[Congressional Record Volume 153, Number 94 (Tuesday, June 12, 2007)]
[Senate]
[Pages S7547-S7558]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS
By Mr. HATCH:
S. 1591. A bill to amend the Internal Revenue Code of 1986 to allow
full expensing for the cost of qualified refinery property in the year
in which the property is placed in service, and to classify petroleum
refining property as 5-year property for purposes of depreciation; to
the Committee on Finance.
Mr. HATCH. Mr. President, today I rise to reintroduce my legislation,
the Refinery Investment Tax Assistance Act, aimed at increasing
refining capacity in this Nation. No one doubts that U.S. consumers and
businesses will face another long hot summer of too high gas prices.
There is general consensus among experts that a major bottleneck in
U.S. refining capacity is a big part of the reason prices are so high.
My bill will help resolve that problem.
As my colleagues know, the Government does not explore for, extract,
transport, or refine oil in this country. Our Nation relies wholly on
private industry to feed a very large domestic energy appetite.
Unfortunately, the Government often stands in the way of industry in
these activities. While many refiners would like to expand their
capacity to refine oil, they face extraordinary costs from bureaucratic
regulations that limit the available funding for such expansion.
Because of this and other unfriendly economic factors, not a single new
refinery has been built in the United States since 1976. In fact, we
have lost nearly 200 refineries over that time period and now we badly
need that refining capacity.
I authored a key provision of the Energy Policy Act of 2005, which is
currently providing some incentives for new refining capacity. However,
due to budgetary constraints, the tax incentives in my proposal were
cut in half during the conference between the House and the Senate. I
am confident that if we had known 2 years ago just how much of a
bottleneck the refinery shortage would present in today's market, the
full measure of my incentive would have been enacted.
The Refinery Investment Tax Assistance Act would restore those
provisions I originally introduced, but which were later removed for
budget reasons. First, it would increase the short-term incentive for
the industry to build new refineries or to expand existing ones. As
with the 2005 bill, S. 1591 would provide immediate expensing of 100
percent of the cost of new or expanded refineries in certain
circumstances. As I said earlier, cost constraints forced us to limit
this incentive in 2005 to 50 percent of expensing for refiners that
were able to commit to installing new refining equipment before 2008.
Under this bill, any added capacity would have to be placed in service
by 2012 in order to qualify to write off the full cost of the expanded
capacity in the first year.
The second part of S. 1591 would address the 10-year depreciation
schedule for refining assets under our current tax law. This 10-year
schedule is longer than the write-off period for much of the equipment
used in other manufacturing industries, including the petrochemical
industry. My bill would eliminate this disparity by shortening the
depreciation schedule for refining assets from 10 years to 5. This
unfair and unwarranted treatment of our refining industry acts as a
long-term obstacle to new investment in increased capacity. I call on
my colleagues to help me level the playing field on depreciation for
this critically important sector of our energy industry.
I should also point out that this legislation would allow refineries
to change only the timing of the depreciation of their equipment, but
not the amount. Meanwhile, it would increase the size of our tax base
by encouraging industry to build new refineries and increase capacity.
Testifying before the Senate Energy and Natural Resources Committee
in 2005, Mr. Bob Slaughter of the National Petrochemical & Refiners
Association said that an important solution to the energy crisis would
be to ``expand the refining tax incentive provision in the Energy Act
[and] reduce the depreciation period for refining investments from 10
to . . . five years in order to remove a current disincentive for
refining investment.''
These changes are incorporated in the legislation I am introducing
today.
Mr. Slaughter gave this testimony in the aftermath of hurricane
Katrina. Every American has felt the effects of the storms on our
energy sector. Refineries have been pummeled and, at one point, an
unprecedented 25 percent of our Nation's refining capacity was taken
offline. The rising gas prices hurt families' budgets, businesses that
pay high travel expenses, and even school districts that must fuel
buses to transport students. Once again, forecasters are predicting a
terrible storm season this summer with hurricanes comparable to those
of 2005.
We have learned that when it comes to our Nation's energy security,
refining is where we are the most vulnerable. This legislation will
help us deal with the energy crisis and make our Nation more secure
from the attacks of Mother Nature and terrorists. I hope my colleagues
will join me in pursuing the secure and independent refining program
that this country truly needs. 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:
[[Page S7548]]
S. 1591
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 ``Refinery Investment Tax
Assistance Act of 2007''.
SEC. 2. FULL EXPENSING FOR QUALIFIED REFINERY PROPERTY.
(a) In General.--Subsection (a) of section 179C of the
Internal Revenue Code of 1986 (relating to election to
expense certain refineries) is amended by striking ``50
percent of''.
(b) Effective Date.--The amendment made by subsection (a)
shall take effect as if included in section 1323 of the
Energy Policy Act of 2005.
SEC. 3. PETROLEUM REFINING PROPERTY TREATED AS 5-YEAR
PROPERTY.
(a) In General.--Subparagraph (B) of section 168(e)(3) of
the Internal Revenue Code of 1986 (relating to 5-year
property) is amended by striking ``and'' at the end of clause
(v), by striking the period at the end of clause (vi)(III)
and inserting ``, and'', and by adding at the end the
following new clause:
``(vii) any petroleum refining property.''.
(b) Petroleum Refining Property.--Section 168(i) of such
Code is amended by adding at the end the following new
paragraph:
``(18) Petroleum refining property.--
``(A) In general.--The term `petroleum refining property'
means any asset for petroleum refining, including assets used
for the distillation, fractionation, and catalytic cracking
of crude petroleum into gasoline and its other components.
``(B) Asset must meet environmental laws.--Such term shall
not include any property which does not meet all applicable
environmental laws in effect on the date such property was
placed in service. For purposes of the preceding sentence, a
waiver under the Clean Air Act shall not be taken into
account in determining whether the applicable environmental
laws have been met.
``(C) Special rule for mergers and acquisitions.--Such term
shall not include any property with respect to which a
deduction was taken under subsection (e)(3)(B) by any other
taxpayer in any preceding year.''.
(c) Effective Date.--
(1) In general.--The amendments made by this section shall
apply to property placed in service after the date of the
enactment of this Act.
(2) Exception.--The amendments made by this section shall
not apply to any property with respect to which the taxpayer
has entered into a binding contract for the construction
thereof on or before the date of the enactment of this Act.
______
By Mr. BAUCUS (for himself, Mr. Grassley, Mr. Rockefeller, Mr.
Conrad, Mr. Bingaman, Ms. Snowe, Mr. Kerry, Mrs. Lincoln, Mr.
Smith, Mr. Schumer, Ms. Stabenow, Ms. Cantwell, Mr. Roberts,
and Mr. Salazar):
S. 1593. A bill to amend the Internal Revenue Code of 1986 to provide
tax relief and protections to military personnel, and for other
purposes; to the Committee on Finance.
Mr. BAUCUS. Mr. President, this week, we celebrate Flag Day, and in a
few weeks we will celebrate the Fourth of July.
We ask a lot from our men and women in the armed services, and their
sacrifices are essential to protecting our freedom here at home. One
way to support them is to make the Tax Code a little friendlier to the
troops.
That is why I am introducing the Defenders of Freedom Tax Relief Act
of 2007. This bill would extend the tax rules favoring the military
that expire in 2007 and 2008. It would also eliminate roadblocks in the
current tax laws that present difficulties for veterans and
servicemembers.
Our troops should fight against our Nation's enemies, not our
Nation's Tax Code. Family members of fallen soldiers killed in the line
of duty receive a death benefit of $100,000. But the Tax Code restricts
the survivors from contributing this benefit into a tax-favored
retirement account. My bill would exempt this benefit from the current
restrictions on contribution amounts and income limitations. That way,
the family members of fallen soldiers could take advantage of tax-
favored Roth IRA accounts.
Lower ranking, lower income soldiers do most of the heavy lifting in
combat situations. Under the current Tax Code, their income is not
counted in computing the earned income tax credit, or EITC. The EITC is
a beneficial tax provision available to working Americans. It makes no
sense to deny it to our troops. My bill would count combat duty income
for EITC purposes, and it would make this change to the Tax Code
permanent.
My bill would also eliminate the confusion that surrounds State gifts
to servicemembers. Military members should not be caught in the
crossfire of competing Tax Code interpretations.
Another hazard facing our troops in the Tax Code is the statute of
limitations for filing a tax refund. Most Veterans' Administration
disability claims filed by veterans are quickly resolved. But thousands
of disability awards are delayed due to lost paperwork or the appeals
of rejected claims. Once a disabled veteran finally gets a favorable
award, the good news is that the disability award is tax-free. But many
of these disabled veterans get ambushed by a statute that bars them
from filing a tax refund claim. My bill would give disabled veterans in
this situation an extra year to claim their tax refunds.
Our men and women in uniform provide an invaluable service to our
country. They, along with their families, make sacrifices and live a
demanding lifestyle. The Tax Code should not add to their hardships as
they move from assignment to assignment around the globe.
Protecting American interests around the world requires most of our
troops to move a number of times during their career. Restricting
favorable mortgage bond financing to only first-time homebuyers does
not make much sense for them. Therefore, my bill would eliminate this
restriction for veterans who served in the active military.
The bill would make permanent a provision that allows intelligence
community employees to make use of the exclusion of gain on the sale of
their home when they are assigned overseas or 50 miles away from their
home.
A soldier's rucksack is heavy enough as it is without piling tax
paperwork on top of it. My bill would help reduce paperwork.
My bill would treat differential pay as wages. This would make it
easer for employers to contribute to a reservist's retirement plans.
And it would eliminate the reservist's need to make estimated tax
payments.
My bill would also make permanent certain taxpayer information
reporting rules, so that the Social Security Administration and the
Veterans' Administration could facilitate the administration of veteran
needs-based pension and compensation programs.
A further roadblock for military service men and women is the 10-
percent penalty triggered for early withdrawal from a qualified
retirement plan. If reservists are called to active duty, the last
thing that they should have to worry about is their 401(k) plan or IRA
account. This provision would permit penalty-free early withdrawal. And
it would give reservists 2 years from the time that they stop active
duty to roll over their IRAs or 401(k) plans.
Small business employers are being asked to make sacrifices here at
home. My bill would help.
Mobilization of Reserve personnel creates unexpected employee
absences. This hits small businesses especially hard. Some employers
voluntarily take on the added burden of eliminating any pay gap
experienced by their reservist-employees. These employers pay the
difference between the civilian salary and the military pay. In
recognition of their patriotism, my bill would provide small businesses
with fewer than 50 employees a tax credit of 20 percent of the
differential pay, up to $20,000, for those small businesses that make
differential payments to reservists called up to active duty.
This bill is fully paid for with a change in the Tax Code that makes
sure that anyone relinquishing their U.S. citizenship is still on the
hook to pay their fair share of U.S. taxes.
