[Congressional Record Volume 154, Number 113 (Thursday, July 10, 2008)]
[Senate]
[Pages S6561-S6581]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. CASEY (for himself, Mr. Sanders, and Ms. Mikulski):
  S. 3237. A bill to assist volunteer fire companies in coping with the 
precipitous rise in fuel prices; to the Committee on Banking, Housing, 
and Urban Affairs.
  Mr. CASEY. Mr. President, I rise today to introduce legislation, 
along with my colleagues Senator Sanders and Senator Mikulski, that 
will provide immediate assistance to our Nation's volunteer 
firefighters who have been severely affected by the rising cost of 
gasoline and diesel fuel. This bill, the Supporting America's Volunteer 
Emergency Services Act, or SAVES Act, will establish a new grant 
program at the Department of Housing and Urban Development to help 
qualifying volunteer fire companies cope with the strain that today's 
gas and diesel prices have put on their already tight operating 
budgets. According to the United States Fire Administration, over 
22,141 fire companies, 89 percent of all fire companies in the United 
States, are volunteer or majority volunteer companies. 39 percent of 
our country's population, some 117 million people, relies on these 
volunteer forces to protect their homes and businesses. In recent 
months, I have heard from fire chiefs across Pennsylvania about the 
effect that high gas and diesel prices are having on their daily 
operations. Some have expressed serious concerns that fuel costs are 
preventing them from responding to emergency calls with the amount of 
equipment recommended by their National Fire Protection Association 
guidelines. This poses a serious risk to public safety. Congress has an 
obligation to address this issue, for we simply cannot afford to let 
high gas prices stand in the way of firefighters' ability to provide 
local families and businesses with the help they need.
  I was lucky to have 6 fire chiefs from York County, Pennsylvania, on 
hand today to help me bring attention to this issue. These gentlemen, 
Deputy Chief Barry Emig of the York Area United Fire and Rescue, Deputy 
Chief Joe Madzelan of the Manchester Township Fire Services, Chief 
William Carlisle of the Fairview Township Fire Department, Assistant 
Chief Trever Rentzel of the Manchester Union Fire Company, chief Tony 
Myers of the Shrewsbury Fire Department, and Chief John Senft of York 
City Fire and Rescue, have helped me and others understand the impact 
that high fuel prices have made on each of their departments' bottom 
line. I want to thank them for going above and beyond the call of duty 
to help me in this effort.
  The program created under the SAVES Act would set a baseline gas and 
diesel price using 2007 price data. Each year, volunteer companies that 
wished to participate would submit their annual fuel receipts. They 
would then be eligible to receive 75 percent of the difference between 
how much they paid for gas and diesel that year, and how much that same 
amount of fuel would have cost at 2007 prices. This straightforward, 
commonsense approach will help to ensure that volunteer fire companies 
do not have to restrain their response to emergency calls.
  I would like to thank my colleagues Senator Sanders and Senator 
Mikulski for agreeing to serve as original cosponsors of this important 
legislation. In addition, I appreciate the leadership of Congressman 
Jason Altmire in offering companion legislation in the House of 
Representatives. I hope that my colleagues in the Senate will join me 
in helping to pass the SAVES Act immediately so that our volunteer fire 
companies can receive some much-needed relief on their next trip to the 
pump.
  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. 3237

       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 ``Supporting America's 
     Volunteer Emergency Services Act of 2008''.

     SEC. 2. FINDINGS.

       Congress finds the following:
       (1) According to the Federal Emergency Management 
     Administration, in 2006 there were--
       (A) 807,150 volunteer firefighters, nearly 73 percent of 
     all active firefighters; and
       (B) 19,915 all-volunteer fire companies nationwide, 
     servicing 22.6 percent of the population of the United States 
     and 4,105 companies comprised of a majority of volunteers, 
     servicing 16.3 percent of the population of the United 
     States.
       (2) These volunteer companies, especially those serving 
     communities of fewer than 5,000 residents, rely heavily upon 
     fund-raising efforts and other potentially unreliable sources 
     of funding for their basic operating expenses.
       (3) According to the Energy Information Administration, 
     between June 2003 and June 2008, the price of regular grade 
     gasoline and diesel fuels rose 171 percent and 229 percent, 
     respectively.
       (4) These rising costs represent an unavoidable burden, and 
     have placed serious constraints on the ability of volunteer 
     companies to respond to fire emergencies.

     SEC. 3. DEFINITION OF QUALIFIED VOLUNTEER FIRE DEPARTMENT.

       In this Act, the term ``qualified volunteer fire 
     department'' has the same meaning given that term in section 
     150(e) of the Internal Revenue Code of 1986.

[[Page S6562]]

     SEC. 4. GASOLINE AND DIESEL FUEL SUBSIDY PROGRAM.

