[Congressional Record Volume 153, Number 111 (Thursday, July 12, 2007)]
[Senate]
[Pages S9138-S9153]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Ms. SNOWE:
  S. 1773. A bill to amend the Internal Revenue Code of 1986 to 
regulate payroll tax deposit agents; to the Committee on Finance.
  Ms. SNOWE. Mr. President, I rise today to introduce the Small 
Business Payroll Protection Act of 2007. This crucial legislation will 
protect small businesses from payroll tax fraud and provide them with 
greater security when working with IRS registered payroll service 
providers.
  By way of background, let me say that in the fall of 2003, small 
businessman Roger Cyr, owner of the Lily Moon Cafe in Saco, Maine, 
learned that he was the victim of payroll tax fraud and that he owed 
$52,000 in back taxes. He was one of a number of small business owners 
in Maine who were forced to pay their payroll taxes twice after an 
unscrupulous payroll provider ran off with their tax deposits instead 
of making the required payments to the Internal Revenue Service.
  Unfortunately, this type of payroll fraud is not unique to my State 
of Maine, with instances of malfeasance occurring in Georgia, Texas, 
Utah, Iowa, Maryland, New York, and elsewhere throughout the U.S. It is 
unconscionable that these small business owners, are required to pay 
their payroll taxes twice. This additional and unexpected expense can 
drive these companies out of business.
  But let me be clear, these egregious examples of payroll fraud hide 
the fact that most small businesses use payroll providers that are 
honest, meticulous, and trustworthy. The majority of payroll tax agents 
pay their clients' taxes accurately, and on time, providing outstanding 
service as they help their clients with a myriad of complicated tax and 
accounting issues. Consequently, the organizing principle behind the 
bill I introduce today is to safeguard small business owners from afew 
dishonest payroll providers, and to shield the honest payroll providers 
from the bad actors in their industry.
  To that end, this legislation contains a number of provisions 
designed to guard small business owners against fraud. These provisions 
include increasing IRS oversight of payroll service providers, creating 
a separate section of the Internal Revenue code that will govern the 
payroll industry, defining the responsibilities of payroll tax deposit 
agents, and requiring all agents to register with the IRS or be 
penalized. The bill also penalizes payroll providers that collect, but 
fail to make, required tax payments by extending section 6672 penalties 
to all payroll tax agents. Additionally, payroll clients will also be 
informed of their continued liability for all of their payroll taxes as 
well as their obligation to periodically verify that their payroll 
taxes are paid in full.
  Now, I recognize that the new regulations will be more costly for 
small payroll companies to implement than for large payroll companies. 
In order to keep client protections in place, while providing small 
payroll services providers with some reasonable flexibility, the bill 
offers a choice. Payroll providers can either obtain a surety bond, or 
comply with quarterly third-party certifications.
  Surety bonds can be very difficult for many small businesses to 
obtain. Consequently, instead of bonding, many small payroll service 
providers prefer the targeted quarterly certification option, which 
ensures that payroll agents are depositing clients' tax funds 
completely and on time. Small payroll agents assert that the 
certification process actually provides their clients with greater 
fraud protection than a surety bond because the certification verifies 
the payroll agent's sound financial practices quarterly, while a surety 
boud only requires an annual audit.
  As Ranking Member of the Senate Committee on Small Business and 
Entrepreneurship, I understand how critical it is to defend our small 
business owners from tax fraud. Enacting these provisions will help 
protect small companies in Maine, Utah, Georgia and in each of our 
states, from the very few dangerous payroll providers that would steal 
their clients' payroll taxes. At the same time, this bill recognizes 
that small payroll tax agents must be provided flexible and reasonable 
regulatory options that offer real protection to their clients. This 
legislation contains both strong safeguards and small business 
flexibility.
  Mr. President, I urge my colleagues to help create a buffer for our 
small businesses from devious pay roll tax agents by increasing IRS 
oversight and protections as contained in this bill. I hope my 
colleagues will strongly support the Small Business Payroll Protection 
Act of 2007.
                                 ______
                                 
      By Mr. BURR (for himself and Mr. Gregg):
  S. 1775. A bill to reauthorize the Elementary and Secondary Education 
Act of 1965 to ensure that no child is left behind; to the Committee on 
Health, Education, Labor, and Pensions.
  Mr. BURR. Mr. President, I rise today to speak on the No Child Left 
Behind Act of 2007, which I am pleased to introduce with my colleague 
Senator Gregg of New Hampshire. It has been an honor for my office to 
work with Senator Gregg, one of the ``Big 4'' architects of the 
original No Child Left Behind legislation that passed Congress with 
overwhelmingly bipartisan support and that was signed into law by 
President Bush in January 2002.
  The No Child Left Behind Act of 2007 is the first comprehensive 
reauthorization legislation to be introduced in either the Senate or 
the House of Representatives. I hope our introduction today will kick-
start the legislative process and get the Senate and the House on the 
path to a swift reauthorization of NCLB, the most sweeping and 
important federal K-12 education legislation passed since the original 
Elementary and Secondary Education Act was passed in 1965.
  If ever there were a Federal law that needed to be reauthorized on 
time, it is No Child Left Behind. As the headline to Ron Brownstein's 
article in yesterday's Los Angeles Times read: ``Don't leave this law 
behind: Progress is slow

[[Page S9139]]

under Bush's 2001 education reform, but No Child Left Behind is worth 
improving.'' To be sure there has been lots of gnashing of teeth and 
grimacing in the K-12 field since NCLB was passed. But as many of us in 
Congress and across the country recognized when NCLB was passed in 
2001, the point of No Child Left Behind wasn't, in the words of Kati 
Haycock of the Education Trust, ``to make people happy.''
  If we had wanted to make the adult stakeholders in K-12 happy, we 
could have done nothing and just kept the status quo. However, in 2001 
this Congress and a number of dedicated individuals and groups across 
this Nation decided the status quo for our children was not acceptable 
and that the time had come to eradicate, as President Bush called it, 
the ``soft bigotry of low expectations.'' Together with strong 
bipartisanship, this Congress with the passage of No Child Left Behind 
stated to all the adult stakeholders that we can and will close the 
achievement gap and to all of America's children that, regardless of 
background, socio-economics, race, ethnicity, or disability, you can 
and will learn and you can and will achieve.
  We must not turn away from what we began when we passed the original 
No Child Left Behind legislation. The stakes are too high both for our 
children and the Nation as a whole. In the ever competitive global 
economy, all our children, not just some and not just the lucky or the 
fortunate, must be equipped with the academic skills to succeed. We 
cannot afford to return to the status quo of days past. The time is now 
to reauthorize No Child Left Behind and to reassert to all of America's 
children that this Congress will not give up on them and will not stop 
this endeavor until the too-long-standing achievement gap is closed 
once and for all and until all children have the academic skills they 
need to succeed in both postsecondary education and the workforce.
  The No Child Left Behind Act of 2007 that Senator Gregg and I are 
introducing today does not abandon the basic tenets of No Child Left 
Behind. To be sure there is still a great deal of work to do to reach 
our Nation's goal of having all children proficient in reading and math 
by 2013-2014. Nevertheless, we are seeing historic increases in student 
achievement. Since the passage of NCLB, the United States has witnessed 
a greater increase in student achievement in the last five years than 
in the 30 previous years combined, as well as a significant narrowing 
in the achievement gap between African-American and Hispanic students 
and their Caucasian peers. The No Child Left Behind Act of 2007 builds 
on the original cornerstone laid by Congress in 2001 of holding schools 
accountable for the academic achievement of all their students and of 
empowering parents to make better choices for their child's education.
  In particular, the No Child Left Behind Act of 2007 preserves the 
foundational principles of NCLB. It maintains the goal that all 
children will reach grade-level proficiency in reading in math by 2013-
2014; keeps in place annual testing in grades 3-8 and at the high 
school level; and keeps in place an accountability system rooted in 
State standards and State assessments. Further, our bill does not water 
down accountability with the addition of multiple measures; rather, it 
keeps a laser-like focus on grade-level achievement in math and 
reading.
  While maintaining the fundamentals of NCLB, the No Child Left Behind 
Act of 2007 rightly responds to legitimate concerns parents, teachers, 
and principals, have raised regarding the original legislation. In 
response to concerns raised about impracticable accountability 
timeframes, the No Child Left Behind Act of 2007 streamlines the 
accountability timeline to make it easier for schools to develop and 
implement plans to improve student achievement and to focus on what 
matters most teaching and learning. Additionally, recognizing that 
schools and their needs vary, the No Child Left Behind Act of 2007 
allows for differentiated interventions for schools in restructuring to 
allow districts and schools to target resources to students and schools 
most in need of assistance. Further, in response to calls for the use 
of a growth model to measure individual student progress and to 
positively recognize schools and educators who are making tremendous 
strides in improving the achievement of all children, the bill expands 
the Department's seven State growth model demonstration to all 50 
States.
  The No Child Left Behind Act of 2007 also responds to legitimate 
concerns regarding the special populations of limited English 
proficient, LEP, students and students with disabilities, by providing 
greater flexibility, focus, and resources to help schools educate these 
students to high standards. Notably, the bill grants new flexibility 
for LEP students who are new to the country and codifies in statute 
recent flexibility granted by the Department of Education for special 
education students, which permits the use of alternate academic 
achievement standards for students with the most significant cognitive 
disabilities and modified academic achievement standards for students 
who have disabilities that preclude them from achieving grade-level 
proficiency. Finally, the bill targets Federal assessment dollars to 
develop and administer valid and reliable assessments for special 
education and LEP students and targets professional development dollars 
to empower teachers with better tools and information for teaching LEP 
and special education children.
  The No Child Left Behind Act of 2007 reasserts that high-quality 
teachers are the most important factor to improved student academic 
achievement. The bill authorizes programs to ensure that all students 
are taught by a highly qualified teacher and to ensure that low-income 
and minority students are not taught by unqualified and inexperienced 
teachers at higher rates than their more affluent peers. The No Child 
Left Behind Act of 2007 maintains the current definition of highly 
qualified teacher; emphasizes alternative certification, incentive, 
differential, and performance and merit pay; and has States and 
districts conduct needs assessments to determine which districts and 
schools have the most acute teacher quality and staffing needs in order 
to better target resources to those schools and districts. Further, the 
bill gives greater authority to local school districts to renegotiate 
restrictions in collective bargaining agreements that contribute to the 
least experienced and qualified teachers teaching in the schools with 
students most in need of a highly qualified teacher.

  Finally, the No Child Left Behind Act of 2007 focuses on improving 
the Nation's high school graduation rate. Included in the legislation 
is the Graduate for a Better Future Act, which I introduced earlier 
this year in response to the high school dropout crisis in the United 
States. The high school graduation rate for the class of 2003 was only 
70 percent nationwide. Thus, almost one-third of American students who 
enter high school in ninth grade drop out of school and never receive a 
high school diploma. Large disparities exist in the high school 
graduation rates among various subgroups of students. Although the high 
school graduation rate for white students was 78 percent in 2003, the 
rate for African American students was only 55 percent, and the rate 
for Hispanic students was only 53 percent.
  To remain competitive in the world economy, it is critical for 
America's youth to graduate from high school and to have access to the 
postsecondary education needed to succeed in the 21st century job 
market. Funds under the Graduate for a Better Future Act will be used 
to create models of excellence for academically rigorous high schools 
to prepare all students for college and the 21st century workplace; to 
implement accelerated academic catch-up programs for students who enter 
high school behind; to implement an early warning system to quickly 
identify students at risk of dropping out of high school; to implement 
comprehensive college guidance programs; and to implement programs that 
offer students opportunities for job-shadowing, internships, and 
community service so that students are able to make the connection 
between what they are learning in school and how that applies and is 
used in the workplace.
  Additionally, the No Child Left Behind Act of 2007 requires states to 
get serious and to get accurate in their calculation of graduation 
rates. The Nation's dropout crisis will not go away

[[Page S9140]]

by fudging on the numbers. The graduation rate in the No Child Left 
Behind Act of 2007 builds on the work of all 50 states through the 
National Governors Association, which has signed the Graduation Counts 
Compact, an effort started in 2005 to find a common method for 
calculating each state's high school graduation rate.
  As I stated at the beginning of my remarks, continuing our endeavor 
begun in 2001, the time is now to reauthorize No Child Left Behind. For 
the future of our Nation, our children, we must not turn back. Once 
again let us stand together and State to the American public that we 
can and will close the achievement gap. And once again let us say to 
every child, regardless of background, you can achieve.
  Mr. GREGG. Mr. President, since its implementation, the No Child Left 
Behind Act has been successful in narrowing the achievement gap and 
improving student performance. Since its passage, the U.S. has 
witnessed a greater increase in student achievement in the last 5 years 
than in the previous 30 years combined, as well as a significant 
narrowing in the achievement gap. Because of No Child Left Behind, 
parents are now empowered with information on the quality of their 
child's school and given the ability to improve their child's education 
through additional tutorial services.
  No Child Left Behind has been tremendously successful in ensuring 
that all students have access to the same high academic standards. No 
longer can a school hide behind the averages of their higher performing 
students; now all students are given the same opportunities to reach 
academic proficiency. Today I am introducing the No Child Left Behind 
Act of 2007 with my colleague Mr. BURR. This bill builds upon the basic 
tenets of No Child Left Behind and rightly responds to the legitimate 
concerns of parents, teachers and principals. The No Child Left Behind 
Act of 2007 maintains the expectation that all students can reach or 
exceed proficiency when given the opportunity. Any rollback of 
accountability simply ignores the progress already being made and the 
belief that all students can reach proficiency when given the 
opportunity.
  Recognizing that each school and its needs vary tremendously, the No 
Child Left Behind Act of 2007 allows for differentiated consequences to 
ensure that schools where a majority of students are not performing at 
grade-level are treated differently than schools where a small segment 
of the school population is not meeting State standards. Coupled with 
additional time before advancing into the next stage of Program 
Improvement, these new differentiated consequences will allow schools 
to target resources and interventions to the students who need the most 
assistance in reaching state-determined levels proficiency.
  Under this bill, the Federal Government will continue to support 
States financially in their development, improvement, and 
administration of State academic assessments through the 
reauthorization of the Grants for State Assessments program. 
Additionally, because many States are still striving to improve their 
assessment systems to assess students with disabilities and limited 
English proficient students validly and reliably, the No Child Left 
Behind Act of 2007 creates a fund dedicated solely to the development 
and improvement of assessments for these students.
  The No Child Left Behind Act of 2007 recognizes that high quality 
teachers are the most important factor to improved student academic 
achievement. The bill authorizes several programs to ensure that all 
students are taught by a highly-qualified teacher and to ensure that 
low-income students are not taught by unqualified and inexperienced 
teachers at higher rates than their more affluent peers. This bill 
authorizes the Teacher Incentive Fund, a program to encourage State and 
schools districts to expand performance-based compensation for teachers 
and principals in high-need schools who raise student achievement and 
close the achievement gap. The No Child Left Behind Act of 2007 also 
authorizes the Adjunct Teacher Corp, a program to encourage highly 
educated and trained professionals, particularly in the areas of math 
and science, to teach high school courses in their area of expertise.
  One of the key cornerstones of No Child Left Behind, options for 
parents, is maintained and expanded in the No Child Left Behind Act of 
2007. Notably, this bill makes supplemental services available at the 
same time as public school choice, expands the time period parents can 
enroll their children in tutorial services programs and makes it easier 
for supplemental service providers to readily access school facilities.
  The No Child Left Behind Act of 2007 authorizes a new ``money follows 
the child'' program and provides financial assistance to districts that 
permit Title I dollars to follow the child to the public school of his 
or her choice. This child-centered program will infuse competition into 
the public school system, empower parents with new choices and 
encourage all public schools to improve the academic achievement of all 
students.
  The combination of strengthening supplemental services and the new 
child-centered program will provide even greater resources for parents 
to ensure that the educational needs of their children are being met.
  This bill maintains what we know is working, accountability, 
transparency and expanded options, without adding burdensome new 
requirements. By maintaining the fundamentals of No Child Left Behind, 
this bill combines maximum flexibility with differentiated consequences 
to ensure that all schools and students have the tools necessary to 
reach academic proficiency.
                                 ______
                                 
