[Congressional Record Volume 154, Number 16 (Thursday, January 31, 2008)]
[Senate]
[Pages S544-S550]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS
By Mr. CARPER (for himself and Mrs. McCaskill):
S. 2583. A bill to amend the Improper Payments Information Act of
2002 (31 U.S.C. 3321 note) in order to prevent the loss of billions in
taxpayer dollars; to the Committee on Homeland Security and
Governmental Affairs.
Mr. CARPER. Mr. President, I rise today to introduce the Improper
Payments Elimination and Recovery Act of 2008.
At first glance, a bill with a name like that might not seem too
exciting. But I can assure my colleagues that it addresses a serious,
largely unknown problem that is a real threat to our fiscal well being.
Each year, agencies are required to look at all of their programs and
activities and determine which are susceptible to significant improper
payments. For those that are deemed at risk, agencies must produce
estimated error rates that are included in their year-end financial
statements. They must also come up with action plans for reducing their
errors.
In fiscal year 2007, agencies are estimated to have made nearly $55
billion in improper payments. That is an astounding number, Mr.
President.
We spend so much time around here throwing around numbers like $55
billion that they begin to lose their meaning. So I want to take a
minute or so to put that number in perspective.
I was surprised to learn that $55 billion is more than the total
budget for the Department of Homeland Security. It is also twice as
much as we're projected to spend to protect the vehicles our soldiers
are using in Iraq against roadside bombs.
To illustrate further the amount of money we are talking about, $55
billion is just a little bit less than the total GDP of Vietnam. It is
a little bit more than the GDPs of Croatia and Slovakia. Most
astoundingly, $55 billion equals the combined GDPs of 44 of the smaller
countries in the world.
So our Federal Government is likely wasting more money than the total
populations of many countries produce in a given year.
But $55 billion is not even a real number. It is likely just the tip
of the iceberg. It includes no error estimates for massive programs
like TANF, SCHIP, and the Medicare Prescription Drug Program. So I
expect that we will see more than $55 billion in improper payments next
year and the year after.
My colleagues and I on the Homeland Security and Governmental Affairs
Committee's Subcommittee on Federal Financial Management have held six
hearings focused on this issue now, including one this afternoon. What
we
[[Page S545]]
have learned is that, in some cases, agencies are just not taking their
responsibility to deal with and address their problems with improper
payments and the management weaknesses that can cause them. The bill I
am bringing forward today addresses just about all of the failures and
deficiencies we've learned about through our oversight.
My bill starts by improving transparency. OMB right now has set the
reporting threshold for improper payments too low, meaning millions of
errors go unreported--and potentially unaddressed--each year. I want to
lower the reporting threshold so that Congress and the general public
have a better picture of the problem we face.
My bill would also help to prevent improper payments from happening
in the first place by requiring that agencies come up with stronger
corrective action plans and aggressive error reduction targets. It
would also implement a recent recommendation from GAO that called on
OMB to develop a process whereby agencies would receive regular audited
opinions on the financial controls used to prevent improper payments
before they happen.
My bill would also force agencies to be more aggressive in recovering
improper payments they make. Some agencies--and most private sector
firms--regularly go over their books to identify payment errors and get
back overpayments made to contractors and others they do business with.
We haven't done that enough in the Federal Government. Even as the
agencies are reporting more and more improper payments, the amount
recovered remains miniscule. I want to change this by requiring that
all agencies with outlays of $1 million or more perform recovery audits
on all of their programs and activities if doing so is cost effective.
Finally--and perhaps most importantly--my bill would hold agencies
accountable. Today, as I mentioned, some agencies do not appear to be
taking improper payments very seriously. I want to force agencies to
hold top managers accountable for their progress--or lack of progress--
in doing something to take better care of the tax dollars we entrust
them with.
I look forward to working with my colleagues to get these important
reforms enacted. I am sure we can all agree that allowing this level of
waste to continue unchecked is reckless and unacceptable.
Mr. President, 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. 2583
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 ``Improper Payments
Elimination and Recovery Act of 2008''.
SEC. 2. IMPROPER PAYMENTS ELIMINATION AND RECOVERY.
(a) Susceptible Programs and Activities.--Section 2 of the
Improper Payments Information Act of 2002 (31 U.S.C. 3321
note) is amended by striking subsection (a) and inserting the
following:
``(a) Identification of Susceptible Programs and
Activities.--
``(1) In general.--The head of each agency shall, in
accordance with guidance prescribed by the Director of the
Office of Management and Budget, annually review all programs
and activities that it administers and identify all such
programs and activities that may be susceptible to
significant improper payments.
``(2) Annual risk assessment.--
``(A) Definition.--In this paragraph the term `significant'
means that improper payments in the program or activity in
the preceding fiscal year exceeded--
``(i) 2.5 percent of all program or activity payments made
during that fiscal year; or
``(ii) $10,000,000.
``(B) Risk assessment.--The review under paragraph (1)
shall include a risk assessment that includes--
``(i) a systematic process for producing a statistically
valid estimate of the level of improper payments being made
by the agency; and
``(ii) an identification of the risks for each program and
activity resulting from the estimates made under clause
(i).''.