       (a) Establishment of Baseline.--
       (1) In general.--The Secretary of Housing and Urban 
     Development shall, for calendar year 2007, determine for each 
     of the 5 Petroleum Administration for Defense Districts the 
     average annual price per gallon for--
       (A) gasoline; and
       (B) diesel fuel.
       (2) Basis for price per gallon.--The average annual price 
     per gallon determined under paragraph (1) shall be based 
     solely on data reported by the Energy Information 
     Administration.
       (3) Baseline.--The price per gallon determined under 
     paragraph (1) shall serve as the baseline fuel cost for each 
     Petroleum Administration for Defense District.
       (b) Payments.--
       (1) Submission of receipts.--At the end of each calendar 
     year, each qualified volunteer fire department seeking 
     reimbursement under this section shall submit to the 
     Secretary of Housing and Urban Development all of its 
     receipts and bills of sales documenting the amounts of 
     gasoline and diesel fuel purchased by such department during 
     that calendar year. Each department shall also provide a sum 
     total of the--
       (A) aggregate number of gallons of gasoline and diesel fuel 
     purchased by the department during that calendar year; and
       (B) costs of purchasing such gasoline and diesel fuel.
       (2) Determination of subsidy amounts.--The Secretary of 
     Housing and Urban Development shall reimburse a qualified 
     volunteer fire department for 75 percent of the difference 
     between--
       (A) the actual expenditures of the department for gasoline 
     and diesel fuel for a calendar year as determined under 
     paragraph (1); and
       (B) the amount that such expenditures would have cost had 
     the department determined such expenditures utilizing the 
     baseline fuels costs determined under subsection (a).
       (3) Special rule relating to states sales tax.--If the 
     State in which a qualified volunteer fire department is 
     located does not charge local or State fuel taxes on such 
     departments when such departments purchase gasoline or diesel 
     fuel, the amount of such omitted sales tax shall be added 
     back in to any determination made under paragraph (2)(A).
       (c) Regulations.--Not later than 60 days after the date of 
     enactment of this Act, the Secretary of Housing and Urban 
     Development shall promulgate such regulations as may be 
     necessary to implement and administer the grant and subsidy 
     programs authorized by this section.

     SEC. 5. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated such sums as are 
     necessary to carry out this Act.
                                 ______
                                 
      By Mr. JOHNSON (for himself, Mr. Enzi, Mr. Tester, Mr. Barrasso, 
        Mrs. McCaskill, Mr. Domenici, Mr. Dorgan, Mr. Allard, Mr. 
        Salazar, and Mr. Nelson of Nebraska):
  S. 3238. A bill to prohibit the importation of ruminants and swine, 
and fresh and frozen meat and products of ruminants and swine, from 
Argentina until the Secretary of Agriculture certifies to Congress that 
every region of Argentina is free of foot and mouth disease without 
vaccination; to the Committee on Agriculture, Nutrition, and Forestry.
  Mr. JOHNSON. Mr. President, I come before the Senate today to discuss 
a critically important issue to the livestock industry in South Dakota 
and across the United States, that being the United States Department 
of Agriculture's, USDA, proposal to regionalize Argentina for Foot-and-
Mouth Disease, or FMD. FMD is a highly contagious and airborne disease 
affecting ruminants and swine. The disease is so destructive that FMD 
is considered to be the most economically devastating of all livestock 
diseases, according to the American Veterinary Medical Association. An 
outbreak in Great Britain in 2001, for example, cost the economy nearly 
$20 billion and led to the slaughter of over 6 million animals. It is 
with concern for the health and viability of our domestic cattle, 
sheep, and swine farmers and ranchers that Senator Enzi joins me today 
in introducing legislation to stop this fundamentally flawed proposal.
  This legislation enjoys significant organizational support from our 
livestock sector, including the American Sheep Industry Association, 
the South Dakota Cattlemen's Association, R-CALF, the South Dakota 
Stockgrowers Association, the U.S. Cattlemen's Association, the 
National Farmers Union, the Western Organization of Resource Councils, 
and Dakota Rural Action. As a highly credible scientific and veterinary 
entity, a poll was take within the National Assembly of State Animal 
Health Officials, NASAHO, and an overwhelming majority of respondents 
are opposed to regionalization of Argentina for FMB. Our South Dakota 
State Veterinarian and the President of NASAHO, Dr, Sam Holland, has 
been invaluable during this process and I thank him for his guidance 
and extensive expertise on this issue. The majority of veterinarians 
within NASAHO oppose regionalizing for FMD for a variety of reasons, 
and Dr. Holland relayed the following causes of concern from State 
veterinarians for USDA's proposed rule: Economic benefits do not 
justify the tremendous risk. Inability to effectively monitor risk. 
Resources, biosecurity, and experience in monitoring freedom are 
inadequate. Regionalization for one of the world's most highly 
contagious virus disease, FMD, is much more complicated than 
regionalization for tuberculosis, brucellosis and many other diseases. 
FMD virus is not only arguably the most contagious virus known for 
animals, but also is particularly resilient in the environment and may 
persist in fomites and be transmitted by such through aerosol or 
contact. Argentina has not experienced an extended timeframe of several 
years of FMD freedom.
  This bill would prohibit the importation of ruminants and swine and 
fresh or frozen ruminant and pork products from any region of Argentina 
until the United States Department of Agriculture can certify to 
Congress that Argentina is free of Foot and Mouth Disease without 
vaccination. While regionalization may be a viable option for other 
livestock diseases, the extremely contagious nature and significant 
economic impact of FMD dictates that we must treat countries as a 
whole, and that a country must demonstrate its ability to remain free 
of FMD. While the USDA is moving to set a precedent with this rule 
regarding its protocol for FMD, this bill is a common sense response 
that USDA's proposal is simply not good policy for American ranchers 
and farmers and for our domestic livestock herds.
  Mr. ENZI. To my friend from South Dakota, I ask whether this 
legislation would interfere with the current status of trade with 
product from countries with a presence of FMD?
  Mr. JOHNSON. My friend from Wyoming raises an excellent question and 
I'm pleased to answer it. It is not our intention or the effect of this 
bill to disrupt the status quo, and our legislation would leave the 
current state of trade intact. Our Code of Federal Regulations allows 
for the importation of certain dried, cured or cooked product from 
countries with a known presence of FMD. This bill will only prohibit 
product that poses a risk for disease transmission, including fresh, 
chilled or frozen, product or live animals.
  Mr. ENZI. Another point of clarification would be why it is necessary 
to specify that no product or live animals should be imported until 
Argentina is free of FMD without vaccination. Can the Senator from 
South Dakota also discuss the intention of that prerequisite?
  Mr. JOHNSON. The Johnson-Enzi bill mandates that Argentina's FMD-free 
status must be achieved without vaccination. This is the acceptable 
standard for trade and also ensures that the disease is truly 
eradicated from the herd, and not suppressed or hidden. While this one 
region in Argentina is thought to be FMD free, this one region within 
Argentina and Argentina as a whole is surrounded by the presence of 
FMD, while the United States has been free of FMD since 1929 and is 
free of FMD without vaccination. Additionally, the United States shares 
borders with our FMD-free neighbors, who are certified as free without 
vaccination.
  As discussed by NASAHO, Argentina has, quite simply, failed to remain 
free of FMD for any length of time, which is a basic component to 
proving the continuity and adequacy of Argentina's infrastructure. As 
recently as 2001, Argentina experienced an FMD outbreak that it failed 
to report for months. This raises serious questions about Argentina's 
approach to communication about this disease in the future, and I don't 
feel that these questions have been adequately answered at this time.
  I thank Senator Enzi and the organizations who have dedicated their 
time and support for this measure, and I will continue to work with my 
colleague from Wyoming in the best interest of our American farmers and 
ranchers.