      By Mr. DURBIN (for himself and Mr. Brown):
  S. 1776. A bill to amend the Federal Food, Drug, and Cosmetic Act to 
establish a user fee program to ensure food safety, and for other 
purposes; to the Committee on Agriculture, Nutrition, and Forestry.
  Mr. DURBIN. Mr. President, I rise today to introduce legislation to 
strengthen the ability of the Food and Drug Administration, FDA, to 
ensure the safety of food imported into the U.S.
  The volume of food imports has increased significantly in recent 
years, from $45.6 billion in 2003 to $64 billion in 2006. According to 
the USDA, imported food accounts for 13 percent of the average 
American's diet, including 31 percent of fruits, juices, and nuts; 9.5 
percent of red meat; and 78.6 percent of fish and shellfish.
  This upward trend in imported food has been accompanied by an 
increasing number of health and safety incidents related to imported 
food products. In the past 6 months, we have seen what appears to be 
the intentional contamination of wheat gluten and rice protein 
concentrate with melamine, which is an industrial product that should 
never find its way into food products. In addition, we recently learned 
that a significant volume of imported fish products from China have 
been contaminated with chemicals and residues, including Malachine 
green and Nitrofuren. We have found imported Chinese toothpaste in the 
U.S. that was contaminated with diethylene glycol, which is a toxic 
component used in antifreeze.
  Unfortunately, the FDA currently lacks the resources and authority to 
adequately determine the quality and safety of food imports, inspect an 
adequate volume of imported food, and rapidly detect and respond to 
incidents of contaminated imports. This legislation would take several 
steps to correct these problems.
  First, the bill would impose a fee for the FDA's oversight of 
imported food products. These fees would generate revenues to be used 
for inspections of imported food and critical food safety research. The 
legislation directs the FDA to use some of this funding to perform 
cutting-edge research to develop testing technologies and methods that 
would quickly and accurately detect the presence of pervasive 
contaminants such as E. coli and listeria. The legislation would also 
establish a food importer certification program that would require 
foreign firms and governments to demonstrate that their food safety 
systems are equivalent to ours.
  What has been made clear through the pet food recall and other 
outbreaks of foodborne illnesses is that the FDA is a severely 
underfunded and understaffed agency. Much of the responsibility for 
overseeing and inspecting the safety of imported food rests with the

[[Page S9141]]

FDA. However, due to fairly flat budgets and increasing 
responsibilities, the number of inspectors looking at these shipments 
has actually decreased from more than 3,000 inspectors in 2003 to the 
present level of around 2,700 inspectors.
  The Centers for Disease Control, CDC, estimates that 76 million 
Americans become sick from foodborne illnesses each year. More than 
300,000 are hospitalized and 5,000 die each year. Less than 1.5 percent 
of imported food is inspected by the FDA and the FDA lacks the 
resources and authorities to certify the standards of our trading 
partners. This situation presents an economic, public health, and 
bioterrorism risk to the U.S.
  The FDA office that is responsible for regulating more than $60 
billion of imported food, the Center for Food Safety and Nutrition, 
CFSAN, is also responsible for regulating $417 billion worth of 
domestic food and $59 billion in cosmetics. All of this activity is 
regulated by an office for which the President requested $467 million 
in fiscal year 2008. Only $312 million of that amount would be for 
inspectors. We clearly need to review FDA's funding to make sure that 
it has the resources necessary to safeguard the 80 percent of our food 
supply that it is responsible for regulating. For this reason, a group 
of my colleagues and I sent a letter earlier this year to the 
Agriculture Appropriations Subcommittee, which funds the FDA, asking 
for a significant increase in the level of funding for the FDA foods 
program.
  But imports present a special challenge. It may cost more to ensure 
the safety of food produced in other countries, and the logistical 
challenges are greater. It is important that we supplement the FDA's 
budget with additional funding streams to make sure that it has the 
resources necessary to safeguard our food supply from contaminated 
imports.
  Specifically this legislation would direct the FDA to collect a user 
fee on imported food products, for the administrative review, 
processing, and inspection costs borne by the FDA. The legislation 
would use that funding to bolster FDA's import inspection program, 
which currently inspects less than 1.5 percent of all imports. It would 
also fund critical research into rapid testing technologies for 
detecting foodborne pathogens.
  Lastly, this bill would establish an imported food certification 
program. Today, any country and any company can export food products to 
the United States as long as they inform regulators of the shipment. No 
checks are performed to ensure that the producer has adequate sanitary 
standards. The FDA does not ensure that trading partners have 
equivalent regulatory systems or inspect overseas plants when problems 
arise.
  When the FDA does want to investigate an outbreak, it can be delayed 
by uncooperative foreign governments. For example, during the pet food 
recall, U.S. regulators were delayed three weeks in their request for 
visas to inspect facilities.
  This new program would mark a watershed change in the food import 
safety posture of the U.S. This bill says that if you want a slice of 
the lucrative U.S. market, you have to comply with the same common-
sense standards that apply to U.S. food producers. You have to have 
equivalent food safety systems and processes in place to those of the 
U.S. You need to give U.S. regulators access to your facilities and 
records so they can check your safety record without unnecessary delay. 
In addition, U.S. regulators would have the power to revoke the 
certification of a company or country that fails to comply, and to 
detain products that fail to meet U.S. standards.
  For too long, we have gone without a solid safety standard for 
imported foods. Instead, our regulators jump from alert to alert and 
recall to recall. This legislation would close these loopholes that 
allow dangerous imports into our country and put a solid, proactive 
system in place to protect our food supply.
  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. 1776

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

     SECTION 1. SHORT TITLE; FINDINGS.

       (a) Short Title.--This Act may be cited as the ``Imported 
     Food Security Act of 2007''.
       (b) Findings.--Congress finds that--
       (1) the safety and integrity of the United States food 
     supply is vital to the public health, to public confidence in 
     the food supply, and to the success of the food sector of the 
     Nation's economy;
       (2) illnesses and deaths of individuals and companion pets 
     caused by contaminated food--
       (A) have contributed to a loss of public confidence in food 
     safety; and
       (B) have caused significant economic loses to manufactures 
     and producers not responsible for contaminated food items;
       (3) the task of preserving the safety of the food supply of 
     the United States faces tremendous pressures with regard to--
       (A) emerging pathogens and other contaminants and the 
     ability to detect all forms of contamination; and
       (B) an increasing volume of imported food, without adequate 
     monitoring and inspection;
       (4) the United States is increasing the amount of food that 
     it imports such that--
       (A) from 2003 to the present, the value of food imports has 
     increased from $45,600,000,000 to $64,000,000,000; and
       (B) imported food accounts for 13 percent of the average 
     Americans diet including 31 percent of fruits, juices, and 
     nuts, 9.5 percent of red meat and 78.6 percent of fish and 
     shellfish; and
       (5) the number of full time equivalent Food and Drug 
     Administration employees conducting inspections has decreased 
     from 2003 to 2007.

     SEC. 2. USER FEES REGARDING INSPECTIONS OF IMPORTED FOOD 
                   SAFETY.

       Chapter VIII of the Federal Food, Drug, and Cosmetic Act 
     (21 U.S.C. 381 et seq.) is amended by inserting after section 
     801 the following:


                   ``USER FEES REGARDING FOOD SAFETY

       ``Sec. 801A.  (a) In General.--
       ``(1) Assessment.--Beginning in fiscal year 2008, the 
     Secretary shall in accordance with this section assess and 
     collect fees on food imported into the United States.
       ``(2) Purpose of fees.--
       ``(A) In general.--The purpose of fees under paragraph (1) 
     is to defray the costs of carrying out section 801 with 
     respect to food. Costs referred to in the preceding sentence 
     include increases in such costs for an additional number of 
     full-time equivalent positions in the Department of Health 
     and Human Services to be engaged in carrying out such 
     section.
       ``(B) Allocations by secretary.--Of the total fee revenues 
     collected under paragraph (1) for a fiscal year, the 
     Secretary shall reserve and expend amounts in accordance with 
     the following:
       ``(i) The Secretary shall reserve not less than 50 percent 
     for carrying out section 801 with respect to food, other than 
     research under section 801(p). In expending the amount so 
     reserved, the Secretary shall give first priority to 
     inspections conducted at ports of entry into the United 
     States and second priority to the implementation of the 
     import certification program under section 805.
       ``(ii) The Secretary shall reserve not more than 50 percent 
     for carrying out research under section 801(p).
       ``(3) Amount of fee; collection.--A fee under paragraph (1) 
     shall be assessed on each line item of food, as defined by 
     the Secretary by regulation. The amount of the fee shall be 
     based on the number of line items, and may not exceed $20 per 
     line item, notwithstanding subsection (b). The liability for 
     the fee constitutes a personal debt due to the United States, 
     and such liability accrues on the date on which the Secretary 
     approves the food under section 801(c)(1). The Secretary may 
     coordinate with and seek the cooperation of other agencies of 
     the Federal Government regarding the collection of such fees.
       ``(b) Total Fee Revenues.--The total fee revenues collected 
     under subsection (a) for a fiscal year shall be the amount 
     appropriated under subsection (f)(3).
       ``(c) Annual Fee Adjustment.--Not later than 60 days after 
     the end of each fiscal year beginning after fiscal year 2008, 
     the Secretary, subject to not exceeding the maximum fee 
     amount specified in subsection (a)(3), shall adjust the 
     amounts that otherwise would under subsection (a) be assessed 
     as fees during the fiscal year in which the adjustment occurs 
     so that the total revenues collected in such fees for such 
     fiscal year equal the amount applicable pursuant to 
     subsection (b) for the fiscal year.
       ``(d) Fee Waiver or Reduction.--The Secretary shall grant a 
     waiver from or a reduction of a fee assessed under subsection 
     (a) where the Secretary finds that the fee to be paid will 
     exceed the anticipated present and future costs incurred by 
     the Secretary in carrying out section 801 with respect to 
     food (which finding may be made by the Secretary using 
     standard costs).
       ``(e) Assessment of Fees.--
       ``(1) Limitation.--Fees may not be assessed under 
     subsection (a) for a fiscal year beginning after fiscal year 
     2008 unless the amount appropriated for salaries and expenses 
     of the Food and Drug Administration for such fiscal year is 
     equal to or greater than the amount appropriated for salaries 
     and expenses of the Food and Drug Administration

[[Page S9142]]

     for fiscal year 2008 multiplied by the adjustment factor 
     applicable to the fiscal year involved, except that in making 
     determinations under this paragraph for the fiscal years 
     involved there shall be excluded--
       ``(A) the amounts appropriated under subsection (f)(3) for 
     the fiscal years involved; and
       ``(B) the amounts appropriated under section 736(g) for 
     such fiscal years.
       ``(2) Authority.--If the Secretary does not assess fees 
     under subsection (a) during any portion of a fiscal year 
     because of paragraph (1) and if at a later date in such 
     fiscal year the Secretary may assess such fees, the Secretary 
     may assess and collect such fees, without any modification in 
     the rate of the fees, at any time in such fiscal year 
     notwithstanding the provisions of subsection (a)(3) relating 
     to the time at which fees are to be paid.
       ``(f) Crediting and Availability of Fees.--
       ``(1) In general.--Fees collected for a fiscal year 
     pursuant to subsection (a) shall be credited to the 
     appropriation account for salaries and expenses of the Food 
     and Drug Administration and shall be available in accordance 
     with appropriation Acts until expended without fiscal year 
     limitation. Such sums as may be necessary may be transferred 
     from the Food and Drug Administration salaries and expenses 
     appropriation account without fiscal year limitation to such 
     appropriation account for salaries and expenses with such 
     fiscal year limitation. The sums transferred shall be 
     available solely for carrying out section 801 with respect to 
     food, and the sums are subject to allocations under 
     subsection (a)(2)(B).
       ``(2) Collections and appropriation acts.--The fees 
     authorized in subsection (a)--
       ``(A) shall be collected in each fiscal year in accordance 
     with subsections (a)(3) and (b); and
       ``(B) shall only be collected and available for the purpose 
     specified in subsection (a)(2).
       ``(3) Authorization of appropriations; allocations by 
     secretary.--Subject to paragraph (4), there is authorized to 
     be appropriated for fees under this section such sums as may 
     be necessary to carry out the purposes of this section for 
     each of the fiscal years 2008 through 2012. Such appropriated 
     funds may be in addition to any other funds appropriated for 
     such purposes.
       ``(4) Offset.--Any amount of fees collected for a fiscal 
     year under subsection (a) that exceeds the amount of fees 
     specified in appropriation Acts for such fiscal year shall be 
     credited to the appropriation account of the Food and Drug 
     Administration as provided in paragraph (1), and shall be 
     subtracted from the amount of fees that would otherwise be 
     authorized to be collected under this section pursuant to 
     appropriation Acts for a subsequent fiscal year.
       ``(g) Collection of Unpaid Fees.--In any case where the 
     Secretary does not receive payment of a fee assessed under 
     subsection (a) within 30 days after it is due, such fee shall 
     be treated as a claim of the United States Government subject 
     to subchapter II of chapter 37 of title 31, United States 
     Code.
       ``(h) Construction.--This section may not be construed as 
     requiring that the number of full-time equivalent positions 
     in the Department of Health and Human Services, for officers, 
     employees, and advisory committees not engaged in carrying 
     out section 801 with respect to food be reduced to offset the 
     number of officers, employees, and advisory committees so 
     engaged.
       ``(i) Definition of Adjustment Factor.--For purposes of 
     this section, the term `adjustment factor' applicable to a 
     fiscal year is the Consumer Price Index for all urban 
     consumers (all items; United States city average) for April 
     of the preceding fiscal year divided by such Index for April 
     2007.''.