(b) Reports on Actions To Reduce Improper Payments.--
Section 2 of the Improper Payments Information Act of 2002
(31 U.S.C. 3321 note) is amended by striking subsection (c)
and inserting the following:
``(c) Reports on Actions To Reduce Improper Payments.--With
respect to any program or activity of an agency with
estimated improper payments under subsection (b), the head of
the agency shall provide with the estimate under subsection
(b) a report on what actions the agency is taking to reduce
the improper payments, including--
``(1) a discussion of the causes of the improper payments
identified, actions planned or taken to correct those causes,
and the planned or actual completion date of the actions
taken to address those causes;
``(2) in order to reduce improper payments to minimal cost-
effective levels, a statement of whether the agency has--
``(A) the internal controls, including information systems;
``(B) the human capital; and
``(C) other infrastructure the agency needs;
``(3) if the agency does not have the internal controls, a
description of the resources the agency has requested in its
budget submission to establish the internal controls;
``(4) a description of the steps the agency has taken to
ensure that agency managers (including the head of the
agency) are held accountable for establishing the appropriate
internal controls, including an appropriate control
environment, that prevent improper payments from occurring
and promptly detect and collect improper payments made; and
``(5) a statement of whether or not the agency has--
``(A) conducted annual improper payment risk assessments;
``(B) developed and implemented improper payment control
plans; and
``(C) implemented appropriate improper payment detection,
investigation, reporting, and data collection procedures and
processes.''.
(c) Reports on Recovery Actions and Governmentwide
Reporting.--
(1) In general.--Section 2 of the Improper Payments
Information Act of 2002 (31 U.S.C. 3321 note) is amended--
(A) by redesignating subsections (d), (e), and (f) as
subsections (f), (g), and (h), respectively; and
(B) by inserting after subsection (c) the following:
``(d) Reports on Actions To Recover Improper Payments.--
With respect to any improper payments identified in recovery
audits conducted under section 2(g) of the Improper Payments
Elimination and Recovery Act of 2008, the head of the agency
shall provide with the estimate under subsection (b) a report
on what actions the agency is taking to recover improper
payments, including--
``(1) the types of errors from which improper payments
resulted;
``(2) a discussion of the methods used by the agency to
recover improper payments;
``(3) the amounts recovered, outstanding, and determined to
not be collectable; and
``(4) an aging schedule of the amounts outstanding.
``(e) Governmentwide Reporting of Improper Payments.--
``(1) Department of the treasury.--The Secretary of the
Treasury shall include in each report submitted under section
331(a) of title 31, United States Code, the improper payment
information reported by the agencies on a governmentwide
basis.
``(2) Office of management and budget.--The Director of the
Office of Management and Budget shall--
``(A) coordinate with the Secretary of the Treasury in the
preparation of the information to be reported under paragraph
(1); and
``(B) prescribe regulations for--
``(i) the information required to be reported; and
``(ii) a format of reporting such information on a
governmentwide basis to be used by agencies.''.
(2) Technical and conforming amendment.--Section 331(a) of
title 31, United States Code, is amended--
(A) in paragraph (6), by striking ``and'' after the
semicolon;
(B) in paragraph (7), by striking the period and inserting
``; and''; and
(C) by adding at the end the following:
``(8) the improper payments information required under
section 2(e) of the Improper Payments Information Act of 2002
(31 U.S.C. 3321 note).''.
(d) Definitions.--Section 2 of the Improper Payment
Information Act of 2002 (31 U.S.C. 3321 note) is amended by
striking subsection (g) (as redesignated by this section) and
inserting the following:
``(g) Definitions.--In this section:
``(1) Agency.--The term `agency' means an executive agency,
as that term is defined in section 102 of title 31, United
States Code.
``(2) Improper payment.--The term `improper payment'--
``(A) means any payment that should not have been made or
that was made in an incorrect amount (including overpayments
and underpayments) under statutory, contractual,
administrative, or other legally applicable requirements; and
``(B) includes any payment to an ineligible recipient, any
payment for an ineligible good or service, any duplicate
payment, payments for services not received, and any payment
that does not account for credit for applicable discounts.
``(3) Payment.--The term `payment' means any transfer or
commitment for future transfer of cash, in-kind benefits,
goods, services, loans and loan guarantees, insurance
subsidies, and other items of value between Federal agencies
and their employees, vendors, partners, and beneficiaries,
and parties to contracts, grants, leases, cooperative
agreements, or any other procurement mechanism, that is--
[[Page S546]]
``(A) made by a Federal agency, a Federal contractor, or a
governmental or other organization administering a Federal
program or activity; and
``(B) derived from Federal funds or other Federal resources
or that will be reimbursed from Federal funds or other
Federal resources.
``(4) Payment for an ineligible good or service.--The term
`payment for an ineligible good or service' shall include a
payment for any good or service that is in violation of any
provision of any contract, grant, lease, cooperative
agreement, or any other procurement mechanism, including any
provision relating to quantity, quality, or timeliness.''.
(e) Guidance by the Office of Management and Budget.--
Section 2 of the Improper Payments Information Act of 2002
(31 U.S.C. 3321 note) is amended by striking subsection (h)
(as redesignated by this section) and inserting the
following:
``(h) Guidance by the Office of Management and Budget.--
``(1) In general.--Not later than 6 months after the date
of enactment of the Improper Payments Elimination and
Recovery Act of 2008, the Director of the Office of
Management and Budget shall prescribe updated guidance to
implement and provide for full compliance with the
requirements of this section. The guidance shall not include
any exemptions not specifically authorized by this section.