[[Page S6563]]

  Mr. ENZI. I am pleased to support this bill with my colleague from 
South Dakota. My friend has done an excellent job of explaining how 
this legislation is an important safeguard for our livestock producers, 
and I would like to add a few comments about the continued need for 
vigilance when it comes to animal health threats. A wide range of 
veterinary professionals and livestock producers recognize the threat 
that Foot-and-Mouth Disease poses to the U.S. livestock industry. If 
the United States is to continue producing and selling the highest 
quality meat products in the world, our country must be free of the 
most dangerous ailments that affect the livestock which enter the 
market.
  The economic threat Foot-and-Mouth Disease poses to our country 
cannot be underestimated. Disease outbreaks threaten the livelihood of 
our nation's ranchers and undermine foreign markets for our meat 
products. One can only look to the economic damage Foot-and-Mouth 
Disease caused to Britain in 2001 to gauge how significant this threat 
is to the United States. The highly contagious nature of this disease 
and the growing international trade of livestock equate the 
regionalization of Foot-and-Mouth Disease in Argentina to mixing fire 
with gasoline. I am glad that my colleague mentioned how Foot-and-Mouth 
Disease is unique and that regionalization would not work with this 
disease as it has with other animal ailments.
  Our cattle, sheep, and swine already face a number of animal health 
challenges and now is not the time to open up our country to new 
diseases. Requiring Argentina to be FMD free without using vaccination 
is not asking too much. This is the same condition the United States 
and our neighbors already operate under in the trade of livestock. This 
bill, respected by a large number of state veterinary officials, 
recognizes this threat and ensures that the proper safeguards remain in 
place to prevent Foot-and-Mouth Disease from reaching our shores.
  Mr. President, I ask unanimous consent that the text of the bill and 
letters of support be printed in the Record.
  There being no objection, the material was ordered to be placed in 
the Record, as follows:

                                S. 3238

       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 ``Foot and Mouth Disease 
     Prevention Act of 2008''.

     SEC. 2. PROHIBITION ON IMPORTATION OF ARGENTINE RUMINANTS AND 
                   SWINE UNTIL ARGENTINA IS FREE OF FOOT AND MOUTH 
                   DISEASE WITHOUT VACCINATION.