     SEC. 3. RESEARCH ON TESTING TECHNIQUES FOR FOOD SAFETY 
                   INSPECTIONS OF IMPORTED FOOD; PRIORITY 
                   REGARDING DETECTION OF INTENTIONAL 
                   ADULTERATION.

       Section 801 of the Federal Food, Drug, and Cosmetic Act (21 
     U.S.C. 381) is amended by adding at the end the following:
       ``(p) Research on Testing Techniques for Food Safety 
     Inspections of Imported Food.--
       ``(1) In general.--The Secretary shall (directly or through 
     grants or contracts) provide for research on the development 
     of tests and sampling methodologies, for use in inspections 
     of food under this section--
       ``(A) whose purpose is to determine whether food is 
     adulterated by reason of being contaminated with 
     microorganisms or pesticide chemicals or related residues; 
     and
       ``(B) whose results are available not later than 
     approximately 60 minutes after the administration of the 
     tests.
       ``(2) Priority.--In providing for research under paragraph 
     (1), the Secretary shall give priority to conducting research 
     on the development of tests that are suitable for inspections 
     of food at ports of entry into the United States. In 
     providing for research under paragraph (1), the Secretary 
     shall under the preceding sentence give priority to 
     conducting research on the development of tests for detecting 
     the presence in food of the pathogens E. coli, salmonella, 
     cyclospora, cryptosporidium, hepatitis A, or listeria, the 
     presence in or on food of pesticide chemicals and related 
     residues, and the presence in or on food of such other 
     pathogens or substances as the Secretary determines to be 
     appropriate. The Secretary shall establish the goal of 
     developing, by the expiration of the 3-year period beginning 
     on the date of the enactment of the Imported Food Security 
     Act of 2007, tests under paragraph (1) for each of the 
     pathogens and substances receiving priority under the 
     preceding sentence.
       ``(3) Periodic reports.--The Secretary shall submit to 
     Congress periodic reports describing the progress that has 
     been made toward the goal referred to in paragraph (1) and 
     describing plans for future research toward the goal. Each of 
     the reports shall provide an estimate by the Secretary of the 
     amount of funds needed to meet such goal, and shall provide a 
     determination by the Secretary of whether there is a need for 
     further research under this subsection. The first such report 
     shall be submitted not later than March 1, 2008, and 
     subsequent reports shall be submitted semiannually after the 
     submission of the first report until the goal is met.
       ``(4) Consultation.--The Secretary shall carry out the 
     program of research under paragraph (1) in consultation with 
     the Director of the Centers for Disease Control and 
     Prevention, the Director of the National Institutes of 
     Health, and the Administrator of the Environmental Protection 
     Agency. The Secretary shall with respect to such research 
     coordinate the activities of the Department of Health and 
     Human Services. The Secretary shall in addition consult with 
     the Secretary of Agriculture (acting through the Food Safety 
     and Inspection Service of the Department of Agriculture) in 
     carrying out the program.
       ``(5) Awards to private entities.--Of the amounts reserved 
     under section 801A(a)(2)(B)(ii) for a fiscal year for 
     carrying out the program of research under paragraph (1), the 
     Secretary shall make available not less than 50 percent for 
     making awards of grants or contracts to private entities to 
     conduct such research.''.

     SEC. 4. CERTIFICATION OF FOOD IMPORTS.

       (a) In General.--Chapter VIII of the Federal Food, Drug, 
     and Cosmetic Act (21 U.S.C. 381 et seq.) is amended by adding 
     at the end the following:

     ``SEC. 805. CERTIFICATION OF FOOD IMPORTS.

       ``(a) In General.--Not later than 2 years after the date of 
     enactment of this section, the Secretary shall establish a 
     system under which a foreign government or foreign food 
     establishment seeking to import food to the United States 
     shall submit a request for certification to the Secretary.
       ``(b) Certification Standard.--A foreign government or 
     foreign food establishment requesting a certification to 
     import food to the United States shall demonstrate, in a 
     manner determined appropriate by the Secretary, that food 
     produced under the supervision of a foreign government or by 
     the foreign food establishment has met standards for food 
     safety, inspection, labeling, and consumer protection that 
     are at least equivalent to standards applicable to food 
     produced in the United States.
       ``(c) Certification Approval.--
       ``(1) Request by foreign government.--Prior to granting the 
     certification request of a foreign government, the Secretary 
     shall review, audit, and certify the food safety program of a 
     requesting foreign government (including all statutes, 
     regulations, and inspection authority) as at least equivalent 
     to the food safety program in the United States, as 
     demonstrated by the foreign government.
       ``(2) Request by foreign food establishment.--Prior to 
     granting the certification request of a foreign food 
     establishment, the Secretary shall certify, based on an 
     onsite inspection, the food safety programs and procedures of 
     a requesting foreign firm as at least equivalent to the food 
     safety programs and procedures of the United States.
       ``(d) Limitation.--A foreign government or foreign firm 
     approved by the Secretary to import food to the United States 
     under this section shall be certified to export only the 
     approved food products to the United States for a period not 
     to exceed 5 years.
       ``(e) Withdrawal of Certification.--The Secretary may 
     withdraw certification of any food from a foreign government 
     or foreign firm--
       ``(1) if such food is linked to an outbreak of human 
     illness;
       ``(2) following an investigation by the Secretary that 
     finds that the foreign government programs and procedures or 
     foreign food establishment is no longer equivalent to the 
     food safety programs and procedures in the United States; or
       ``(3) following a refusal to allow United States officials 
     to conduct such audits and investigations as may be necessary 
     to fulfill the requirements under this section.
       ``(f) Renewal of Certification.--The Secretary shall audit 
     foreign governments and foreign food establishments at least 
     every 5 years to ensure the continued compliance with the 
     standards set forth in this section.
       ``(g) Required Routine Inspection.--The Secretary shall 
     routinely inspect food and food animals (via a physical 
     examination) before it enters the United States to ensure 
     that it is--
       ``(1) safe;
       ``(2) labeled as required for food produced in the United 
     States; and
       ``(3) otherwise meets requirements under this Act.
       ``(h) Enforcement.--The Secretary is authorized to--
       ``(1) deny importation of food from any foreign government 
     that does not permit United States officials to enter the 
     foreign country to conduct such audits and inspections as may 
     be necessary to fulfill the requirements under this section;

[[Page S9143]]

       ``(2) deny importation of food from any foreign government 
     or foreign firm that does not consent to an investigation by 
     the Secretary when food from that foreign country or foreign 
     firm is linked to a food-borne illness outbreak or is 
     otherwise found to be adulterated or mislabeled; and
       ``(3) promulgate rules and regulations to carry out the 
     purposes of this section, including setting terms and 
     conditions for the destruction of products that fail to meet 
     the standards of this Act.
       ``(i) Detention and Seizure.--Any food imported for 
     consumption in the United States may be detained, seized, or 
     condemned pursuant to section 304.
       ``(j) Definition.--For purposes of this section, the term 
     `food establishment'--
       ``(1) means a slaughterhouse, factory, warehouse, or 
     facility owned or operated by a person located in any State 
     that processes food or a facility that holds, stores, or 
     transports food or food ingredients; and
       ``(2) does not include a farm, restaurant, other retail 
     food establishment, nonprofit food establishment in which 
     food is prepared for or served directly to the consumer, or 
     fishing vessel (other than a fishing vessel engaged in 
     processing, as that term is defined in section 123.3 of title 
     21, Code of Federal Regulations).''.
       (b) Transitional Program.--Not later than 180 days after 
     the date of enactment of this Act, the Secretary of Health 
     and Human Services shall promulgate regulations to establish 
     a transitional food safety import review program, with 
     minimal disruption to commerce, that shall be in effect until 
     the date of implementation of the food import certification 
     program under section 805 of the Federal Food, Drug, and 
     Cosmetic Act (as added by subsection (a)).
                                 ______
                                 
      By Mr. TESTER (for himself and Mr. Dorgan):
  S. 1779. A bill to establish a program for tribal colleges and 
universities within the Department of Health and Human Services and to 
amend the Native American Programs Act of 1974 to authorize the 
provision of grants and cooperative agreements to tribal colleges and 
universities, and for other purposes; to the Committee on Indian 
Affairs.
  Mr. TESTER. Mr. President, Indian Education is perhaps the most 
important issue facing Indian Country today because education 
represents hope. Higher education leads to better job opportunities. 
Better jobs lead to higher income and happier days. Higher income leads 
to greater access to health care and adequate housing and overall, a 
higher quality of life. Higher quality of life leads to strong 
communities. Happy, healthy, and strong communities are more resistant 
to the destructive forces of poverty such as chemical abuse, violence 
and neglect.
  No one disagrees that 85 percent unemployment in Indian Country is 
unacceptable. No one disagrees that it is unacceptable that the 
majority of America's at-risk youth live in Indian Country. However, 
merely reciting these statistics over and over won't make the situation 
any better. We need to work together to make Indian Country a better 
place to live, work and raise a family.
  Senator Dorgan and I introduce this vital legislation to help advance 
the remarkable work tribal colleges and universities are doing. Through 
grants awarded under this bill, tribal colleges and universities will 
have additional resources necessary to strengthen Indian communities 
through the provision of health promotion and disease prevention 
education, outreach and workforce development programs, through program 
implementation, research, and capacity building. Not only will it 
improve education, but it will also improve the delivery of culturally 
appropriate health care services. In addition to good education and 
increased access to health care, this bill will also help create good 
jobs in Indian Country.
  Tribal colleges and universities are accredited by independent, 
regional accreditation agencies, and like all institutions of higher 
education, must undergo stringent performance reviews to retain their 
accreditation status. In addition to offering postsecondary education 
opportunities, tribal colleges serve reservation communities by 
providing critical services including: libraries, community centers, 
cultural, historical and language programs; tribal archives, career 
centers, economic development and business centers; health and wellness 
centers, public meeting places, child and elder care centers. Despite 
their many obligations, functions, and notable achievements, tribal 
colleges remain the most poorly funded institutions of higher education 
in this country.
  The continued success and future of the Nation's tribal colleges and 
universities depends on their ability to provide higher education and 
community outreach programs. For them to succeed however, they must 
have the financial resources to do so. I am honored to rise today to 
introduce this important legislation for improving conditions in 
America's Indian Country. I am proud of the folks who came together to 
help craft the bill and am proud to cosponsor it with my friend, 
Chairman of the Senate Committee on Indian Affairs, Senator Dorgan.
  I am proud to serve on the Indian Affairs Committee and to work to 
improve conditions in Indian Country.
  For example, on April 5th, I held a Tribal College Summit at the 
Blackfeet Community College in Browning, the first of its kind.
  Leaders of all the Tribal nations in Montana and leaders throughout 
Indian higher education met to brainstorm about how we can improve 
tribal colleges in the State of Montana and across the country. By the 
end of the day, each group pledged to take specific actions to improve 
tribal college education throughout the U.S.
  Part of my pledge includes introducing this PATH legislation. By 
training more Indian students to enter the health care field, we will 
provide Indian country with more educated and self-sufficient members 
and improve the quality of and access to healthcare in Indian Country.
  Healthier communities and good-paying jobs lead to improved overall 
conditions in Indian Country.
  As a Montanan and member of the Senate Indian Affairs Community, I am 
proud to introduce this legislation. I look forward to swift 
consideration and eventual passage.
                                 ______
                                 
      By Mrs. BOXER (for herself and Mrs. Feinstein):
  S. 1781. A bill to designate the facility of the United States Postal 
Service located at 118 Minner Avenue in Bakersfield, California, as the 
``Buck Owens Post Office''; to the Committee on Homeland Security and 
Governmental Affairs.
  Mrs. BOXER. Mr. President, today I am joined by my colleague, Senator 
Feinstein, to introduce legislation to designate the facility of the 
United States Postal Service located at 118 Minner Avenue in 
Bakersfield, California, as the Buck Owens Post Office.
  Country western legend, Buck Owens was one of the pioneers of the 
``Bakersfield Sound,'' that brought the raw edge of electric guitars 
and a rock and roll beat to country music. A great musician and a 
generous man, Buck left behind a legacy of artistry and love for his 
adopted hometown of Bakersfield and California's Central Valley.
  The son of a sharecropper, Buck was born Alvis Edgar Owens, Jr. in 
Sherman, TX, in 1929. At an early age, he nicknamed himself ``Buck'' 
after a mule on the family farm. In 1937, the Owens family moved west 
seeking better fortune during the Great Depression. When he was just 13 
years old, Buck dropped out of school to find work, but he never 
stopped pursuing his passion for music.
  A natural musician, Buck taught himself to play guitar in his early 
teens. When he was just 16, he had already landed a regular show on a 
local radio station and was playing shows in honky tonks and bars 
around Phoenix. Just 6 years later, Buck moved his young family to 
Bakersfield, California, where he began to make his mark on country 
music as a performer, a songwriter, and a recording artist.
  Buck's trademark stinging electric guitar and rhythm sound 
revolutionized country music and challenged the Nashville 
establishment. His 20 number-one hits are a testament to his place 
among the greatest artists in country music history. Throughout his 
decades as an entertainer, Buck delighted audiences from Bakersfield to 
Nashville, all the way to Japan and even the White House.
  Buck's pioneering work has continued to inspire a new generation of 
musicians. In 1986, when Buck had finished a 25-year run as the cohost 
of the Hee Haw television show, Dwight Yoakam and other new traditional 
performers were just beginning a revival of his hallmark Bakersfield 
Sound.
  I was fortunate to have met Buck back in 1997 at his Crystal Palace 
in Bakersfield, when I was invited to

