Congressional Record, Volume 154 Issue 92 (Thursday, June 5, 2008)

[Congressional Record Volume 154, Number 92 (Thursday, June 5, 2008)]
[Senate]
[Pages S5206-S5216]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

By Mr. TESTER (for himself, Mr. Crapo, Mr. Baucus, and Mr.
Craig):
S. 3085. A bill to require the Secretary of the Interior to establish
a cooperative watershed management program, and for other purposes; to
the Committee on Energy and Natural Resources.
Mr. TESTER. Mr. President, I rise today to introduce the Cooperative
Watershed Act of 2008 with my colleagues Senators Crapo, Baucus and
Craig.
This is an important piece of legislation because it deals with being
good caretakers of our water.
Water is life. It is as simple as that folks. If we do not manage
what we have, well then people are going to be in trouble. In Montana,
we are currently suffering through almost a decade of drought, and with
growing demand, increased pollution, and a changing climate, our water
resources will only become more stressed in the coming years.
Now folks in Montana are not the type to sit back and wait for
someone else to come along and fix a problem for them. No, folks in
Montana have long since started coming together to form local groups to
ensure their water resources are properly managed. These groups consist
of irrigators, farmers, environmental groups, scientists, and
governmental officials all working together. Unfortunately, these
groups often are limited by a lack of funding for projects and a full
time administrator. These groups hold so much potential, but are being
held back by the simple lack of funding. That is why I, along with
Senators Crapo, Baucus, and Craig, have introduced the Cooperative
Watershed Act of 2008.
The Cooperative Watershed Act of 2008 sets up a granting program
under the Department of the Interior to help local stakeholders come
together and form or expand watershed-wide management groups that can
cooperatively manage their local water resources. The funds in this
bill will help these groups build the capacity to act as grassroots,
nonregulatory entities to address local water availability and quality
issues within a watershed.
By getting all the different stakeholders involved in the management
process, these groups will help reduce the need for Federal regulation
and litigation, and result in the best overall use of the available,
and often limited, water supply. Make no mistake, in Montana we
understand that local stakeholders are in the best position to manage
their own resources, but Federal support must play a role in helping
them establish the capacity to do so.
Now in granting funds, this bill takes into account that different
strokes are needed for different folks. To accommodate the varying
stages of development of different groups, the grant program is divided
into three phases: an initial planning phase to help new groups form
and begin to formulate ideas and project proposals, a pilot project
phase to help semi-established groups gain the capacity to conduct
projects and studies, and an implementation phase to help fully formed
and functioning groups undertake large-scale, multi-year projects.
Montana has been a leader in implementing water resources planning on
a watershed scale for years, and the funding provided in this bill will
allow Montanans and other interested States to increase their capacity
to effectively manage their vital water resources as we move into the
future.
Mr. President, I ask by 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. 3085

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 ``Cooperative Watershed
Management Act of 2008''.

SEC. 2. DEFINITIONS.

In this Act:
(1) Affected stakeholder.--The term ``affected
stakeholder'' means an entity that significantly affects, or
is significantly affected by, the quality or quantity of
water in a watershed, as determined by the Secretary.
(2) Grant recipient.--The term ``grant recipient'' means an
eligible management entity that the Secretary has selected to
receive a grant under section 3(c)(2).

[[Page S5207]]

(3) Management group.--The term ``management group'' means
a self-sustaining, cooperative watershed-wide management
group that--
(A) is comprised of each affected stakeholder of the
watershed that is the subject of the management group;
(B) incorporates the perspectives of a diverse array of
stakeholders;
(C) is designed to be carried out as a grassroots,
nonregulatory entity to address local water availability and
quality issues within the watershed that is the subject of
the management group; and
(D) is capable of managing in a sustainable manner the
water resources of the watershed that is the subject of the
management group and improving the functioning condition of
rivers and streams through--
(i) water conservation;
(ii) improved water quality;
(iii) ecological resiliency; and
(iv) the reduction of water conflicts.
(4) Program.--The term ``program'' means the cooperative
watershed management program established by the Secretary
under section 3(a).
(5) Secretary.--The term ``Secretary'' means the Secretary
of the Interior.

SEC. 3. PROGRAM.

(a) Establishment.--Not later than 180 days after the date
of enactment of this Act, the Secretary shall establish a
program, which shall be known as the ``cooperative watershed
management program'', under which the Secretary shall provide
grants to eligible management entities--
(1) to form a management group;
(2) to enlarge a management group, of which the eligible
management entity is a member; or
(3) to conduct 1 or more projects in accordance with the
goals of a management group, of which the eligible management
entity is a member.
(b) Eligibility.--To be eligible to receive a grant under
this section, an eligible management entity shall be
comprised of each affected stakeholder of the watershed that
is the subject of the eligible management entity, including
to the maximum extent practicable--
(1) representatives of private interests, including
representatives of--
(A) hydroelectric production;
(B) livestock grazing;
(C) timber production;
(D) land development;
(E) recreation or tourism;
(F) irrigated agricultural production; and
(G) the environment;
(2) any Federal agency that has authority with respect to
the watershed, including not less than 1 representative of--
(A) the Department of Agriculture;
(B) the Department of the Interior; and
(C) the National Oceanic and Atmospheric Administration;
(3) any State or local agency that has authority with
respect to the watershed; and
(4) any member of an Indian tribe that owns land within the
watershed or has land in the watershed held in trust.
(c) Application.--
(1) Establishment of application process; criteria.--Not
later than 1 year after the date of enactment of this Act,
the Secretary shall establish--
(A) an application process under which each eligible
management entity may apply for a grant under this section;
and
(B) criteria for consideration of the application of each
eligible management entity.
(2) Application process.--To be eligible to receive a grant
under this section, an eligible management entity shall
submit to the Secretary an application in accordance with the
application process and criteria established by the Secretary
under paragraph (1).
(d) Distribution of Grant Funds.--
(1) In general.--In distributing grant funds under this
section, the Secretary shall comply with paragraph (2).
(2) Funding procedure.--
(A) First phase.--
(i) In general.--During the first phase of a grant
established under this subparagraph, the Secretary may
provide to a grant recipient a grant in an amount of not
greater than $100,000 each year for a period of not more than
3 years.
(ii) Mandatory use of funds.--A grant recipient that
receives funds through a grant during the first phase shall
use the funds--

(I) to establish or enlarge a management group;
(II) to develop a mission statement for the management
group; and
(III) to develop project concepts.

(iii) Annual determination of eligibility.--

(I) Determination.--For each year of the first phase, not
later than 270 days after the date on which a grant recipient
first receives grant funds for the year, the Secretary shall
determine whether the grant recipient has made sufficient
progress during the year to justify additional funding.
(II) Effect of determination.--If the Secretary determines
under subclause (I) that the progress of a grant recipient
during the year covered by the determination justifies
additional funding, the Secretary shall provide to the grant
recipient grant funds for the year following the year during
which the determination was made.

(iv) Advancement conditions.--A grant recipient shall not
be eligible to receive grant funds during the second phase
described in subparagraph (B) until the date on which the
Secretary determines that the management group established by
the grant recipient is--

(I) fully formed, including the drafting and approval of
articles of incorporation and bylaws governing the
organization; and
(II) fully functional, including holding regular meetings,
having reached a consensus on the mission of the group, and
having developed project concepts.

(B) Second phase.--
(i) In general.--During the second phase of a grant
established under this subparagraph, the Secretary may
provide to a grant recipient a grant in an amount of not
greater than $1,000,000 each year for a period of not more
than 4 years.
(ii) Mandatory use of funds.--A grant recipient that
receives funds through a grant under the second phase shall
use the funds to carry out watershed management projects.
(iii) Annual determination of eligibility.--

(I) Determination.--For each year of the second phase, not
later than 270 days after the date on which a grant recipient
first receives grant funds for the year, the Secretary shall
determine whether the grant recipient has made sufficient
progress during the year to justify additional funding.
(II) Effect of determination.--If the Secretary determines
under subclause (I) that the progress of a grant recipient
during the year covered by the determination justifies
additional funding, the Secretary shall provide to the grant
recipient grant funds for the year following the year during
which the determination was made.

(iv) Advancement condition.--A grant recipient shall not be
eligible to receive grant funds during the third phase
described in subparagraph (C) until the date on which the
Secretary determines that the grant recipient has--

(I) completed each requirement with respect to each year of
the second phase; and
(II) demonstrated that 1 or more pilot projects of the
grant recipient have resulted in demonstrable improvements in
the functioning condition of at least 1 river or stream in
the watershed.

(I) In general.--Except as provided in subclause (II),
during the third phase of a grant established under this
subparagraph, the Secretary may provide to a grant recipient
a grant in an amount of not greater than $5,000,000 for a
period of not more than 5 years.
(II) Exception.--The Secretary may provide to a grant
recipient a grant in an amount that is greater than the
amount described in subclause (I) if the Secretary determines
that the grant recipient is capable of using the additional
amount to achieve an appropriate increase in an economic,
social, or environmental benefit that could not otherwise be
achieved by the grant recipient through the amount described
in subclause (I).