       The Secretary of Agriculture shall prohibit the importation 
     into the United States of any ruminant or swine, or any fresh 
     (including chilled or frozen) meat or product of any ruminant 
     or swine, that is born, raised, or slaughtered in Argentina 
     until the Secretary certifies to Congress that every region 
     of Argentina is free of foot and mouth disease without 
     vaccination.
                                  ____

                                                     July 7, 2008.
     Hon. Tim Johnson,
     Senate Committee on Banking, Housing and Urban Affairs, 
         Washington, DC.
     Hon. Mike Enzi,
     Senate Committee on Banking, Housing and Urban Affairs, 
         Washington, DC.
       Dear Senators Johnson and Enzi: The American Sheep Industry 
     Association, (ASI) on behalf of the 70,000 farm and ranch 
     families producing lamb and wool in the United States, 
     strongly supports your legislation regarding sheep and meat 
     imports from Argentina.
       This legislation is absolutely critical to the future of a 
     healthy sheep industry in America.
       In fact, the proposal to regionalize trade in live sheep 
     and sheep meat drove industry concerns and questions about 
     the trade and disease risks to point that this is a top issue 
     of the state and national associations of the sheep industry.
       We commit our support for approval of this legislation and 
     commend your leadership in addressing appropriate livestock 
     and meat trade standards on behalf of the nation's livestock 
     industry.
           Sincerely,
                                                  Burdell Johnson,
     ASI President.
                                  ____



                 UNITED STATES CATTLEMEN'S ASSOCIATION
                   P.O. Box 339--San Lucas, CA 93954

       USCA (July 10, 2008)--The U.S. Cattlemen's Association 
     (USCA) today hailed the introduction of legislation in the 
     U.S. Senate that would block meat shipments from Argentina 
     until that country is free of Foot and Mouth Disease (FMD), 
     an airborne livestock disease that is devastating to 
     livestock production.
       Senator Tim Johnson (D-SD) and Senator Mike Enzi (R-WY) 
     introduced the Foot and Mouth Disease Prevention Act of 2008, 
     which would add common sense to a proposal by the U.S. 
     Department of Agriculture (USDA) that would allow importation 
     of Argentine fresh and prepackaged beef, lamb and other meat 
     from select regions of Argentina, as well as live animals.
       ``Cattlemen from across the country appreciate Senator 
     Johnson and Senator Enzi along with the other co-sponsors of 
     this important legislation,'' said Jon Wooster, a California 
     rancher and USCA president. ``We're calling it the `Keep 
     America FMD-Free bill'.''
       Wooster explained that an outbreak of FMD within the U.S. 
     cattle industry would bring livestock commerce to a 
     standstill overnight and would likely result in the 
     depopulation of millions of cattle, hogs, lambs, goats and 
     wildlife.
       The American Veterinary Medical Association has deemed FMD 
     the most economically devastating of all livestock disease. A 
     recent study by Kansas State University found that an 
     outbreak of FMD would cost the State of Kansas alone nearly 
     $1 billion.
       ``Despite the risks, the Department of Agriculture 
     continues to consider the implementation of a regionalized 
     beef trade plan with Argentina,'' noted Wooster. ``FMD is an 
     airborne disease that will not stop at an imaginary border 
     controlled by a foreign nation. Argentina has proven time and 
     time again that it does not have America's best interests at 
     heart. This is a country that has attacked U.S. agriculture 
     in the World Trade Organization (WTO) and has intentionally 
     turned its back on, and still refuses to pay, billions in 
     U.S. loans despite U.S. court judgments mandating it do so.'' 
     .
       Senators Tim Johnson (D-SD) and Mike Enzi (R-WY) along with 
     Senators Jon Tester (D-MT), John Barrasso (R-WY), Claire 
     McCaskill (D-MO), Pete Domenici (R-NM), Byron Dorgan (D-ND), 
     Ken Salazar (D-CO), and Wayne Allard (R-CO) are co-sponsors 
     of the Foot and Mouth Disease Prevention Act of 2008. USCA 
     has worked diligently to maintain import standards that will 
     keep the U.S. cattle industry on the offensive rather than 
     the defensive when it comes to controlling the introduction 
     of foreign animal disease into the U.S.
       ``We will continue to work on moving this bill forward by 
     adding co-sponsors and garnering support both on Capitol Hill 
     and in the country. USCA is firmly resolved to ensuring the 
     U.S. cattle industry is protected by the highest import 
     standards possible, and to seeing that the `Keep America FMD-
     Free' bill becomes law,'' said Wooster.
                                  ____