``(2) Contents.--The updated guidance under paragraph (1)
shall prescribe--
``(A) the form of the reports on actions to reduce improper
payments, recovery actions, and governmentwide reporting; and
``(B) strategies for addressing risks and establishing
appropriate prepayment and postpayment internal controls.''.
(f) Internal Controls.--
(1) Report on effectiveness of a-123 implementation.--The
President's Council on Integrity and Efficiency shall conduct
a study of the effectiveness of implementation of the Office
of Management and Budget's Circular No. A-123 (revised),
Management's Responsibility for Internal Control at
preventing improper payments or addressing internal control
problems that contribute to improper payments, and not later
than 1 year after the date of enactment of this Act, submit a
report on the study to--
(A) the Committee on Homeland Security and Governmental
Affairs of the Senate;
(B) the Committee on Oversight and Government Reform of the
House of Representatives;
(C) the Director of the Office of Management and Budget;
and
(D) the Comptroller General.
(2) Consultation and cooperation.--The President's Council
on Integrity and Efficiency shall consult and cooperate with
the committees and director described under paragraph (1) to
ensure the nature and scope of the study under paragraph (1)
will address the needs on those committees and the Director
of the Office of Management and Budget, including how the
implementation of Circular No. A-123 (revised) has helped to
identify, report, prevent, and recover improper payments.
(3) Determination of agency readiness for opinion on
internal control.--Not later than 1 year after the date of
enactment of the Improper Payments Elimination and Recovery
Act of 2008, the Director of the Office of Management and
Budget shall develop--
(A) specific criteria as to when an agency should initially
be required to obtain an opinion on internal control over
financial reporting; and
(B) criteria for an agency that has demonstrated a
stabilized, effective system of internal control over
financial reporting, whereby the agency would qualify for a
multiyear cycle for obtaining an audit opinion on internal
control over financial reporting, rather than an annual
cycle.
(g) Recovery Audits.--An agency with outlays of $1,000,000
or more in any fiscal year shall conduct a recovery audit (as
that term is defined by the Director of the Office of
Management and Budget under section 3561 of title 31, United
States Code) of all programs and activities, if the agency
determines that--
(1) conducting an internal recovery audit would be
effective; or
(2) a prior audit has identified improper payments that can
be recouped and it is cost beneficial for a recovery activity
to recapture those funds.
(h) Report on Recovery Auditing.--Not later than 180 days
after the date of the enactment of this Act, the Chief
Financial Officers Council established under section 302 of
the Chief Financial Officers Act of 1990 (31 U.S.C. 901 note)
and the President's Council on Integrity and Efficiency
established under Executive Order 12805 of May 11, 1992, in
consultation with recovery audit experts, shall--
(1) jointly conduct a study of the potential costs and
benefits of requiring Federal agencies to recover improper
payments using the services of--
(A) private contractors;
(B) agency employees;
(C) cross-servicing from other agencies; or
(D) any combination of the provision of services described
under subparagraphs (A) through (C); and
(2) submit a report on the results of the study to--
(A) the Committee on Homeland Security and Governmental
Affairs of the Senate;
(B) the Committee on Oversight and Government Reform of the
House of Representatives; and
(C) the Comptroller General.
SEC. 3. COMPLIANCE.
(a) Definitions.--In this section:
(1) Agency.--The term ``agency'' has the meaning given
under section 2(f) of the Improper Payments Information Act
of 2002 (31 U.S.C. 3321 note) as redesignated by this Act.
(2) Compliance.--The term ``compliance'' means that the
agency--
(A) has published a performance report for the most recent
fiscal year and posted that report on the agency website;
(B) has conducted a program specific risk assessment for
each program or activity that--
(i) is in compliance with section 2(a) the Improper
Payments Information Act of 2002 (31 U.S.C. 3321 note); and
(ii) is included in the performance report;
(C) publishes program specific improper payments estimates
for all programs and activities identified under section 2(b)
of the Improper Payments Information Act of 2002 (31 U.S.C.
3321 note) in the performance report;
(D) publishes programmatic corrective action plans prepared
under section 2(c) of the Improper Payments Information Act
of 2002 (31 U.S.C. 3321 note) that the agency may have in the
performance report;
(E) publishes Office of Management and Budget approved
improper payments reduction targets in the performance report
for each program assessed to be at risk, and is determined by
the Office of Management and Budget to be actively meeting
such targets;
(F) publishes the compliance report under subsection (c) in
the performance report; and
(G) is not subject to the subsection (d)(4).
(3) Delinquent program.--The term ``delinquent program''
means a program which is partially or wholly responsible for
the determination of an agency being not in compliance.
(4) Performance report.--The term ``performance report''
means the performance and accountability report referred to
under section 3516(b) of title 31, United States Code, or a
program performance report under section 1116 of that title.
(b) Annual Compliance Report by OMB.--
(1) In general.--Each year, the Director of the Office of
Management and Budget shall prepare a report with an
identification of--
(A) the compliance status of each agency under this
section; and
(B) the delinquent programs responsible for that status.
(2) Inclusion in budget submission.--The Director of Office
of the Management and Budget shall include the report
described under paragraph (1) in the annual budget submitted
under section 1105 of title 31, United States Code.
(c) Annual Compliance Report by Inspector General.--
(1) In general.--Each fiscal year, the Inspector General of
each agency shall determine whether the agency is in
compliance with the Improper Payments Information Act of 2002
(31 U.S.C. 3321 note) and this Act and submit a report to the
head of the agency on that determination.