We owe the Americans fighting in our Armed Forces an enormous debt of
gratitude. These important tax reforms are one small way of saluting
them for all that they do. I urge my colleagues to join me in
supporting this measure.
Mr. President, I ask unanimous consent that the text of the bill be
printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
S. 1593
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
(a) Short Title.--This Act may be cited as the ``Defenders
of Freedom Tax Relief Act of 2007''.
(b) Amendment of 1986 Code.--Except as otherwise expressly
provided, whenever in
[[Page S7549]]
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.
Sec. 2. Extension of statute of limitations to file claims for refunds
relating to disability determinations by Department of
Veterans Affairs.
Sec. 3. Permanent extension of election to treat combat pay as earned
income for purposes of earned income credit.
Sec. 4. Treatment of differential military pay as wages.
Sec. 5. Permanent extension of penalty-free withdrawals from retirement
plans by individual called to active duty.
Sec. 6. State payments to service members treated as qualified military
benefits.
Sec. 7. Permanent extension of disclosure authority to Department of
Veterans Affairs.
Sec. 8. Three-year extension of qualified mortgage bond program rules
for veterans.
Sec. 9. Permanent exclusion of gain from sale of a principal residence
by certain employees of the intelligence community.
Sec. 10. Contributions of military death gratuities to Roth IRAs.
Sec. 11. Credit for employer differential wage payments to employees
who are active duty members of the uniformed services.
Sec. 12. Revision of tax rules on expatriation of individuals.
SEC. 2. EXTENSION OF STATUTE OF LIMITATIONS TO FILE CLAIMS
FOR REFUNDS RELATING TO DISABILITY
DETERMINATIONS BY DEPARTMENT OF VETERANS
AFFAIRS.
(a) In General.--Subsection (d) of section 6511 (relating
to special rules applicable to income taxes) is amended by
adding at the end the following new paragraph:
``(8) Special rules when uniformed services retired pay is
reduced as a result of award of disability compensation.--
``(A) Period of limitation on filing claim.--If the claim
for credit or refund relates to an overpayment of tax imposed
by subtitle A on account of--
``(i) the reduction of uniformed services retired pay
computed under section 1406 or 1407 of title 10, United
States Code, or
``(ii) the waiver of such pay under section 5305 of title
38 of such Code,
as a result of an award of compensation under title 38 of
such Code pursuant to a determination by the Secretary of
Veterans Affairs, the 3-year period of limitation prescribed
in subsection (a) shall be extended, for purposes of
permitting a credit or refund based upon the amount of such
reduction or waiver, until the end of the 1-year period
beginning on the date of such determination.
``(B) Limitation to 5 taxable years.--Subparagraph (A)
shall not apply with respect to any taxable year which began
more than 5 years before the date of such determination.''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to claims for credit or refund filed after the
date of the enactment of this Act.
(c) Transition Rules.--In the case of a determination
described in paragraph (8) of section 6511(d) of the Internal
Revenue Code of 1986 (as added by this section) which is made
by the Secretary of Veterans Affairs after December 31, 2000,
and on or before the date of the enactment of this Act, such
paragraph--
(1) shall not apply with respect to any taxable year which
began before January 1, 2001, and
(2) shall be applied by substituting ``the date of the
enactment of the Defenders of Freedom Tax Relief Act of
2007'' for ``the date of such determination'' in subparagraph
(A) thereof.
SEC. 3. PERMANENT EXTENSION OF ELECTION TO TREAT COMBAT PAY
AS EARNED INCOME FOR PURPOSES OF EARNED INCOME
CREDIT.
(a) In General.--Clause (vi) of section 32(c)(2)(B)
(defining earned income) 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.''.
(b) Effective Date.--The amendment made by this section
shall apply to taxable years ending after December 31, 2007.
SEC. 4. TREATMENT OF DIFFERENTIAL MILITARY PAY AS WAGES.
(a) Income Tax Withholding on Differential Wage Payments.--
(1) In general.--Section 3401 (relating to definitions) is
amended by adding at the end the following new subsection:
``(h) Differential Wage Payments to Active Duty Members of
the Uniformed Services.--
``(1) In general.--For purposes of subsection (a), any
differential wage payment shall be treated as a payment of
wages by the employer to the employee.
``(2) Differential wage payment.--For purposes of paragraph
(1), the term `differential wage payment' means any payment
which--
``(A) is made by an employer to an individual with respect
to any period during which the individual is performing
service in the uniformed services while on active duty for a
period of more than 30 days, and
``(B) represents all or a portion of the wages the
individual would have received from the employer if the
individual were performing service for the employer.''.
(2) Effective date.--The amendment made by this subsection
shall apply to remuneration paid after December 31, 2007.
(b) Treatment of Differential Wage Payments for Retirement
Plan Purposes.--
(1) Pension plans.--
(A) In general.--Section 414(u) (relating to special rules
relating to veterans' reemployment rights under USERRA) is
amended by adding at the end the following new paragraph:
``(11) Treatment of differential wage payments.--
``(A) In general.--Except as provided in this paragraph,
for purposes of applying this title to a retirement plan to
which this subsection applies--
``(i) an individual receiving a differential wage payment
shall be treated as an employee of the employer making the
payment,
``(ii) the differential wage payment shall be treated as
compensation, and
``(iii) the plan shall not be treated as failing to meet
the requirements of any provision described in paragraph
(1)(C) by reason of any contribution or benefit which is
based on the differential wage payment.
``(B) Special rule for distributions.--
``(i) In general.--Notwithstanding subparagraph (A)(i), for
purposes of section 401(k)(2)(B)(i)(I), 403(b)(7)(A)(ii),
403(b)(11)(A), or 457(d)(1)(A)(ii), an individual shall be
treated as having been severed from employment during any
period the individual is performing service in the uniformed
services described in section 3401(h)(2)(A).
``(ii) Limitation.--If an individual elects to receive a
distribution by reason of clause (i), the plan shall provide
that the individual may not make an elective deferral or
employee contribution during the 6-month period beginning on
the date of the distribution.
``(C) Nondiscrimination requirement.--Subparagraph (A)(iii)
shall apply only if all employees of an employer (as
determined under subsections (b), (c), (m), and (o))
performing service in the uniformed services described in
section 3401(h)(2)(A) are entitled to receive differential
wage payments on reasonably equivalent terms and, if eligible
to participate in a retirement plan maintained by the
employer, to make contributions based on the payments on
reasonably equivalent terms. For purposes of applying this
subparagraph, the provisions of paragraphs (3), (4), and (5)
of section 410(b) shall apply.
``(D) Differential wage payment.--For purposes of this
paragraph, the term `differential wage payment' has the
meaning given such term by section 3401(h)(2).''.
(B) Conforming amendment.--The heading for section 414(u)
is amended by inserting ``and to Differential Wage Payments
to Members on Active Duty'' after ``USERRA''.
(2) Differential wage payments treated as compensation for
individual retirement plans.--Section 219(f)(1) (defining
compensation) is amended by adding at the end the following
new sentence: ``The term `compensation' includes any
differential wage payment (as defined in section
3401(h)(2)).''.
(3) Effective date.--The amendments made by this subsection
shall apply to years beginning after December 31, 2007.
(c) Provisions Relating to Plan Amendments.--
(1) In general.--If this subsection applies to any plan or
annuity contract amendment--
(A) such plan or contract shall be treated as being
operated in accordance with the terms of the plan or contract
during the period described in paragraph (2)(B)(i), and
(B) except as provided by the Secretary of the Treasury,
such plan shall not fail to meet the requirements of the
Internal Revenue Code of 1986 or the Employee Retirement
Income Security Act of 1974 by reason of such amendment.
(2) Amendments to which section applies.--
(A) In general.--This subsection shall apply to any
amendment to any plan or annuity contract which is made--
(i) pursuant to any amendment made by this section, and
(ii) on or before the last day of the first plan year
beginning on or after January 1, 2009.
(B) Conditions.--This subsection shall not apply to any
plan or annuity contract amendment unless--
(i) during the period beginning on the date the amendment
described in subparagraph (A)(i) takes effect and ending on
the date described in subparagraph (A)(ii) (or, if earlier,
the date the plan or contract amendment is adopted), the plan
or contract is operated as if such plan or contract amendment
were in effect, and
(ii) such plan or contract amendment applies retroactively
for such period.
SEC. 5. PERMANENT EXTENSION OF PENALTY-FREE WITHDRAWALS FROM
RETIREMENT PLANS BY INDIVIDUAL CALLED TO ACTIVE
DUTY.
Clause (iv) of section 72(t)(2)(G) (relating to
distributions from retirement plans to individuals called to
active duty) is amended by striking all after ``September 11,
2001'' and inserting a period.
[[Page S7550]]
SEC. 6. STATE PAYMENTS TO SERVICE MEMBERS TREATED AS
QUALIFIED MILITARY BENEFITS.
(a) In General.--Section 134(b) (defining qualified
military benefit) is amended by adding at the end the
following new paragraph:
``(6) Certain state payments.--The term `qualified military
benefit' includes any bonus payment by a State or political
subdivision thereof to any member or former member of the
uniformed services of the United States or any dependent of
such member only by reason of such member's service in an
combat zone (as defined in section 112(c)(2), determined
without regard to the parenthetical).''.
(b) Effective Date.--The amendment made by this section
shall apply to payments made before, on, or after the date of
the enactment of this Act.
SEC. 7. PERMANENT EXTENSION OF DISCLOSURE AUTHORITY TO
DEPARTMENT OF VETERANS AFFAIRS.
Section 6103(l)(7)(D) (relating to program to which rule
applies) is amended by striking the last sentence.
SEC. 8. THREE-YEAR EXTENSION OF QUALIFIED MORTGAGE BOND
PROGRAM RULES FOR VETERANS.
Section 143(d)(2)(D) (relating to exception) is amended by
striking ``January 1, 2008'' and inserting ``January 1,
2011''.
SEC. 9. PERMANENT EXCLUSION OF GAIN FROM SALE OF A PRINCIPAL
RESIDENCE BY CERTAIN EMPLOYEES OF THE
INTELLIGENCE COMMUNITY.
(a) In General.--Section 417(e) of division A of the Tax
Relief and Health Care Act of 2006 is amended by striking
``and before January 1, 2011''.
(b) Duty Station May Be Outside United States.--
(1) In general.--Section 121(d)(9)(C) (defining qualified
official extended duty) is amended by striking clause (vi).
(2) Effective date.--The amendment made by this subsection
shall apply to sales or exchanges after the date of the
enactment of this Act.
SEC. 10. CONTRIBUTIONS OF MILITARY DEATH GRATUITIES TO ROTH
IRAS.