                                       National Farmers Union,

                                    Washington, DC, July 10, 2008.
     Hon. Tim Johnson,
     U.S. Senate,
     Washington, DC.
       Dear Senator Johnson: On behalf of the family farmers, 
     ranchers and rural residents of National Farmers Union (NFU), 
     I write in strong support of your legislation to prohibit the 
     importation of Argentine ruminants, swine, fresh and frozen 
     meat, and products from ruminants and swine until the U.S. 
     Department of Agriculture (USDA) Secretary certifies the 
     country Foot and Mouth Disease (FMD) free. I applaud your 
     leadership to ensure all measures are employed to protect the 
     American livestock industry and consumer confidence in our 
     meat supply.
       The ban proposed in your legislation is necessary in order 
     to prevent jeopardizing our own efforts to eradicate 
     livestock diseases, and thereby protecting the food supply. 
     Your legislation enhances food safety through requiring every 
     region of Argentina to be FMD-free without vaccination before 
     exporting ruminants, swine and meat products to the United 
     States.
       FMD is a highly infectious virus that, if introduced into 
     the United States, could contaminate entire herds and leave 
     producers in financial ruin, as infected herds must be culled 
     to prevent the spread of the disease. FMD is so devastating 
     the American Veterinary Medical Association considers it to 
     be the most economically destructive of all livestock 
     diseases. The United States suffered nine outbreaks of FMD in 
     the early twentieth century, but has been FMD-free since 
     1929. According to USDA's Animal and Plant Health Inspection 
     Service, the economic impacts of a re-occurrence of FMD in 
     the United States could cost the economy billions of dollars 
     in the first year alone.
       America's family farmers and ranchers produce the safest, 
     most abundant food supply in the world. FMD presents a very 
     real threat to American agriculture and its introduction into 
     the United States can and must be prevented. Requiring a 
     country like Argentina, with such an apparent problem with 
     this devastating disease, to prove FMD-free status is an 
     acceptable standard to trade. Opening our borders to 
     Argentine ruminant products is a risk that American producers 
     simply cannot afford. Your legislation is needed to ensure 
     harmful products are not allowed into the United States and 
     that Argentina is not an exception to the rule.
       I thank you for introducing this important legislation, and 
     look forward to working with you to ensure its passage.
           Sincerely,
                                                         Tom Buis,
                                President, National Farmers Union.

[[Page S6564]]

     
                                  ____
                                        R-CALF United Stockgrowers


                                                   of America,

                                       Billings, MT, July 3, 2008.
     Hon. Tim Johnson,
     U.S. Senate,
     Washington, DC.
       Dear Senator Johnson, On behalf of the thousands of cattle-
     producing members of R-CALF USA located throughout the United 
     States, we greatly appreciate and strongly support your 
     legislation to prohibit the importation of certain animals 
     and animal products from Argentina until every region of 
     Argentina is free of foot and mouth disease without 
     vaccination.
       Foot and mouth disease (FMD) is recognized internationally 
     as one of the most contagious diseases of cloven-hoofed 
     animals and it bears the potential to cause severe economic 
     losses to U.S. cattle producers. Your legislation recognizes 
     that the most effective prevention measure against this 
     highly contagious disease is to ensure that it is not 
     imported into the United States from countries where FMD is 
     known to exist or was recently detected.
       R-CALF USA stands ready to assist you in building both 
     industry and congressional support for this important, 
     disease-prevention measure. Thank you for initiating this 
     needed legislation to protect the U.S. cattle industry from 
     the unnecessary and potentially dangerous exposure to FMD 
     from Argentinean imports.
           Sincerely,
                                                 R.M. Thornsberry,
     President, R-CALF USA Board of Directors.
                                  ____

                                                      South Dakota


                                      Cattlemen's Association,

                                        Pierre, SD, July 10, 2008.
     Senator Tim Johnson,
     Hart Senate Office Building,
     Washington, DC
     Senator Mike Enzi,
     Russell Senate Office Building,
     Washington, DC.
       Dear Senators Johnson and Enzi: I am writing on behalf of 
     the 1,000 beef producer members of the South Dakota 
     Cattlemen's Association (SDCA) to express support for the 
     Foot and Mouth Disease Prevention Act of 2008. SDCA supports 
     free and fair trade based on OIE standards that will protect 
     the health of our cattle herd and the economic livelihood of 
     our cattlemen.
       Our top trade priority is to regain market access for U.S. 
     beef in order to recapture the lost value of exports that 
     occurred after the occurrence of BSE in 2003. To that end, 
     we've worked closely with elected and regulatory officials to 
     ensure adequate measures are taken to protect our herd health 
     and maintain consumer confidence in U.S. beef.
       In light of numerous unanswered questions regarding the 
     status of Foot and Mouth Disease in Argentina, we believe 
     passage of the Foot and Mouth Disease Prevention Act is 
     critical to ensure this devastating disease doesn't enter the 
     U.S. cattle herd through the importation of Argentine cattle 
     and beef products. We commend your willingness to stand up 
     for South Dakota's beef producers and look forward to working 
     with you on this important issue.
           Regards,
                                                    Jodie Hickman,
     Executive Director.
                                  ____