(2) Preparation of report.--The Inspector General of each
agency may enter into contracts and other arrangements with
public agencies and with private persons for the preparation
of financial statements, studies, analyses, and other
services in preparing the report described under paragraph
(1).
(3) Inclusion in performance report.--The head of each
agency shall include the report of the agency Inspector
General described under paragraph (1) in the performance
report.
(d) Remediation Assistance.--
(1) Voluntary remediation assistance.--If an agency is
determined by the agency Inspector General not to be in
compliance under subsection (c) in a fiscal year, the head of
the agency may transfer funds from any available
appropriations of that agency for expenditure on intensified
compliance for any delinquent program (notwithstanding any
appropriations transfer authority limitation in any other
provision of law).
(2) Required remediation assistance.--If an agency is
determined by the agency Inspector General not to be in
compliance under subsection (c) for 2 consecutive fiscal
years, the head of the agency shall transfer funds from any
available appropriations of that agency to expend on
intensified compliance (notwithstanding any appropriations
transfer authority limitation in any other provision of law).
(3) Remediation rescission.--
(A) In general.--If an agency is determined by the agency
Inspector General not to be in compliance under subsection
(c) for a period of 3 consecutive fiscal years and any
delinquent program is included in the report under that
subsection for 2 consecutive years during that 3-fiscal year
period, the head of the agency shall transfer 5 percent of
the available appropriations for each of those delinquent
programs, as determined by the head of the agency, to
miscellaneous receipts of the United States Treasury.
(B) Continuation of transfers.--The head of an agency shall
make transfers under subparagraph (A) until the agency is
determined to be in compliance under subsection (b).
(4) Stop-loss provision.--If an agency is determined under
the Improper Payments Information Act of 2002 (31 U.S.C. 3321
note) to have an improper payment rate greater than 15
percent for 3 consecutive fiscal years
[[Page S547]]
(regardless of the whether the program is a delinquent
program)--
(A) not later than 30 days after that determination, the
head of agency shall submit to Congress proposals for
statutory changes or other relevant actions determined
necessary to stop the financial loss by the program; and
(B) no further appropriations for such program shall be
authorized until such time as the inspector general of that
agency submits a certification to Congress that sufficient
changes in the program (whether those proposed by agency or
otherwise) have been implemented to warrant resumed
authorization of appropriations.
______
By Mr. REID (for Mrs. Clinton):
S. 2584. A bill to establish a program to evaluate HIV/AIDS programs
in order to improve accountability, increase transparency, and ensure
the delivery of evidence-based services, to the Committee on Foreign
Relations.
Mrs. CLINTON. Mr. President, today I rise to introduce the PEPFAR
Accountability and Transparency Act, a bill that will increase our
ability to research and identify the most effective interventions in
combating global AIDS. As we work to increase funding for the
President's Emergency Plan for AIDS Relief, PEPFAR, I believe we must
also insure that we maximize our investment in programs that have been
found effective in preventing infections and delivering care to as many
people as possible.
Through the years, the science known as operations research--the
ability to identify what is working and what is not working in our
treatment, prevention, and care interventions--has helped to improve
the effectiveness of the health care delivery system that we have
established and enhanced with U.S. funding.
Take, for example, the issue of mother to child transmission of HIV.
In the U.S., cases of perinatal HIV transmission have dropped
markedly--from more than 1,000 in 1991 to less than 100 in 2005--
largely due to access to critically needed, life-extending drugs. But
in the developing world, where fewer than 10 percent of HIV positive
pregnant women, about 1 out of every 3 children born to mothers with
HIV end up with the virus--a wholly preventable situation. The field of
operations research is allowing us to understand how we can, in low
resource settings, improve testing, education, and treatment options
that reduce cases of perinatal transmission.
There are many other areas where the data from operations research
can transform our ability to maximize the U.S. investment in global
AIDS funding--through measuring the impact of our prevention education
efforts, to understanding how addressing gender inequality can reduce
HIV infection, to ensuring that treatment is delivered in a way that
extends the lives of people with HIV.
This legislation will require the Government to develop a strategic
plan to improve program monitoring, evaluation and operations research.
With this plan, we can determine the effectiveness of the interventions
we are funding, so that we can replicate those that are working well,
and examine ways to improve those that do not have the outcomes that we
expected. The bill would also increase the dissemination of research
findings, so that those working in low-resource settings would be able
to easily learn and implement cost-effective interventions in their
communities.
I am proud to support increases for PEPFAR, but I also believe that
we must ensure that these increases are targeted toward effective
programs that reach as many people as possible. This legislation will
help us achieve that goal. I look forward to working with my colleagues
in the Senate to support this legislation and operations research as we
move forward with PEPFAR reauthorization.
Mr. President, I ask unanimous consent that a letter of support be
printed in the Record.
There being no objection, the material was ordered to be placed in
the Record, as follows:
Elizabeth Glaser Pediatric
AIDS Foundation,
January 28, 2008.
Hon. Hillary Rodham Clinton,
Washington, DC.
Dear Senator Clinton: On behalf of the Elizabeth Glaser
Pediatric AIDS Foundation, I would like to express our strong
support for the PEPFAR Accountability and Transparency Act.
We appreciate your leadership in expanding the important role
of operations research, program monitoring, and impact
evaluation research in the President's Emergency Plan for
AIDS Relief (PEPFAR) and applaud your efforts in maximizing
U.S. financial commitment to the global AIDS pandemic.