[[Page S9144]]

present one of his special red, white, and blue guitars to a promising 
music student named William Villatoro. I still vividly remember how the 
young man was deeply moved and inspired by Buck's generous gesture. I 
will certainly remember Buck Owens as a man of great compassion who 
possessed a profound love for his country. Although he is no longer 
with us, I take great comfort in knowing that Buck Owens was able to be 
a shining light not only in the life of a young man from Bakersfield 
but also to the millions of others who admired his musical gifts and 
were touched by his humanity.
  I encourage my colleagues to join me in support of this legislation 
as we commemorate an icon of American music whose artistry and 
generosity touched so many lives in his community.
                                 ______
                                 
      By Mr. FEINGOLD (for himself and Mr. Durbin):
  S. 1782. A bill to amend chapter 1 of title 9 of United States Code 
with respect to arbitration; to the Committee on the Judiciary.
  Mr. FEINGOLD. Mr. President, today I will introduce the Arbitration 
Fairness Act of 2007. Just as its name suggests, the Arbitration 
Fairness Act is designed to return fairness to the arbitration system. 
This bill is not an anti-arbitration bill. If anything, it is pro-
arbitration. I firmly believe that this bill will strengthen the 
arbitration system by returning arbitration to a more equitable design 
that reflects the intent of the original arbitration legislation, the 
Federal Arbitration Act.
  President Calvin Coolidge signed the Federal Arbitration Act, FAA, 
into law on February 12, 1925. Congress passed the FAA to make 
arbitration an enforceable alternative to the civil courts. Even as 
early as the 1920s, there were concerns about the efficiency of the 
civil court system and a desire to allow a speedier alternative. The 
intent of the FAA, as expressed in a 1923 hearing before a subcommittee 
of the Senate Judiciary Committee, was ``to enable business men to 
settle their disputes expeditiously and economically.'' In a later 
hearing on the FAA, it was clarified that the legislation was not 
intended to apply to the employment contracts of those businesses. This 
distinction is important because it illustrates that, while arbitration 
was something that the FAA's original sponsors wanted to promote, they 
were also careful to make clear that they didn't intend for arbitration 
to become a weapon to be wielded by the powerful against those with 
less financial and negotiating power.
  Since the FAA's enactment, the use of arbitration has grown 
exponentially. Arbitration certainly has advantages. It can be a fair 
and efficient way to settle disputes. I strongly support voluntary, 
alternative dispute resolution methods, and I believe we ought to 
encourage their use. But I also believe that arbitration is a fair way 
to settle disputes between consumers and lenders only when it is 
entered into knowingly and voluntarily by both parties to the dispute 
after the dispute has arisen. Otherwise arbitration can be used as a 
weapon by the stronger party against the weaker party.
  One of the most fundamental principles of our justice system is the 
constitutional right to take a dispute to court. Indeed, all Americans 
have the right in civil and criminal cases to a trial by jury. The 
right to a jury trial in civil cases in Federal court is contained in 
the Seventh Amendment to the Constitution. Many States provide a 
similar right to a jury trial in civil matters filed in State court.
  I have been concerned for many years that mandatory arbitration 
clauses are slowly eroding the legal protections that should be 
available to all Americans. A large and growing number of corporations 
now require millions of consumers and employees to sign contracts that 
include mandatory arbitration clauses. Most of these individuals have 
little or no meaningful opportunity to negotiate the terms of their 
contracts and so find themselves having to choose either to accept a 
mandatory arbitration clause or to forgo securing employment or needed 
goods and services. Incredibly, mandatory arbitration clauses have been 
used to prevent individuals from trying to vindicate their civil rights 
under statutes specifically passed by Congress to protect them.
  There is a range of ways in which mandatory arbitration can be 
particularly hostile to individuals attempting to assert their rights. 
For example, the administrative fees, both to gain access to the 
arbitration forum and to pay for the ongoing services of the arbitrator 
or arbitrator, can be so high as to act as a de facto bar for many 
individuals who have a claim that requires resolution. In addition, 
arbitration generally lacks discovery proceedings and other civil due 
process protections.
  Furthermore, there is no meaningful judicial review of arbitrators' 
decisions. Under mandatory, binding arbitration, even if a party 
believes that the arbitrator did not consider all the facts or follow 
the law, the party cannot file a suit in court. The only basis for 
challenging a binding arbitration decision is fairly narrow: if there 
is reason to believe that the arbitrator committed actual fraud, or was 
biased, corrupt, or guilty of misconduct, or exceeded his or her 
powers. Because mandatory, binding arbitration is so conclusive, it is 
a credible means of dispute resolution only when all parties understand 
the full ramifications of agreeing to it.
  Unfortunately, in a variety of contexts, employment agreements, 
credit card agreements, HMO contracts, securities broker contracts, and 
other consumer and franchise agreements, mandatory arbitration is fast 
becoming the rule, rather than the exception. The practice of forcing 
employees to use arbitration has been on the rise since the Supreme 
Court's Circuit City decision in 2001. Unless Congress acts, the 
protections it has provided through law for American workers, 
investors, and consumers, will slowly become irrelevant.
  The Arbitration Fairness Act of 2007, which I am happy to say will 
also be introduced in the House by Representative Hank Johnson, D-GA, 
reinstates the FAA's original intent by requiring that agreements to 
arbitrate employment, consumer, franchise, or civil rights disputes be 
made after the dispute has arisen. The act does not apply to mandatory 
arbitration systems agreed to in collective bargaining, and it does not 
prohibit arbitration. What it does do is prevent a party with greater 
bargaining power from forcing individuals into arbitration through a 
contractual provision. It will ensure that citizens once again have a 
true choice between arbitration and the traditional civil court system.
  In our system of Government, Congress and State legislatures pass 
laws and the courts are available to citizens to make sure those laws 
are enforced. But the rule of law means little if the only forum 
available to those who believe they have been wronged is an 
alternative, unaccountable system where the law passed by the 
legislature does not necessarily apply. This legislation both protects 
Americans from exploitation and strengthens a valuable alternative 
method of dispute resolution. These are both worthy ends, and I hope 
that my colleagues in the Senate will join me in working to pass this 
important bill.
  I ask unanimous consent that the text of the bill and a section-by-
section analysis be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                S. 1782

       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 ``Arbitration Fairness Act of 
     2007''.

     SEC. 2. FINDINGS.

       The Congress finds the following:
       (1) The Federal Arbitration Act (now enacted as chapter 1 
     of title 9 of the United States Code) was intended to apply 
     to disputes between commercial entities of generally similar 
     sophistication and bargaining power.
       (2) A series of United States Supreme Court decisions have 
     changed the meaning of the Act so that it now extends to 
     disputes between parties of greatly disparate economic power, 
     such as consumer disputes and employment disputes. As a 
     result, a large and rapidly growing number of corporations 
     are requiring millions of consumers and employees to give up 
     their right to have disputes resolved by a judge or jury, and 
     instead submit their claims to binding arbitration.
       (3) Most consumers and employees have little or no 
     meaningful option whether to submit their claims to 
     arbitration. Few people

[[Page S9145]]

     realize, or understand the importance of the deliberately 
     fine print that strips them of rights; and because entire 
     industries are adopting these clauses, people increasingly 
     have no choice but to accept them. They must often give up 
     their rights as a condition of having a job, getting 
     necessary medical care, buying a car, opening a bank account, 
     getting a credit card, and the like. Often times, they are 
     not even aware that they have given up their rights.
       (4) Private arbitration companies are sometimes under great 
     pressure to devise systems that favor the corporate repeat 
     players who decide whether those companies will receive their 
     lucrative business.
       (5) Mandatory arbitration undermines the development of 
     public law for civil rights and consumer rights, because 
     there is no meaningful judicial review of arbitrators' 
     decisions. With the knowledge that their rulings will not be 
     seriously examined by a court applying current law, 
     arbitrators enjoy near complete freedom to ignore the law and 
     even their own rules.
       (6) Mandatory arbitration is a poor system for protecting 
     civil rights and consumer rights because it is not 
     transparent. While the American civil justice system features 
     publicly accountable decision makers who generally issue 
     written decisions that are widely available to the public, 
     arbitration offers none of these features.
       (7) Many corporations add to their arbitration clauses 
     unfair provisions that deliberately tilt the systems against 
     individuals, including provisions that strip individuals of 
     substantive statutory rights, ban class actions, and force 
     people to arbitrate their claims hundreds of miles from their 
     homes. While some courts have been protective of individuals, 
     too many courts have upheld even egregiously unfair mandatory 
     arbitration clauses in deference to a supposed Federal policy 
     favoring arbitration over the constitutional rights of 
     individuals.

     SEC. 3. DEFINITIONS.

       Section 1 of title 9, United States Code, is amended--
       (1) by amending the heading to read as follows:

     ``Sec. 1. Definitions'';

       (2) by inserting before `` `Maritime' '' the following:
     ``As used in this chapter--'';
       (3) by striking `` `Maritime transactions' '' and inserting 
     the following:
       ``(1) `maritime transactions';'';
       (4) by striking ``commerce'' and inserting the following:
       ``(2) `commerce' '';
       (5) by striking ``, but nothing'' and all that follows 
     through the period at the end, and inserting a semicolon; and
       (6) by adding at the end the following:
       ``(3) `employment dispute', as herein defined, means a 
     dispute between an employer and employee arising out of the 
     relationship of employer and employee as defined by the Fair 
     Labor Standards Act;
       ``(4) `consumer dispute', as herein defined, means a 
     dispute between a person other than an organization who seeks 
     or acquires real or personal property, services, money, or 
     credit for personal, family, or household purposes and the 
     seller or provider of such property, services, money, or 
     credit;
       ``(5) `franchise dispute', as herein defined, means a 
     dispute between a franchisor and franchisee arising out of or 
     relating to contract or agreement by which--
       ``(A) a franchisee is granted the right to engage in the 
     business of offering, selling, or distributing goods or 
     services under a marketing plan or system prescribed in 
     substantial part by a franchisor;
       ``(B) the operation of the franchisee's business pursuant 
     to such plan or system is substantially associated with the 
     franchisor's trademark, service mark, trade name, logotype, 
     advertising, or other commercial symbol designating the 
     franchisor or its affiliate; and
       ``(C) the franchisee is required to pay, directly or 
     indirectly, a franchise fee; and
       ``(6) `pre-dispute arbitration agreement', as herein 
     defined, means any agreement to arbitrate disputes that had 
     not yet arisen at the time of the making of the agreement.''.

     SEC. 4. VALIDITY AND ENFORCEABILITY.

       Section 2 of title 9, United States Code, is amended--
       (1) by amending the heading to read as follows:

     ``Sec. 2. Validity and enforceability'',

       (2) by inserting ``(a)'' before ``A written'';
       (3) by striking ``, save'' and all that follows through 
     ``contract'', and inserting ``to the same extent as contracts 
     generally, except as otherwise provided in this title''; and
       (4) by adding at the end the following:
       ``(b) No predispute arbitration agreement shall be valid or 
     enforceable if it requires arbitration of--
       ``(1) an employment, consumer, or franchise dispute; or
       ``(2) a dispute arising under any statute intended to 
     protect civil rights or to regulate contracts or transactions 
     between parties of unequal bargaining power.
       ``(c) An issue as to whether this chapter applies to an 
     arbitration agreement shall be determined by Federal law. 
     Except as otherwise provided in this chapter, the validity or 
     enforceability of an agreement to arbitrate shall be 
     determined by the court, rather than the arbitrator, 
     irrespective of whether the party resisting arbitration 
     challenges the arbitration agreement specifically or in 
     conjunction with other terms of the contract containing such 
     agreement.
       ``(d) Nothing in this chapter shall apply to any 
     arbitration provision in a collective bargaining 
     agreement.''.

     SEC. 5. EFFECTIVE DATE.

       This Act, and the amendments made by this Act, shall take 
     effect on the date of the enactment of this Act and shall 
     apply with respect to any dispute or claim that arises on or 
     after such date.
                                  ____


                      Section-by-Section Analysis

       When Congress enacted the Federal Arbitration Act 
     (``FAA''), its goal was to allow an alternative forum for 
     parties on equal footing to resolve their disputes. Yet a 
     series of court decisions moved the law away from its 
     original intent and opened the door for arbitration to be 
     used to deprive ordinary citizens in employment, consumer, 
     and franchise disputes of their constitutional right to use 
     the civil justice system.
       The Arbitration Fairness Act of 2007, introduced in the 
     Senate by Sen. Russ Feingold (D-WI) and in the House by Rep. 
     Hank Johnson (D-GA), reflects the FAA's original intent by 
     requiring that agreements to arbitrate employment, consumer, 
     franchise, or civil rights disputes be made after the dispute 
     has arisen. The Act does not prohibit arbitration, but it 
     will prevent a party with greater bargaining power from 
     forcing individuals into arbitration through a contract 
     entered into prior to a dispute arising. It will ensure that 
     citizens have a true choice between arbitration and the 
     traditional civil court system.
       Sec. 1: Short Title: the ``Arbitration Fairness Act of 
     2007''
       Sec. 2: Findings: This section details how the law has 
     moved away from the original intent of the Federal 
     Arbitration Act and has now exposed growing numbers of 
     individual consumers and employees to mandatory arbitration 
     agreements. It also discusses the ways in which mandatory 
     arbitration systems are skewed in favor of powerful, 
     corporate, repeat players.
       Sec. 3: Definitions: This section amends section 1 of the 
     FAA (9 U.S.C. Sec. 1) to include specific definitions of 
     ``employment dispute,'' ``consumer dispute,'' and ``franchise 
     dispute,'' which are covered by the Act. An employment 
     dispute is any dispute between an employer and employee 
     arising out of the relationship as defined by the Fair Labor 
     Standards Act. A consumer dispute is a dispute between an 
     individual person who seeks or acquires property, services, 
     money, or credit for non-business purposes and the seller or 
     provider of those goods or services. A franchise dispute is a 
     dispute between a franchisor and franchisee arising out of or 
     relating to the contract establishing the franchise.
       Sec. 4: Validity and Enforceability: This section amends 
     section 2 of the FAA (9 U.S.C. Sec. 2) to establish that 
     agreements to arbitrate employment, consumer, or franchise 
     disputes will not be enforceable if they are entered before 
     the actual dispute arises. It extends this rule to disputes 
     arising under civil rights statutes and statutes regulating 
     contracts or transactions between parties of unequal 
     bargaining power. This section also states that disputes as 
     to whether the Act applies shall be resolved by the court, 
     rather than through arbitration. Finally, the section 
     clarifies that the Act does not apply to collective 
     bargaining agreements.
       Sec. 5: Effective Date: The Act shall apply to claims and 
     disputes arising on or after the date of enactment.
                                 ______
                                 