(ii) Mandatory use of funds.--A grant recipient that
receives funds through a grant under the third phase shall
use the funds to carry out not less than 1 watershed
management project of the grant recipient.
(3) Permissive use of funds.--A grant recipient that
receives funds through a grant under this section may use the
funds--
(A) to pay for--
(i) the administrative costs of the management group of the
grant recipient;
(ii) the salary of not more than 1 full-time employee of
the management group of the grant recipient; and
(iii) any legal fees of the grant recipient arising from
the establishment of the management group of the grant
recipient;
(B) to fund--
(i) studies of the watershed that is managed by the
management group of the grant recipient; and
(ii) any project--

(I) described in the mission statement of the management
group of the grant recipient; and
(II) to be carried out by the management group of the grant
recipient to achieve any goal of the management group;

(C) to carry out demonstration projects relating to water
conservation or alternative water uses; and
(D) to expand a management group that is established by the
grant recipient.
(4) Requirement of consensus of members of management
group.--A management group of a grant recipient may not use
grant funds for any initiative of the management group unless
the group reaches a consensus decision.
(e) Cost Share.--
(1) Planning.--The Federal share of the cost of any
activity of a management group of a grant recipient relating
to any use required under subsection (d)(2)(A)(ii) shall be
100 percent.
(2) Projects carried out under second phase.--
(A) In general.--Subject to subparagraph (B), the Federal
share of the costs of any activity of a management group of a
grant recipient relating to a watershed management project
described in subsection (d)(2)(B)(ii) shall not exceed 60
percent of the total costs of the watershed management
project.
(B) Limitation.--To pay for any costs relating to
administrative expenses incurred for a watershed management
project described in subsection (d)(2)(B)(ii), a management
group of a grant recipient may use grant funds in an amount
not greater than the lesser of--
(i) $100,000; or

[[Page S5208]]

(ii) 20 percent of the total amount of the Federal share
provided to the management group to carry out the watershed
management project.
(C) Form of non-federal share.--The non-Federal share under
subparagraph (A) may be in the form of any in-kind
contributions.
(3) Projects carried out under third phase.--
(A) In general.--Subject to subparagraph (B), the Federal
share of the costs of any activity of a management group of a
grant recipient relating to a watershed management project
described in subsection (d)(2)(C)(ii) shall not exceed 50
percent of the total costs of the watershed management
project.
(B) Limitation.--To pay for any costs relating to
administrative expenses with respect to a watershed
management project described in subsection (d)(2)(C)(ii), a
management group of a grant recipient may use grant funds in
an amount not greater than the lesser of--
(i) $100,000; or
(ii) 20 percent of the total amount of the Federal share
provided to the management group to carry out the watershed
management project.
(C) Form of non-federal share.--The non-Federal share under
subparagraph (A) may be in the form of any in-kind
contributions.
(f) Annual Reports.--
(1) In general.--Not later than 1 year after the date on
which a management group of a grant recipient first receives
funds through a grant under this section, and annually
thereafter, in accordance with paragraph (2), the management
group shall submit to the Secretary a report that describes,
for the period covered by the report, the progress of the
management group with respect to the duties of the management
group.
(2) Required degree of detail.--The contents of an annual
report required under paragraph (1) shall contain a degree of
detail that is sufficient to enable the Secretary to complete
each report required under subsection (g), as determined by
the Secretary.
(g) Report.--Not later than 5 years after the date of
enactment of this Act, and every 5 years thereafter, the
Secretary shall submit to the appropriate committees of
Congress a report that describes--
(1) the manner by which the program enables the Secretary--
(A) to address water conflicts;
(B) to conserve water; and
(C) to improve water quality; and
(2) each benefit that is achieved through the
administration of the program, including, to the maximum
extent practicable, a quantitative analysis of each economic,
social, and environmental benefit.
(h) Authorization of Appropriations.--There are authorized
to be appropriated to carry out this section--
(1) $2,000,000 for each of fiscal years 2008 and 2009;
(2) $5,000,000 for fiscal year 2010;
(3) $10,000,000 for fiscal year 2011; and
(4) $20,000,000 for each of fiscal years 2012 through 2020.
______

By Mr. DURBIN:
S. 3086. A bill to amend the antitrust laws to ensure competitive
market-based fees and terms for merchants' access to electronic payment
systems; to the Committee on the Judiciary.
Mr. DURBIN. Mr. President, I rise today to introduce the Credit Card
Fair Fee Act of 2008. This legislation will provide fairness and
transparency in the setting of credit card interchange fees. This bill
is companion legislation to a bipartisan bill introduced in the House
of Representatives by Chairman John Conyers of the House Judiciary
Committee and Representative Chris Cannon. The Conyers-Cannon bill
currently has an additional 19 Democratic and 16 Republican cosponsors.
This legislation is supported by the Merchants Payments Coalition, a
coalition of retailers, supermarkets, convenience stores, drug stores,
fuel stations, on-line merchants and other businesses. The coalition's
member associations collectively represent about 2.7 million stores
with approximately 50 million employees.
Interchange fees may not be well known to most Americans, but they
should be. Last year, U.S. retailers, and by extension their customers,
paid approximately $42 billion in interchange fees to the banks that
issue credit cards. The billions that are paid in interchange fees each
year significantly cut into the profit margins of retailers and pinch
the pocketbooks of consumers. And neither retailers nor consumers have
a say in how these interchange fees are set within the Visa and
MasterCard systems, which together account for over 70 percent of the
credit and debit card market. The current lack of meaningful
competition, negotiation and transparency in the setting of interchange
fees represents a market failure, one that affects every American
retailer and every American consumer.
My legislation takes a measured approach to address this market
failure. My bill would identify credit and debit card payment systems
that have significant market power, and would permit the retailers who
use those systems to collectively negotiate with the providers of the
systems over the fees for system access and use. If the retailers and
providers are unable to agree voluntarily on a consensus set of fees,
the bill would direct an impartial panel of judges to consider the two
parties' fee proposals, and to select the proposal that most closely
reflects what a hypothetical perfectly competitive market would
produce. As I will discuss further below, this approach will protect
retailers and consumers by preventing credit card companies from using
their market power to charge unreasonable fees through an unfair
process.
So what are interchange fees, and why do they pose a problem?
Whenever a consumer uses a credit or debit card to make a purchase from
a retailer, the banks and credit card companies involved in the
transaction charge a number of fees that are passed on to the retailer
and ultimately to the consumer. The interchange fee is one such fee. It
is a fee charged by the card-issuing bank to the retailer's bank.
Here is an example of how an interchange fee is charged. When a
consumer buys $100 in goods from a retailer using a Visa or MasterCard,
the retailer first submits the transaction information to the
retailer's bank (the ``acquiring bank''). The acquiring bank submits
this information, via the Visa or MasterCard network, to the bank that
issued the card to the consumer, the issuing bank. The issuing bank
either authorizes or denies the transaction. If the transaction is
authorized, the issuing bank sends to the acquiring bank, via the Visa
or MasterCard network, the purchase amount minus an interchange fee
that is retained by the issuing bank.

As a result of the interchange fee and other processing fees imposed
upon the retailer by the acquiring bank, collectively, these fees are
known as the ``merchant discount fee,'' the retailer typically only
receives approximately $97.50 out of the $100 sale. In order to cover
this cost and continue to make a profit, retailers typically raise the
retail price of their goods, meaning that consumers must pay more
regardless of whether they pay with cash or plastic.
Visa and MasterCard set the interchange fee rates for all the banks
and all the retailers that participate in the Visa and MasterCard
systems. Those interchange rates are frequently charged as a percentage
of the sale amount plus a flat fee; for example, an interchange fee
might equal 1.75 percent + 20 cents per transaction. The interchange
fee rate varies for certain types of Visa and MasterCard cards and
transaction categories, and is typically higher for cards that involve
rewards programs for cardholders.
What is the rationale for assessing interchange fees? According to
Visa, MasterCard, and the banks that issue them, these fees are used to
pay for important functions within the credit and debit card systems.
For example, interchange fees can be used to cover the costs of
processing and authorizing credit card transactions, including the
costs of ensuring data security and safeguarding against fraud.
Interchange fees can also help protect an issuing bank from the risk
that a consumer may not pay his or her credit card bill, which would
leave the issuing bank on the hook for the amount that it gave to the
acquiring bank at the time of a credit card transaction.
In addition to covering these costs and risks, interchange fees have
been used to generate income for issuing banks. This income can be
retained by the issuing banks as profit, or can be devoted to other
uses such as consumer marketing campaigns or rewards programs for
certain cardholders.
In addition to the benefits that interchange fees provide for issuing
banks, Visa, MasterCard and their participating banks argue that
interchange fees have also provided benefits to retailers and consumers
by helping to make credit and debit card transactions more efficient
and more prevalent. Visa, MasterCard and the banks claim that the
growing use of credit and debit cards saves retailers from certain
expenses involved with transacting business with cash or

[[Page S5209]]

checks. They also claim that their cards bring benefits to consumers,
including extra convenience, the availability of short-term credit, and
rewards programs that are offered to some cardholders.
It is clear that interchange fees do play an important part in the
credit and debit card systems, and that overall these systems have
created efficiencies and benefits for banks, merchants and consumers.
However, it is also clear that those who must ultimately pay
interchange fees--retailers and their consumers--have no say in
negotiating how much the interchange fees should be. As a result,
interchange fees are being set at rates that would not be agreed upon
in a competitive market, and that may favor banks to the detriment of
merchants and consumers.