(a) Provision in Effect Before Pension Protection Act.--
Subsection (e) of section 408A (relating to qualified
rollover contribution), as in effect before the amendments
made by section 824 of the Pension Protection Act of 2006, is
amended to read as follows:
``(e) Qualified Rollover Contribution.--For purposes of
this section--
``(1) In general.--The term `qualified rollover
contribution' means a rollover contribution to a Roth IRA
from another such account, or from an individual retirement
plan, but only if such rollover contribution meets the
requirements of section 408(d)(3). Such term includes a
rollover contribution described in section 402A(c)(3)(A). For
purposes of section 408(d)(3)(B), there shall be disregarded
any qualified rollover contribution from an individual
retirement plan (other than a Roth IRA) to a Roth IRA.
``(2) Military death gratuity.--
``(A) In general.--The term `qualified rollover
contribution' includes a contribution to a Roth IRA
maintained for the benefit of an individual to the extent
that such contribution does not exceed the amount received by
such individual under section 1477 of title 10, United States
Code, or under section 1967 of title 38 of such Code, if such
contribution is made not later than 1 year after the day on
which such individual receives such amount.
``(B) Annual limit on number of rollovers not to apply.--
Section 408(d)(3)(B) shall not apply with respect to amounts
treated as a rollover by the subparagraph (A).
``(C) Application of section 72.--For purposes of applying
section 72 in the case of a distribution which is not a
qualified distribution, the amount treated as a rollover by
reason of subparagraph (A) shall be treated as investment in
the contract.''.
(b) Provision in Effect After Pension Protection Act.--
Subsection (e) of section 408A, as in effect after the
amendments made by section 824 of the Pension Protection Act
of 2006, is amended to read as follows:
``(e) Qualified Rollover Contribution.--For purposes of
this section--
``(1) In general.--The term `qualified rollover
contribution' means a rollover contribution--
``(A) to a Roth IRA from another such account,
``(B) from an eligible retirement plan, but only if--
``(i) in the case of an individual retirement plan, such
rollover contribution meets the requirements of section
408(d)(3), and
``(ii) in the case of any eligible retirement plan (as
defined in section 402(c)(8)(B) other than clauses (i) and
(ii) thereof), such rollover contribution meets the
requirements of section 402(c), 403(b)(8), or 457(e)(16), as
applicable.
For purposes of section 408(d)(3)(B), there shall be
disregarded any qualified rollover contribution from an
individual retirement plan (other than a Roth IRA) to a Roth
IRA.
``(2) Military death gratuity.--
``(A) In general.--The term `qualified rollover
contribution' includes a contribution to a Roth IRA
maintained for the benefit of an individual to the extent
that such contribution does not exceed the amount received by
such individual under section 1477 of title 10, United States
Code, or under section 1967 of title 38 of such Code, if such
contribution is made not later than 1 year after the day on
which such individual receives such amount.
``(B) Annual limit on number of rollovers not to apply.--
Section 408(d)(3)(B) shall not apply with respect to amounts
treated as a rollover by the subparagraph (A).
``(C) Application of section 72.--For purposes of applying
section 72 in the case of a distribution which is not a
qualified distribution, the amount treated as a rollover by
reason of subparagraph (A) shall be treated as investment in
the contract.''.
(c) Effective Dates.--
(1) In general.--Except as provided by paragraphs (2) and
(3), the amendments made by this section shall apply with
respect to deaths from injuries occurring on or after the
date of the enactment of this Act.
(2) Application of amendments to deaths from injuries
occurring on or after october 7, 2001, and before
enactment.--The amendments made by this section shall apply
to any contribution made pursuant to section 408A(e)(2) of
the Internal Revenue Code of 1986, as amended by this Act,
with respect to amounts received under section 1477 of title
10, United States Code, or under section 1967 of title 38 of
such Code, for deaths from injuries occurring on or after
October 7, 2001, and before the date of the enactment of this
Act if such contribution is made not later than 1 year after
the date of the enactment of this Act.
(3) Pension protection act changes.--Section 408A(e)(1) of
the Internal Revenue Code of 1986 (as in effect after the
amendments made by subsection (b)) shall apply to taxable
years beginning after December 31, 2007.
SEC. 11. CREDIT FOR EMPLOYER DIFFERENTIAL WAGE PAYMENTS TO
EMPLOYEES WHO ARE ACTIVE DUTY MEMBERS OF THE
UNIFORMED SERVICES.
(a) In General.--Subpart D of part IV of subchapter A of
chapter 1 (relating to business credits) is amended by adding
at the end the following new section:
``SEC. 45O. EMPLOYER WAGE CREDIT FOR EMPLOYEES WHO ARE ACTIVE
DUTY MEMBERS OF THE UNIFORMED SERVICES.
``(a) General Rule.--For purposes of section 38, in the
case of an eligible small business employer, the differential
wage payment credit for any taxable year is an amount equal
to 20 percent of the sum of the eligible differential wage
payments for each of the qualified employees of the taxpayer
during such taxable year.
``(b) Definitions.--For purposes of this section--
``(1) Eligible differential wage payments.--The term
`eligible differential wage payments' means, with respect to
each qualified employee, so much of the differential wage
payments (as defined in section 3401(h)(2)) paid to such
employee for the taxable year as does not exceed $20,000.
``(2) Qualified employee.--The term `qualified employee'
means a person who has been an employee of the taxpayer for
the 91-day period immediately preceding the period for which
any differential wage payment is made.
``(3) Eligible small business employer.--
``(A) In general.--The term `eligible small business
employer' means, with respect to any taxable year, any
employer which--
``(i) employed an average of less that 50 employees on
business days during such taxable year, and
``(ii) under a written plan of the employer, provides
eligible differential wage payments to every qualified
employee of the employer.
``(B) Controlled groups.--For purposes of subparagraph (A),
all persons treated as a single employer under subsection
(b), (c), (m), or (o) of section 414 shall be treated as a
single employer.
``(c) Coordination With Other Credits.--The amount of
credit otherwise allowable under this chapter with respect to
compensation paid to any employee shall be reduced by the
credit determined under this section with respect to such
employee.
``(d) Disallowance for Failure to Comply With Employment or
Reemployment Rights of Members of the Reserve Components of
the Armed Forces of the United States.--No credit shall be
allowed under subsection (a) to a taxpayer for--
``(1) any taxable year, beginning after the date of the
enactment of this section, in which the taxpayer is under a
final order, judgment, or other process issued or required by
a district court of the United States under section 4323 of
title 38 of the United States Code with respect to a
violation of chapter 43 of such title, and
``(2) the 2 succeeding taxable years.
``(e) Certain Rules to Apply.--For purposes of this
section, rules similar to the rules of subsections (c), (d),
and (e) of section 52 shall apply.
``(f) Termination.--This section shall not apply to any
payments made after December 31, 2009.''.
(b) Credit Treated as Part of General Business Credit.--
Section 38(b) (relating to general business credit) is
amended by striking ``plus'' at the end of paragraph (30), by
striking the period at the end of paragraph (31) and
inserting ``, plus'', and by adding at the end of following
new paragraph:
``(32) the differential wage payment credit determined
under section 45O(a).''.
(c) No Deduction for Compensation Taken Into Account for
Credit.--Section 280C(a) (relating to rule for employment
credits) is amended by inserting ``45O(a),'' after
``45A(a),''.
(d) Clerical Amendment.--The table of sections for subpart
D of part IV of subchapter A of chapter 1 is amended by
adding at the end the following new item:
[[Page S7551]]
``Sec. 45O. Employer wage credit for employees who are active duty
members of the uniformed services.''.
(e) Effective Date.--The amendments made by this section
shall apply to amounts paid after the date of the enactment
of this Act.
SEC. 12. REVISION OF TAX RULES ON EXPATRIATION OF
INDIVIDUALS.
(a) In General.--Subpart A of part II of subchapter N of
chapter 1 is amended by inserting after section 877 the
following new section:
``SEC. 877A. TAX RESPONSIBILITIES OF EXPATRIATION.
``(a) General Rules.--For purposes of this subtitle--
``(1) Mark to market.--Except as provided in subsections
(d) and (f), all property of a covered expatriate to whom
this section applies shall be treated as sold on the day
before the expatriation date for its fair market value.
``(2) Recognition of gain or loss.--In the case of any sale
under paragraph (1)--
``(A) notwithstanding any other provision of this title,
any gain arising from such sale shall be taken into account
for the taxable year of the sale, and
``(B) any loss arising from such sale shall be taken into
account for the taxable year of the sale to the extent
otherwise provided by this title, except that section 1091
shall not apply to any such loss.
Proper adjustment shall be made in the amount of any gain or
loss subsequently realized for gain or loss taken into
account under the preceding sentence.
``(3) Exclusion for certain gain.--
``(A) In general.--The amount which, but for this
paragraph, would be includible in the gross income of any
individual by reason of this section shall be reduced (but
not below zero) by $600,000. For purposes of this paragraph,
allocable expatriation gain taken into account under
subsection (f)(2) shall be treated in the same manner as an
amount required to be includible in gross income.
``(B) Cost-of-living adjustment.--
``(i) In general.--In the case of an expatriation date
occurring in any calendar year after 2007, the $600,000
amount under subparagraph (A) shall be increased by an amount
equal to--
``(I) such dollar amount, multiplied by
``(II) the cost-of-living adjustment determined under
section 1(f)(3) for such calendar year, determined by
substituting `calendar year 2006' for `calendar year 1992' in
subparagraph (B) thereof.
``(ii) Rounding rules.--If any amount after adjustment
under clause (i) is not a multiple of $1,000, such amount
shall be rounded to the next lower multiple of $1,000.
``(4) Election to continue to be taxed as united states
citizen.--
``(A) In general.--If a covered expatriate elects the
application of this paragraph--
``(i) this section (other than this paragraph and
subsection (i)) shall not apply to the expatriate, but
``(ii) in the case of property to which this section would
apply but for such election, the expatriate shall be subject
to tax under this title in the same manner as if the
individual were a United States citizen.
``(B) Requirements.--Subparagraph (A) shall not apply to an
individual unless the individual--
``(i) provides security for payment of tax in such form and
manner, and in such amount, as the Secretary may require,
``(ii) consents to the waiver of any right of the
individual under any treaty of the United States which would
preclude assessment or collection of any tax which may be
imposed by reason of this paragraph, and
``(iii) complies with such other requirements as the
Secretary may prescribe.
``(C) Election.--An election under subparagraph (A) shall
apply to all property to which this section would apply but
for the election and, once made, shall be irrevocable. Such
election shall also apply to property the basis of which is
determined in whole or in part by reference to the property
with respect to which the election was made.