Significant advances have been made over the last twenty-
five years in HIV/AIDS prevention, care, and treatment to
improve the lives of children and families affected by HIV/
AIDS across the globe. Yet, while scientists and doctors have
learned a great deal about HIV, how to prevent the spread of
HIV, and how to treat those already infected, insufficient
focus has been placed on putting many of those advances into
action on the frontlines of the pandemic. Operations research
is becoming increasingly important in determining what
approaches work best in the field and ensuring that this
knowledge is applied on a broader scale.
Your legislation will help ensure that we maximize the
lifesaving impact of PEPFAR resources by elevating operations
research as a priority in PEPFAR, improving accountability,
and strengthening transparency. Specifically, the legislation
directs the Office of the Global AIDS Coordinator to work in
collaboration with federal agencies, country governments, and
implementing partners to develop a five-year strategic plan
to prioritize operations research, program monitoring, and
impact evaluation research projects and establish timelines
for action.
Thank you for your leadership and commitment to this issue.
We look forward to working closely with you to ensure that
children, women, and families worldwide benefit from this
important piece of legislation.
Sincerely,
Pamela W. Barnes,
President and Chief Executive Officer.
______
Mr. ROCKEFELLER:
S. 2586. A bill to provide States with fiscal relief through a
temporary increase in the Federal medical assistance percentage and
direct payments to States; to the Committee on Finance.
Mr. ROCKEFELLER. Mr. President, I rise today to introduce a critical
piece of legislation, the State Fiscal Relief Act of 2008. This
legislation builds upon the $20 billion State fiscal relief model
passed by Congress and signed into law by President Bush as part of the
Jobs and Growth Tax Reconciliation Act of 2003. It would provide $12
billion in State aid, equally divided between an increase in Federal
Medicaid matching payments and general revenue sharing grants to
States.
Many of my colleagues may wonder why I am introducing a $12 billion
State fiscal relief bill instead of a $15 billion State fiscal relief
bill--the approach I have consistently supported. The reason is simple.
I want to build on the strong, bipartisan support of our Nation's
Governors, who have repeatedly endorsed a $12 billion fiscal relief
package--with $6 billion in additional Medicaid assistance to States
and $6 billion in targeted grants to States. I still worry that State
deficits will only grow in the coming days, weeks, and months, but I am
willing to start with $12 billion and continue my work with our
Nation's Governors, health care providers, advocates, and others to get
this aid to States immediately.
I want to begin my remarks with the fact that leading economists
support State fiscal relief. Earlier this month, Mark Zandi, chief
economist of Moody's Economy.com, examined the effectiveness of the
various stimulus options that Congress is considering. Dr. Zandi's
analysis found that targeted State aid would generate increased
economic activity of $1.36 for each dollar of cost, because it would
lessen State and local government budget cuts that ``are sure to become
a substantial drag on the economy later this year and into 2009.''
As a former Governor, who survived the tough times of the 1980s, I
strongly believe that States deserve to be a part of the economic
stimulus package currently before the Senate. State and local
governments are an integral part of our national economic engine. They
provide health care and a wealth of social services to millions of
Americans, particularly when the economy is weak. We should act
immediately to provide States with relief before they are faced with
the harsh decision to cut children and families off of Medicaid.
States experience enormous budget pressures when the economy slows.
State revenues can evaporate rapidly during an economic downturn.
Unlike the Federal Government, States cannot borrow infinite amounts of
debt from China and other countries. By law, 49 States including West
Virginia--are required to balance their budgets and, in times of
economic downturn, this task becomes significantly more difficult.
[[Page S548]]
A delayed Federal response to the growing impact of this downturn on
States is an invitation to disaster. We know from experience that
Medicaid is consistently the first program slated for cuts during a
State budget squeeze. This is not only a problem for current Medicaid
enrollees; it is also a problem for hard-working Americans who have
lost their jobs because of the economic slowdown.
In the last year, our unemployment rate has increased to 5.0 percent
with nearly 900,000 more Americans without jobs. The loss of a job is
hard enough financially on an individual or family, but since the
majority of Americans get their health insurance through their jobs,
the loss of a job often results in a simultaneous loss of health
insurance coverage. Medicaid fills the gap for working families when
they lose access to private coverage. For every 1 percent increase in
the unemployment rate, Medicaid enrollment increases by 2-3 million
people.
During the last economic downturn, the number of uninsured Americans
would have been millions more if Medicaid and CHIP had not responded to
the twin challenges of an economic downturn and a sharp drop-off in
private health insurance coverage. A critical factor in helping States
sustain Medicaid enrollment during those difficult times was the $20
billion in State fiscal relief that Congress enacted in 2003. The 2003
fiscal relief provisions went a long way to preserve health care
coverage for millions of working Americans. However, we cannot discount
the fact that one million low-income people had already lost Medicaid
coverage because we waited two years into the recession to pass State
fiscal relief. We should not make the same mistake twice. We must act
quickly.
There is no question that health care is economic stimulus. Insuring
jobless workers encourages consumption of health care services and
provides an economic boost to the health care sector. People without
insurance seek treatment less often than people who are insured.
Uninsured Americans not only have greater problems accessing needed
care but often spend more out-of-pocket on health care, making it
harder for them to spend on other things.
