframe that midlife and older 
     individuals and families have to assess the realities of 
     their individual circumstances, to recover from 
     counterproductive choices and decisionmaking processes, and 
     to benefit from more informed financial practices, has 
     immediate impact and near-term consequences for Americans 
     nearing or of retirement age.
       (8) Research indicates that there are now 4 basic sources 
     of retirement income security. Those sources are social 
     security benefits, pensions and savings, healthcare insurance 
     coverage, and, for an increasing number of older individuals, 
     necessary earnings from working during one's retirement 
     years.
       (9) Over the next 30 years, the number of older individuals 
     in the United States is expected to double, from 35,000,000 
     to nearly 75,000,000, and long-term care costs are expected 
     to skyrocket.
       (10) Financial exploitation is the largest single category 
     of abuse against older individuals and this population 
     comprises more than \1/2\ of all telemarketing victims in the 
     United States.
       (11) The Federal Trade Commission (FTC) Identity Theft Data 
     Clearinghouse has reported that incidents of identity theft 
     targeting individuals older than the age of 60 increased from 
     1,821 victims in 2000 to 21,084 victims in 2004, an increase 
     of more than 11 times in number.

     SEC. 3. DEFINITIONS.

       In this Act:
       (1) Alaska native corporation.--The term ``Alaska Native 
     Corporation'' has the same meaning as the term ``Native 
     Corporation'' under section 3 of the Alaska Native Claim 
     Settlement Act (43 U.S.C. 1602).
       (2) Economic and financial education.--The term ``economic 
     and financial education'' means education that--
       (A) promotes an understanding of consumer, economic, and 
     personal finance concepts, including--
       (i) basic economic concepts such as supply and demand and 
     opportunity cost; and
       (ii) basic financial literacy concepts such as the 
     importance of budgeting and money management, saving, 
     retirement planning, and maintaining good credit;
       (B) includes information regarding predatory lending and 
     financial abuse schemes; and
       (C) is based on recognized economic and financial education 
     standards.
       (3) Eligible area entity.--The term ``eligible area 
     entity'' means an entity that is--
       (A) a State agency, area agency on aging, Indian tribal 
     organization, Alaska Native Corporation, or Native Hawaiian 
     organization;
       (B) a nonprofit organization with a proven record of 
     providing--
       (i) services to midlife and older individuals;
       (ii) consumer awareness programs; or
       (iii) supportive services to low-income families; or
       (C) a partnership comprised of 2 or more entities described 
     in subparagraph (A) or (B).
       (4) Eligible entity.--The term ``eligible entity'' means a 
     national organization with substantial experience in the 
     field of economic and financial education.
       (5) Midlife.--The term ``midlife'', when used with respect 
     to an individual, means an individual aged 45 to 64 years.
       (6) Native hawaiian organization.--The term ``Native 
     Hawaiian organization'' means any organization that--
       (A) serves and represents the interests of Native 
     Hawaiians; and
       (B) has as a primary and stated purpose the provision of 
     services to Native Hawaiians.
       (7) Older.--The term ``older'', when used with respect to 
     an individual, means an individual aged 65 or older.
       (8) Secretary.--The term ``Secretary'' means the Secretary 
     of Health and Human Services.

     SEC. 4. PURPOSE AND GOALS.

       (a) Purpose.--The purpose of this Act is to promote 
     economic and financial literacy among midlife and older 
     individuals, and to reduce financial abuse and fraud among 
     such individuals, through providing assistance to 
     organizations for economic and financial education programs.
       (b) Goals.--The goals of this Act are--
       (1) to increase the knowledge of economic and financial 
     literacy among midlife and older individuals to enable the 
     individuals to make informed financial decisions; and
       (2) to reduce the amount of financial abuse and fraud among 
     midlife and older individuals.

     SEC. 5. GRANT PROGRAM TO ENHANCE ECONOMIC, FINANCIAL, AND 
                   RETIREMENT LITERACY AND REDUCE FINANCIAL ABUSE 
                   AND FRAUD AMONG MIDLIFE AND OLDER AMERICANS.

       (a) Program Authorized.--From amounts appropriated under 
     section 8, the Secretary is authorized to award a grant to a 
     national entity to enable the national entity to carry out 
     the subgrant program for economic and financial education 
     under section 6.
       (b) Application.--A national entity desiring a grant under 
     this section shall submit an application to the Secretary at 
     such time, in such form, and containing such information as 
     the Secretary may require, including a plan for continuing to 
     carry out the program under this section after the grant 
     expires.
       (c) Limitation on Administrative Costs.--A national entity 
     receiving a grant under this section may not use more than 5 
     percent of the total amount of the grant for each fiscal year 
     for the administrative costs of carrying out the program 
     under this section.
       (d) Evaluation.--The Secretary shall evaluate the programs 
     that receive grant funds under this section in order to judge 
     the performance of such programs.
       (e) Report.--For each fiscal year for which grants are 
     awarded under this section, the Secretary shall prepare and 
     submit to Congress a report on the program under this 
     section, which report shall include information from the 
     evaluation under subsection (d) and the evaluations under 
     section 6(e).