``(b) Election To Defer Tax.--
``(1) In general.--If the taxpayer elects the application
of this subsection with respect to any property treated as
sold by reason of subsection (a), the payment of the
additional tax attributable to such property shall be
postponed until the due date of the return for the taxable
year in which such property is disposed of (or, in the case
of property disposed of in a transaction in which gain is not
recognized in whole or in part, until such other date as the
Secretary may prescribe).
``(2) Determination of tax with respect to property.--For
purposes of paragraph (1), the additional tax attributable to
any property is an amount which bears the same ratio to the
additional tax imposed by this chapter for the taxable year
solely by reason of subsection (a) as the gain taken into
account under subsection (a) with respect to such property
bears to the total gain taken into account under subsection
(a) with respect to all property to which subsection (a)
applies.
``(3) Termination of postponement.--No tax may be postponed
under this subsection later than the due date for the return
of tax imposed by this chapter for the taxable year which
includes the date of death of the expatriate (or, if earlier,
the time that the security provided with respect to the
property fails to meet the requirements of paragraph (4),
unless the taxpayer corrects such failure within the time
specified by the Secretary).
``(4) Security.--
``(A) In general.--No election may be made under paragraph
(1) with respect to any property unless adequate security is
provided to the Secretary with respect to such property.
``(B) Adequate security.--For purposes of subparagraph (A),
security with respect to any property shall be treated as
adequate security if--
``(i) it is a bond in an amount equal to the deferred tax
amount under paragraph (2) for the property, or
``(ii) the taxpayer otherwise establishes to the
satisfaction of the Secretary that the security is adequate.
``(5) Waiver of certain rights.--No election may be made
under paragraph (1) unless the taxpayer consents to the
waiver of any right under any treaty of the United States
which would preclude assessment or collection of any tax
imposed by reason of this section.
``(6) Elections.--An election under paragraph (1) shall
only apply to property described in the election and, once
made, is irrevocable. An election may be made under paragraph
(1) with respect to an interest in a trust with respect to
which gain is required to be recognized under subsection
(f)(1).
``(7) Interest.--For purposes of section 6601--
``(A) the last date for the payment of tax shall be
determined without regard to the election under this
subsection, and
``(B) section 6621(a)(2) shall be applied by substituting
`5 percentage points' for `3 percentage points' in
subparagraph (B) thereof.
``(c) Covered Expatriate.--For purposes of this section--
``(1) In general.--Except as provided in paragraph (2), the
term `covered expatriate' means an expatriate.
``(2) Exceptions.--An individual shall not be treated as a
covered expatriate if--
``(A) the individual--
``(i) became at birth a citizen of the United States and a
citizen of another country and, as of the expatriation date,
continues to be a citizen of, and is taxed as a resident of,
such other country, and
``(ii) has not been a resident of the United States (as
defined in section 7701(b)(1)(A)(ii)) during the 5 taxable
years ending with the taxable year during which the
expatriation date occurs, or
``(B)(i) the individual's relinquishment of United States
citizenship occurs before such individual attains age 18\1/
2\, and
``(ii) the individual has been a resident of the United
States (as so defined) for not more than 5 taxable years
before the date of relinquishment.
``(d) Exempt Property; Special Rules for Pension Plans.--
``(1) Exempt property.--This section shall not apply to the
following:
``(A) United states real property interests.--Any United
States real property interest (as defined in section
897(c)(1)), other than stock of a United States real property
holding corporation which does not, on the day before the
expatriation date, meet the requirements of section
897(c)(2).
``(B) Specified property.--Any property or interest in
property not described in subparagraph (A) which the
Secretary specifies in regulations.
``(2) Special rules for certain retirement plans.--
``(A) In general.--If a covered expatriate holds on the day
before the expatriation date any interest in a retirement
plan to which this paragraph applies--
``(i) such interest shall not be treated as sold for
purposes of subsection (a)(1), but
``(ii) an amount equal to the present value of the
expatriate's nonforfeitable accrued benefit shall be treated
as having been received by such individual on such date as a
distribution under the plan.
``(B) Treatment of subsequent distributions.--In the case
of any distribution on or after the expatriation date to or
on behalf of the covered expatriate from a plan from which
the expatriate was treated as receiving a distribution under
subparagraph (A), the amount otherwise includible in gross
income by reason of the subsequent distribution shall be
reduced by the excess of the amount includible in gross
income under subparagraph (A) over any portion of such amount
to which this subparagraph previously applied.
``(C) Treatment of subsequent distributions by plan.--For
purposes of this title, a retirement plan to which this
paragraph applies, and any person acting on the plan's
behalf, shall treat any subsequent distribution described in
subparagraph (B) in the same manner as such distribution
would be treated without regard to this paragraph.
``(D) Applicable plans.--This paragraph shall apply to--
``(i) any qualified retirement plan (as defined in section
4974(c)),
``(ii) an eligible deferred compensation plan (as defined
in section 457(b)) of an eligible employer described in
section 457(e)(1)(A), and
``(iii) to the extent provided in regulations, any foreign
pension plan or similar retirement arrangements or programs.
``(e) Definitions.--For purposes of this section--
``(1) Expatriate.--The term `expatriate' means--
``(A) any United States citizen who relinquishes
citizenship, and
``(B) any long-term resident of the United States who--
[[Page S7552]]
``(i) ceases to be a lawful permanent resident of the
United States (within the meaning of section 7701(b)(6)), or
``(ii) commences to be treated as a resident of a foreign
country under the provisions of a tax treaty between the
United States and the foreign country and who does not waive
the benefits of such treaty applicable to residents of the
foreign country.
``(2) Expatriation date.--The term `expatriation date'
means--
``(A) the date an individual relinquishes United States
citizenship, or
``(B) in the case of a long-term resident of the United
States, the date of the event described in clause (i) or (ii)
of paragraph (1)(B).
``(3) Relinquishment of citizenship.--A citizen shall be
treated as relinquishing United States citizenship on the
earliest of--
``(A) the date the individual renounces such individual's
United States nationality before a diplomatic or consular
officer of the United States pursuant to paragraph (5) of
section 349(a) of the Immigration and Nationality Act (8
U.S.C. 1481(a)(5)),
``(B) the date the individual furnishes to the United
States Department of State a signed statement of voluntary
relinquishment of United States nationality confirming the
performance of an act of expatriation specified in paragraph
(1), (2), (3), or (4) of section 349(a) of the Immigration
and Nationality Act (8 U.S.C. 1481(a)(1)-(4)),
``(C) the date the United States Department of State issues
to the individual a certificate of loss of nationality, or
``(D) the date a court of the United States cancels a
naturalized citizen's certificate of naturalization.
Subparagraph (A) or (B) shall not apply to any individual
unless the renunciation or voluntary relinquishment is
subsequently approved by the issuance to the individual of a
certificate of loss of nationality by the United States
Department of State.
``(4) Long-term resident.--The term `long-term resident'
has the meaning given to such term by section 877(e)(2).
``(f) Special Rules Applicable to Beneficiaries' Interests
in Trust.--
``(1) In general.--Except as provided in paragraph (2), if
an individual is determined under paragraph (3) to hold an
interest in a trust on the day before the expatriation date--
``(A) the individual shall not be treated as having sold
such interest,
``(B) such interest shall be treated as a separate share in
the trust, and
``(C)(i) such separate share shall be treated as a separate
trust consisting of the assets allocable to such share,
``(ii) the separate trust shall be treated as having sold
its assets on the day before the expatriation date for their
fair market value and as having distributed all of its assets
to the individual as of such time, and
``(iii) the individual shall be treated as having
recontributed the assets to the separate trust.
Subsection (a)(2) shall apply to any income, gain, or loss of
the individual arising from a distribution described in
subparagraph (C)(ii). In determining the amount of such
distribution, proper adjustments shall be made for
liabilities of the trust allocable to an individual's share
in the trust.
``(2) Special rules for interests in qualified trusts.--
``(A) In general.--If the trust interest described in
paragraph (1) is an interest in a qualified trust--
``(i) paragraph (1) and subsection (a) shall not apply, and
``(ii) in addition to any other tax imposed by this title,
there is hereby imposed on each distribution with respect to
such interest a tax in the amount determined under
subparagraph (B).
``(B) Amount of tax.--The amount of tax under subparagraph
(A)(ii) shall be equal to the lesser of--
``(i) the highest rate of tax imposed by section 1(e) for
the taxable year which includes the day before the
expatriation date, multiplied by the amount of the
distribution, or
``(ii) the balance in the deferred tax account immediately
before the distribution determined without regard to any
increases under subparagraph (C)(ii) after the 30th day
preceding the distribution.
``(C) Deferred tax account.--For purposes of subparagraph
(B)(ii)--
``(i) Opening balance.--The opening balance in a deferred
tax account with respect to any trust interest is an amount
equal to the tax which would have been imposed on the
allocable expatriation gain with respect to the trust
interest if such gain had been included in gross income under
subsection (a).
``(ii) Increase for interest.--The balance in the deferred
tax account shall be increased by the amount of interest
determined (on the balance in the account at the time the
interest accrues), for periods after the 90th day after the
expatriation date, by using the rates and method applicable
under section 6621 for underpayments of tax for such periods,
except that section 6621(a)(2) shall be applied by
substituting `5 percentage points' for `3 percentage points'
in subparagraph (B) thereof.
``(iii) Decrease for taxes previously paid.--The balance in
the tax deferred account shall be reduced--
``(I) by the amount of taxes imposed by subparagraph (A) on
any distribution to the person holding the trust interest,
and
``(II) in the case of a person holding a nonvested
interest, to the extent provided in regulations, by the
amount of taxes imposed by subparagraph (A) on distributions
from the trust with respect to nonvested interests not held
by such person.
``(D) Allocable expatriation gain.--For purposes of this
paragraph, the allocable expatriation gain with respect to
any beneficiary's interest in a trust is the amount of gain
which would be allocable to such beneficiary's vested and
nonvested interests in the trust if the beneficiary held
directly all assets allocable to such interests.
``(E) Tax deducted and withheld.--
``(i) In general.--The tax imposed by subparagraph (A)(ii)
shall be deducted and withheld by the trustees from the
distribution to which it relates.
``(ii) Exception where failure to waive treaty rights.--If
an amount may not be deducted and withheld under clause (i)
by reason of the distributee failing to waive any treaty
right with respect to such distribution--
``(I) the tax imposed by subparagraph (A)(ii) shall be
imposed on the trust and each trustee shall be personally
liable for the amount of such tax, and
``(II) any other beneficiary of the trust shall be entitled
to recover from the distributee the amount of such tax
imposed on the other beneficiary.
``(F) Disposition.--If a trust ceases to be a qualified
trust at any time, a covered expatriate disposes of an
interest in a qualified trust, or a covered expatriate
holding an interest in a qualified trust dies, then, in lieu
of the tax imposed by subparagraph (A)(ii), there is hereby
imposed a tax equal to the lesser of--
``(i) the tax determined under paragraph (1) as if the day
before the expatriation date were the date of such cessation,
disposition, or death, whichever is applicable, or
``(ii) the balance in the tax deferred account immediately
before such date.