      By Mr. ENZI:
  S. 1783. A bill to provide 10 steps to transform health care in 
America; to the Committee on Finance.
  Mr. ENZI. Mr. President, I rise for the purpose of introducing a bill 
on health care reform. I know the Presiding Officer has immense 
interest in it, as do a number of other Senators. I have read his bill 
and incorporated many parts of that.
  Health care reform is one of the biggest needs in this country. It is 
the fastest escalating price in this country. It is the biggest cost to 
companies and individuals in this country. We need to have a solution.
  I have been working with Senator Kennedy, who is the chairman of the 
Health, Education, Labor and Pensions Committee. He has a very full 
plate with the Higher Education Act, the higher education 
reconciliation, information technology, and I could go on to mention 
about 53 bills we are working on in that committee. So I have had some 
latitude as ranking member to try to pull together some information--
some legislation that would deal with health care for this Nation. This 
is a work in progress. This is not a finished document.
  I wish to thank Senator Kennedy for working with me and his staff and 
my staff to come up with some health care principles we wanted to 
follow. Of course, I appreciate the work Senator Nelson did with me in 
previous times and currently on small business health plans. I 
appreciate Senator Baucus's efforts on health care and how the tax

[[Page S9146]]

package goes together with that. We can see there are a lot of moving 
parts to anything we do with health. Senator Coburn has an outstanding 
and very comprehensive package on how we can solve many of the health 
care and health insurance problems in this Nation. Senator Lott, 
Senator DeMint, Senator McConnell; as I mentioned, the Presiding 
Officer, Senator Whitehouse; Senator Lincoln, Senator Carper, Senator 
Salazar, and Senator Durbin--these are all people who have come up with 
either a comprehensive plan or a piece of a plan that would work to 
make an important difference in health care in this country.
  Congressman McCreary on the House side has been a real leader on this 
and, of course, the President and the administration have made 
contributions as well. The President, in his State of the Union speech, 
made some comments about how taxes would fit in with solving some of 
the uninsured problems in the country, and some of those provisions are 
in here as well.
  Without the work of everyone on this, it can't be done. If it gets 
polarized, it can't be done. This is something which has to be done in 
a very bipartisan way. I hope we have a framework from which we can all 
operate, making changes, finding third ways.
  I work on an 80-percent rule. I anticipate and from experience have 
found that usually everybody can agree on 80 percent of the issues, and 
among the 80 percent of the issues on which they agree, they can agree 
on 80 percent of any one of those issues. You never get a perfect bill 
around here. If you can get 80 percent, you can get a lot done. That is 
what we are trying to do on health care--make an 80-percent change for 
the people of America. Eighty percent would be a huge difference and 
will help out a lot of people.
  So I rise today to talk about an issue that is literally a heartbeat 
away from devastating the lives of every American; that is, our current 
health care crisis. Undeniably, we have a problem. There are 46.1 
million Americans, according to the last tabulation, who are uninsured. 
Now, we always talk about that figure and change it slightly 
differently because there are 7 million of those people who make over 
$80,000 a year and don't have insurance, so they must choose not to 
have insurance, but they are uninsured. People who are on Medicaid, 
they don't have to sign up for anything before they have an emergency. 
When they go to the hospital, they can sign up then. That is a 
significant number of the 46.1 million people as well. So I don't know 
whether to really say they don't have insurance, but at any rate, let's 
just use that figure of 46.1 million Americans who are uninsured and 
figure out a way to solve that, as well as to help people who also have 
insurance to perhaps be able to handle the situation even better.
  Health care costs are outstripping inflation. They are increasing 
annually at three times the rate of the Consumer Price Index. It is 
little surprise that three out of every four Americans are concerned 
about health care--three out of four. I think probably, if you are 
talking to people, you would think the percentage was even higher than 
that.
  Employer-provided health insurance is voluntary and in critical 
condition. Sixty percent of the country's employers offer insurance 
today, but that is down 9 percent from a few years ago. It is partly 
due to the fact that the cost of health insurance for companies has 
nearly doubled in the same amount of time. With employers expected to 
pay over $8,000 per employee versus $4,000 5 years ago, we have no 
choice but to stabilize the system and provide more options for 
businesses so they can continue to provide health care for their 
employees.

  We must also provide real options--real options for those without 
employer-based health care. My own home State of Wyoming is hard-hit. 
On average, one in five Wyoming residents is uninsured, and more and 
more residents are losing the coverage they do have as the costs go up. 
It is largely due to the fact that much of Wyoming's economy is small 
business. Nearly 70 percent of Wyoming employers are small business. 
Actually, if you use the Federal definition of small business and you 
talk about companies headquartered in Wyoming, 100 percent of the 
companies are small business. We don't have a single one, according to 
the Federal definition, that is based in Wyoming. But nearly 70 percent 
of the employers find that it is nearly impossible to afford health 
care coverage for their employees.
  Thankfully, I am not here today to talk about these problems; I am 
here to provide real solutions. Americans need and deserve real 
solutions to this crisis now, and they are counting on this body to 
work together to get that. The time has come to move beyond the 
rhetoric and principles to true comprehensive health care reform.
  Congress could enact 10 major steps for health care reform. These 10 
steps are the basis of the legislation I am introducing today, the Ten 
Steps to Transform Health Care in America, or simply ``Ten Steps.''
  In putting together these 10 steps, I first wanted to understand the 
problem, and all the proposals others have been discussing help with 
that. I have studied those other proposals very carefully, and my 
colleagues will find that I have included many of the concepts of those 
other proposals in the 10 steps. I particularly wish to recognize again 
and thank Senator Baucus, Senator Kennedy, Senator Nelson, Senator 
Coburn, Senator Lott, Senator DeMint, Senator McConnell, Senator 
Whitehouse, Senator Lincoln, Senator Carper, Senator Salazar, Senator 
Durbin, Congressman McCreary, the President, the administration--all of 
them for their contributions, for their patience, and for their 
willingness to share their ideas.
  However, to truly do this right, we have to move beyond the usual 
jurisdictional issues, beyond the usual reauthorizations of a single 
program at a time. We have to examine the whole health care system and 
together--together, we have to put forward a bold and comprehensive 
solution that addresses our health care crisis. That is what Ten Steps 
does. It is a comprehensive solution to a very big problem. It can be 
done in parts. It doesn't have to be done as one structure.
  It needs to go through the committee process. I have pointed out 
several times that bills that don't go through the committee process 
usually don't make it through the process at all. They are good for 
making rhetoric, they are good for making points, they are sometimes 
good for advancing a principle, but they seldom ever make it to the 
President's desk for signature. So I know this will have to go through 
more than one committee. I know the jurisdictional issues between 
Health, Education, Labor and Pensions and the Finance Committees. I 
have no problem. We did the pensions bill last year, going through 
those same kinds of multiple committees and getting agreement from 
everybody, and that can be done on this issue as well--of course, as 
long as we don't polarize it.
  So I want to reiterate again that this is not a final bill. One of 
the things we have done in the HELP Committee which has helped to move 
things along is to consider every bill a work in progress. At a lot of 
the committee meetings, when you have a markup, different amendments 
are presented and they are voted up or down, just like on the floor. 
Well, that doesn't result in a lot of compromise. So what we have done 
on the HELP Committee is use the markup process as an indication of 
problems and the level of intensity of those problems, and we have 
agreed to work through those problems even after the bill makes it 
through committee. As a result, it seldom makes it through committee 
unanimously, but it makes it through committee in a bipartisan way, and 
that encourages people to work together to find solutions. Sometimes it 
is one way or the other, but usually it is finding a third way to come 
up with a mechanism to do what we are trying to do. Once we can put 
away some of the old ``diving into the weeds'' things that have 
happened year after year, we are able to come up with something new and 
different that actually reaches the goal we have been trying to reach 
as we jumped into the weeds through the whole process.
  So I want to remind everybody that it is a work in progress. We want 
more ideas. We want some of those third ways. But primarily, we want 
everybody to take a look at what is in here because it is a compilation 
of a number of people who have really taken a look at the situation.
  So what does it do? These 10 steps--I will break them down into the 
actual 10 steps and go through each of them.

[[Page S9147]]

  First, we eliminate unfair tax treatment of health insurance, which 
expands choices and coverage and gives all Americans more control over 
their health care.
  Our current health insurance system is biased toward employer-based 
coverage--kind of due to a historical accident. The wage controls of 
World War II increased competition among employers for recruiting the 
best employees and incentivized employers to offer health benefits 
instead of what they couldn't do, which was increase wages. In 1954, 
Congress codified a provision declaring that such a contribution would 
not count as taxable income. This tax policy made it very favorable for 
individuals to get their health benefits through their employers and 
consequently has penalized individuals who get coverage through the 
individual market. So if you work for a big company--a tax break. If 
you don't--penalized.
  The Joint Committee on Taxation estimated that moving this tax bias 
and a few related health care tax policies will save the Government 
$3.6 trillion over the next 10 years. Even around here, that is a lot 
of money. That is a lot of money which can and should be used to expand 
choices and access and give individuals more control over their health 
care. Ten Steps ensures that every American can benefit from this 
savings--whether they get their health care from their employer, from 
the individual insurance market or they decide they want to get off 
Medicaid and switch to private insurance.

  Let me be clear. My goal is not to erode employer-based health 
insurance, given that the Ten Steps does not alter the way employers 
treat health insurance. Rather, I wish to provide more options for 
individuals who don't currently have insurance through their employer. 
Everyone should be treated equally.
  Once the employee exclusion for health care insurance is eliminated, 
we must provide additional tax incentives for the purchase of health 
care insurance. Ten Steps is a hybrid approach, combining the standard 
deduction for health insurance with a tax subsidy for those who need it 
the most. That way, no particular population is adversely affected.
  The second step of Ten Steps would increase affordable options for 
working families to purchase health insurance through a standard tax 
deduction. The national above-the-line standard deduction for health 
insurance will equal $15,000 for a family and $7,500 for an individual. 
I wish to also note the earned-income tax credit for taxpayers with 
qualifying children is held harmless--that is very important--so those 
receiving the earned-income tax credit will not be affected by these 
changes. Actually, they will be affected in a positive way.
  For example, say Bob from Gillette, WY, has total compensation of 
$38,000, made up of $34,000 in wages and $4,000 in health insurance 
premiums paid by his employer. Because of the current unfair tax 
treatment of premiums, Bob's current taxable income is reduced to 
$34,000, which means he paid about $5,000 in taxes. To an accountant, 
this is all fascinating; for other people, I am not so sure.
  Under the Ten Steps, which eliminates the exclusion of premiums from 
tax, Bob's total compensation and thus taxable income would be $38,000. 
By providing Bob with a $7,500 standard deduction for health insurance, 
his taxable income under this bill would be lowered to $30,500, which 
means he would pay about $4,000 in taxes. So Bob's total savings under 
this proposal is $1,000 a year.
  The third step of Ten Steps is what makes this a hybrid approach. I 
couple the standard deduction with a refundable, advanceable, 
assignable tax-based subsidy. That is a mouthful, but it ensures that 
Americans receive this credit in a meaningful way that allows them to 
purchase real insurance coverage.
  Given that everybody is not familiar with these terms, I will explain 
them. As a refundable credit, it benefits folks even if they don't have 
tax liability. They don't have to owe taxes in order to get it. This 
helps low-income individuals. Advanceable means the subsidy would be 
paid at the beginning of the year so individuals can use the funds to 
immediately purchase health insurance. If it wasn't advanceable, 
individuals would need to first pay for their health insurance and then 
get the money back at the end of the year to pay them back for that 
purchase. To encourage everyone to obtain health insurance right away, 
we should provide those funds upfront. Further, to ensure that the 
subsidy goes toward the purchase of health care insurance, it is also 
assignable--paid directly from the IRS to the insurance carrier that 
the individual chooses.
  Ten Steps includes the tax subsidy equal to $5,000 for a family or 
$2,500 for an individual. The full subsidy amount is available to 
individuals at or below 100 percent of the Federal poverty level, which 
is $20,650 right now for a family of four. The subsidy is phased out 
between up to 300 percent of Federal poverty level, with individuals at 
200 percent receiving half the subsidy and individuals at 301 percent 
receiving the standard deduction instead of the subsidy. I am sure 
everybody got that.
  The fourth key step for health care reform is to provide market-based 
pooling to reduce growing health care costs and increase access not 
only for small businesses, unions and other kinds of organizations and 
their workers, members, and families. That is a change from anything I 
have done on pooling before, but it is a change that was requested by 
the other organizations and unions, as well as small business. Those of 
you who know me well recognize how central this would be to any health 
care reform proposal of mine.
  While I have not yet introduced the small business health plan 
legislation from last year, I have not abandoned those key principles. 
Every day, emergency rooms treat more than 30,000 uninsured Americans 
who work for or depend on small businesses. That is at least 30,000 
reasons why I will not abandon the concept. However, in the proposal I 
am introducing, I have addressed some of the criticisms of the bill, 
and I have offered what I believe are appropriate solutions.
  For instance, while the earlier bill focused heavily on small 
businesses--and this one still does--it simply became clear that other 
organizations, including unions and churches, can benefit from better 
pooling options too. Therefore, under this bill, the umbrella of the 
pooling option has been expanded to include more kinds of organizations 
but with the same strong focus on consumer protections and State-based 
oversight.
  Of course, a big elephant in the room was dealing with those who were 
misled to fear how the initial proposal dealt with insurance mandates. 
I hope those who were so vocal before will pause this time around. By 
incorporating what many have described as the Snowe amendment--which I 
am sure we would have passed at the time we were talking about that 
before--the legislation would require benefit mandate categories if a 
majority of the States required them. While I still have some concerns, 
I am comfortable with this compromise because the mandate requirement 
is coupled with something it needs to encourage pooling and that is a 
common definition of what that mandate means. We do it with the Federal 
insurance plan because definitions in all the States run a little bit 
different. If you are trying to do something comprehensively, it is 
pretty hard to figure out what each definition means, so there needs to 
be a way of streamlining it and coming up with a common definition for 
that mandate. I don't think people have a problem with that, especially 
since we do it with the Federal plan.
  As I learned with the previous debate, mandates for many different 
services and items are not consistent from State to State. Thus, if we 
are to discuss requiring those, we should at least have a consistent 
definition of what those mandates require. We should not further 
complicate the pooling option with a multitude of definitions. We want 
to make insurance as simple as possible. I know that is kind of an 
oxymoron, I am sure, because I know nobody in America relishes having 
their insurance agent come over and spend an evening explaining the 
bill to them. But we want to have this little bit of streamlining so it 
is simpler and people will be able to understand it, to the degree that 
is possible with insurance.