The grants to States are also stimulative. For example, they can be
used to finance unfunded Federal mandates like child support
enforcement. Six economists recently wrote that ``restoring funding to
the child support program will produce well-targeted stimulus to the
economy because child support redistributes income toward lower-income
families who are more likely to use the income to meet their
consumption needs. Restoring funding to the child support program would
also mean that the State and county governments would not have to lay
off child support workers and reduce the level of services that they
provide families in the child support program.''
One of the arguments against State fiscal relief that I continue to
hear is the argument that State fiscal conditions are not that bad. We
have to be very cautious about that type of argument because State
fiscal situations are changing rapidly. The recent CBO report on the
economy alludes to this very fact. It reads, ``Recent evidence
indicates that many States respond relatively quickly to a downturn in
the economy, even if it occurs after their budgets have been enacted
for the year.''
We already know from the National Governors Association that 18
States have reported budget shortfalls totaling $14 billion for 2008
and 17 States project shortfalls totaling $31 billion for 2009.
However, we cannot simply take a snapshot of the economy today and
argue that this is not a crisis waiting to happen. The fact of the
matter is that a dozen more States could be in deficit situations very
soon if the downturn continues. This is especially true given the
significant decline in property tax revenues in many States and the
impact of the bonus depreciation provisions included in the stimulus
bill in several States.
As proud as I am of the 2003 fiscal relief package, I want to remind
my colleagues that the $20 billion in relief was nearly too late. One
million low-income people had already been cut off of Medicaid by the
time that legislation finally passed because we waited two years into
the recession to enact it. History does not have to repeat itself. We
know that working families are at risk of becoming uninsured now and
into the near future, so we must act swiftly to protect them.
I urge my colleagues to support this important legislation. We have a
real opportunity to proactively address a looming health care crisis.
This approach is supported by the National Governors Association as
well as hundreds of provider and health advocacy groups nationwide. We
should not allow this opportunity to pass. Too much is at stake.
Mr. President, 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. 2586
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 ``State Fiscal Relief Act of
2008''.
SEC. 2. TEMPORARY STATE FISCAL RELIEF.
(a) Temporary Increase of the Medicaid FMAP.--
(1) Permitting maintenance of fiscal year 2007 fmap for
last 3 calendar quarters of fiscal year 2008.--Subject to
paragraph (5), if the FMAP determined without regard to this
subsection for a State for fiscal year 2008 is less than the
FMAP as so determined for fiscal year 2007, the FMAP for the
State for fiscal year 2007 shall be substituted for the
State's FMAP for the second, third, and fourth calendar
quarters of fiscal year 2008, before the application of this
subsection.
(2) Permitting maintenance of fiscal year 2008 fmap for
first 2 quarters of fiscal year 2009.--Subject to paragraph
(5), if the FMAP determined without regard to this subsection
for a State for fiscal year 2009 is less than the FMAP as so
determined for fiscal year 2008, the FMAP for the State for
fiscal year 2008 shall be substituted for the State's FMAP
for the first and second calendar quarters of fiscal year
2009, before the application of this subsection.
(3) General 1.225 percentage points increase for last 3
calendar quarters of fiscal year 2008 and first 2 calendar
quarters of fiscal year 2009.--Subject to paragraphs (5),
(6), and (7), for each State for the second, third, and
fourth calendar quarters of fiscal year 2008 and for the
first and second calendar quarters of fiscal year 2009, the
FMAP (taking into account the application of paragraphs (1)
and (2)) shall be increased by 1.225 percentage points.
(4) Increase in cap on medicaid payments to territories.--
Subject to paragraphs (6) and (7), with respect to the
second, third, and fourth calendar quarters of fiscal year
2008 and the first and second calendar quarters of fiscal
year 2009, the amounts otherwise determined for Puerto Rico,
the Virgin Islands, Guam, the Northern Mariana Islands, and
American Samoa under subsections (f) and (g) of section 1108
of the Social Security Act (42 U.S.C. 1308) shall each be
increased by an amount equal to 2.45 percent of such amounts.
(5) Scope of application.--The increases in the FMAP for a
State under this subsection shall apply only for purposes of
title XIX of the Social Security Act and shall not apply with
respect to--
(A) disproportionate share hospital payments described in
section 1923 of such Act (42 U.S.C. 1396r-4);
(B) payments under title IV or XXI of such Act (42 U.S.C.
601 et seq. and 1397aa et seq.); or
(C) any payments under XIX of such Act that are based on
the enhanced FMAP described in section 2105(b) of such Act
(42 U.S.C. 1397ee(b)).
(6) State eligibility.--
(A) In general.--Subject to subparagraph (B), a State is
eligible for an increase in its FMAP under paragraph (3) or
an increase in a cap amount under paragraph (4) only if the
eligibility under its State plan under title XIX of the
Social Security Act (including any waiver under such title or
under section 1115 of such Act (42 U.S.C. 1315)) is no more
restrictive than the eligibility under such plan (or waiver)
as in effect on December 31, 2007.
(B) State reinstatement of eligibility permitted.--A State
that has restricted eligibility under its State plan under
title XIX of the Social Security Act (including any waiver
under such title or under section 1115 of such Act (42 U.S.C.
1315)) after December 31, 2007 is eligible for an increase in
its FMAP under paragraph (3) or an increase in a cap amount
under paragraph (4) in the first calendar quarter (and
subsequent calendar quarters) in which the State has
reinstated eligibility that is no more restrictive than the
eligibility under such plan (or waiver) as in effect on
December 31, 2007.
(C) Rule of construction.--Nothing in subparagraph (A) or
(B) shall be construed as affecting a State's flexibility
with respect to benefits offered under the State medicaid
program under title XIX of the Social Security Act (42 U.S.C.