Such tax shall be imposed on the trust and each trustee shall
be personally liable for the amount of such tax and any other
beneficiary of the trust shall be entitled to recover from
the covered expatriate or the estate the amount of such tax
imposed on the other beneficiary.
``(G) Definitions and special rules.--For purposes of this
paragraph--
``(i) Qualified trust.--The term `qualified trust' means a
trust which is described in section 7701(a)(30)(E).
``(ii) Vested interest.--The term `vested interest' means
any interest which, as of the day before the expatriation
date, is vested in the beneficiary.
``(iii) Nonvested interest.--The term `nonvested interest'
means, with respect to any beneficiary, any interest in a
trust which is not a vested interest. Such interest shall be
determined by assuming the maximum exercise of discretion in
favor of the beneficiary and the occurrence of all
contingencies in favor of the beneficiary.
``(iv) Adjustments.--The Secretary may provide for such
adjustments to the bases of assets in a trust or a deferred
tax account, and the timing of such adjustments, in order to
ensure that gain is taxed only once.
``(v) Coordination with retirement plan rules.--This
subsection shall not apply to an interest in a trust which is
part of a retirement plan to which subsection (d)(2) applies.
``(3) Determination of beneficiaries' interest in trust.--
``(A) Determinations under paragraph (1).--For purposes of
paragraph (1), a beneficiary's interest in a trust shall be
based upon all relevant facts and circumstances, including
the terms of the trust instrument and any letter of wishes or
similar document, historical patterns of trust distributions,
and the existence of and functions performed by a trust
protector or any similar adviser.
``(B) Other determinations.--For purposes of this section--
``(i) Constructive ownership.--If a beneficiary of a trust
is a corporation, partnership, trust, or estate, the
shareholders, partners, or beneficiaries shall be deemed to
be the trust beneficiaries for purposes of this section.
``(ii) Taxpayer return position.--A taxpayer shall clearly
indicate on its income tax return--
``(I) the methodology used to determine that taxpayer's
trust interest under this section, and
``(II) if the taxpayer knows (or has reason to know) that
any other beneficiary of such trust is using a different
methodology to determine such beneficiary's trust interest
under this section.
``(g) Termination of Deferrals, Etc.--In the case of any
covered expatriate, notwithstanding any other provision of
this title--
``(1) any period during which recognition of income or gain
is deferred shall terminate on the day before the
expatriation date, and
``(2) any extension of time for payment of tax shall cease
to apply on the day before the expatriation date and the
unpaid portion of such tax shall be due and payable at the
time and in the manner prescribed by the Secretary.
``(h) Imposition of Tentative Tax.--
``(1) In general.--If an individual is required to include
any amount in gross income under subsection (a) for any
taxable year, there is hereby imposed, immediately before the
expatriation date, a tax in an amount equal to the amount of
tax which would be imposed if the taxable year were a short
taxable year ending on the expatriation date.
[[Page S7553]]
``(2) Due date.--The due date for any tax imposed by
paragraph (1) shall be the 90th day after the expatriation
date.
``(3) Treatment of tax.--Any tax paid under paragraph (1)
shall be treated as a payment of the tax imposed by this
chapter for the taxable year to which subsection (a) applies.
``(4) Deferral of tax.--The provisions of subsection (b)
shall apply to the tax imposed by this subsection to the
extent attributable to gain includible in gross income by
reason of this section.
``(i) Special Liens for Deferred Tax Amounts.--
``(1) Imposition of lien.--
``(A) In general.--If a covered expatriate makes an
election under subsection (a)(4) or (b) which results in the
deferral of any tax imposed by reason of subsection (a), the
deferred amount (including any interest, additional amount,
addition to tax, assessable penalty, and costs attributable
to the deferred amount) shall be a lien in favor of the
United States on all property of the expatriate located in
the United States (without regard to whether this section
applies to the property).
``(B) Deferred amount.--For purposes of this subsection,
the deferred amount is the amount of the increase in the
covered expatriate's income tax which, but for the election
under subsection (a)(4) or (b), would have occurred by reason
of this section for the taxable year including the
expatriation date.
``(2) Period of lien.--The lien imposed by this subsection
shall arise on the expatriation date and continue until--
``(A) the liability for tax by reason of this section is
satisfied or has become unenforceable by reason of lapse of
time, or
``(B) it is established to the satisfaction of the
Secretary that no further tax liability may arise by reason
of this section.
``(3) Certain rules apply.--The rules set forth in
paragraphs (1), (3), and (4) of section 6324A(d) shall apply
with respect to the lien imposed by this subsection as if it
were a lien imposed by section 6324A.
``(j) Regulations.--The Secretary shall prescribe such
regulations as may be necessary or appropriate to carry out
the purposes of this section.''.
(b) Inclusion in Income of Gifts and Bequests Received by
United States Citizens and Residents From Expatriates.--
Section 102 (relating to gifts, etc. not included in gross
income) is amended by adding at the end the following new
subsection:
``(d) Gifts and Inheritances From Covered Expatriates.--
``(1) Treatment of gifts and inheritances.--
``(A) In general.--Subsection (a) shall not exclude from
gross income the value of any property acquired by gift,
bequest, devise, or inheritance from a covered expatriate
after the expatriation date.
``(B) Determination of basis.--Notwithstanding sections
1015 or 1022, the basis of any property described in
subparagraph (A) in the hands of the donee or the person
acquiring such property from the decedent shall be equal to
the fair market value of the property at the time of the
gift, bequest, devise, or inheritance.
``(2) Exceptions for transfers otherwise subject to estate
or gift tax.--Paragraph (1) shall not apply to any property
if either--
``(A) the gift, bequest, devise, or inheritance is--
``(i) shown on a timely filed return of tax imposed by
chapter 12 as a taxable gift by the covered expatriate, or
``(ii) included in the gross estate of the covered
expatriate for purposes of chapter 11 and shown on a timely
filed return of tax imposed by chapter 11 of the estate of
the covered expatriate, or
``(B) no such return was timely filed but no such return
would have been required to be filed even if the covered
expatriate were a citizen or long-term resident of the United
States.
``(3) Definitions.--For purposes of this subsection, any
term used in this subsection which is also used in section
877A shall have the same meaning as when used in section
877A.''.
(c) Definition of Termination of United States
Citizenship.--Section 7701(a) is amended by adding at the end
the following new paragraph:
``(50) Termination of united states citizenship.--
``(A) In general.--An individual shall not cease to be
treated as a United States citizen before the date on which--
``(i) the individual's citizenship is treated as
relinquished under section 877A(e)(3), and
``(ii) the individual provides a statement in accordance
with section 6039G (if such a statement is otherwise
required).
``(B) Dual citizens.--Under regulations prescribed by the
Secretary, subparagraph (A) shall not apply to an individual
who became at birth a citizen of the United States and a
citizen of another country.''.
(d) Ineligibility for Visa or Admission to United States.--
(1) In general.--Section 212(a)(10)(E) of the Immigration
and Nationality Act (8 U.S.C. 1182(a)(10)(E)) is amended to
read as follows:
``(E) Former citizens not in compliance with expatriation
revenue provisions.--Any alien who is a former citizen of the
United States who relinquishes United States citizenship
(within the meaning of section 877A(e)(3) of the Internal
Revenue Code of 1986) and who is not in compliance with
section 877A of such Code (relating to expatriation) is
inadmissible.''.
(2) Availability of information.--
(A) In general.--Section 6103(l) (relating to disclosure of
returns and return information for purposes other than tax
administration) is amended by adding at the end the following
new paragraph:
``(21) Disclosure to deny visa or admission to certain
expatriates.--Upon written request of the Attorney General or
the Attorney General's delegate, the Secretary shall disclose
whether an individual is in compliance with section 877A (and
if not in compliance, any items of noncompliance) to officers
and employees of the Federal agency responsible for
administering section 212(a)(10)(E) of the Immigration and
Nationality Act solely for the purpose of, and to the extent
necessary in, administering such section 212(a)(10)(E).''.
(B) Safeguards.--Section 6103(p)(4) (relating to
safeguards) is amended by striking ``or (20)'' each place it
appears and inserting ``(20), or (21)''.
(3) Effective dates.--The amendments made by this
subsection shall apply to individuals who relinquish United
States citizenship on or after the date of the enactment of
this Act.
(e) Conforming Amendments.--
(1) Section 877 is amended by adding at the end the
following new subsection:
``(h) Application.--This section shall not apply to an
expatriate (as defined in section 877A(e)) whose expatriation
date (as so defined) occurs on or after the date of the
enactment of this subsection.''.
(2) Section 2107 is amended by adding at the end the
following new subsection:
``(f) Application.--This section shall not apply to any
expatriate subject to section 877A.''.
(3) Section 2501(a)(3) is amended by adding at the end the
following new subparagraph:
``(C) Application.--This paragraph shall not apply to any
expatriate subject to section 877A.''.
(4) Section 6039G(a) is amended by inserting ``or 877A''
after ``section 877(b)''.
(5) The second sentence of section 6039G(d) is amended by
inserting ``or who relinquishes United States citizenship
(within the meaning of section 877A(e)(3))'' after ``section
877(a))''.
(6) Section 7701(n) is amended by adding at the end the
following new paragraph:
``(3) Application.--This subsection shall not apply to any
expatriate subject to section 877A.''.
(f) Clerical Amendment.--The table of sections for subpart
A of part II of subchapter N of chapter 1 is amended by
inserting after the item relating to section 877 the
following new item:
``Sec. 877A. Tax responsibilities of expatriation''.
(g) Effective Date.--
(1) In general.--Except as provided in this subsection, the
amendments made by this section shall apply to expatriates
(within the meaning of section 877A(e) of the Internal
Revenue Code of 1986, as added by this section) whose
expatriation date (as so defined) occurs on or after the date
of the enactment of this Act.
(2) Gifts and bequests.--Section 102(d) of the Internal
Revenue Code of 1986 (as added by subsection (b)) shall apply
to gifts and bequests received on or after the date of the
enactment of this Act, from an individual or the estate of an
individual whose expatriation date (as so defined) occurs
after such date.
(3) Due date for tentative tax.--The due date under section
877A(h)(2) of the Internal Revenue Code of 1986, as added by
this section, shall in no event occur before the 90th day
after the date of the enactment of this Act.
Mr. KERRY. Mr. President, today Senators Baucus, Grassley and I,
along with other Finance Committee members, are introducing the
Defenders of Freedom Tax Relief Act of 2007. Earlier in the year,
Senator Smith and I introduced the Active Duty Military Tax Relief Act
of 2007, which would help those who are valiantly serving their country
and the families that they leave behind.