  While the next step is probably one of the most obvious ones, it is 
also one many have not yet discussed. Currently, HIPAA portability 
protections

[[Page S9148]]

are provided to group health plans. The protections provide assurances 
to consumers that insurers will deal with preexisting conditions fairly 
and provide coverage, even to small groups.
  These protections have been a great help for individuals purchasing 
health care coverage in the group market. However, those consumer 
protections are not provided nearly as well to individuals who are 
purchasing in the individual market. Ten Steps blends the individual 
and group market to extend important HIPAA portability protections to 
the individual market so the insurance security can better move with 
you from job to job. It allows people to take that new opportunity and 
still be sure they will be covered, even if they have had some 
preexisting conditions.
  The sixth step emphasizes preventive benefits and helps individuals 
with chronic diseases better manage their health. America should have 
health care, not sick care. Prevention, prevention, prevention. That 
makes a big difference in the cost.
  We have all been discussing the need to do more to prevent disease, 
not just treat its symptoms. Even though I leave much to the markets to 
define some health insurance components, the one thing we must 
emphasize is the need for prevention. Any plan purchased with the tax 
subsidy must include basic preventive services and a medical self-
management component.
  This concept is modeled after a very successful program in Wyoming. 
In 2005, Wyoming EqualityCare, our Medicaid Program, began providing 
one-on-one case management for Medicaid participants with chronic 
illnesses, such as diabetes, asthma, depression or heart disease, to 
encourage better self-management of these conditions. The program 
provides educational information on self-management, as well as a nurse 
health coach who follows up with each patient to ensure they have what 
they need to take care of themselves.
  In addition, EqualityCare provides a nursing hotline so all patients 
have a direct line to a health care provider when they are concerned 
about an illness. These programs targeting those with chronic illnesses 
were estimated to save nearly $13 million for the EqualityCare program 
in 2006. In a lot of States, that would not sound like a lot, but 
Wyoming is the least-populated of all of the States. We are hoping to 
get 500,000 people in the next census. When you talk about $13 million 
being saved in this EqualityCare Program dealing with Medicaid 
participants, it is a lot of money, proportionately, particularly 
because it cut down on inappropriate use of emergency room services.
  Now, another key step of the Ten Steps for health care reform is to 
give individuals the choice to convert the value of their Medicaid and 
SCHIP program benefits into private health insurance, putting them in 
control of their health care, not the Federal Government. The rationale 
for this step is simple. If the market can provide better coverage at a 
lower price, why not allow Americans to access that care?
  This gives low-income individuals more options about where they can 
receive their care and what care is available to them. Some providers 
don't see Medicaid and SCHIP patients. This provision will change that 
by letting the market forces work and give all patients more choices. 
It is time for people to start making decisions about their care. Let's 
get the Government out of the doctors office.
  About 6,000 kids are enrolled in the Wyoming SCHIP program. An 
additional 6,000 kids are eligible for the program but are not 
enrolled. I wonder why that is. Maybe it is because folks in Wyoming 
are wary about accepting Government help, and they think there is a 
negative stigma associated with SCHIP and Medicaid. Well, under Ten 
Steps, they can use that money to purchase health care insurance 
through the private sector so that their family can attain the high 
quality care they need and deserve. This will cover more people.
  The eighth step in Ten Steps is a bipartisan proposal which the HELP 
Committee approved last month--the ``Wired for Health Care Quality 
Act,'' which encouraged the adoption of cutting-edge information 
technologies in health care to improve patient care, reduce medical 
errors, and cut health care costs. Some of the most serious challenges 
facing health care today--medical errors, inconsistent quality, and 
rising costs--can be addressed through the effective application of 
available health information technology linking all elements of the 
health care system.
  The widespread use of health IT can save lives. If somebody is 
traveling and gets in a car wreck or gets hurt in some other way, the 
emergency room doctor would be able to find out everything he or she 
needs to know to make the right treatment decisions, without the person 
having to fill out one of those little papers at the doctors office, 
which they may not be capable of doing if they have been in a requiem 
or have some other problem.
  Better use of health IT would also allow medical data to move with 
people when they go to other locations. When someone goes to the 
doctor's office, they won't have to take the clipboard and a pencil and 
write down everything they can remember about their history. It will 
already be recorded and go with them. It will make a huge difference.

  Beyond saving lives and saving time, more effective use of health 
information technology would save us a lot of money. A RAND study 
suggested that health IT has the potential to save--listen to this--
$162 billion a year. Even around here that is real money. In order for 
these savings to be realized, we have to create an infrastructure for 
interoperability.
  All the different health providers and insurers and doctors have to 
be able to get the information electronically, but doctors, hospitals, 
health care advocates, the business community, including small 
businesses, are clamoring for Congress to take action and establish 
uniform health IT standards. That will cut down on the cost of the 
software.
  Time is of the essence. If Congress does not act, our health care 
system will move forward in a highly inefficient, fragmented, and 
disjointed way. Among other things, this bill will eliminate 
duplicative tests and reduce medical errors. That is a lot of where 
that $162 billion a year in savings comes from.
  Health care reform cannot simply expand health insurance coverage. It 
must also expand access to actual providers of care. There are growing 
shortages of health care providers nationally, with a shortage of up to 
200,000 primary care physicians and 1 million nurses expected by 2020. 
Who is going to take care of us at the hospital if we don't have 
nurses? Who is going to help make a diagnosis if we don't have doctors?
  That is why the ninth step of Ten Steps helps future providers and 
nurses pay for their education while encouraging them to serve in areas 
with great need with five key reforms.
  This legislation provides competitive matching grants for States to 
encourage nurses to return to the profession after having left the 
workforce for 3 years or more while reaffirming the commitment to 
current programs targeting nurse educators and nurse education. So this 
will encourage people to come back into providing that excellent 
service. To deal with the shortage right now, this legislation will 
expand the number of nonimmigrant skilled workers visa slots for nurses 
serving in medically underserved areas.
  To expand access to those most vulnerable, Ten Steps reaffirms the 
commitment to current programs that are working, such as the Community 
Health Centers program and the loan repayment programs at the National 
Health Service Corps. Working together, these two programs provide key 
support in underserved areas.
  To allow for greater access to health care services, clarification 
will be made that convenient care clinics may accept and receive 
reimbursement from Medicaid and SCHIP patients. These convenient care 
clinics are small health care facilities located in retail outlets 
providing affordable and accessible nonemergency health care from 
nurses, physician assistants, and physicians. Often open 7 days a week, 
these clinics provide an option for those seeking routine and 
preventive care services in a more convenient setting--at the retail 
outlets--and with patients seen typically within 15 minutes.
  Finally, building upon the successes of current rural health 
programs, Ten Steps will ensure appropriate development of rural health 
systems and access to care for residents in rural areas.

[[Page S9149]]

  In providing access to health care, I believe it is important to 
envision where we want to provide that care. Community and home-based 
care is often much preferred, less costly, and proven to increase 
quality of life. To encourage innovative approaches to keeping long-
term care in residential settings, competitive grants will be available 
to give seniors more options for receiving care in home or community-
based settings. We just had a hearing on that subject in the HELP 
Committee. It was both very helpful and very convincing.
  The final step to Ten Steps decreases the skyrocketing cost of health 
care by restoring reliability in our medical justice system through 
State-based solutions. The bill I have been discussing today includes 
the Fair and Reliable Medical Justice Act, which I just introduced with 
Senator Baucus, for States to encourage early disclosure of preventable 
health care errors, prompt and fair compensation for injured patients, 
and careful analysis on patterns of health care errors to prevent 
future injuries. By funding demonstration projects, States are enabled 
to experiment with and learn from ideas leading to long-term solutions 
tailored to the unique circumstances of each State.
  No one--not patients or health care providers--is appropriately 
served by our current medical litigation procedures. Right now, many 
patients who are hurt by negligent actions receive no compensation for 
their loss. Those who do receive merely 40 cents of every premium 
dollar, given the high cost of legal fees and administrative costs. 
That is simply a waste of medical resources.
  Furthermore, the likelihood and the outcomes of lawsuits and 
settlements bear little relation to whether the health care provider 
was at fault. Consequently, we are not learning from our mistakes. 
Rather, we are simply diverting our doctors. When someone has a medical 
emergency, they want to see a doctor in an operating room, not a 
courtroom.
  The medical liability system is losing information that could be used 
to improve the practice of medicine. Although zero medical errors is an 
unattainable goal, the reduction of medical errors should be the 
ultimate goal in medical reform. The Institute of Medicine, in its 
landmark study called ``To Err is Human,'' estimated that preventable 
medical errors kill somewhere between 44,000 and 98,000 Americans each 
year. That study further emphasized that to improve our health care 
outcomes, we should no longer focus on individual situations but on the 
whole system of care that is failing American patients.
  In the 8 years since that study, little progress has been made. 
Instead, the practice of medicine has become more specialized and 
complex while the tort system is more focused on individual blame than 
on a system safety.
  I realize I have talked for quite a bit about Ten Steps, and given 
the current crisis, we should be talking a lot more about real 
solutions, not just problems. I also want everyone to know I believe 
the introduction of this bill today is simply the first step forward. I 
look forward to talking with others about their thoughts on how to 
improve this proposal, how to better refine it so it can better serve 
all Americans.
  With all of that talk, I also want action, real action, to provide 
real coverage for Americans, not a large expansion of a government 
program with a huge pricetag that does little to impact those who are 
uninsured.
  We have an opportunity, we have an obligation to take care of the 
people of this country, and they are demanding it. Let's work from a 
basis of some information and see where we can take it so that we get a 
solution and we get action now.
                                 ______
                                 

 By Mr. KERRY (for himself, Ms. Snowe, Ms. Cantwell, and Ms. Landrieu):

  S. 1784. A bill to amend the Small Business Act to improve programs 
for veterans, and for other purposes; to the Committee on Small 
Business and Entrepreneurship.
  Mr. KERRY. Mr. President, I am pleased to introduce today the 
Military Reservist and Veteran Small Business Reauthorization and 
Opportunity Act. As the Chairman of the Senate Committee on Small 
Business and Entrepreneurship, I am gratified that I was able to work 
with Ranking Member Senator Snowe on behalf of the 25 million veterans 
currently in America, including over 1 million who have left military 
service since September 11, 2001. As the conflicts in Iraq and 
Afghanistan continue, the number of veterans, including service 
disabled veterans, will increase and reservists will continue to carry 
more of the burden then ever before. As veterans and reservists reenter 
civilian life, the small business programs provided by the Federal 
Government will become even more critical. I am serious about 
addressing the problems affecting veterans and reservists who wish or 
are already engaged in small business and this bill is another step 
forward in doing so.
  The Military Reservist and Veteran Small Business Reauthorization and 
Opportunity Act of 2007 reauthorizes the veteran programs in the Small 
Business Administration. Specifically, this legislation increases the 
funding authorization for the Office of Veteran Business Development 
from $2 million today to $2.5 million over three years. In light of the 
large numbers of veterans returning from Iraq and Afghanistan and 
increased responsibilities placed on this office by Executive Order 
13360, it is high time that the Office of Veteran Business Development 
receive the funding levels that it needs.
  The bill also creates an Interagency Task Force to improve 
coordination between agencies in administrating veteran small business 
programs. One of the biggest complaints that our Committee heard at the 
``Assessing Federal Small Business Assistance Programs for Veterans and 
Reservists'' hearing held on January 31st was that Federal agencies do 
not work together in reaching out to veterans and informing them about 
small business programs. This task force is an attempt to improve that. 
The task force is composed of representatives from Small Business 
Administration, Department of Defense, Department of Veterans Affairs, 
Department of Labor, General Services Administration, Office of 
Management Budget and four veterans service organizations appointed by 
the President. The task force will focus on increasing veterans' small 
business success, including procurement and franchising opportunities, 
access to capital, and other types of business development assistance.
  This bill also permanently extends the SBA Advisory Committee on 
Veterans Business Affairs. The committee was created to serve as an 
independent source of advice and policy recommendations to the SBA, the 
Congress, and the President. The veteran small business owners who 
serve on this committee provide a unique perspective which is sorely 
needed at this challenging time. Unfortunately, continuing uncertainty 
about the Committee's future has, at times, distracted the committee 
from focusing on its core function. Therefore, I have called for its 
permanent extension. It is clear to me that more needs to be done to 
address the issues facing veterans and reservists, and the role this 
committee plays will continue to be important.
  Additionally, I have taken a number of steps to better serve the 
reservists who are serving their country abroad while their businesses 
are suffering at home. Over the past decade, the Department of Defense 
has increased its reliance on the National Guard and reserves. This has 
intensified since September 11, 2001, and increased deployments are 
expected to continue. The affect of this increase on reservists and 
small businesses continues to remain of concern. A 2003 GAO report 
indicated that 41 percent of reservists lost income when mobilized. 
This had a higher effect on self-employed reservists, 55 percent of 
whom lost income.