                                   South Dakota Farmers Union,

                                Huron, South Dakota, July 9, 2008.
     Hon. Tim Johnson,
     U.S. Senate,
     Washington, DC.
       Dear Senator Johnson: On behalf of the family farmers and 
     ranchers of the South Dakota Farmers Union (SDFU), I write to 
     express support of your legislation The Foot and Mouth 
     Disease Prevention Act of 2008 to require the U.S. Department 
     of Agriculture (USDA) to prevent the importation of livestock 
     from Argentina until the USDA can certify that Argentina is 
     free of Foot and Mouth Disease (FMD) without vaccination.
       As you know, the possibility of the importing live animals 
     and fresh meat with FMD would put our herds at risk and cause 
     an economic hardship for our producers. The devastation that 
     FMD can cause was seen first hand in England in 2001. SDFU 
     fears that a similar situation would have severe economic 
     consequences not only for producers in our state but 
     nationwide. Your legislation is a proactive measure that will 
     insure that this does not occur. As a result, until USDA 
     certifies that Argentina is free of FMD, the importation of 
     live stock and meat product should not be allowed. We owe it 
     to both producers and consumers to protect their livestock 
     herd and provide a safe food product.
       SDFU fully supports your legislation to require USDA to 
     certify Argentina free of FMD. I look forward to working with 
     you and your colleagues for a quick passage of this important 
     legislation to help protect American livestock producers and 
     consumers.
           Sincerely,
                                                      Doug Sombke,
                                                        President.
                                 ______
                                 
      By Mr. FEINGOLD (for himself, Mr. Dodd, and Mr. Menendez):
  S. 3239. A bill to prohibit the Secretary of the Interior from 
issuing new Federal oil and gas leases to holders of existing leases 
who do not diligently develop the land subject to the existing leases 
or relinquish the leases, and for other purposes; to the Committee on 
Energy and Natural Resources.
  Mr. FEINGOLD. Mr. President, I would like to talk about the strong 
concerns I am hearing back home about gas and diesel prices and about a 
bill I am introducing today in response to those concerns.
  We all know that over the past 12 months, the price of a gallon of 
gas has risen over a dollar, from around $3 last year to over $4 today. 
Diesel has increased from $2.91 a year ago to $4.72 per gallon today.
  At the listening sessions I hold in every county of my State each 
year, Wisconsinites are, of course, talking about how those soaring oil 
prices are hurting their pocketbooks. And it is not just at the pump. 
They are feeling the pain also at the grocery store, on the farm, and 
at the ticket counter. Those high fuel prices are having a rippling 
effect throughout our entire economy. Wisconsinites, like Americans all 
around the country, are feeling squeezed. With no relief in sight, the 
anxiety and tension keep building. Americans are emotionally, 
physically, and financially drained. My colleague from Minnesota, 
Senator Klobuchar, had it right when she stated that Americans are 
running on empty.
  Here is what I am hearing from Wisconsinites. One constituent told 
me:

       I have done everything I can to use as little gas as 
     possible, even before prices got so high. My two-parent 
     family (with two children) has only one car. I ride my 
     bicycle or walk to work and use the car as little as 
     possible. However, the rising cost of fuel is causing higher 
     prices for food and other necessities which are becoming more 
     difficult for my family and others.

  From another parent:

       I have an adorable child I am trying to raise on a budget 
     that no longer reaches from paycheck to paycheck. I currently 
     work an hour away from where I live as the jobs are not 
     available in [my] area. Between the rising price of gas, 
     electric/heat and food, my husband and I can barely pay our 
     mortgage.

  I have heard from many others who are struggling as they care for 
elderly parents. One lady has a mother in a nursing home, and she used 
to visit her three times a week. However, with the nursing home 20 
miles away and high fuel prices, now she can only afford to visit her 
mother once a week. That, to me, is a very poignant example--one of so 
many examples--of the real human impact these gas prices have.
  Even those who have managed their money well and have saved are 
struggling. One constituent commented that he had planned to put extra 
money toward retirement and pay down debt. With the high fuel prices, 
he does not have any extra money and is worried that he will end up on 
government assistance at the age of 57.
  There are more letters and more e-mails and more phone calls. The 
high cost of driving affects all kinds of people and livelihoods. It 
affects kids whose parents cannot drive them across town to a friend's 
house or to soccer practice because they have to conserve gas to get to 
work. It affects young students and senior citizens who are on fixed 
incomes. Small businesses are finding they need to increase prices to 
cover increased transportation costs. Farmers are, of course, feeling 
the pinch in one way or another, whether it be fertilizer or fuel or 
transportation or feed for livestock and dairy farmers.

  All over the country, people have resorted to alternative forms of 
transportation in an effort to escape these costs. There is a range of 
positive proposals to improve systems in Wisconsin from the Kenosha-
Racine-Milwaukee commuter rail, extending Amtrak to Madison, or just 
adding buses or routes. While I strongly support long-term plans to 
invest in mass transit, I also recognize that at least for the time 
being in many parts of Wisconsin and in this country, it is unrealistic 
for many to rely on mass transportation. Commuting to work, be it 
across a large city or between two towns, is a gas- and dollar-guzzling 
task that many people cannot avoid or, increasingly, afford.
  For the large number of Americans living in predominantly rural 
areas, this is especially challenging due to the typically longer trips 
and fewer transportation options. So Wisconsinites want to know: When 
is the Federal Government going to provide some relief?
  With my support, Congress has made some progress. Last December we 
enacted energy legislation, H.R. 6, that