Why are retailers unable to negotiate changes in Visa's and
MasterCard's interchange fee rates? There are several reasons. First,
because of Visa's and MasterCard's market power, the overwhelming
majority of American retailers have no choice but to accept Visa and
MasterCard as a method of payment. Credit and debit cards are currently
used for over 40 percent of all transactions in the U.S., and that
percentage is increasing, in part due to extensive marketing by the
card companies and the banks. Visa and MasterCard control over 70
percent of the market for credit and debit cards. Most retailers simply
cannot survive unless they agree to accept those cards.
Second, within an electronic payment system the only party with whom
retailers are able to negotiate effectively is the retailer's acquiring
bank, and interchange fees are not covered in those negotiations. In
their efforts to obtain retailers' business, including the business of
processing the retailers' credit card transactions, acquiring banks
will negotiate and compete over many of the component fees that make up
the merchant discount fee. However, the interchange fee is typically by
far the largest component of the merchant discount fee, and acquiring
banks do not negotiate with retailers on interchange rates nor do they
compete to offer retailers lower interchange rates. Instead,
interchange rates are set by Visa and MasterCard, who claim that their
rates are set without the involvement of the banks. Accordingly, the
acquiring banks tell their retailer customers that the interchange rate
component cannot be negotiated or reduced below the level set by Visa
and MasterCard.
The interchange fee thus serves as a de facto price floor for the
overall merchant discount fee--a floor that is fixed in a
nontransparent, nonnegotiable fashion by card companies with
significant market power. Although I have asked the credit card
companies on several occasions for information that would help me
understand the cost components that contribute to their interchange
rates, it is still unclear how much profit margin is built into that
floor. The margin may be significant, and as long as issuers and
acquirers are happy with it, there is no incentive for card companies
to help merchants and consumers by reducing it. Additionally, it should
be noted that many if not most acquiring banks also serve as issuing
banks, and therefore have almost no incentive to compete to lower the
interchange rates that they themselves receive. Because the acquirers
and issuers are often the same banks, no one negotiates with issuers
about interchange fees on the retailers' behalf, and the retailers are
left to negotiate for themselves.
Third, while some retailers may try to negotiate directly with Visa
or MasterCard to lower the interchange fee component of their merchant
discount fees, most retailers have no leverage in these negotiations
since at the end of the day they will likely have to agree to accept
Visa and MasterCard in order to stay in business.
As a result of this vast disparity in negotiating power, Visa and
MasterCard can essentially impose interchange rates upon retailers and
those retailers have no choice but to accept them. Furthermore, Visa
and MasterCard also frequently impose take-it-or-leave-it contractual
terms and conditions on retailers, such as acceptance rules that
require retailers to honor all cards issued by that credit card
company, even if the card is a rewards card with a higher interchange
rate.
Because there is no competition and no real retailer negotiation
involved in the setting of interchange fees, it is not surprising that
interchange fees are being charged at levels that would not be agreed
upon in a fair and competitive market. This has been demonstrated in a
number of ways.
For example, as economies of scale and advances in technology have
brought down the cost of credit card transaction processing in recent
years, normal market pressures would suggest that interchange rates
would have similarly decreased. But as noted in a March 29, 2008 Wall
Street Journal editorial, ``The Visa interchange fee has increased over
the past decade to 1.76 percent from an average of 1.5 percent.
Economies of scale should be driving fees down, as in most other
service-fee industries.'' In March 2006, the American Banker reported
that ``according to the credit card industry newsletter The Nilson
Report, interchange rates for Visa and MasterCard International have
risen steadily every year since 1997.''
Also, interchange fees continue to be charged as a percentage of the
sale price, so even though the cost of processing a $1 credit card
transaction is comparable to processing a $1,000 transaction, the
interchange fee paid on that $1,000 sale is much higher and much more
lucrative for the issuing bank.
Additionally, Americans are paying higher interchange fees than are
consumers in other countries who use the same Visa and MasterCard
cards. According to a report by the Federal Reserve Bank in
Minneapolis, U.S. interchange fees average around 1.75 percent, while
in other industrialized countries such as Britain interchange fees
typically average around 0.7 percent.
In 2001, the total amount of interchange fees collected in the U.S.
was $16.6 billion. By 2007, that amount grew to approximately $42
billion, an increase of over 150 percent since 2001. What are banks
doing with the tens of billions of dollars they are collecting in
interchange fees each year? There is a serious lack of transparency on
this issue, but one study indicates that only around 13 percent of
collected interchange fees are devoted to covering the cost of
processing credit card transactions. According to this study, the
majority of the collected fees went toward profits for the issuing
banks, rewards programs that benefit mostly affluent cardholders, and
marketing campaigns.
Visa and MasterCard and the banks that use them argue that their
interchange fee rates are set at levels that best balance benefits and
costs to card issuers and to merchants. If the card companies and the
banks truly believe that interchange fee rates are already set at a
level that is fair to merchants, it seems they should have no objection
to formalizing a process for setting interchange rates that is fair and
transparent and that gives merchants a legitimate voice in the process.

That is what the Credit Card Fair Fee Act would do. This legislation
would apply to widely-used credit and debit card systems. Recognizing
that these electronic payment systems have become nearly as important
to our consumer economy as cash and that most retailers cannot stay in
business without accepting them, the bill would ensure that retailers
have access to these electronic payment systems at fair rates and
terms.
Under the bill, if any electronic payment system has significant
market power, i.e., 20 percent or more of the credit and debit card
market, retailers would receive limited antitrust immunity to engage in
collective negotiations with the providers of that electronic payment
system over the fees and terms for access to the system.
The bill would establish a mandatory period for negotiations between
the retailers and providers over fees and terms. If the negotiations
between the retailers and providers do not result in an agreement, the
matter would be brought before a panel of expert Electronic Payment
System Judges, who would be appointed by the Department of Justice
Antitrust Division and the Federal Trade Commission.
These Judges would conduct a period of discovery during which
information about fees, terms, and market conditions for electronic
payment systems

[[Page S5210]]

would be disclosed. At the end of the discovery period, the Judges
would order a mandatory 21-day settlement conference to facilitate a
settlement between the retailers and electronic payment system
providers. If the settlement conference failed to result in an
agreement, the Judges would conduct a hearing where each side would
present their final offer of fees and terms. The Judges would then
select the offer of fees and terms that most closely represented the
fees and terms that would be negotiated in a hypothetical perfectly
competitive market where neither party had market power.
After choosing between the two offers put forth by the parties, the
Judges would enter an order providing that these fees and terms would
govern access to the electronic payment system by the merchants for a
period of 3 years, unless the parties supersede this agreement with a
voluntarily negotiated agreement. Decisions by the Judges would be
appealable to the D.C. Circuit Court of Appeals.
The Credit Card Fair Fee Act is modeled after the Copyright Royalty
and Distribution Reform Act of 2004, which created a similar system for
the use of copyrighted music works.
Credit card companies and banks may claim that this legislation
involves government price setting, but this is not the case. This
legislation does not permit the government to establish on its own
accord what the fees and terms for retailer usage of credit card
systems ought to be. Rather, it sets up a process whereby retailers
would be able to make their case as to what fees and terms are fair,
and if the retailers and credit card providers fail to agree
voluntarily on those fees and terms, independent judges would evaluate
the parties' offers and select the offer that most closely resembles
what the result would be in a fair and competitive market. In contrast,
currently Visa and MasterCard can use their overwhelming market power
to establish non-negotiable interchange fees and terms, and retailers
are forced to abide by these fees and terms or else be denied access to
payment systems that account for a huge percentage of all U.S.
transactions. This type of unaccountable fee-setting runs far more risk
of harm for retailers and consumers.

Under my legislation, if the credit card companies and the banks are
able to persuade the Judges that current interchange rates are
justifiable, then the rates would remain as they are today. If, on the
other hand, the retailers are persuasive in arguing that current
interchange rates cannot be justified by competitive market dynamics,
then the Judges would likely rule that alternative interchange rates
would better represent the result of a perfectly competitive market. In
either case, at a minimum the interests of retailers and consumers
would be much better represented in this fundamentally important
market.
My legislation represents a measured approach to addressing the
current market failure with interchange fee-setting. Other countries
have addressed the problem of unfair interchange fees through far more
drastic solutions. For example, Australia has imposed a system of
direct regulation of interchange fees through its central bank, and
Mexico's central bank has negotiated rate reductions with the card
companies. My legislation represents a middle ground between the
current flawed system and these aggressive foreign regulatory
frameworks.
In short, the Credit Card Fair Fee Act would address the market power
imbalance between retailers and credit card companies in setting
interchange fee rates. It would create a forum where these fees can be
fairly negotiated by parties with equal bargaining power. It would
ensure that interchange fees and terms are fair to both banks and
retailers. And if retailers are able to negotiate interchange rates
that reduce the transaction cost of doing business with plastic, it
would be beneficial to consumers as well.
How do we know that retailers will not just pocket any savings they
get through any reduction in interchange fees that they are able to
negotiate? We know because unlike the credit card interchange rate-
setting process, the retail industry is highly competitive, and that
competition is largely based on price.
Also, sometimes we hear the banks and card companies argue that if
interchange fees are reduced, they will have to raise fees and
penalties on cardholders to make up for the revenue shortfall. If these
companies stand by this argument, I would expect them to stand by its
converse and reduce their cardholder fees and penalties whenever their
interchange fee collections increase. However, interchange fee
collections have increased 150 percent since 2001, and we have seen no
corresponding decrease in fees and penalties imposed upon all
cardholders. Unless you are one of the small percentage of cardholders
with a current balance, no annual fees, and a lavish rewards program,
your issuing bank is probably taking two bites at your wallet--one with
interchange fees and one with the fees on your statement.
The Credit Card Fair Fee Act will protect consumers and retailers by
preventing credit card companies from using their market power to
charge unreasonable fees through an unfair process. This is important
legislation, and I urge my colleagues to support its passage.
______