The Defenders of Freedom on Tax Relief Act of 2007 includes several
provisions from the Active Duty Military Tax Relief Act of 2007. It
also includes additional provisions to help military families and
veterans who often struggle financially.
The best definition of patriotism is keeping faith with those who
wear the uniform of our country. That means giving our troops the
resources they need to keep them safe while they are protecting us. And
it means supporting our troops at home as well as abroad.
Currently, there are over 149,700 military personnel serving in Iraq.
There are approximately 22,100 U.S. servicemembers in Afghanistan. Many
of these men and women are reservists and have been called to active
duty, frequently for multiple tours.
Most large businesses have the resources to provide supplemental
income to reservist employees called up and to replace them with
temporary employees. I applaud the businesses that have been able to
pay supplemental income to their reservists, but
[[Page S7554]]
it is not easy for small businesses to do the same.
In January, the Committee on Small Business and Entrepreneurship held
a hearing on veterans' small business issues. A majority of our
veterans returning from Iraq and Afghanistan are Reserve and National
Guard members--35 percent of whom are either self-employed or own or
are employed by a small business.
We heard some disturbing statistics about the impact and unintended
consequences the call up of reservists is having on small businesses.
According to a January 2007 survey conducted by Workforce Management,
54 percent of the businesses surveyed responded that they would not
hire a citizen soldier if they knew that they could be called up for an
indeterminate amount of time. I am concerned that long call ups and
redeployments have made it hard for small businesses to be supportive
of civilian soldiers.
The Active Duty Military Tax Relief Act of 2007 provides a tax credit
to small businesses to assist with the cost of paying the salary of
their reservist employees when they are called to active duty. A
similar provision is included in the Defenders of Freedom Tax Relief
Act of 2007.
In addition to helping small businesses, the Active Duty Military Tax
Relief Act of 2007 addresses concerns related to differential military
pay, income tax withholding, and retirement plan participation. These
provisions will make it easier for employers who would like to pay
their employees supplemental income, above their military pay, and make
pension contributions. Our legislation would make differential military
pay subject to Federal income tax withholding. In addition, with
respect to the retirement plan rules, the bill provides that a person
receiving differential military pay would be treated as an employee of
the employer making the payment, and allows the differential military
pay to be treated as compensation. These provisions are included in the
Defenders of Freedom Tax Relief Act of 2007.
The Active Duty Military Tax Relief Act of 2007 would make permanent
the existing provision which allows taxpayer to include combat pay as
earned income for purposes of the earned-income tax credit, EITC.
Without this provision some military families would no longer be
eligible to receive the EITC because combat pay is currently not
taxable.
Last Congress, Senator Smith and I introduced the Fallen Heroes
Family Savings Act, which we have incorporated into the Active Duty
Military Tax Relief Act. This provision provides tax relief for the
death gratuity payment that is given to families who have lost a loved
one in combat. This payment is currently $100,000.
Our current tax laws do not allow the recipients of this payment to
use it to make contributions to tax-preferred saving accounts that help
with saving for retirement. The Active Duty Military Tax Relief Act of
2007 would allow military death gratuities to be contributed to certain
tax-preferred accounts. These contributions would be treated as
qualified rollovers. A similar provision is included in the Defenders
of Freedom Tax Relief Act of 2007.
Our service men and women need to know that we are honoring their
valor by taking care of those they leave behind. Helping ease the tax
burden on the death gratuity will enable military families to save more
for retirement. These changes to our tax laws will help our military
families with some of their financial burdens. It cannot repay the
sacrifices they have made for us, but it is a small way we can support
our troops and their families at home as well as abroad.
______
By Mr. LAUTENBERG (for himself, Mr. Inouye, Mr. Smith, and Mr.
Stevens):
S. 1594. A bill to amend title 46, United States Code, to improve
safety and security for especially hazardous cargoes, and for other
purposes; to the Committee on Commerce, Science, and Transportation.
Mr. LAUTENBERG. Mr. President, I rise today to introduce the Maritime
Hazardous Cargo Security Act of 2007 along with my colleagues Senators
Inouye, Stevens, and Smith. As the bipartisan leaders of the Senate
Committee on Commerce, Science, and Transportation and its Subcommittee
on Surface Transportation and Merchant Marine Safety, Security, and
Infrastructure, we have been working together over the course of this
session to evaluate the risks posed by the transportation of especially
hazardous cargo in the maritime sector. This bill is the result of
exhaustive research and consultation with affected industries and the
Department of Homeland Security. Ships bringing liquefied natural gas,
LNG, from foreign ports as well as the facilities along America's
shores that handle LNG must be better secured against terrorism.
With so much focus on hazardous cargo that is transported on our
roads and railways, we must not neglect the much larger shipments of
hazardous cargoes that are carried by vessel. Energy supply challenges
in our country have led to the proposals for approximately 70 new
shoreside facilities in the United States to receive liquefied natural
gas via oceangoing tank vessel. Many of the safety and security risks
of the transportation of this commodity are known and have been
detailed by the Government Accountability Office. Furthermore, other
chemicals and petrochemicals can present even greater security risks.
The shipping system for these commodities is international in scope,
so our bill would require the administration to work with our
international trading partners to develop standards of care to
adequately protect those ships, facilities, employees and nearby
communities and residents from attacks involving these and other
hazardous cargoes. Our proposal would require significant steps to
protect the safety and security of our regional and national economies,
and the public health, from the potential hazards of high risk cargo
transported by ship.
Specifically the Maritime Hazardous Cargo Act of 2007 would: Direct
the Administration to work with international partners to develop
standards and procedures for the safe and secure handling of especially
hazardous cargoes, EHC, for all vessels and port facilities; require
successful completion of U.S. Coast Guard Incident Command System, ICS,
training for all personnel responsible for the safety and security of a
vessel in port; require the Department of Homeland Security to develop
regional response and recovery plans for the resumption of commerce
after disruption by a security incident; authorize the U.S. Coast Guard
to develop cost share plans for security costs associated with high-
risk U.S. facilities; authorize assistance to foreign ports that handle
and transport EHC's for the purpose of complying with or exceeding
current International Ship and Port Facility Code, ISPFC, standards;
authorize voluntary third party validation of international port
facilities to certify they meet or exceed international safety
standards; and require the U.S. Coast Guard to develop a resource
allocation plan to show how its proposed budget will be used for EHC
security operations and to report to Congress biannually.
In summary, the Maritime Hazardous Cargo Act of 2007 will require
strengthening of Federal protections against terrorist attacks on
facilities and vessels that transport, handle, and store especially
hazardous cargoes, EHC's. The transportation of EHC's by ship can pose
a significant risk to the public safety and the economic security of
the Nation, particularly the transportation of chemicals and
petrochemicals such as anhydrous ammonia, ammonium nitrate, chlorine,
liquefied natural gas and liquefied petroleum gas. Currently, no
international standards exist for the safe and secure handling of these
chemicals/petrochemicals by ship and limited U.S. Coast Guard resources
for EHC security poses a dangerous risk to our communities. Further, I
intend to work with my cosponsors and other colleagues to ensure there
are sufficient resources in the Federal budget to carry out the
provisions of the bill.
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. 1594
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Maritime
Hazardous Cargo Security Act''.
[[Page S7555]]
(b) Table of Contents.--The table of contents for this Act
is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. International committee for the safe and secure transportation
of especially hazardous cargo.
Sec. 3. Validation of compliance with ISPFC standards.
Sec. 4. Safety and security assistance for foreign ports.
Sec. 5. Coast Guard port assistance program.
Sec. 6. EHC facility risk-based cost sharing.
Sec. 7. Transportation security incident mitigation plan.
Sec. 8. Coast Guard national resource allocation plan.
Sec. 9. Incident command system training.
Sec. 10. Conveyance of certain National Defense Reserve Fleet Vessels.
Sec. 11. Pre-positioning interoperable communications equipment at
interagency operational centers.
Sec. 12. Definitions.
SEC. 2. INTERNATIONAL COMMITTEE FOR THE SAFE AND SECURE
TRANSPORTATION OF ESPECIALLY HAZARDOUS CARGO.
(a) In General.--Chapter 701 of title 46, United States
Code, is amended by inserting after section 70109 the
following:
``Sec. 70109A. International committee for the safe and
secure transportation of especially hazardous cargo
``(a) In General.--The Secretary, in consultation with the
Secretary of State and other appropriate entities, shall, in
a manner consistent with international treaties, conventions,
and agreements to which the United States is a party,
establish a committee that includes representatives of United
States trading partners that supply tank or break-bulk
shipments of especially hazardous cargo to the United States.
``(b) Safe and Secure Loading, Unloading, and
Transportation of Especially Hazardous Cargoes.--In carrying
out this section, the Secretary, in cooperation with the
International Maritime Organization and in consultation with
the International Standards Organization and shipping
industry stakeholders, shall develop protocols, procedures,
standards, and requirements for receiving, handling, loading,
unloading, vessel crewing, and transportation of especially
hazardous cargo to promote the safe and secure operation of
ports, facilities, and vessels that transport especially
hazardous cargo to the United States.
``(c) Deadlines.--The Secretary shall--
``(1) initiate the development of the committee within 180
days after the date of enactment of the Maritime Hazardous
Cargo Security Act; and
``(2) endeavor to have the protocols, procedures,
standards, and requirements developed by the committee take
effect within 3 years after the date of enactment of that
Act.
``(d) Reports.--The Secretary shall report annually to the
Senate Committee on Commerce, Science, and Transportation,
the House of Representatives Committee on Transportation and
Infrastructure, and the House of Representatives Committee on
Homeland Security on the development, implementation, and
administration of the protocols, procedures, standards, and
requirements developed by the committee established under
subsection (a).''.
(b) Conforming Amendment.--The chapter analysis for chapter
701 of title 46, United States Code, is amended by inserting
after the item relating the section 70109 the following:
``70109A. International committee for the safe and secure
transportation of especially hazardous cargo''.
SEC. 3. VALIDATION OF COMPLIANCE WITH ISPFC STANDARDS.
(a) In General.--Chapter 701 of title 46, United States
Code, is amended by inserting after section 70110 the
following:
``70110A. Port safety and security validations
``(a) In General.--The Secretary, in consultation with the
Secretary of State, shall, in a manner consistent with
international treaties, conventions, and agreements to which
the United States is a party, develop and implement a
voluntary program under which foreign ports and facilities
can certify their compliance with applicable International
Ship and Port Facility Code standards.
``(b) Third-party Validation.--
``(1) In general.--In carrying out this section, the
Secretary, in cooperation with the International Maritime
Organization and the International Standards Organization,
shall develop and implement a program under which
independent, third-party entities are certified to validate a
foreign port's or facility's compliance under the program
developed under subsection (a).