[[Page S6565]]

raises corporate average fuel economy standards for vehicles while 
protecting American jobs. It also increases the requirement for 
alternative fuels from 8.5 billion gallons in 2008 to 36 billion 
gallons in 2022. I also recently cosponsored an amendment to make the 
Federal Government stop filling the Strategic Petroleum Reserve, which 
is 97 percent full. Fortunately, Congress passed this legislation, and 
the administration finally agreed to stop taking oil off the market to 
store it underground. The bill, H.R. 6022, was signed into law in May.
  We also made some progress in preventing market manipulation. I 
cosponsored the Oil and Gas Traders Oversight Act, S. 577, which would 
help ensure that the previously unregulated trading commodities are 
subject to greater Federal oversight by requiring the reporting of 
trades, and then a similar provision was included in the final version 
of the farm bill which was recently enacted.
  These are positive steps, but much more needs to be done. So today I 
am introducing legislation that seeks to answer a question more and 
more Americans are asking, which is: Why aren't the oil companies 
developing 66 million acres of land that they are already leasing from 
the U.S. Government? Those same companies, and some of my colleagues, 
say we need to open more Federal lands to drilling. Well, I guess I 
would like to know then why the oil companies are not producing on most 
of the Federal lands they already have under lease.
  At a recent Senate Judiciary Committee hearing, I actually had the 
chance to ask the top five oil executives in the country just that 
question, and it was incredible. They couldn't come up with any good 
explanation at all. In fact, one of the executives told me they have 
the manpower and the infrastructure to put all of their existing leases 
of Federal lands into oil production.
  I find this troubling. No one is talking about pulling oil out of a 
hat, but with 75 percent of currently leased Federal lands and waters 
not producing oil and gas, Congress needs to insist on some 
accountability on this point. This is why today I am introducing the 
Responsible Federal Oil and Gas Lease Act. This bill says if oil and 
gas companies want to lease additional lands, they must either be 
producing or diligently developing their existing Federal leases, or 
they have to give up those leases. This way, if a company makes the 
business decision to terminate or not pursue exploration, then the 
lease will be made available to other companies who might actually 
drill or figure out a way to get some oil out of this land. This is a 
responsible way to increase production and keep the private sector 
accountable for production.
  So with over 100 billion barrels of oil under Federal lands and 
waters that are being leased or are available for leasing, Congress 
must properly encourage their development, and oil companies should use 
the land they already have before coming to Congress, hat in hand, 
asking for more land.
  This bill is similar to legislation introduced by Representative 
Rahall which the House considered last month. I will work to make sure 
the Senate follows their lead. I am also cosponsoring a bill introduced 
by my colleague who is on the Senate floor, my good friend Senator 
Dodd, that encourages oil companies to utilize the land they have been 
granted by making them pay fees on land under lease but not in 
production.
  There are a number of other steps Congress should take, including 
addressing the role of excess speculation in the energy futures market 
and clamping down on OPEC's price fixing. I am a cosponsor of S. 879, 
which would authorize the Justice Department and the FTC to sue foreign 
countries under U.S. antitrust law for limiting the supply or fixing 
the price of oil. Also, of course, we need to aggressively pursue 
alternative fuels, efficiency, and renewable energy because the facts 
show that even if we drilled every corner of the country, and offshore 
too, that wouldn't solve our energy problems.
  In the long term, the Government's Energy Information Administration 
reports that opening more Outer Continental Shelf regions to drilling 
``would not have a significant impact on domestic crude and natural oil 
gas production or prices before 2030,'' nor will it significantly 
affect prices after 2030, the agency reports, ``because oil prices are 
determined on the international market.'' In short, the facts are 
telling us that we simply cannot just drill our way out of this, and 
more drilling does not necessarily mean lower prices at the pump.
  Unfortunately, a minority of Senators have repeatedly blocked efforts 
to expand renewables and address price gouging and excess energy market 
speculation. I sincerely hope we can get beyond this partisan 
bickering. My constituents don't want finger-pointing or name calling; 
they want some relief, and they deserve it. They also deserve to know 
that we are pressing forward on plans that embrace a new energy future.
  Thirty years ago, our Nation was rattled by our reliance on oil. If I 
am still here in 30 years, for the sake of my constituents, I hope we 
will have succeeded at diversifying our energy uses and oil does not 
still have a stranglehold over our citizens and the economy.
                                 ______
                                 