By Ms. SNOWE:
S. 3087. A bill to amend title 38, United States Code, to make
certain improvements in the home loan guaranty programs administered by
the Secretary of Veterans Affairs, and for other purposes; to the
Committee on Veterans' Affairs.
Ms. SNOWE. Mr. President, I rise today to introduce legislation that
would expand and strengthen the guaranteed home loan program
administered by the Department of Veterans' Affairs. This action is
particularly timely given the many readjustment challenges faced by our
veterans and their families in this time of war, challenges that have
been compounded for veterans by the current subprime mortgage market
crisis and credit crunch. Mr. President, this legislation is intended
to be the companion legislation to H.R. 4884, Helping Our Veterans Keep
Their Homes Act of 2008, introduced in the House by Chairman Filner of
the House Veterans' Affairs Committee.
For some time, we have heard from many veterans that the current
structure of the VA Home Loan guarantee program has not been responsive
to the needs of veterans in today's market. For example, the current
home loan limit is $417,000. Unfortunately, in many states with the
largest population of veterans, reservists, and active duty personnel,
the average home price is well above the national average and above the
current loan ceiling. In contrast, the Federal Housing Authority home
loan program constrains the loan dollar value by State and county. I
strongly believe that veterans and service members should not be
penalized for geographic differences in the housing market--
particularly when, for many, where they live is not of their own
choosing but directed by the military organization in which they are
serving in the defense of the Nation.
We have also learned that for veterans and lenders, the VA loan
process can be costly, both with respect to personal finance and time.
The fees that are required for participation in the program impose
costs on the veteran and family that reduce the financial
attractiveness of the VA loan. In fact, it has been suggested that
those fees, the bureaucratic red-tape, and the loan dollar value
constraints that I previously noted, contributed to the conditions that
resulted in far too many veterans being steered toward subprime loans
in the first place.
Equally disturbing are reports that veterans and reservists did not
have access to prime rate loans because of the tumult created in their
lives due to repeated deployments to Iraq, Afghanistan, or both.
Unbelievably, despite their wartime service, these patriots were
assessed to have less than the desired level of personal financial
stability sought by prime rate lenders and received low credit scores.
With access to prime loans limited, subprimes became an option of
necessity for many veterans.
What has become a point of frustration for veterans now trapped in
the mortgage debacle is that the guaranteed home loan program is
limited in its ability to provide relief for veterans who have fallen
victim to unscrupulous lenders who prey on military families.
Given the sacrifices of our veterans and their families, and the
disruption

[[Page S5211]]

in their lives created when they patriotically answer their Nation's
call to service, we must do better by our veterans by providing a
readjustment benefit that reflects the realities of today's housing
market. The legislation that I am introducing today would provide for
the following: (1) increase the maximum home loan guarantee amount to
$729,750; (2) decrease the equity requirement to refinance a home loan;
(3) require the VA Secretary to review and streamline the process of
using a guaranteed home loan to purchase a condominium; (4) eliminate
the home loan funding fees; (5) reduce the home loan refinance fees to
one percent; (6) extend the adjustable rate mortgage demonstration
project to 2018; (7) extend the hybrid adjustable rate mortgage
demonstration project to 2012; (8) raise the maximum loan guarantee for
refinancing a home to $729,750; and (9) authorize the VA to offer a 30
percent guaranty for loans made on homes determined by VA and HUD to be
affordable housing.
Clearly, this is the right thing to do. I should note that this
legislation is supported by the veterans' services organizations,
including the Veterans of Foreign Wars and the American Legion. I
sincerely hope that my colleagues will join me and offer their support
for this important legislation.
______

By Mr. WYDEN:
S. 3088. A bill to designate certain land in the State of Oregon as
wilderness, and for other purposes; to the Committee on Energy and
Natural Resources.
Mr. WYDEN. Mr. President, today I am pleased to introduce two bills
to protect two unique places in the high desert of Central and Eastern
Oregon as wilderness. These areas both reflect the wild, rugged beauty
that makes Oregon's terrain east of the Cascade Mountains so
incomparable.
The first bill I am introducing, the Oregon Badlands Wilderness Act
of 2008, S. 3088, would designate as wilderness almost 30,000 acres of
the area known as the Badlands. The Badlands consists of high desert
that is located just 15 miles east of Bend, Oregon, and straddles the
Deschutes-Crook county border. The Badlands is made up of pockets of
soft sand, lichen-covered lava flows and 1,000-year-old ancient
junipers. It is home to pronghorn, deer, and elk.
The effort to protect the Badlands was led by a Bend schoolteacher,
Alice Elshoff, in the 1980s. According to an article about Ms.
Elshoff's efforts, ``Huge chunks of basalt rock jut out of the soft
desert sand like blisters that burst from within the earth. Twisted
juniper trees, some hundreds of years old, seem to desperately cling to
the jagged rock formations. And beneath the trees and nearly hidden in
narrow hideaways among the rocks are faint red drawings, messages left
by prehistoric Indians who called this rugged part of the world home.
This is the Badlands.''
In addition to its natural attributes, many Bend business leaders
understand that an Oregon Badlands Wilderness adds to the area's
national reputation as a hub for diverse outdoor recreation. In the
Bend area, people can enjoy almost any outdoor activity--boating,
biking, skiing, horseback riding, hunting, riding off-road vehicles and
hiking. Within roughly an hour's drive of Bend, there are more than
400,000 acres of public lands available to motorized recreation--and I
look forward to continuing to work with the Central Oregon off road and
snowmobile communities. The region's diverse recreational options are a
true example of multiple use. Into that mix we now add the peace and
solitude of a wilderness recreation experience. These kinds of diverse
recreational opportunities and scenic natural areas are part of what
has attracted companies and new residents to the Bend area and, with
them, booming economic development. According to the 2007 article in
The Economist entitled ``Booming Bend,'' ``Fabulous scenery attracts
people with fabulous amounts of money.'' To sum it up, people seek
places to live and work with the kind of high quality of life the Bend
area can offer. The natural beauty and recreational opportunities of an
area like Bend propel this growth.
The Bend community has been talking about protecting the special
place known as the Badlands for many years. Volunteers have been
working with long-time Oregon ranchers, notably Bev and Ray Clarno,
whose family has worked the land for generations, along with
conservationists, irrigators, and more than 200 local businesses to
gain protection for the Badlands as wilderness.
This designation is also a tribute to a remarkable young woman,
Rachel Scdoris, who grew up driving and training her sled dog team
through this area--and the bill provides that she may continue doing so
for as long as she chooses. Ms. Scdoris is legally blind, and she
recently completed in her third Iditarod sled dog race.
This wilderness designation has been a long time in coming; it has
been over two decades since the BLM began reviewing which lands should
be considered candidates for wilderness. From that time forward, BLM
has repeatedly concluded that the Badlands should be protected as
Wilderness. It is time to make it happen. This unique part of the
Oregon high desert needs to be permanently protected for generations to
come.
The second bill I am introducing is the Spring Basin Wilderness Act
of 2008, S. 3089. This region is further east and even more remote than
the Badlands. Spring Basin is one of Central Oregon's premier wild
areas. Overlooking the John Day Wild and Scenic River, the rolling
hills of Spring Basin burst with color during the spring wildflower
bloom. It boasts canyons and diverse geology that offers recreational
opportunities for hikers, horseback riders, hunters, botanists, and
other outdoor enthusiasts. The area is important habitat for
populations of Mule Deer and Rocky Mountain Elk, as well as many bird
species. To preserve this natural treasure, my bill would designate
approximately 8,600 acres as the Spring Basin Wilderness.
During the past several years, many community leaders and adjacent
landowners have approached me advocating for Wilderness designation for
this spectacular land that borders the Wild and Scenic John Day River
and the nearby John Day Fossil Beds. The area is known across Oregon
for its profusion of spring wildflowers. The Confederated Tribes of
Warm Springs, local landowners, the County Commission and the Federal
Bureau of Land Management all support Wilderness designation for Spring
Basin. In fact, Spring Basin was recommended to Congress as a
wilderness area by the Bureau of Land Management in 1989. Protecting
this scenic jewel will add to Oregon's treasured wilderness and the
unique recreational opportunities it provides.
I want to express my thanks to all the volunteers and supporters who
have worked tirelessly to protect this area and reached out to diverse
community groups to build support. I also want to thank the
Confederated Tribes of the Warm Springs for their engagement and
support. The Confederated Tribes of the Warm Springs own and manage
approximately 30,000 acres of adjacent land that they manage to the
north and east of Spring Basin. The Tribes manage these lands for the
improvement of fish and wildlife habitat and I look forward to working
with them to implement this legislation.
Mr. President, I ask unanimous consent that the text of the bills be
printed in the Record.
There being no objection, the text of the bills was ordered to be
printed in the Record, as follows:

S. 3088

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 ``Oregon Badlands Wilderness
Act of 2008''.

SEC. 2. FINDINGS AND PURPOSES.

(a) Findings.--Congress finds that--
(1) certain Bureau of Land Management land in central
Oregon qualifies for addition to the National Wilderness
Preservation System;
(2) 1 of the chief economic assets of the central Oregon
region is the rich diversity of available recreation, with
the region offering a wide variety of multiple-use areas for
skiing, biking, hunting, off-highway vehicle use, boating,
and other motorized recreation;
(3) there are over 400,000 acres of public land near Bend,
Oregon, available for off-highway vehicles and other
motorized recreation uses;
(4) motorized recreation users in central Oregon should
continue to have access to an abundance of land managed, in
part, for their use;
(5) the proposed Oregon Badlands Wilderness would increase
the offerings in the region by making an additional 30,000
acres in

[[Page S5212]]

central Oregon available for wilderness recreation and
solitude; and
(6) certain land exchanges that would consolidate Federal
land holdings within or near to the proposed wilderness to
enhance wilderness values and management are in the public
interest.
(b) Purposes.--The purposes of this Act are--
(1) to designate the Oregon Badlands Wilderness in the
State of Oregon; and
(2) to authorize, direct, and facilitate several land
exchanges to consolidate Federal land holdings within or near
the Oregon Badlands Wilderness.

SEC. 3. DEFINITIONS.