  In 1999, I created the Military Reservist Economic Injury Disaster 
Loan, MREIDL, program to provide loans to small businesses that incur 
economic injury as a result of an essential employee being called to 
active duty. However, since 2002, fewer than 300 of these loans have 
been approved by the SBA, despite record numbers of reservists being 
called to active duty. It is clear that changes need to be made, so 
that reservists are informed about the availability of the MREIDL 
program and that the program better meets their needs.
  At the hearing on January 31, we heard suggestions for a number of

[[Page S9150]]

changes which would improve the Military Reservist Economic Injury 
Disaster Loan program, and I have included those changes in this bill. 
They include increasing the application deadline for such a loan from 
90 days to 1 year following the date of discharge; creating a 
predeployment loan approval process; and improved outreach and 
technical assistance.
  This bill also increases to $50,000 the amount SBA can disburse 
without requiring collateral under the MREIDL program. Reservist 
families have already sacrificed enough when a family member goes away 
to serve their country and when their business is harmed as a result. 
This loan program would allow reservist dependent businesses to access 
the capital they need to stay afloat without having to sacrifice beyond 
the service of the key employees. In order to give reservists time to 
repay the loans, the non-collaterized loan created in this bill would 
not accumulate interest or require payments for one year or until after 
the deployment ends, whichever is longer.
  While addressing the funding needs of reservists is essential, I also 
want to make sure that reservists receive the technical and management 
assistance they need to succeed. For that reason, this bill also 
includes the establishment of the Reservists Enterprise Transition and 
Sustainability Task Force. This grant program would allow Small 
Business Development Centers, Women's Business Centers and veteran 
centers to compete for grants to create programs that help small 
businesses prepare for and cope with the mobilization of reservist-
employees and owners.
  There are two more provisions which will help this Nation's service 
members. One section of the bill will require the SBA to give priority 
to MREIDL loans during loan processing. Another provision will give 
activated service members an extension of any SBA time limitations 
equal to the time spent on active duty. This will make it easier for 
service members to serve their country while continuing to meet their 
obligations at home.
  Lastly, this bill calls for two reports. One report will look at the 
needs of service-disabled veterans who are interested in becoming 
entrepreneurs. As a result of the war on terror and improved medicine, 
we are seeing more service-disabled veterans than we have seen in 
decades. For some service-disabled veterans, entrepreneurship is the 
best or only way of achieving economic independence. Therefore, it is 
essential that we understand and take steps to address the needs of the 
service-disabled veteran entrepreneur or small business owner.
  This bill also calls for a study to investigate how to improve 
relations between reservists and their employers. In January, the 
Committee heard that recent changes by the Department of Defense to 
policies regulating the length and frequency of reservist deployments 
is harming the ability of reservists to find jobs and the ability of 
small business owners to continue hiring them. Witnesses testified 
about reservists being turned down or not considered for jobs because 
they are reservists. I have heard reservists talk about being pressured 
to leave the reserves if they would like to continue to advance at 
work. I have also heard the concerns of small business owners who want 
to support servicemembers; however, they cannot do so if it means the 
survival of their business. Understanding more about this issue is 
important and essential to making sure that policymakers can continue 
to support citizen soldiers and the small businesses that employ them 
across the Nation.

  Veterans possess great technical skills and valuable leadership 
experience, but they require financial resources and small business 
training to turn that potential into a viable enterprise. A recent 
report by the Small Business Administration stated that 22 percent of 
veterans plan to start or are starting a business when they leave the 
military. For service-disabled veterans, this number rises to 28 
percent. This bill is another step forward in providing the necessary 
resources for veterans and reservists to succeed in starting or growing 
a small business.
  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. 1784

       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 ``Military Reservist and 
     Veteran Small Business Reauthorization and Opportunity Act of 
     2007''.

     SEC. 2. DEFINITIONS.

       In this Act--
       (1) the term ``activated'' means receiving an order placing 
     a Reservist on active duty;
       (2) the term ``active duty'' has the meaning given that 
     term in section 101 of title 10, United States Code;
       (3) the terms ``Administration'' and ``Administrator'' mean 
     the Small Business Administration and the Administrator 
     thereof, respectively;
       (4) the term ``Reservist'' means a member of a reserve 
     component of the Armed Forces, as described in section 10101 
     of title 10, United States Code;
       (5) the term ``Service Corps of Retired Executives'' means 
     the Service Corps of Retired Executives authorized by section 
     8(b)(1) of the Small Business Act (15 U.S.C. 637(b)(1));
       (6) the terms ``service-disabled veteran'' and ``small 
     business concern'' have the meanings given those terms in 
     section 3 of the Small Business Act (15 U.S.C. 632);
       (7) the term ``small business development center'' means a 
     small business development center described in section 21 of 
     the Small Business Act (15 U.S.C. 648); and
       (8) the term ``women's business center'' means a women's 
     business center described in section 29 of the Small Business 
     Act (15 U.S.C. 656).

                 TITLE I--VETERANS BUSINESS DEVELOPMENT

     SEC. 101. INCREASED FUNDING FOR THE OFFICE OF VETERANS 
                   BUSINESS DEVELOPMENT.

       (a) In General.--There are authorized to be appropriated to 
     the Office of Veterans Business Development of the 
     Administration, to remain available until expended--
       (1) $2,100,000 for fiscal year 2008;
       (2) $2,300,000 for fiscal year 2009; and
       (3) $2,500,000 for fiscal year 2010.
       (b) Sense of Congress.--It is the sense of Congress that 
     any amounts provided pursuant to this section that are in 
     excess of amounts provided to the Administration for the 
     Office of Veterans Business Development in fiscal year 2007, 
     should be used to support Veterans Business Outreach Centers.

     SEC. 102. INTERAGENCY TASK FORCE.

       Section 32 of the Small Business Act (15 U.S.C. 657b) is 
     amended by adding at the end the following:
       ``(d) Interagency Task Force.--
       ``(1) Establishment.--Not later than 90 days after the date 
     of enactment of this subsection, the President shall 
     establish an interagency task force to coordinate the efforts 
     of Federal agencies necessary to increase capital and 
     business development opportunities for, and increase the 
     award of Federal contracting and subcontracting opportunities 
     to, small business concerns owned and controlled by service-
     disabled veterans and small business concerns owned and 
     controlled by veterans (in this section referred to as the 
     `task force').
       ``(2) Membership.--The members of the task force shall 
     include--
       ``(A) the Administrator, who shall serve as chairperson of 
     the task force;
       ``(B) a representative from--
       ``(i) the Department of Veterans Affairs;
       ``(ii) the Department of Defense;
       ``(iii) the Administration (in addition to the 
     Administrator);
       ``(iv) the Department of Labor;
       ``(v) the General Services Administration; and
       ``(vi) the Office of Management and Budget; and
       ``(C) 4 representatives of veterans service organizations, 
     selected by the President.
       ``(3) Duties.--The task force shall coordinate 
     administrative and regulatory activities and develop 
     proposals relating to--
       ``(A) increasing capital access and capacity of small 
     business concerns owned and controlled by service-disabled 
     veterans and small business concerns owned and controlled by 
     veterans through loans, surety bonding, and franchising;
       ``(B) increasing access to Federal contracting and 
     subcontracting for small business concerns owned and 
     controlled by service-disabled veterans and small business 
     concerns owned and controlled by veterans through increased 
     use of contract reservations, expanded mentor-protege 
     assistance, and matching such small business concerns with 
     contracting opportunities;
       ``(C) increasing the integrity of certifications of status 
     as a small business concern owned and controlled by service-
     disabled veterans or a small business concern owned and 
     controlled by veterans;
       ``(D) reducing paperwork and administrative burdens on 
     veterans in accessing business development and 
     entrepreneurship opportunities; and
       ``(E) making other improvements relating to the support for 
     veterans business development by the Federal Government.
       ``(4) Reporting.--The task force shall submit an annual 
     report regarding its activities and proposals to--

[[Page S9151]]

       ``(A) the Committee on Small Business and Entrepreneurship 
     and the Committee on Veterans' Affairs of the Senate; and
       ``(B) the Committee on Small Business and the Committee on 
     Veterans' Affairs of the House of Representatives.''.

     SEC. 103. PERMANENT EXTENSION OF SBA ADVISORY COMMITTEE ON 
                   VETERANS BUSINESS AFFAIRS.

       (a) Assumption of Duties.--Section 33 of the Small Business 
     Act (15 U.S.C. 657c) is amended--
       (1) by striking subsection (h); and
       (2) by redesignating subsections (i) through (k) as 
     subsections (h) through (j), respectively.
       (b) Permanent Extension of Authority.--Section 203 of the 
     Veterans Entrepreneurship and Small Business Development Act 
     of 1999 (15 U.S.C. 657b note) is amended by striking 
     subsection (h).

 TITLE II--NATIONAL RESERVIST ENTERPRISE TRANSITION AND SUSTAINABILITY

     SEC. 201. SHORT TITLE.

       This title may be cited as the ``National Reservist 
     Enterprise Transition and Sustainability Act of 2007''.

     SEC. 202. PURPOSE.

       The purpose of this title is to establish a program to--
       (1) provide managerial, financial, planning, development, 
     technical, and regulatory assistance to small business 
     concerns owned and operated by Reservists;
       (2) provide managerial, financial, planning, development, 
     technical, and regulatory assistance to the temporary heads 
     of small business concerns owned and operated by Reservists;
       (3) create a partnership between the Small Business 
     Administration, the Department of Defense, and the Department 
     of Veterans Affairs to assist small business concerns owned 
     and operated by Reservists;
       (4) utilize the service delivery network of small business 
     development centers, women's business centers, Veterans 
     Business Outreach Centers, and centers operated by the 
     National Veterans Business Development Corporation to expand 
     the access of small business concerns owned and operated by 
     Reservists to programs providing business management, 
     development, financial, procurement, technical, regulatory, 
     and marketing assistance;
       (5) utilize the service delivery network of small business 
     development centers, women's business centers, Veterans 
     Business Outreach Centers, and centers operated by the 
     National Veterans Business Development Corporation to quickly 
     respond to an activation of Reservists that own and operate 
     small business concerns; and
       (6) utilize the service delivery network of small business 
     development centers, women's business centers, Veterans 
     Business Outreach Centers, and centers operated by the 
     National Veterans Business Development Corporation to assist 
     Reservists that own and operate small business concerns in 
     preparing for future military activations.

     SEC. 203. NATIONAL GUARD AND RESERVE BUSINESS ASSISTANCE.

       (a) In General.--Section 21(a)(1) of the Small Business Act 
     (15 U.S.C. 648(a)(1)) is amended by inserting ``any small 
     business development center, women's business center, 
     Veterans Business Outreach Center, or center operated by the 
     National Veterans Business Development Corporation providing 
     enterprise transition and sustainability assistance to 
     Reservists under section 37,'' after ``any women's business 
     center operating pursuant to section 29,''.
       (b) Program.--The Small Business Act (15 U.S.C. 631 et 
     seq.) is amended--
       (1) by redesignating section 37 (15 U.S.C. 631 note) as 
     section 38; and
       (2) by inserting after section 36 the following:

     ``SEC. 37. RESERVIST ENTERPRISE TRANSITION AND 
                   SUSTAINABILITY.

       ``(a) In General.--The Administrator shall establish a 
     program to provide business planning assistance to small 
     business concerns owned and operated by Reservists.
       ``(b) Definitions.--In this section--
       ``(1) the terms `activated' and `activation' mean having 
     received an order placing a Reservists on active duty, as 
     defined by section 101(1) of title 10, United States Code;
       ``(2) the term `Administrator' means the Administrator of 
     the Small Business Administration, acting through the 
     Associate Administrator for Small Business Development 
     Centers;
       ``(3) the term `Association' means the association 
     established under section 21(a)(3)(A);
       ``(4) the term `eligible applicant' means--
       ``(A) a small business development center that is 
     accredited under section 21(k);
       ``(B) a women's business center;
       ``(C) a Veterans Business Outreach Center that receives 
     funds from the Office of Veterans Business Development; or
       ``(D) an information and assistance center operated by the 
     National Veterans Business Development Corporation under 
     section 33;
       ``(5) the term `enterprise transition and sustainability 
     assistance' means assistance provided by an eligible 
     applicant to a small business concern owned and operated by a 
     Reservist, who has been activated or is likely to be 
     activated in the next 12 months, to develop and implement a 
     business strategy for the period while the owner is on active 
     duty and 6 months after the date of the return of the owner;
       ``(6) the term `Reservist' means any person who is--
       ``(A) a member of a reserve component of the Armed Forces, 
     as defined by section 10101 of title 10, United States Code; 
     and
       ``(B) on active status, as defined by section 101(d)(4) of 
     title 10, United States Code;
       ``(7) the term `small business development center' means a 
     small business development center as described in section 21 
     of the Small Business Act (15 U.S.C. 648);
       ``(8) the term `State' means each of the several States of 
     the United States, the District of Columbia, the Commonwealth 
     of Puerto Rico, the Virgin Islands, American Samoa, and Guam; 
     and
       ``(9) the term `women's business center' means a women's 
     business center described in section 29 of the Small Business 
     Act (15 U.S.C. 656).
       ``(c) Authority.--The Administrator may award grants, in 
     accordance with the regulations developed under subsection 
     (d), to eligible applicants to assist small business concerns 
     owned and operated by Reservists by--
       ``(1) providing management, development, financing, 
     procurement, technical, regulatory, and marketing assistance;
       ``(2) providing access to information and resources, 
     including Federal and State business assistance programs;
       ``(3) distributing contact information provided by the 
     Department of Defense regarding activated Reservists to 
     corresponding State directors;
       ``(4) offering free, one-on-one, in-depth counseling 
     regarding management, development, financing, procurement, 
     regulations, and marketing;
       ``(5) assisting in developing a long-term plan for possible 
     future activation; and
       ``(6) providing enterprise transition and sustainability 
     assistance.
       ``(d) Rulemaking.--
       ``(1) In general.--The Administrator, in consultation with 
     the Association and after notice and an opportunity for 
     comment, shall promulgate regulations to carry out this 
     section.
       ``(2) Deadline.--The Administrator shall promulgate final 
     regulations not later than 180 days of the date of enactment 
     of the Military Reservist and Veteran Small Business 
     Reauthorization and Opportunity Act of 2007.
       ``(3) Contents.--The regulations developed by the 
     Administrator under this subsection shall establish--
       ``(A) procedures for identifying, in consultation with the 
     Secretary of Defense, States that have had a recent 
     activation of Reservists;
       ``(B) priorities for the types of assistance to be provided 
     under the program authorized by this section;
       ``(C) standards relating to educational, technical, and 
     support services to be provided by a grantee;
       ``(D) standards relating to any national service delivery 
     and support function to be provided by a grantee;
       ``(E) standards relating to any work plan that the 
     Administrator may require a grantee to develop; and
       ``(F) standards relating to the educational, technical, and 
     professional competency of any expert or other assistance 
     provider to whom a small business concern may be referred for 
     assistance by a grantee.
       ``(e) Application.--
       ``(1) In general.--Each eligible applicant desiring a grant 
     under this section shall submit an application to the 
     Administrator at such time, in such manner, and accompanied 
     by such information as the Administrator may reasonably 
     require.
       ``(2) Contents.--Each application submitted under paragraph 
     (1) shall describe--
       ``(A) the activities for which the applicant seeks 
     assistance under this section; and
       ``(B) how the applicant plans to allocate funds within its 
     network.
       ``(3) Matching not required.--Subparagraphs (A) and (B) of 
     section 21(a)(4), requiring matching funds, shall not apply 
     to grants awarded under this section.
       ``(f) Award of Grants.--
       ``(1) Deadline.--The Administrator shall award grants not 
     later than 60 days after the promulgation of final rules and 
     regulations under subsection (d).
       ``(2) Amount.--Each eligible applicant awarded a grant 
     under this section shall receive a grant in an amount--
       ``(A) not less than $75,000 per fiscal year; and
       ``(B) not greater than $300,000 per fiscal year.
       ``(g) Report.--
       ``(1) In general.--The Comptroller General of the United 
     States shall--
       ``(A) initiate an evaluation of the program not later than 
     30 months after the disbursement of the first grant under 
     this section; and
       ``(B) submit a report not later than 6 months after the 
     initiation of the evaluation under paragraph (1) to--
       ``(i) the Administrator;
       ``(ii) the Committee on Small Business and Entrepreneurship 
     of the Senate; and
       ``(iii) the Committee on Small Business of the House of 
     Representatives.
       ``(2) Contents.--The report under paragraph (1) shall--
       ``(A) address the results of the evaluation conducted under 
     paragraph (1); and
       ``(B) recommend changes to law, if any, that it believes 
     would be necessary or advisable to achieve the goals of this 
     section.
       ``(h) Authorization of Appropriations.--
       ``(1) In general.--There are authorized to be appropriated 
     to carry out this section--
       ``(A) $5,000,000 for the first fiscal year beginning after 
     the date of enactment of the

[[Page S9152]]

     Military Reservist and Veteran Small Business Reauthorization 
     and Opportunity Act of 2007; and
       ``(B) $5,000,000 for each of the 3 fiscal years following 
     the fiscal year described in subparagraph (A).
       ``(2) Limitation on use of other funds.--The Administrator 
     may carry out the program authorized by this section only 
     with amounts appropriated in advance specifically to carry 
     out this section.''.