     SEC. 6. SUBGRANT PROGRAM TO ENHANCE ECONOMIC, FINANCIAL, AND 
                   RETIREMENT LITERACY AND REDUCE FINANCIAL ABUSE 
                   AND FRAUD AMONG MIDLIFE AND OLDER AMERICANS.

       (a) Subgrants Authorized.--A national entity that receives 
     a grant under section 5 shall use grant funds to award 
     subgrants to eligible area entities to enable the eligible 
     area entities to deliver economic and financial education 
     programs to midlife and older individuals who reside in local 
     communities, in order to--
       (1) enhance financial and retirement knowledge among such 
     individuals; and
       (2) reduce financial abuse and fraud, including 
     telemarketing, mortgage, and pension fraud, and identity 
     theft among such individuals.
       (b) Application.--An eligible area entity desiring a 
     subgrant under this section shall submit an application to 
     the national entity awarding the subgrants at such time, in 
     such form, and containing such information as the national 
     entity may require, including a plan for continuing the 
     programs assisted with subgrant funds under this section 
     after the subgrant expires.
       (c) Award Basis.--In awarding subgrants under this section, 
     a national entity shall--
       (1) give special consideration to eligible area entities 
     that are partnerships described in section 3(3)(C); and
       (2) give priority to programs previously funded by a 
     subgrant under this section that the Secretary judges 
     effective under the evaluation described in subsection 
     (e)(2)(A).
       (d) Limitation on Administrative Costs.--An eligible area 
     entity receiving a subgrant under this section may not use 
     more than 5 percent of the total amount of the subgrant in 
     each fiscal year for the administrative costs of carrying out 
     the program under this section.
       (e) Evaluation and Report.--
       (1) Establishment of performance measures.--A national 
     entity awarding subgrants under this section shall develop 
     measures to evaluate the programs that receive subgrant 
     funds.
       (2) Evaluation according to performance measures.--Applying 
     the performance measures developed under paragraph (1), a 
     national entity awarding subgrants under this section shall 
     evaluate the programs that receive subgrant funds in order 
     to--
       (A) judge the performance and effectiveness of such 
     programs;
       (B) identify which programs represent the best practices of 
     entities developing such programs for midlife and older 
     individuals;
       (C) identify which programs may be replicated; and
       (D) assess any behavioral change, as well as asset 
     accumulation, made by program participants.
       (3) Submission to congress.--For each fiscal year for which 
     a national entity awards subgrants under this section, the 
     national entity shall submit to the Secretary a report 
     containing--
       (A) a description of the status of the subgrant program 
     under this section;
       (B) a description of the programs provided with subgrant 
     funds under this section; and
       (C) the results of the evaluation of such programs under 
     paragraph (2).

     SEC. 7. NATIONAL TRAINING AND TECHNICAL ASSISTANCE PROGRAM.

       (a) Authority.--The Secretary is authorized to award a 
     grant to 1 or more eligible entities to--
       (1) create and make available instructional materials and 
     information that promote economic and financial education; 
     and
       (2) provide training and other related assistance regarding 
     the establishment of economic and financial education 
     programs to

[[Page S9129]]

     eligible area entities awarded a subgrant under section 6.
       (b) Application.--An eligible entity desiring a grant under 
     this section shall submit an application to the Secretary at 
     such time, in such form, and containing such information as 
     the Secretary may require.
       (c) Basis and Term.--The Secretary shall award a grant 
     under this section on a competitive, merit basis for a term 
     of 3 years.

     SEC. 8. AUTHORIZATION OF APPROPRIATIONS.

       (a) Authorization.--There are authorized to be appropriated 
     to carry out this Act, $100,000,000 for each of the fiscal 
     years 2007 through 2010.
       (b) Limitation on Funds for Evaluation and Report.--The 
     Secretary may not use more than $500,000 of the amounts 
     appropriated under subsection (a) for each fiscal year to 
     carry out section 6(e).
       (c) Limitation on Funds for Training and Technical 
     Assistance.--The Secretary may not use less than 5 percent or 
     more than 10 percent of the amounts appropriated under 
     subsection (a) for each fiscal year to carry out section 7.
                                 ______