In this Act:
(1) District.--The term ``District'' means the Central
Oregon Irrigation District, which has offices in Redmond,
Oregon.
(2) Landowner.--The term ``Landowner'' means Ray Clarno, a
resident of Redmond, Oregon.
(3) Secretary.--The term ``Secretary'' means the Secretary
of the Interior.
(4) State.--The term ``State'' means the State of Oregon.
(5) Wilderness.--The term ``Wilderness'' means the Oregon
Badlands Wilderness designated by section 4(a).
(6) Wilderness map.--The term ``wilderness map'' means the
map entitled ``Badlands Wilderness'' and dated June 4, 2008.

SEC. 4. OREGON BADLANDS WILDERNESS.

(a) Designation.--In accordance with the Wilderness Act (16
U.S.C. 1131 et seq.), approximately 29,837 acres of Bureau of
Land Management land in the State, as depicted on the
wilderness map, is designated as Wilderness and as a
component of the National Wilderness Preservation System, to
be known as the ``Oregon Badlands Wilderness''.
(b) Map and Legal Description.--
(1) Submission of map and legal description.--As soon as
practicable after the date of enactment of this Act, the
Secretary shall file a map and legal description of the
Wilderness with--
(A) the Committee on Energy and Natural Resources of the
Senate; and
(B) the Committee on Natural Resources of the House of
Representatives.
(2) Force of law.--The map and legal description filed
under paragraph (1) shall have the same force and effect as
if included in this Act, except that the Secretary may
correct any errors in the map or legal description.
(3) Public availability.--The map and legal description
filed under paragraph (1) shall be on file and available for
public inspection in the appropriate offices of the
Secretary.
(c) Administration of Wilderness.--
(1) In general.--Subject to valid existing rights, the
Wilderness shall be administered by the Secretary in
accordance with the Wilderness Act (16 U.S.C. 1131 et seq.),
except that--
(A) any reference in the Wilderness Act to the effective
date of the Wilderness Act shall be considered to be a
reference to the date of enactment of this Act; and
(B) any reference in that Act to the Secretary of
Agriculture shall be considered to be a reference to the
Secretary of the Interior.
(2) Incorporation of acquired land and interests.--Any land
or interest in land within the boundary of the Wilderness
that is acquired by the United States shall--
(A) become part of the Wilderness; and
(B) be managed in accordance with this Act, the Wilderness
Act (16 U.S.C. 1131 et seq.), and any other applicable law.
(3) Withdrawal.--Subject to valid existing rights, the
Federal land designated as wilderness by this Act is
withdrawn from all forms of--
(A) entry, appropriation, or disposal under the public land
laws;
(B) location, entry, and patent under the mining laws; and
(C) disposition under the mineral leasing, mineral
materials, and geothermal leasing laws.
(4) Grazing.--The grazing of livestock in the Wilderness,
if established before the date of enactment of this Act, and
the maintenance of facilities in existence on the date of
enactment of this Act relating to grazing, shall be permitted
to continue subject to such reasonable regulations as are
considered necessary by the Secretary in accordance with--
(A) section 4(d)(4) of the Wilderness Act (16 U.S.C.
1133(d)(4)); and
(B) the guidelines set forth in Appendix A of the report of
the Committee on Interior and Insular Affairs of the House of
Representatives accompanying H.R. 2570 of the 101st Congress
(H. Rept. 101-405).
(5) Access to private property.--The Secretary shall
provide any owner of private property within the boundary of
the Wilderness adequate access to the property to ensure the
reasonable use and enjoyment of the property by the owner.
(6) Tribal rights.--Nothing in this Act--
(A) affects, alters, amends, repeals, interprets,
extinguishes, modifies, or is in conflict with--
(i) the treaty rights of an Indian tribe, including the
rights secured by the Treaty of June 25, 1855, between the
United States and the Tribes and Bands of Middle Oregon (12
Stat. 963); or
(ii) any other rights of an Indian tribe; or
(B) prevents, prohibits, terminates, or abridges the
exercise of treaty-reserved rights, including the rights
secured by the Treaty of June 25, 1855, between the United
States and the Tribes and Bands of Middle Oregon (12 Stat.
963)--
(i) within the boundaries of the Wilderness; or
(ii) on land acquired by the United States under this Act.

SEC. 5. SCDORIS CORRIDOR.

(a) Existing Use.--
(1) In general.--Subject to subsection (b), the route
depicted on the wilderness map shall be included in a
corridor with a width of 25 feet to be excluded from the
Wilderness to accommodate the existing use of the route for
purposes relating to the training of sled dogs by Rachael
Scdoris.
(2) Inclusion in wilderness.--On final and total
termination of the use of the route for the purposes
described in paragraph (1), the corridor described in that
paragraph shall--
(A) become part of the Wilderness; and
(B) be managed in accordance with this Act, the Wilderness
Act (16 U.S.C. 1131 et seq.), and any other applicable law.
(b) Interim Management.--Except as provided in subsection
(a), the corridor shall otherwise be managed as wilderness.
(c) Withdrawal.--Subject to valid existing rights, the
corridor described in subsection (a)(1) is withdrawn from all
forms of--
(1) entry, appropriation, or disposal under the public land
laws;
(2) location, entry, and patent under the mining laws; and
(3) disposition under the mineral leasing, mineral
materials, and geothermal leasing laws.

SEC. 6. RELEASE OF WILDERNESS STUDY AREAS.

(a) Finding.--Congress finds that, for the purposes of
section 603 of the Federal Land Policy and Management Act of
1976 (43 U.S.C. 1782), the Bureau of Land Management land
identified as the Badlands wilderness study area has been
adequately studied for wilderness designation.
(b) Release.--Any public land described in subsection (a)
that is not designated as wilderness by this Act--
(1) is no longer subject to section 603(c) of the Federal
Land Policy and Management Act of 1976 (43 U.S.C. 1782(c));
and
(2) shall be managed in accordance with the applicable land
management plans adopted under section 202 of that Act (43
U.S.C. 1712).

SEC. 7. LAND EXCHANGES.

(a) Clarno Land Exchange.--
(1) Conveyance of land.--If the Landowner offers to convey
to the United States all right, title, and interest of the
Landowner in and to the non-Federal land described in
paragraph (2)(A), the Secretary shall--
(A) accept the offer; and
(B) on receipt of acceptable title to the non-Federal land
and subject to valid existing rights, convey to the Landowner
all right, title, and interest of the United States in and to
the Federal land described in paragraph (2)(B).
(2) Description of land.--
(A) Non-federal land.--The non-Federal land referred to in
paragraph (1) is the approximately 240 acres of non-Federal
land identified on the wilderness map as ``Clarno to Federal
Government''.
(B) Federal land.--The Federal land referred to in
paragraph (1)(B) is the approximately 245 acres of Federal
land identified on the wilderness map as ``Federal Government
to Clarno''.
(3) Surveys.--The exact acreage and legal description of
the Federal land and non-Federal land described in paragraph
(2) shall be determined by surveys approved by the Secretary.
(b) District Exchange.--
(1) Conveyance of land.--If the District offers to convey
to the United States all right, title, and interest of the
District in and to the non-Federal land described in
paragraph (2)(A), the Secretary shall--
(A) accept the offer; and
(B) on receipt of acceptable title to the non-Federal land
and subject to valid existing rights, convey to the District
all right, title, and interest of the United States in and to
the Federal land described in paragraph (2)(B).
(2) Description of land.--
(A) Non-federal land.--The non-Federal land referred to in
paragraph (1) is the approximately 564 acres of non-Federal
land identified on the wilderness map as ``COID to Federal
Government''.
(B) Federal land.--The Federal land referred to in
paragraph (1)(B) is the approximately 686 acres of Federal
land identified on the wilderness map as ``Federal Government
to COID''.
(3) Surveys.--The exact acreage and legal description of
the Federal land and non-Federal land described in paragraph
(2) shall be determined by surveys approved by the Secretary.
(c) Applicable Law.--Except as otherwise provided in this
section, the Secretary shall carry out the land exchanges
under this section in accordance with section 206 of the
Federal Land Policy and Management Act of 1976 (43 U.S.C.
1716).
(d) Valuation, Appraisals, and Equalization.--
(1) In general.--The value of the Federal land and the non-
Federal land to be conveyed in a land exchange under this
section--
(A) shall be equal, as determined by appraisals conducted
in accordance with paragraph (2); or

[[Page S5213]]

(B) if not equal, shall be equalized in accordance with
paragraph (3).
(2) Appraisals.--
(A) In general.--The Federal land and the non-Federal land
to be exchanged under this section shall be appraised by an
independent, qualified appraiser that is agreed to by the
Secretary and the owner of the non-Federal land to be
exchanged.
(B) Requirements.--An appraisal under subparagraph (A)
shall be conducted in accordance with--
(i) the Uniform Appraisal Standards for Federal Land
Acquisition; and
(ii) the Uniform Standards of Professional Appraisal
Practice.
(3) Equalization.--
(A) In general.--If the value of the Federal land and the
non-Federal land to be conveyed in a land exchange under this
section is not equal, the value may be equalized by--
(i) the Secretary making a cash equalization payment to the
owner of the non-Federal land;
(ii) the owner of the non-Federal land making a cash
equalization payment to the Secretary; or
(iii) reducing the acreage of the Federal land or the non-
Federal land to be exchanged, as appropriate.
(B) Cash equalization payments.--Any cash equalization
payments received by the Secretary under subparagraph (A)(ii)
shall be--
(i) deposited in the Federal Land Disposal Account
established by section 206(a) of the Federal Land Transaction
Facilitation Act (43 U.S.C. 2305(a)); and
(ii) used in accordance with that Act.
(e) Conditions of Exchange.--
(1) In general.--As a condition of a conveyance of Federal
land and non-Federal land under this section, the Federal
Government and the owner of the non-Federal land shall
equally share all costs relating to the land exchange,
including the costs of appraisals, surveys, and any necessary
environmental clearances.
(2) Valid existing rights.--The exchange of Federal land
and non-Federal land under this section shall be subject to
any easements, rights-of-way, or other valid encumbrances in
existence on the date of enactment of this Act.
(f) Deadline for Completion of Land Exchange.--It is the
intent of Congress that the land exchanges under this section
shall be completed not later than 16 months after the date of
enactment of this Act.
____

S. 3089

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 ``Spring Basin Wilderness Act
of 2008''.