                     TITLE III--RESERVIST PROGRAMS

     SEC. 301. RESERVIST PROGRAMS.

       (a) Application Period.--Section 7(b)(3)(C) of the Small 
     Business Act (15 U.S.C. 636(b)(3)(C)) is amended by striking 
     ``90 days'' and inserting ``1 year''.
       (b) Pre-Consideration Process.--
       (1) Definition.--In this subsection, the term ``eligible 
     Reservist'' means a Reservist who--
       (A) has not been ordered to active duty;
       (B) expects to be ordered to active duty during a period of 
     military conflict; and
       (C) can reasonably demonstrate that the small business 
     concern for which that Reservist is a key employee will 
     suffer economic injury in the absence of that Reservist.
       (2) Establishment.--Not later than 6 months after the date 
     of enactment of this Act, the Administrator shall establish a 
     pre-consideration process, under which the Administrator--
       (A) may collect all relevant materials necessary for 
     processing a loan to a small business concern under section 
     7(b)(3) of the Small Business Act (15 U.S.C. 636(b)(3)) 
     before an eligible Reservist employed by that small business 
     concern is activated; and
       (B) shall distribute funds for any loan approved under 
     subparagraph (A) if that eligible Reservist is activated.
       (c) Outreach and Technical Assistance Program.--
       (1) In general.--Not later than 6 months after the date of 
     enactment of this Act, the Administrator, in consultation 
     with the Secretary of Veterans Affairs and the Secretary of 
     Defense, shall develop a comprehensive outreach and technical 
     assistance program (in this subsection referred to as the 
     ``program'') to--
       (A) market the loans available under section 7(b)(3) of the 
     Small Business Act (15 U.S.C. 636(b)(3)) to Reservists, and 
     family members of Reservists, that are on active duty and 
     that are not on active duty; and
       (B) provide technical assistance to a small business 
     concern applying for a loan under that section.
       (2) Components.--The program shall--
       (A) incorporate appropriate websites maintained by the 
     Administration, the Department of Veterans Affairs, and the 
     Department of Defense; and
       (B) require that information on the program is made 
     available to small business concerns directly through--
       (i) the district offices and resource partners of the 
     Administration, including small business development centers, 
     women's business centers, and the Service Corps of Retired 
     Executives; and
       (ii) other Federal agencies, including the Department of 
     Veterans Affairs and the Department of Defense.
       (3) Report.--
       (A) In general.--Not later than 6 months after the date of 
     enactment of this Act, and every 6 months thereafter until 
     the date that is 30 months after such date of enactment, the 
     Administrator shall submit to Congress a report on the status 
     of the program.
       (B) Contents.--Each report submitted under subparagraph (A) 
     shall include--
       (i) for the 6-month period ending on the date of that 
     report--

       (I) the number of loans approved under section 7(b)(3) of 
     the Small Business Act (15 U.S.C. 636(b)(3));
       (II) the number of loans disbursed under that section; and
       (III) the total amount disbursed under that section; and

       (ii) recommendations, if any, to make the program more 
     effective in serving small business concerns that employ 
     Reservists.

     SEC. 302. RESERVIST LOANS.

       (a) In General.--Section 7(b)(3)(E) of the Small Business 
     Act (15 U.S.C. 636(b)(3)(E)) is amended by striking 
     ``$1,500,000'' each place such term appears and inserting 
     ``$2,000,000''.
       (b) Loan Information.--
       (1) In general.--The Administrator and the Secretary of 
     Defense shall develop a joint website and printed materials 
     providing information regarding any program for small 
     business concerns that is available to veterans or 
     Reservists.
       (2) Marketing.--The Administrator is authorized--
       (A) to advertise and promote the program under section 
     7(b)(3) of the Small Business Act jointly with the Secretary 
     of Defense and veterans' service organizations; and
       (B) to advertise and promote participation by lenders in 
     such program jointly with trade associations for banks or 
     other lending institutions.

     SEC. 303. NONCOLLATERALIZED LOANS.

       Section 7(b)(3) of the Small Business Act (15 U.S.C. 
     636(b)(3)) is amended by adding at the end the following:
       ``(G)(i) Notwithstanding any other provision of law, the 
     Administrator may make a loan under this paragraph of not 
     more than $50,000 without collateral.
       ``(ii) The Administrator may defer payment of principal and 
     interest on a loan described in clause (i) during the longer 
     of--
       ``(I) the 1-year period beginning on the date of the 
     initial disbursement of the loan; and
       ``(II) the period during which the relevant essential 
     employee is on active duty.''.

     SEC. 304. LOAN PRIORITY.

       Section 7(b)(3) of the Small Business Act (15 U.S.C. 
     636(b)(3)), as amended by this Act, is amended by adding at 
     the end the following:
       ``(H) The Administrator shall give priority to any 
     application for a loan under this paragraph and shall process 
     and make a determination regarding such applications prior to 
     processing or making a determination on other loan 
     applications under this subsection, on a rolling basis.''.

     SEC. 305. RELIEF FROM TIME LIMITATIONS FOR VETERAN-OWNED 
                   SMALL BUSINESSES.

       Section 3(q) of the Small Business Act (15 U.S.C. 632(q)) 
     is amended by adding at the end the following:
       ``(5) Relief from time limitations.--
       ``(A) In general.--Any time limitation on any 
     qualification, certification, or period of participation 
     imposed under this Act on any program available to small 
     business concerns shall be extended for a small business 
     concern that--
       ``(i) is owned and controlled by--

       ``(I) a veteran who was called or ordered to active duty 
     under a provision of law specified in section 101(a)(13)(B) 
     of title 10, United States Code, on or after September 11, 
     2001; or
       ``(II) a service-disabled veteran who became such a veteran 
     due to an injury or illness incurred or aggravated in the 
     active military, naval, or air service during a period of 
     active duty pursuant to a call or order to active duty under 
     a provision of law referred to in subclause (I) on or after 
     September 11, 2001; and

       ``(ii) was subject to the time limitation during such 
     period of active duty.
       ``(B) Duration.--Upon submission of proper documentation to 
     the Administrator, the extension of a time limitation under 
     subparagraph (A) shall be equal to the period of time that 
     such veteran who owned or controlled such a concern was on 
     active duty as described in that subparagraph.''.

     SEC. 306. SERVICE-DISABLED VETERANS.

       Not later than 180 days after the date of enactment of this 
     Act, the Comptroller General of the United States shall 
     submit to the Committee on Small Business and 
     Entrepreneurship of the Senate and the Committee on Small 
     Business of the House of Representatives a report 
     describing--
       (1) the types of assistance needed by service-disabled 
     veterans who wish to become entrepreneurs; and
       (2) any resources that would assist such service-disabled 
     veterans.

     SEC. 307. STUDY ON OPTIONS FOR PROMOTING POSITIVE WORKING 
                   RELATIONS BETWEEN EMPLOYERS AND THEIR RESERVE 
                   COMPONENT EMPLOYEES.

       (a) Study Required.--The Secretary of Defense shall conduct 
     a study on options for promoting positive working relations 
     between employers and Reserve component employees of such 
     employers, including assessing options for improving the time 
     in which employers of Reservists are notified of the call or 
     order of such members to active duty other than for training.
       (b) Report.--
       (1) In general.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary of Defense shall submit 
     to the appropriate committees of Congress a report on the 
     study conducted under subsection (a).
       (2) Contents.--The report submitted under paragraph (1) 
     shall--
       (A) provide a quantitative and qualitative assessment of--
       (i) what measures, if any, are being taken to inform 
     Reservists of the obligations and responsibilities of such 
     members to their employers;
       (ii) how effective such measures have been; and
       (iii) whether there are additional measures that could be 
     taken to promote positive working relations between 
     Reservists and their employers, including any steps that 
     could be taken to ensure that employers are timely notified 
     of a call to active duty; and
       (B) assess whether there has been a reduction in the hiring 
     of Reservists by business concerns because of--
       (i) any increase in the use of Reservists after September 
     11, 2001; or
       (ii) any change in any policy of the Department of Defense 
     relating to Reservists after September 11, 2001.
       (c) Appropriate Committees of Congress Defined.--In this 
     section, the term ``appropriate committees of Congress'' 
     means--
       (1) the Committee on Armed Services and the Committee on 
     Small Business and Entrepreneurship of the Senate; and
       (2) the Committee on Armed Services and the Committee on 
     Small Business of the House of Representatives.

  Ms. SNOWE. Mr. President, as ranking member of the Senate Committee 
on Small Business and Entrepreneurship, I rise today, with Senator 
Kerry, to introduce the Military Reservist and Veteran Small Business 
Reauthorization and Opportunity Act of 2007. This bill improves the 
programs and resources available to our Nation's veteran entrepreneurs 
and the small businesses that employ our veterans.
  Thank you, Senator Kerry, for working so closely with me on this 
bipartisan legislation and for your long

[[Page S9153]]

standing commitment to our Nation's veterans. This bipartisan measure 
contains key provisions from both S. 904, the Veterans Small Business 
Opportunity Act of 2007, which I introduced in March, and Senator 
Kerry's S. 1005, Military Reservist and Veteran Small Business 
Reauthorization Act of 2007. It is truly critical that all of our 
fellow Senators, on both sides of the aisle, continue to collaborate on 
our veterans' behalf and support swift passage of this legislation.
  In October 2003, I requested a Congressional Budget Office Report 
entitled ``The Effects of Reserve Call-Ups on Civilian Employers.'' 
That report, issued in May 2005, highlighted the problems that our 
nation's small businesses face when their owners or key employees are 
``called up'' to serve in defense of our Nation. In response to that 
report's findings, I offered two bills to improve the resources and 
programs targeted to these veterans and small businesses. Those bills, 
S. 1014, the Supporting our Patriotic Businesses Act, and S. 3122, the 
Patriot Loan Act of 2006, were the genesis of S. 904 that I introduced 
earlier this year. Similarly, Senator Kerry has an established history 
of working on these issues, and the Small Business Committee on January 
31 held its first hearing of the 110th Congress regarding programs to 
assist veterans and reservists.
  In recent years, our Nation's Guard and Reserve forces, which I 
collectively refer to as reservists, have selflessly answered the call 
to duty in both Iraq and Afghanistan. In fact, there have been over 
425,000 reservist deployments, including nearly 3,000 from my home 
State of Maine, to those two countries since September 11, 2001. With 
the majority of nongovernmental reservists either being self-employed 
or working for small businesses, it is easy to see that veteran 
entrepreneurs and small businesses are profoundly and 
disproportionately impacted by these deployments.
  As our reservists answer our Nation's call to duty, we must similarly 
fulfill our obligations to help protect their livelihood back home. In 
addition to addressing this responsibility, our legislation includes 
other broad provisions to help our Nation's veteran entrepreneurs 
across the board.
  First, our bill makes vast improvements to the Small Business 
Administration's, SBA, Military Reservist Economic Disaster Loan, 
MREIDL, program. The MREIDL program provides funds to businesses to 
meet ordinary and necessary business expenses that they could have 
made, if not for the deployment of a reservist who is one of their 
essential employees.
  Specifically, the bill establishes a preapplication process so 
businesses can be prepared, in advance, to apply for an MREIDL and 
includes a provision allowing a businesses up to 1 year, as opposed to 
90 days, to apply. The legislation increases, from $1.5 million to $2 
million, the maximum MREIDL loan a business can take and raises, from 
$5,000 to $50,000, the level of uncollateralized MREIDL loans available 
to businesses. Finally, our changes to the MREIDL program would allow 
the SBA Administrator to defer the payment of principal and interest 
while the employee is deployed.
  Second, the measure also includes a national reservist enterprise 
transition and sustainability provision. This provision would allow the 
SBA to award grants to entities that assist businesses with preparing 
and implementing a business strategy to cover the period of time that 
the owner is called-up on active duty through 6 months after that 
owner's date of return.
  Third, our bill would create a new Interagency Task Force to 
coordinate the efforts of Federal agencies necessary to increase 
capital and business development opportunities for, and increase the 
award of Federal contracting opportunities to, small businesses owned 
and controlled by veterans. This type of coordinated and targeted 
effort by our Federal Government is long overdue.
  Finally, today's legislation would increase funding for the SBA's 
Office of Veterans Business Development, and permanently extend the 
duties and responsibilities of the SBA Advisory Committee on Veterans 
Business Affairs. It would also allow small businesses owned and 
operated by veterans to extend their SBA program participation time 
limitations by the duration of their owner's deployment.
  While I have not provided an exhaustive list of this bill's 
provisions and all that it would do, a simple review of the legislation 
will reveal that it goes far toward helping our nation's veteran 
entrepreneurs and our patriotic small businesses that employ 
reservists, despite the risk that deployments entail. Our legislation 
is not a silver bullet, but it is certainly a step in the right 
direction. To that end, I urge my colleagues to join us in support of 
this bill.

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