1396 et seq.) (including any waiver under such title or under
section 1115 of such Act (42 U.S.C. 1315)).
[[Page S549]]
(7) Requirement for certain states.--In the case of a State
that requires political subdivisions within the State to
contribute toward the non-Federal share of expenditures under
the State medicaid plan required under section 1902(a)(2) of
the Social Security Act (42 U.S.C. 1396a(a)(2)), the State
shall not require that such political subdivisions pay a
greater percentage of the non-Federal share of such
expenditures for the second, third, and fourth calendar
quarters of fiscal year 2008 and the first and second
calendar quarters of fiscal year 2009, than the percentage
that was required by the State under such plan on December
31, 2007, prior to application of this subsection.
(8) Definitions.--In this subsection:
(A) FMAP.--The term ``FMAP'' means the Federal medical
assistance percentage, as defined in section 1905(b) of the
Social Security Act (42 U.S.C. 1396d(b)).
(B) State.--The term ``State'' has the meaning given such
term for purposes of title XIX of the Social Security Act (42
U.S.C. 1396 et seq.).
(9) Repeal.--Effective as of October 1, 2009, this
subsection is repealed.
(b) Payments to States for Assistance With Providing
Government Services.--The Social Security Act (42 U.S.C. 301
et seq.) is amended by inserting after title V the following:
``TITLE VI--TEMPORARY STATE FISCAL RELIEF
``SEC. 601. TEMPORARY STATE FISCAL RELIEF.
``(a) Appropriation.--There is authorized to be
appropriated and is appropriated for making payments to
States under this section--
``(1) $3,600,000,000 for fiscal year 2008; and
``(2) $2,400,000,000 for fiscal year 2009.
``(b) Payments.--
``(1) Fiscal year 2008.--From the amount appropriated under
subsection (a)(1) for fiscal year 2008, the Secretary of the
Treasury shall, not later than the later of the date that is
45 days after the date of enactment of this Act or the date
that a State provides the certification required by
subsection (e) for fiscal year 2008, pay each State the
amount determined for the State for fiscal year 2008 under
subsection (c).
``(2) Fiscal year 2009.--From the amount appropriated under
subsection (a)(2) for fiscal year 2009, the Secretary of the
Treasury shall, not later than the later of October 1, 2008,
or the date that a State provides the certification required
by subsection (e) for fiscal year 2009, pay each State the
amount determined for the State for fiscal year 2009 under
subsection (c).
``(c) Payments Based on Population.--
``(1) In general.--Subject to paragraph (2), the amount
appropriated under subsection (a) for each of fiscal years
2008 and 2009 shall be used to pay each State an amount equal
to the relative population proportion amount described in
paragraph (3) for such fiscal year.
``(2) Minimum payment.--
``(A) In general.--No State shall receive a payment under
this section for a fiscal year that is less than--
``(i) in the case of 1 of the 50 States or the District of
Columbia, \1/2\ of 1 percent of the amount appropriated for
such fiscal year under subsection (a); and
``(ii) in the case of the Commonwealth of Puerto Rico, the
United States Virgin Islands, Guam, the Commonwealth of the
Northern Mariana Islands, or American Samoa, \1/10\ of 1
percent of the amount appropriated for such fiscal year under
subsection (a).
``(B) Pro rata adjustments.--The Secretary of the Treasury
shall adjust on a pro rata basis the amount of the payments
to States determined under this section without regard to
this subparagraph to the extent necessary to comply with the
requirements of subparagraph (A).
``(3) Relative population proportion amount.--The relative
population proportion amount described in this paragraph is
the product of--
``(A) the amount described in subsection (a) for a fiscal
year; and
``(B) the relative State population proportion (as defined
in paragraph (4)).
``(4) Relative state population proportion defined.--For
purposes of paragraph (3)(B), the term `relative State
population proportion' means, with respect to a State, the
amount equal to the quotient of--
``(A) the population of the State (as reported in the most
recent decennial census); and
``(B) the total population of all States (as reported in
the most recent decennial census).
``(d) Use of Payment.--
``(1) In general.--Subject to paragraph (2), a State shall
use the funds provided under a payment made under this
section for a fiscal year to--
``(A) provide essential government services;
``(B) cover the costs to the State of complying with any
Federal intergovernmental mandate (as defined in section
421(5) of the Congressional Budget Act of 1974) to the extent
that the mandate applies to the State, and the Federal
Government has not provided funds to cover the costs; or
``(C) compensate for a decline in Federal funding to the
State.
``(2) Limitation.--A State may only use funds provided
under a payment made under this section for types of
expenditures permitted under the most recently approved
budget for the State.
``(e) Certification.--In order to receive a payment under
this section for a fiscal year, the State shall provide the
Secretary of the Treasury with a certification that the
State's proposed uses of the funds are consistent with
subsection (d).
``(f) Definition of State.--In this section, the term
`State' means the 50 States, the District of Columbia, the
Commonwealth of Puerto Rico, the United States Virgin
Islands, Guam, the Commonwealth of the Northern Mariana
Islands, and American Samoa.
``(g) Repeal.--Effective as of October 1, 2009, this title
is repealed.''.
______
By Mrs. FEINSTEIN (for herself, Mrs. Hutchison, Mrs. Boxer, Mr.
Kyl, Mr. Schumer, Mr. Cornyn, Mr. Durbin, Mr. McCain, Mr.