SEC. 2. DEFINITIONS.

In this Act:
(1) Family trust.--The term ``family trust'' means the
Bowerman Family Trust, which is the owner of the land
described in section 4(d)(2)(A).
(2) Keys.--The term ``Keys'' means Bob Keys, a resident of
Portland, Oregon.
(3) Mcgreer.--The term ``McGreer'' means H. Kelly McGreer,
a resident of Antelope, Oregon.
(4) Secretary.--The term ``Secretary'' means the Secretary
of the Interior.
(5) State.--The term ``State'' means the State of Oregon.
(6) Tribes.--The term ``Tribes'' means the Confederated
Tribes of the Warm Springs Indian Reservation, with offices
in Warm Springs, Oregon.
(7) Wilderness map.--The term ``wilderness map'' means the
map entitled ``Spring Basin Study Area with Exchange
Proposals'' and dated May 22, 2008.

SEC. 3. SPRING BASIN WILDERNESS.

(a) Designation.--In accordance with the Wilderness Act (16
U.S.C. 1131 et seq.), the approximately 8,661 acres of Bureau
of Land Management land in the State, as depicted on the
wilderness map, is designated as wilderness and as a
component of the National Wilderness Preservation System, to
be known as the ``Spring Basin Wilderness''.
(b) Administration of Wilderness.--
(1) In general.--Subject to valid existing rights, the
Wilderness shall be administered by the Secretary in
accordance with the Wilderness Act (16 U.S.C. 1131 et seq.),
except that--
(A) any reference in the Wilderness Act to the effective
date of the Wilderness Act shall be considered to be a
reference to the date of enactment of this Act; and
(B) any reference in that Act to the Secretary of
Agriculture shall be considered to be a reference to the
Secretary of the Interior.
(2) Incorporation of acquired land and interests.--Any land
or interest in land within the boundary of the Wilderness
that is acquired by the United States shall--
(A) become part of the Wilderness; and
(B) be managed in accordance with this Act, the Wilderness
Act (16 U.S.C. 1131 et seq.), and any other applicable law.
(3) Grazing.--The grazing of domestic livestock in the
Wilderness shall be administered in accordance with--
(A) section 4(d)(4) of the Wilderness Act (16 U.S.C.
1133(d)(4));
(B) the guidelines set forth in the report of the Committee
on Interior and Insular Affairs of the House of
Representatives accompanying H.R. 5487 of the 96th Congress
(H. Rept. 96-617); and
(C) the guidelines set forth in Appendix A of the report of
the Committee on Interior and Insular Affairs of the House of
Representatives accompanying H.R. 2570 of the 101st Congress
(H. Rept. 101-405).
(4) Access to non-federal land.--In accordance with the
Wilderness Act (16 U.S.C. 1131 et seq.), the Secretary shall
provide reasonable access to non-Federal land within the
boundaries of the Wilderness.
(5) State water laws.--Nothing in this section constitutes
an exemption from State water laws (including regulations).
(6) Tribal rights.--Nothing in this section--
(A) affects, alters, amends, repeals, interprets,
extinguishes, modifies, or is in conflict with--
(i) the treaty rights of an Indian tribe, including the
rights secured by the Treaty of June 25, 1855, between the
United States and the Tribes and Bands of Middle Oregon (12
Stat. 963); or
(ii) any other rights of an Indian tribe; or
(B) prevents, prohibits, terminates, or abridges the
exercise of treaty-reserved rights, including the rights
secured by the Treaty of June 25, 1855, between the United
States and the Tribes and Bands of Middle Oregon (12 Stat.
963)--
(i) within the boundaries of the Wilderness; or
(ii) on land acquired by the United States under this Act.

SEC. 4. LAND EXCHANGES.

(a) Confederated Tribes of the Warm Springs Indian
Reservation Land Exchange.--
(1) Conveyance of land.--If the Tribes offer to convey to
the United States all right, title, and interest of the
Tribes in and to the non-Federal land described in paragraph
(2)(A), the Secretary shall--
(A) accept the offer; and
(B) on receipt of acceptable title to the non-Federal land
and subject to valid existing rights, convey to the Tribes
all right, title, and interest of the United States in and to
the Federal land described in paragraph (2)(B).
(2) Description of land.--
(A) Non-federal land.--The non-Federal land referred to in
paragraph (1) is the approximately 3,635 acres of non-Federal
land identified on the wilderness map as ``Lands proposed for
transfer from the CTWSIR to the Federal Government''.
(B) Federal land.--The Federal land referred to in
paragraph (1)(B) is the approximately 3,653 acres of Federal
land identified on the wilderness map as ``Lands proposed for
transfer from the Federal Government to CTWSIR''.
(3) Surveys.--The exact acreage and legal description of
the Federal land and non-Federal land described in paragraph
(2) shall be determined by surveys approved by the Secretary.
(b) McGreer Land Exchange.--
(1) Conveyance of land.--If McGreer offers to convey to the
United States all right, title, and interest of McGreer in
and to the non-Federal land described in paragraph (2)(A),
the Secretary shall--
(A) accept the offer; and
(B) on receipt of acceptable title to the non-Federal land
and subject to valid existing rights, convey to McGreer all
right, title, and interest of the United States in and to the
Federal land described in paragraph (2)(B).
(2) Description of land.--
(A) Non-federal land.--The non-Federal land referred to in
paragraph (1) is the approximately 18 acres of non-Federal
land identified on the wilderness map as ``Lands proposed for
transfer from McGreer to the Federal Government''.
(B) Federal land.--The Federal land referred to in
paragraph (1)(B) is the approximately 325 acres of Federal
land identified on the wilderness map as ``Lands proposed for
transfer from the Federal Government to McGreer''.
(3) Surveys.--The exact acreage and legal description of
the Federal land and non-Federal land described in paragraph
(2) shall be determined by surveys approved by the Secretary.
(c) Keys Land Exchange.--
(1) Conveyance of land.--If Keys offers to convey to the
United States all right, title, and interest of Keys in and
to the non-Federal land described in paragraph (2)(A), the
Secretary shall--
(A) accept the offer; and
(B) on receipt of acceptable title to the non-Federal land
and subject to valid existing rights, convey to Keys all
right, title, and interest of the United States in and to the
Federal land described in paragraph (2)(B).
(2) Description of land.--
(A) Non-federal land.--The non-Federal land referred to in
paragraph (1) is the approximately 181 acres of non-Federal
land identified on the wilderness map as ``Lands proposed for
transfer from Keys to the Federal Government''.
(B) Federal land.--The Federal land referred to in
paragraph (1)(B) is the approximately 183 acres of Federal
land identified on the wilderness map as ``Lands proposed for
transfer from the Federal Government to Keys''.
(3) Surveys.--The exact acreage and legal description of
the Federal land and non-Federal land described in paragraph
(2) shall be determined by surveys approved by the Secretary.
(d) Bowerman Land Exchange.--

[[Page S5214]]

(1) Conveyance of land.--If the family trust offers to
convey to the United States all right, title, and interest of
the family trust in and to the non-Federal land described in
paragraph (2)(A), the Secretary shall--
(A) accept the offer; and
(B) on receipt of acceptable title to the non-Federal land
and subject to valid existing rights, convey to the family
trust all right, title, and interest of the United States in
and to the Federal land described in paragraph (2)(B).
(2) Description of land.--
(A) Non-federal land.--The non-Federal land referred to in
paragraph (1) is the approximately 34 acres of non-Federal
land identified on the wilderness map as ``Lands proposed for
transfer from Bowerman to the Federal Government''.
(B) Federal land.--The Federal land referred to in
paragraph (1)(B) is the approximately 24 acres of Federal
land identified on the wilderness map as ``Lands proposed for
transfer from the Federal Government to Bowerman''.
(3) Surveys.--The exact acreage and legal description of
the Federal land and non-Federal land described in paragraph
(2) shall be determined by surveys approved by the Secretary.
(e) Applicable Law.--Except as otherwise provided in this
section, the Secretary shall carry out the land exchanges
under this section in accordance with section 206 of the
Federal Land Policy and Management Act of 1976 (43 U.S.C.
1716).
(f) Valuation, Appraisals, and Equalization.--
(1) In general.--The value of the Federal land and the non-
Federal land to be conveyed in a land exchange under this
section--
(A) shall be equal, as determined by appraisals conducted
in accordance with paragraph (2); or
(B) if not equal, shall be equalized in accordance with
paragraph (3).
(2) Appraisals.--
(A) In general.--The Federal land and the non-Federal land
to be exchanged under this section shall be appraised by an
independent, qualified appraiser that is agreed to by the
Secretary and the owner of the non-Federal land to be
exchanged.
(B) Requirements.--An appraisal under subparagraph (A)
shall be conducted in accordance with--
(i) the Uniform Appraisal Standards for Federal Land
Acquisition; and
(ii) the Uniform Standards of Professional Appraisal
Practice.
(3) Equalization.--
(A) In general.--If the value of the Federal land and the
non-Federal land to be conveyed in a land exchange under this
section is not equal, the value may be equalized by--
(i) the Secretary making a cash equalization payment to the
owner of the non-Federal land;
(ii) the owner of the non-Federal land making a cash
equalization payment to the Secretary; or
(iii) reducing the acreage of the Federal land or the non-
Federal land to be exchanged, as appropriate.
(B) Cash equalization payments.--Any cash equalization
payments received by the Secretary under subparagraph (A)(ii)
shall be--
(i) deposited in the Federal Land Disposal Account
established by section 206(a) of the Federal Land Transaction
Facilitation Act (43 U.S.C. 2305(a)); and
(ii) used in accordance with that Act.
(g) Conditions of Exchange.--
(1) In general.--As a condition of the conveyance of
Federal land and non-Federal land under this section, the
Federal Government and the owner of the non-Federal land
shall equally share all costs relating to the land exchange,
including the costs of appraisals, surveys, and any necessary
environmental clearances.
(2) Valid existing rights.--The exchange of Federal land
and non-Federal land under this section shall be subject to
any easements, rights-of-way, or other valid encumbrances in
existence on the date of enactment of this Act.
(h) Deadline for Completion of Land Exchange.--It is the
intent of Congress that the land exchanges under this section
shall be completed not later than 16 months after the date of
enactment of this Act.
______