``(2) Program components.--The international program shall
include--
``(A) international inspection protocols and procedures;
``(B) minimum validation standards to ensure a port or
facility meets the applicable International Ship and Port
Facility Code standards;
``(C) recognition for foreign ports or facilities that
exceed the minimum standards;
``(D) uniform performance metrics by which inspection
validations are to be conducted;
``(E) a process for notifying a port or facility, and its
host nation, of areas of concern about the port's or
facility's failure to comply with International Ship and Port
Facility Code standards;
``(F) provisional or probationary validations;
``(G) conditions under which routine monitoring is to occur
if a port or facility receives a provisional or probationary
validation;
``(H) a process by which failed validations can be
appealed; and
``(I) an appropriate cycle for re-inspection and
validation.
``(c) Certification of Third Party Entities.--The Secretary
may not certify a third party entity to validate ports or
facilities under subsection (b) unless--
``(1) the entity demonstrates to the satisfaction of the
Secretary the ability to perform validations in accordance
with the standards, protocols, procedures, and requirements
established by the program implemented under subsection (a);
and
``(2) the entity has no beneficial interest in or any
direct control over the port and facilities being inspected
and validated.
``(d) Monitoring--The Secretary shall regularly monitor and
audit the operations of each third party entity conducting
validations under this section to ensure that it is meeting
the minimum standards, operating protocols, procedures, and
requirements established by international agreement.
``(e) Revocation.--The Secretary shall revoke the
certification of any entity determined by the Secretary not
to meet the minimum standards, operating protocol,
procedures, and requirements established by international
agreement for third party entity validations.
``(f) Protection of Security and Proprietary Information.--
In carrying out this section, the Secretary shall take
appropriate actions to protect from disclosure information
that--
``(1) is security sensitive, proprietary, or business
sensitive; or
``(2) is otherwise not appropriately in the public domain.
``(g) Deadlines.--The Secretary shall--
``(1) initiate procedures to carry out this section within
180 days after the date of enactment of the Maritime
Hazardous Cargo Security Act; and
``(2) develop standards under subsection (b) for third
party validation within 2 years after the date of enactment
of that Act.
``(h) Reports.--The Secretary shall report annually to the
Senate Committee on Commerce, Science, and Transportation,
the House of Representatives Committee on Transportation and
Infrastructure, and the House of Representatives Committee on
Homeland Security on activities conducted pursuant to this
section.''.
(c) Conforming Amendment.--The chapter analysis for chapter
701 of title 46, United States Code, is amended by inserting
after the item relating to section 70110 the following:
``70110A. Port safety and security validations''.
SEC. 4. SAFETY AND SECURITY ASSISTANCE FOR FOREIGN PORTS.
(a) In General.--Section 70110(e)(1) of title 46, United
States Code, is amended by striking the second sentence and
inserting the following: ``The Secretary shall establish a
strategic plan to utilize those assistance programs to assist
ports and facilities that are found by the Secretary under
subsection (a) not to maintain effective antiterrorism
measures in the implementation of port security antiterrorism
measures.''.
(b) Conforming Amendments.--
(1) Section 70110 of title 46, United States Code, is
amended--
(A) by inserting ``or facilities'' after ``ports'' in the
section heading;
(B) by inserting ``or facility'' after ``port'' each place
it appears; and
(C) by striking ``Ports'' in the heading for subsection (e)
and inserting ``Ports, Facilities,''.
(2) The chapter analysis for chapter 701 of title 46,
United States Code, is amended by striking the item relating
to section 70110 and inserting the following:
``70110. Actions and assistance for foreign ports or facilities and
United States territories''.
SEC. 5. COAST GUARD PORT ASSISTANCE PROGRAM.
Section 70110 of title 46, United States Code, is amended
by adding at the end thereof the following:
``(f) Coast Guard Lend-Lease Assistance.--
``(1) In general.--The Secretary may lend, lease, or
otherwise provide equipment, and provide technical training
and support, to the owner or operator of a foreign port or
facility--
``(A) to assist in bringing the port or facility into
compliance with applicable International Ship and Port
Facility Code standards;
``(B) to assist the port or facility in meeting standards
established under section 70109A of this chapter; and
``(C) to assist the port or facility in exceeding the
standards described in subparagraph (A) and (B).
``(2) Conditions.--The Secretary--
``(A) shall provide such assistance based upon an
assessment of the risks to the security of the United States
and the inability of the owner or operator of the port or
facility otherwise to bring the port or facility into
compliance with those standards and to maintain compliance
with them; but
``(B) may not provide such assistance unless the facility
or port has been subjected to a comprehensive port security
assessment by
[[Page S7556]]
the Coast Guard or a third party entity certified by the
Secretary under section 70110A(b) to validate foreign port or
facility compliance with International Ship and Port Facility
Code standards.
``(3) Deadline.--The Secretary shall identify ports and
facilities that qualify for assistance under this subsection
within 180 days after the date of enactment of the Maritime
Hazardous Cargo Security Act.
``(4) Authorization of appropriations.--There are
authorized to be appropriated to the Secretary such sums as
may be necessary to carry out this subsection.''.
SEC. 6. EHC FACILITY RISK-BASED COST SHARING.
The Commandant shall identify facilities sited or
constructed on or adjacent to the navigable waters of the
United States that receive, handle, load, or unload
especially hazardous cargos that pose a risk greater than an
acceptable risk threshhold, as determined by the Secretary
under a uniform risk assessment methodology. The Secretary
may establish a security cost-share plan to assist the Coast
Guard in providing security for the transportation of
especially hazardous cargo to such facilities.
SEC. 7. TRANSPORTATION SECURITY INCIDENT MITIGATION PLAN.
Section 70103(b)(2) of title 46, United States Code, is
amended--
(1) by redesignating subparagraphs (E) through (G) as
subparagraphs (F) through (H), respectively; and
(2) by inserting after subparagraph (D) the following:
``(E) establish regional response and recovery protocols to
prepare for, respond to, mitigate against, and recover from a
transportation security incident consistent with section 202
of the Security and Accountability for Every Port Act of 2006
(6 U.S.C. 942) and section 70103(a) of title 46, United
States Code;''.
SEC. 8. COAST GUARD NATIONAL RESOURCE ALLOCATION PLAN.
The Commandant shall develop a national resource allocation
plan for Coast Guard assets and resources necessary to meet
safety and security requirements associated with receiving,
handling, and loading especially hazardous cargo at United
States ports and facilities, taking into account the Coast
Guard assets and resources necessary to execute other Coast
Guard missions. The Secretary shall submit the plan to the
Congress at the same time as the President submits the Budget
of the United States for fiscal year 2009, together with an
estimate of the operational and capital costs required to
assure an acceptable level of safety and security under the
plan.
SEC. 9. INCIDENT COMMAND SYSTEM TRAINING.
The Secretary shall ensure that Federal, State, and local
personnel responsible for the safety and security of vessels
in port carrying especially hazardous cargo have successfully
completed training in the Coast Guard's incident command
system.
SEC. 10. CONVEYANCE OF CERTAIN NATIONAL DEFENSE RESERVE FLEET
VESSELS.
Section 57102 of title 46, United States Code, is amended--
(1) by striking ``vessel or sell the vessel for cash.'' in
subsection (a) and inserting ``vessel, sell the vessel for
cash, or convey the vessel under subsection (c) to the owner
or operator of a port.''; and
(2) by adding at the end thereof the following:
``(c) Conveyance to Port Authority.--The Secretary, after
consultation with the Maritime Administration, may convey a
vessel described in subsection (a) to the owner or operator
of a United States or foreign port--
``(1) for use in safety or security operations at that
port;
``(2) with or without compensation; and
``(3) subject to such limitations on its use and further
disposition as the Secretary determines to be appropriate.''.
SEC. 11. PRE-POSITIONING INTEROPERABLE COMMUNICATIONS
EQUIPMENT AT INTERAGENCY OPERATIONAL CENTERS.
Section 70107A of title 46, United States Code, is
amended--
(1) by redesignating subsections (e) and (f) as subsections
(f) and (g), respectively; and
(2) by inserting after subsection (d) the following:
``(e) Deployment of Interoperable Communications Equipment
at Interagency Operational Centers.--
``(1) In general.--The Secretary shall ensure that
interoperable communications technology is deployed at all
interagency operational centers established under subsection
(a).
``(2) Considerations.--In carrying out paragraph (1), the
Secretary shall consider the continuing technological
evolution of communications technologies and devices, with
its implicit risk of obsolescence, and shall ensure, to the
maximum extent feasible, that a substantial part of the
technology deployed involves prenegotiated contracts and
other arrangements for rapid deployment of equipment,
supplies, and systems rather than the warehousing or storage
of equipment and supplies currently available at the time the
technology is deployed.
``(3) Requirements and characteristics.--The interoperable
communications technology deployed under paragraph (1)
shall--
``(A) be capable of re-establishing communications when
existing infrastructure is damaged or destroyed in an
emergency or a major disaster;
``(B) include appropriate current, widely-used equipment,
such as Land Mobile Radio Systems, cellular telephones and
satellite equipment, Cells-On-Wheels, Cells-On-Light-Trucks,
or other self-contained mobile cell sites that can be towed,
backup batteries, generators, fuel, and computers;
``(C) include contracts (including prenegotiated contracts)
for rapid delivery of the most current technology available
from commercial sources;
``(D) include arrangements for training to ensure that
personnel are familiar with the operation of the equipment
and devices to be delivered pursuant to such contracts; and
``(E) be utilized as appropriate during live area exercises
conducted by the United States Coast Guard.
``(4) Additional characteristics.--Portions of the
communications technology deployed under paragraph (1) may be
virtual and may include items donated on an in-kind
contribution basis.
``(5) Rule of construction.--Nothing in this subsection
shall be construed or interpreted to preclude the use of
funds under this section by the Secretary for interim or
long-term Internet Protocol-based interoperable solutions,
notwithstanding compliance with the Project 25 standard.''.
SEC. 12. DEFINITIONS.
In this Act:
(1) Commandant.--The term ``Commandant'' means the
Commandant of the Coast Guard.
(2) Especially hazardous cargo.--The term ``especially
hazardous cargo'' means anhydrous ammonia, ammonium nitrate,
chlorine, liquefied natural gas, liquefied petroleum gas, and
any other substance identified by the Secretary of the
department in which the Coast Guard is operating as
especially hazardous cargo.
(3) Secretary.--The term ``Secretary'' means the Secretary
of the department in which the Coast Guard is operating.
______
Mr. SMITH (for himself and Mr. Wyden):
S. 1595. A bill to amend title XVIII of the Social Security Act to
provide flexibility in the manner in which beds are counted for
purposes of determining whether a hospital may be designated as a
critical access hospital under the Medicare program; to the Committee
on Finance.