Bingaman, Mr. Craig, Ms. Cantwell, Mr. Domenici and Mr Crapo):
S. 2587. A bill to amend the Immigration and Nationality Act to
provide for compensation to States incarcerating undocumented aliens
charged with a felony or 2 or more misdemeanors; to the Committee on
the Judiciary.
Mrs. FEINSTEIN. Mr. President, today Senator Hutchison and I are
introducing two bills that will significantly alleviate the burden of
illegal immigration on State and local governments: the SCAAP
Reimbursement Protection Act of 2008 and the Ensure Timely SCAAP
Reimbursement Act. We are joined by Senators Boxer, Kyl, Schumer,
Cornyn, Durbin, McCain, Bingaman, Craig, Cantwell, Domenici, and Crapo.
These bills will amend the State Criminal Alien Assistance Program,
SCAAP, statute to ensure that states and localities receive more
funding for costs associated with incarcerating criminal aliens, and
that these reimbursements are given out in a timely manner.
The cost of incarcerating criminal aliens is high. In California
alone, the State spent more than $900 million in 2007 to house over
20,000 criminal aliens.
Congress enacted SCAAP in 1994 to help reimburse States and
localities for the cost of arrest, incarceration, and transportation of
these aliens.
However, in 2003, the Department of Justice, DOJ, reinterpreted the
statute. Now States are only reimbursed for what they spend
incarcerating convicted criminal aliens and only when the arrest and
conviction occur in the same fiscal year.
The DOJ reinterpretation has significantly cut the reimbursement
local governments are eligible to receive for incarcerating and
processing illegal aliens.
This reinterpretation is even more devastating because SCAAP is
consistently under-funded. The President has zeroed out SCAAP funding
in his budget proposal over the past 6 years. Through bi-partisan
support, Congress was only able to partially fund the program.
As a result, SCAAP only reimburses States for a fraction of the costs
of incarcerating criminal aliens. For example, in fiscal year 2007,
SCAAP reimbursed only $109.5 million of the more than $912.5 million
spent by the California Department of Corrections that year. That means
the State paid $803 million of its own funds to house criminal aliens.
This cut has had a domino effect on public safety funding. Every
dollar less that SCAAP reimburses States means a dollar less to spend
on critical public safety services. For example, after the SCAAP
funding cuts in 2003, the Los Angeles County Sheriff's Department
implemented an ``early release'' policy for prisoners convicted of
misdemeanors.
I believe it is the Federal Government's responsibility to control
illegal immigration. The funding cuts imposed by this administration
have let our local public safety services down, and have made our
communities less safe.
The SCAAP Reimbursement Protection Act of 2008 would restore the
original intent of SCAAP so that States are reimbursed for the costs of
incarcerating aliens who are either charged with or convicted of a
felony or two misdemeanors. States would also be reimbursed regardless
of the fiscal year of the incarceration and conviction.
This bill has been endorsed by the National Sheriffs' Associate,
California State Association of Counties, CSAC, the U.S./Mexico Border
Counties Coalition, the Virginia Sheriffs' Association, the Los Angeles
County Sheriff Lee
[[Page S550]]
Baca, and the Sheriffs' Association of Texas.
Our colleagues on the House Judiciary Committee unanimously passed a
companion bill, H.R. 1512, and I urge you to do the same.
Another problem with SCAAP is the significant delay in reimbursement.
Recently, State and county governments that foot the bill for holding
criminal aliens between July 2004 and June 2005 had to wait until June
21, 2007, before they were reimbursed.
For example, Los Angeles County, San Bernardino County, and Riverside
County waited 2 years to receive their reimbursement--totaling $85.9
million. While they were waiting, public safety offices had to cut back
on critical services. This delay is worse when one considers that even
when localities receive the federal funds, they are only reimbursed for
pennies on every dollar spent.
Delays place unreasonable budgetary burdens on States, counties, and
municipalities that already shoulder most of the costs of housing
criminal aliens.
California is not alone. Every other State depends on these funds to
perform what is ultimately a federal responsibility--to control illegal
immigration and its effects in our communities. These delays affect
every State.
The Ensure Timely SCARP Reimbursement Act would help ease this burden
on States and localities by requiring the Justice Department to
disburse funds within 6 months of the application deadline.
I ask my colleagues to join me in supporting these much needed
amendments to the SCAAP statute. Mr. President, I ask unanimous consent
that the text of these two bills be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
S. 2587
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 ``SCAAP Reimbursement
Protection Act of 2008''.
SEC. 2. ASSISTANCE FOR STATES INCARCERATING UNDOCUMENTED
ALIENS CHARGED WITH CERTAIN CRIMES.
Section 241(i)(3)(A) of the Immigration and Nationality Act
(8 U.S.C. 1231(i)(3)(A)) is amended by inserting ``charged
with or'' before ``convicted''.
____
S. 2588
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 ``Ensure Timely SCAAP
Reimbursement Act''.
SEC. 2. DISTRIBUTION OF SCAAP COMPENSATION.
Section 241(i) of the Immigration and Nationality Act (8
U.S.C. 1231(i)) is amended by adding at the end the
following:
``(7) Any funds awarded to a State or a political
subdivision of a State, including a municipality, for a
fiscal year under this subsection shall be distributed to
such State or political subdivision not later than 120 days
after the last day of the application period for assistance
under this subsection for that fiscal year.''.
____________________