By Mr. GRASSLEY:
S. 3093. A bill to extend and improve the effectiveness of the
employment eligibility confirmation program; to the Committee on the
Judiciary.
Mr. GRASSLEY. Mr. President, today, I am introducing legislation to
reauthorize and expand the E-verify program, a web based tool run by
the Department of Homeland Security for employers across the country.
Known as the Basic Pilot Program since its inception in 1996, E-verify
provides employers with a process to verify the work eligibility of new
hires. This program is set to expire in November of this year.
The Immigration Reform and Control Act of 1986 made it unlawful for
employers to knowingly hire or employ aliens not eligible to work in
the United States and required employers to examine the identity and
work eligibility documents of all new employees.
Employers are required to participate in a paper-based employment
eligibility verification system, commonly referred to as the I-9
system, in which they examine documents presented by new hires to
verify identity and work eligibility, and complete and retain I-9
verification forms. Under current law, if the documents provided by an
employee reasonably appear on their face to be genuine, the employer
has met its document review obligation. However, the easy availability
of counterfeit documents and fake identifications has made a mockery of
the law.
In 1996, Congress authorized the Basic Pilot Program to help
employers verify the eligibility of their workers. Participants in this
program electronically verify new hires' employment authorization
through the Social Security Administration and, if necessary, the
Department of Homeland Security databases.
The Basic Pilot was authorized in 5 States until an expansion of the
program was agreed to by Congress in 2003. Now, all States and all
employers can take advantage of this voluntary and free program.
The bill I am introducing today isn't broad expansion of the current
program, which I would like to see done. I attempted to revamp E-verify
in 2006 and 2007 when the Senate debated a comprehensive immigration
bill. During those debates, I offered amendments to require all
businesses to use E-verify rather than maintaining it as a voluntary
system. Over time, I would like to see this tool as a staple in the
workforce. My legislation today doesn't go that far.
My amendment in 2006 and 2007 also would have changed the
verification and appeal procedures, and would have improved the ability
of the Federal Government to go after employers who knowingly hire
illegal aliens.
While I hope that the Congress can one day address these issues, my
priority this year is the reauthorization of the E-verify program. We
must not let it expire. Employers rely on it, and we must not pull the
rug from under them in their attempt to abide by the law.
My legislation would extend the program indefinitely. There's no
reason that we should allow this to expire in 1, 5 or 10 years. It
should only expire when Congress feels the need to terminate it. Right
now, over 61,000 employers use the program. That number is likely to
grow, and they need to be able to know that Congress isn't going to let
this program die.
Another provision in my bill would require all contractors of the
U.S. Government to use E-verify, even though they have the authority to
do so today. Under the original statute in 1996, the Federal
Government--including the Executive and Legislative Branches--must
comply with the terms and conditions of E-verify. I added this
provision because I don't like the progress I am seeing from the
administration to require contractors to use the program.
In August of this year, Secretary Chertoff announced a series of
reforms to address border security and immigration challenges that our
country faces. One of the 26 proposed reforms was to require Federal
contractors to use the basic pilot program.
Specifically, Secretary Chertoff said that ``the Administration will
commence a rulemaking process to require all federal contractors and
vendors to use E-Verify, the federal electronic employment verification
system, to ensure that their employees are authorized to work in the
United States.'' I firmly believe that the Federal Government ought to
lead by example, and they shouldn't wait for my bill to become law.
My bill would also allow employers to check the status of all
employees, not just new hires. Since the system is voluntary,
businesses should be able to use E-verify to check the work eligibility
of all their employees. They would alert the Department of Homeland
Security of their desire to check all employees and be required to do
the checks not later than 10 days after. If an employer wants to make
sure his or her labor force is lawful, or legally allowed to work in
the United States, he or she should be afforded that right. Also, the
Department of Homeland Security should be able to require repeat
offenders of immigration law to check the status of all employees, not
just

[[Page S5215]]

new hires. My legislation would require certain employers to use E-
verify if the Security has reasonable cause to believe that the
employer has engaged in the hiring of undocumented workers. This
provision will help us hold employers accountable.
My bill would require more information sharing between the agencies
at the Department of Homeland Security. Citizenship and Immigration
Service, the agency in charge of service and benefits for immigrants,
runs the program. However, Immigration and Customs Enforcement has the
duty to enforce immigration laws and conduct worksite enforcement. I
fear that the two agencies don't communicate enough, especially when it
comes to this program. While CIS will provide ICE information about
employers who use E-verify upon request, this should be an automatic
process. The enforcement agency is better equipped to go after those
who hire illegal aliens, and they should have access to such
information, including those businesses that receive final non-
confirmations through the system. My bill would require CIS to report
monthly to ICE.
Finally, as a Senator from a State with many rural communities, I
have heard small businesses say they want a system that works and is
easy to use. Many towns in Iowa and across the country want to be able
to use E-verify but may not have access to computers or the Internet.
The Citizenship and Immigration Service has made strides to help
businesses learn the system and accommodate their lack of access. As we
continue to ramp up the program and potentially make it a requirement
for all employers, I would like to see the Federal Government reach out
to rural areas and figure out a way to make this work. My bill would
authorize the Director of U.S. CIS to establish a demonstration program
that assists small businesses in verifying the employment eligibility
of their newly hired employees.
In conclusion, I cannot stress enough the importance of making sure
E-verify remains intact and operating for employers across the country.
We need to reauthorize the program this year so that businesses can
continue to abide by our immigration laws. I urge my colleagues to join
me in this effort.
______

By Mr. BAUCUS:
S. 3095. A bill to amend title XVIII of the Social Security Act to
expand the Medicare Rural Hospital Flexibility Program to increase the
delivery of mental health services and other health services to
veterans of Operation Enduring Freedom and Operation Iraqi Freedom and
to other residents of rural areas, and for other purposes; to the
Committee on Finance.
Mr. BAUCUS. Mr. President, an Iraq veteran named Travis Williams told
his story at a field hearing in Great Falls, Montana last summer. After
graduating from Capitol High School in Helena in 2002, Travis quickly
joined the Marine Corps. Travis was deployed to Iraq in 2005. He served
in Al Anbar province.
Like thousands of other American men and women in uniform, Travis
served nobly and with honor under the most difficult of circumstances.
He experienced the horrors of combat. He lost numerous friends. And he
saw unspeakable violence.
Travis testified that after months of combat, his emotions seemed to
dull or shutdown. As he later learned, he was experiencing a normal
reaction to a highly abnormal situation. His reaction was a defense
mechanism that allowed him to continue to operate in a combat zone. His
mind was finding a way to keep going. Thousands of marines, soldiers,
airmen and seamen have experienced this phenomenon.
Travis testified that when he arrived home it seemed ``surreal.'' He
felt more out of place in his own home than he did in Iraq. Travis
isolated himself from his friends. He was frequently drunk and angry.
Looking back, he understands that he was on what he called the ``path
to destruction.''
One day, Travis received a phone call from Deb McBee. Deb is a
veteran's service officer from the Military Order of the Purple Heart.
Deb had heard about Travis' experiences in combat. She recommended that
he visit the VA clinic to seek help. Travis took her advice. The VA
referred Travis to a veteran's liaison for the Western Montana Mental
Health Clinic.
Travis connected immediately with his mental health counselor. The
counselor was also a veteran who understood the nightmare of combat and
the loneliness of coming home. Over time, the counselor helped Travis
to get back on track. Before long, Travis was enrolled in a pre-med
program and had overcome many of the feelings of anger and loss he had
felt before.
I begin with Travis' story because it offers hope. But it offers hope
amid a very dark picture facing our veterans. A recent study by the
RAND Corporation revealed that American veterans are facing a crisis of
epic proportions. RAND estimates that around 300,000 service members
suffer from post-traumatic stress disorder--also known as PTSD--or
major depression. And 320,000 individuals reported experiencing
probable traumatic brain injury during deployment.
The RAND study found that only 53 percent of service members with
post-traumatic stress disorder or depression have seen a doctor or
mental health provider in the past year. Of those who had a mental
disorder and sought care, about half received only ``minimally
adequate'' treatment.
Tragically, on any single day, on average, 18 veterans commit
suicide. More than one out of five of those vets were patients
undergoing treatment by the VA. Think of it: Today, 18 veterans are
liable to commit suicide.
The VA has responded to this crisis with numerous initiatives that
offer hope to thousands of veterans. This year, the VA will spend more
than $3.5 billion for mental health services. Some of these funds will
be invested in a new mental health inpatient ward in Helena, Montana.
Over the last several years, the VA has opened up hundreds of new rural
health clinics. Today, there are more than 700 of these clinics
providing health care to our Nation's veterans. Montana has recently
received two new rural health clinics in Lewistown and Cut Bank. The VA
is making great strides.
But we need to do more. Thousands of veterans still remain out of
reach.
The VA has undertaken an aggressive campaign to make mental health
care services available to veterans living in rural areas. But
thousands of Americans returning from Iraq and Afghanistan live
hundreds of miles away from the health care that they need.
The Veteran's Affairs Office of Policy Analysis and Forecasting
counts 118,685 registered highly-rural veterans in America. Of these,
only 39,158 live within 2 hours of a VA medical center. Thousands of
veterans returning from Iraq and Afghanistan often have to choose
between a day-long trip to the VA or no care at all. In my home state
of Montana 32,404 rural veterans are enrolled in the VA healthcare
system. Over 10,000 of those veterans must drive more than an hour and
a half to reach a VA hospital. And thousands of those veterans must
drive over two hours both ways. In times of crisis, two hours is much
too far to drive.
Research conducted by the Department of Veterans Affairs shows that
veterans residing in rural areas are in poorer health than their urban
counterparts. Nationwide, one out of every five veterans enrolled in VA
health care lives in a rural area. Providing quality health care in a
rural setting has proved to be a daunting challenge. Limited numbers of
doctors and long highways make inadequate access to care all too
common.
But let me return to Travis Williams' story. The key lesson of
Travis' story is that getting the right care to veterans is all about
teamwork. It wasn't just the VA that saved Travis. It wasn't just
professional mental health counselors alone. It wasn't just veterans'
service organizations. Travis' willpower alone was not sufficient to
get him through the hard times. It was all of those things. All of
those factors working together helped Travis to get away from a life of
anger and despair, and back to a life full of meaning and purpose.
Teamwork is what the Relief for Rural Veterans Act is all about. The
bill would enable small rural hospitals, mental health service
providers, and other rural providers to work together to respond to the
needs of veterans in crisis. States could apply for funding to increase
their capacity to deliver mental health services by using state-of-the-
art technology such as tele-health and tele-psychiatry.