Mr. SMITH. Mr. President, I am pleased to be joined today by my
colleague Senator Wyden, to introduce this important piece of
legislation for America's rural hospitals. Our legislation will work to
ensure that hospitals in under-served areas, including those in our
home State of Oregon, have the flexibility they need to provide care to
their communities.
The Critical Access Hospital program, CAH, is an important safety net
that ensures that communities have access to health care services in
rural areas such as my hometown of Pendleton, OR. Hundreds of hospitals
across the United States operate under a CAH designation, 25 of which
are in Oregon. In order to obtain this designation, certain
requirements, such as being located more than 35 miles from any other
hospital, or receiving certification by the state to be a ``necessary
provider.'' CAH's also must provide 24-hour emergency care services 7
days a week.
One requirement, however, the 25-patient bed limit, has proven to be
too constricting for facilities during times of unexpected, increased
need, such as during an influenza outbreak or an influx of tourism to
the community.
Leadership for Oregon hospitals have expressed to me that these rules
could lead to severe patient safety issues. As hospitals reach their
25-bed capacity, they could be forced to divert those in need of care
to a hospital much farther from their home and families. Alternatively,
should these small hospitals take the patient in they put themselves at
risk of losing their important CAH status. Loss of such status could
cause the closing of the facility altogether.
Access to health care remains an issue in our Nation and this bill is
one small way in which we can work to ensure that rural hospital doors
remain open for millions of Americans living in communities who depend
on CAH's for their medical care. This bill will provide the flexibility
necessary for a CAH to choose to meet either the 25-bed-per day limit
or a limit of 20-beds-per-day averaged throughout the year. Therefore,
during a time of surge, they can care for more patients in need even if
the hospital would exceed the use of 25 beds, which they could not do
under current law. However, our bill ensures that during times of non-
surge these hospitals are meeting the requirements under law that make
them a CAH. This new yearly average is set lower than the daily limit
to ensure that we are not expanding this program.
We believe that this simple tweak in the current law is critically
important
[[Page S7557]]
to keeping our rural hospitals open and their communities' health care
needs served. I hope my colleagues will join me in support of this
bill, and I look forward to working with Chairman Baucus and other
members of the Finance Committee to secure passage of this important
bill.
______
By Mr. VITTER:
S. 1597. A bill to preserve open competition and Federal Government
neutrality towards the labor relations of Federal Government
contractors on Federal and federally funded construction projects; to
the Committee on Homeland Security and Governmental Affairs.
Mr. VITTER. Mr. President, I am pleased to introduce today a bill
that would go a long way toward ensuring that Federal contracting
remains a process of equal opportunity and open competition.
Specifically, my legislation would prohibit the practice of attaching
restrictive union-only project labor agreements, or PLAs, to Federal
contracts.
In short, any contractor or subcontractor who is bidding on a
construction project that includes a union-only PLA must agree to
recognize unions as the representatives of the employees on that job;
use the union hiring hall to obtain workers and apprentices; pay union
wages and benefits; and follow the union's restrictive rules, job
classifications, and arbitration procedures.
These restrictions would apply at the expense of a contractor's or
subcontractor's usual team of workers. They would apply in States that
may have low numbers of unionized construction workers, even if it
meant denying jobs to local, in-State workers and required bringing in
employees from out of State. Finally, the restrictions in a union-only
PLA would apply even though only 13 percent of our private construction
workforce belongs to a construction labor union, and therefore
effectively locking out almost nine of every 10 able, qualified
workers.
In my home State of Louisiana, just 7.4 percent of private
construction workers belong to a construction labor union. Yet, for
example, if union-only PLAs are attached to the Federal construction
projects helping rebuild Louisiana after the devastation of Hurricanes
Katrina and Rita, Louisianans will be locked out of this important
rebuilding process, making it difficult to find work and earn a decent
wage; the same jobs and wages that would enable Louisiana families to
return to the hurricane-affected areas and rebuild their lives in these
communities. Yet, instead of enabling local folks and businesses to
come together and participate in their community's renewal, PLAs will
ensure that these valuable jobs will go to just a select few, mostly
out-of-State union workers. It is inexcusable that local Louisiana
firms and their workers would be barred from freely bidding on
construction projects in their own town or parish. And this is just one
example of the harmful consequences associated with PLAs.
In sum, the Federal Government should not be in the business of
taking taxpayers' money to fund projects that exclude more than four
out of five workers, making these projects discriminatory,
anticompetitive, and unnecessarily expensive. At the very least,
taxpayers should be able to bid and work on projects that they are
funding with their own hard-earned dollars. Construction workers should
have the opportunity to work on projects that benefit their own
communities regardless of their union affiliation. The Federal
Government should maintain a neutral position and encourage full and
open competition in the Federal contracting process.
Contracts should be awarded based on sound, commonsense criteria,
such as quality of work, experience, and cost. Union affiliation has no
place within the criteria for considering a contract bid. The best bid,
by the most qualified contractor or subcontractor, should always be the
winning bid.
I urge my colleagues to support this important legislation and to
oppose attempts to attach union-only project labor agreements to
Federal projects.
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. 1597
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 ``Government Neutrality in
Contracting Act''.
SEC. 2. PURPOSES.
It is the purpose of this Act to--
(1) promote and ensure open competition on Federal and
federally funded or assisted construction projects;
(2) maintain Federal Government neutrality towards the
labor relations of Federal Government contractors on Federal
and federally funded or assisted construction projects;
(3) reduce construction costs to the Federal Government and
to the taxpayers;
(4) expand job opportunities, especially for small and
disadvantaged businesses; and
(5) prevent discrimination against Federal Government
contractors or their employees based upon labor affiliation
or the lack thereof, thereby promoting the economical,
nondiscriminatory, and efficient administration and
completion of Federal and federally funded or assisted
construction projects.
SEC. 3. PRESERVATION OF OPEN COMPETITION AND FEDERAL
GOVERNMENT NEUTRALITY.
(a) Prohibition.--
(1) General rule.--The head of each executive agency that
awards any construction contract after the date of enactment
of this Act, or that obligates funds pursuant to such a
contract, shall ensure that the agency, and any construction
manager acting on behalf of the Federal Government with
respect to such contract, in its bid specifications, project
agreements, or other controlling documents does not--
(A) require or prohibit a bidder, offeror, contractor, or
subcontractor from entering into, or adhering to, agreements
with 1 or more labor organization, with respect to that
construction project or another related construction project;
or
(B) otherwise discriminate against a bidder, offeror,
contractor, or subcontractor because such bidder, offeror,
contractor, or subcontractor--
(i) became a signatory, or otherwise adhered to, an
agreement with 1 or more labor organization with respect to
that construction project or another related construction
project; or
(ii) refused to become a signatory, or otherwise adhere to,
an agreement with 1 or more labor organization with respect
to that construction project or another related construction
project.
(2) Application of prohibition.--The provisions of this
section shall not apply to contracts awarded prior to the
date of enactment of this Act, and subcontracts awarded
pursuant to such contracts regardless of the date of such
subcontracts.
(3) Rule of construction.--Nothing in paragraph (1) shall
be construed to prohibit a contractor or subcontractor from
voluntarily entering into an agreement described in such
paragraph.
(b) Recipients of Grants and Other Assistance.--The head of
each executive agency that awards grants, provides financial
assistance, or enters into cooperative agreements for
construction projects after the date of enactment of this
Act, shall ensure that--
(1) the bid specifications, project agreements, or other
controlling documents for such construction projects of a
recipient of a grant or financial assistance, or by the
parties to a cooperative agreement, do not contain any of the
requirements or prohibitions described in subparagraph (A) or
(B) of subsection (a)(1); or
(2) the bid specifications, project agreements, or other
controlling documents for such construction projects of a
construction manager acting on behalf of a recipient or party
described in paragraph (1), do not contain any of the
requirements or prohibitions described in subparagraph (A) or
(B) of subsection (a)(1).
(c) Failure to Comply.--If an executive agency, a recipient
of a grant or financial assistance from an executive agency,
a party to a cooperative agreement with an executive agency,
or a construction manager acting on behalf of such an agency,
recipient or party, fails to comply with subsection (a) or
(b), the head of the executive agency awarding the contract,
grant, or assistance, or entering into the agreement,
involved shall take such action, consistent with law, as the
head of the agency determines to be appropriate.
(d) Exemptions.--
(1) In general.--The head of an executive agency may exempt
a particular project, contract, subcontract, grant, or
cooperative agreement from the requirements of 1 or more of
the provisions of subsections (a) and (b) if the head of such
agency determines that special circumstances exist that
require an exemption in order to avert an imminent threat to
public health or safety or to serve the national security.
(2) Special circumstances.--For purposes of paragraph (1),
a finding of ``special circumstances'' may not be based on
the possibility or existence of a labor dispute concerning
contractors or subcontractors that are nonsignatories to, or
that otherwise do not adhere to, agreements with 1 or more
labor organization, or labor disputes concerning employees on
the project who are not members of, or affiliated with, a
labor organization.
[[Page S7558]]
(3) Additional exemption for certain projects.--The head of
an executive agency, upon application of an awarding
authority, a recipient of grants or financial assistance, a
party to a cooperative agreement, or a construction manager
acting on behalf of any of such entities, may exempt a
particular project from the requirements of any or all of the
provisions of subsections (a) or (c), if the agency head
finds--
(A) that the awarding authority, recipient of grants or
financial assistance, party to a cooperative agreement, or
construction manager acting on behalf of any of such entities
had issued or was a party to, as of the date of the enactment
of this Act, bid specifications, project agreements,
agreements with one or more labor organizations, or other
controlling documents with respect to that particular
project, which contained any of the requirements or
prohibitions set forth in subsection (a)(1); and
(B) that one or more construction contracts subject to such
requirements or prohibitions had been awarded as of the date
of the enactment of this Act.
(e) Federal Acquisition Regulatory Council.--With respect
to Federal contracts to which this section applies, not later
than 60 days after the date of enactment of this Act, the
Federal Acquisition Regulatory Council shall take appropriate
action to amend the Federal Acquisition Regulation to
implement the provisions of this section.
(f) Definitions.--In this section:
(1) Construction contract.--The term ``construction
contract'' means any contract for the construction,
rehabilitation, alteration, conversion, extension, or repair
of buildings, highways, or other improvements to real
property.
(2) Executive agency.--The term ``executive agency'' has
the meaning given such term in section 105 of title 5, United
States Code, except that such term shall not include the
Government Accountability Office.
(3) Labor organization.--The term ``labor organization''
has the meaning given such term in section 701(d) of the
Civil Rights Act of 1964 (42 U.S.C. 2000e(d)).
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