[[Page S5216]]

More specifically, my bill will give the Secretary of Health and
Human Services authority to award grants under the Medicare Rural
Hospital Flexibility Program. The Medicare Flex Program has a
successful 10-year history of strengthening the rural healthcare
infrastructure. Under this new authority, States can apply for grants
to increase the capacity of rural providers to provide mental health
services to veterans and other rural residents. The bill would
authorize an additional $100 million for this new authority for 2
years.
The Medicare Flex Program is a good way to improve health care
services in rural America. It has provided grants to States to develop
State rural health care plans. It supports conversion of eligible small
rural hospital facilities to critical access status. It supports rural
emergency medical services. And it fosters rural health care network
development. It makes sense to expand this program to include mental
health services needed by veterans in crisis.
Research conducted by the University of Maine found that small rural
hospitals are playing a major role in providing emergency health care
services to veterans. They are filling a critical gap in caring for
veterans in crisis.
But the Federal Government has not thus far provided funds to help
rural hospitals to perform this task. The grants authorized in my bill
could support crisis intervention services and other health care
services needed by Iraq and Afghanistan veterans. My bill will focus
upon those veterans who live far from VA facilities. It could provide
relief for veterans who have to drive hours to receive emergency mental
health care.
An additional benefit of these grants is that all rural residents,
regardless of whether they are veterans or not, would be able to take
advantage of the increased capacity of their small rural hospitals to
deliver improved healthcare services.
Iraq and Afghanistan Veterans of America and the National Alliance on
Mental Health Care have endorsed this bill.
The RAND study I mentioned earlier concluded that we need a major
national effort to improve the capacity of the mental health system to
care for veterans. The report stated that the effort must include the
military, veterans, and civilian healthcare systems.
This bill is one answer to that call. This bill is a way to approach
the problems facing our veterans from a new perspective. The philosophy
behind the bill is that all agencies that can lend a hand to our
veterans should do so. The challenges facing our Nation's veterans are
too large for the VA to handle on its own.
Researchers estimate that PTSD and depression among returning service
members will cost the Nation as much as $6.2 billion in the 2 years
following deployment. That's an amount that includes both direct
medical care and costs for lost productivity and suicide. Investing in
more high-quality treatment could save close to $2 billion within 2
years by substantially reducing those indirect costs.
Last month, Chairman Bob Filner said this about the crisis facing our
veterans: This is not a crisis that only concerns numbers. This is a
matter of life and death for the veterans for whom we are responsible.
I urge the VA to continue its efforts to extend its reach into rural
areas. I applaud the nation's thousands of volunteers who serve our
Nations' veterans. And I offer this legislation as one way to begin a
new approach to help those who have sacrificed so much in the name of
duty, honor, and country.
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. 3095

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 ``Relief for Rural Veterans in
Crisis Act of 2008''.

SEC. 2. EXPANSION AND EXTENSION OF THE MEDICARE RURAL
HOSPITAL FLEXIBILITY PROGRAM.

(a) In General.--Section 1820(g) of the Social Security Act
(42 U.S.C. 1395i-4(g)) is amended by adding at the end the
following new paragraph:
``(6) Providing mental health services and other health
services to veterans and other residents of rural areas.--
``(A) Grants to states.--The Secretary may award grants to
States that have submitted applications in accordance with
subparagraph (B) for increasing the delivery of mental health
services or other health care services deemed necessary to
meet the needs of veterans of Operation Iraqi Freedom and
Operation Enduring Freedom living in rural areas (as defined
for purposes of section 1886(d) and including areas that are
rural census tracks, as defined by the Administrator of the
Health Resources and Services Administration), including for
the provision of crisis intervention services and the
detection of post-traumatic stress disorder, traumatic brain
injury, and other signature injuries of veterans of Operation
Iraqi Freedom and Operation Enduring Freedom, and for
referral of such veterans to medical facilities operated by
the Department of Veterans Affairs, and for the delivery of
such services to other residents of such rural areas.
``(B) Application.--
``(i) In general.--An application is in accordance with
this subparagraph if the State submits to the Secretary at
such time and in such form as the Secretary may require an
application containing the assurances described in
subparagraphs (A)(ii) and (A)(iii) of subsection (b)(1).
``(ii) Consideration of regional approaches, networks, or
technology.--The Secretary may, as appropriate in awarding
grants to States under subparagraph (A), consider whether the
application submitted by a State under this subparagraph
includes 1 or more proposals that utilize regional
approaches, networks, health information technology,
telehealth, or telemedicine to deliver services described in
subparagraph (A) to individuals described in that
subparagraph. For purposes of this clause, a network may, as
the Secretary determines appropriate, include Federally
qualified health centers, rural health clinics, home health
agencies, community mental health clinics and other providers
of mental health services, pharmacists, local government, and
other providers deemed necessary to meet the needs of
veterans.
``(iii) Coordination at local level.--The Secretary shall
require, as appropriate, a State to demonstrate consultation
with the hospital association of such State, rural hospitals
located in such State, providers of mental health services,
or other appropriate stakeholders for the provision of
services under a grant awarded under this paragraph.
``(iv) Special consideration of certain applications.--In
awarding grants to States under subparagraph (A), the
Secretary shall give special consideration to applications
submitted by States in which veterans make up a high
percentage (as determined by the Secretary) of the total
population of the State. Such consideration shall be given
without regard to the number of veterans of Operation Iraqi
Freedom and Operation Enduring Freedom living in the areas in
which mental health services and other health care services
would be delivered under the application.
``(C) Coordination with va.--The Secretary shall, as
appropriate, consult with the Director of the Office of Rural
Health of the Department of Veterans Affairs in awarding
grants to States under subparagraph (A).
``(D) Use of funds.--A State awarded a grant under this
paragraph may, as appropriate, use the funds to reimburse
providers of services described in subparagraph (A) to
individuals described in that subparagraph.
``(E) Limitation on use of grant funds for administrative
expenses.--A State awarded a grant under this paragraph may
not expend more than 15 percent of the amount of the grant
for administrative expenses.
``(F) Final report.--Not later than 1 year after the date
on which the last grant is awarded to a State under
subparagraph (A), the Secretary shall submit a report to
Congress on the grants awarded under such subparagraph. Such
report shall include an assessment of the impact of such
grants on increasing the delivery of mental health services
and other health services to veterans of the United States
Armed Forces living in rural areas (as so defined and
including such areas that are rural census tracks), with
particular emphasis on the impact of such grants on the
delivery of such services to veterans of Operation Enduring
Freedom and Operation Iraqi Freedom, and to other individuals
living in such rural areas.''.
(b) Use of Funds for Federal Administrative Expenses.--
Section 1820(g)(5) of the Social Security Act (42 U.S.C.
1395i-4(g)(5)) is amended--
(1) by striking ``beginning with fiscal year 2005'' and
inserting ``for each of fiscal years 2005 through 2008''; and
(2) by inserting ``and, of the total amount appropriated
for grants under paragraphs (1), (2), and (6) for a fiscal
year (beginning with fiscal year 2009)'' after ``2005)''.
(c) Extension of Authorization for FLEX Grants.--Section
1820(j) of the Social Security Act (42 U.S.C. 1395i-4(j)) is
amended--
(1) by striking ``and for'' and inserting ``for''; and
(2) by inserting ``, for making grants to all States under
paragraphs (1) and (2) of subsection (g), $55,000,000 in each
of fiscal years 2009 and 2010, and for making grants to all
States under paragraph (6) of subsection (g), $50,000,000 in
each of fiscal years 2009 and 2010, to remain available until
expended'' before the period at the end.

____________________