      By Mr. BIDEN (for himself, Mr. Specter, Mr. Cardin, and Mr. 
        Kerry):
  S. 3245. A bill to increase public confidence in the justice system 
and address any unwarranted racial and ethnic disparities in the 
criminal process; to the Committee on the Judiciary.
  Mr. BIDEN. Mr. President, the Constitution guarantees all Americans 
the right to the equal protection of the law. Nowhere is the guarantee 
of equal protection more important than in our criminal justice system. 
In a criminal justice system that imprisons a record 2.3 million, even 
the perception of bias on the basis of race, ethnicity, or any other 
protected class is unacceptable and should be guarded against at all 
costs.
  Unfortunately, studies, reports, and case law from the last several 
years have documented racial disparities during many of the stages of 
the criminal justice system--law enforcement contact with a suspect, 
arrest, charging, plea bargaining, jury selection, and sentencing. 
Nowhere are the effects of these racial disparities more evident than 
in our prisons. By some estimates, nearly three-quarters of prisoners 
in the United States are either African-American or Hispanic. One of 
every three African-American men born today can expect to go to prison 
in his lifetime. These numbers, and studies and reports that show 
similar disparities during other stages of the criminal justice 
process, engender a crisis of public trust in the integrity of our 
criminal justice system and raise the possibility that we are failing 
to make good on the constitutional promise of equal protection.
  Both the reality and the perception of inappropriate disparate 
treatment of minorities in the justice system erode respect for the law 
and undermine public safety.
  Communities become increasingly reluctant to report crimes to and 
cooperate with police and prosecutors. They become reluctant to 
participate in juries and, when they do participate, to vote for 
conviction where the defendant is a minority. To fulfill the promise of 
the Constitution, and to effectively fight crime and deliver impartial 
justice, it is essential to identify and address unjustified 
disparities in the criminal justice system.
  The Justice Integrity Act establishes a pilot program within the 
Justice Department to identify and eliminate unjustified disparities in 
the administration of justice. Ten U.S. Attorneys designated by the 
Attorney General will each appoint and chair an advisory group, 
composed of Federal and State prosecutors and defenders, private 
defense counsel, Federal and State judges, correctional officers, 
victims' rights representatives, Civil Rights organizations, business 
representatives and faith-based organizations engaged in criminal 
justice work.
  The advisory group will systematically gather and examine data 
regarding the criminal process in its district and seek to determine 
the causes of any racial or ethnic disparity. The advisory group will 
produce a report on its findings and recommend a plan to reduce any 
unwarranted racial and ethnic disparities and thereby increase public 
confidence in the criminal justice system. The U.S. Attorney will 
consider the advisory group's recommendations and adopt a plan and

[[Page S6566]]

submit a report to the Attorney General. At the end of the pilot 
program, the Attorney General will produce a comprehensive report to 
Congress on the results of the pilot program in all ten districts and 
recommend best-practices.
  The Justice Integrity Act has been endorsed by the National Criminal 
Justice Association, The Sentencing Project, the American Bar 
Association, and a number of former United States Attorneys. I am proud 
to introduce this important bill with the support of my colleagues and 
friends--Senators Arlen Specter, John Kerry, and Ben Cardin. We urge 
other members to join us.
  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 
placed in the Record, as follows:

                                S. 3245

       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 ``Justice Integrity Act of 
     2008''.

     SEC. 2. FINDINGS.

       Congress finds that--
       (1) the pursuit of justice requires the fair application of 
     the law;
       (2) racial and ethnic disparities in the criminal process 
     have contributed to a growing perception of bias in the 
     criminal justice system;
       (3) there are a variety of possible causes of disparities 
     in criminal justice statistics among racial and ethnic groups 
     and these causes may differ throughout the United States, 
     including factors such as--
       (A) varying levels of criminal activity among racial and 
     ethnic groups and legitimate law enforcement response to that 
     criminal activity; and
       (B) racial discrimination, ethnic and cultural 
     insensitivity, or unconscious bias;
       (4) the Nation would benefit from an understanding of all 
     factors causing a disparate impact on the criminal justice 
     system; and
       (5) programs that promote fairness will increase public 
     confidence in the criminal justice system, increase public 
     safety, and further the pursuit of justice.

     SEC. 3. PILOT PROGRAM.

       (a) In General.--Not later than 90 days after the date of 
     enactment of this Act, the Attorney General shall establish a 
     pilot program in 10 United States districts in order to 
     promote fairness, and the perception of fairness, in the 
     Federal criminal justice system, and to determine whether 
     legislation is required.
       (b) Program Requirements.--
       (1) U.S. attorneys.--The Attorney General shall designate, 
     in accordance with paragraph (3), 10 United States Attorneys 
     who shall each implement a plan in accordance with section 4, 
     beginning not later than 1 month after those United states 
     Attorneys are designated by the Attorney General.
       (2) Purpose.--The purposes of the plans required by this 
     section are--
       (A) to gather racial and ethnic data on investigations and 
     prosecutions in the United States districts and the causes of 
     disparities, if any;
       (B) to determine the extent to which the communities' 
     perception of bias has affected confidence in the Federal 
     criminal justice system;
       (C) to analyze whether measures may be taken to reduce 
     unwarranted disparities, if any, and increase confidence in 
     the criminal justice system; and
       (D) to make recommendations, to the extent possible, to 
     ensure that law enforcement priorities and initiatives, 
     charging and plea bargaining decisions, sentencing 
     recommendations, and other steps within the criminal process 
     are not influenced by racial and ethnic stereotyping or bias, 
     and do not produce unwarranted disparities from otherwise 
     neutral laws or policies.
       (3) Criteria for selection.--
       (A) In general.--The 10 pilot districts referred to in 
     subsection (a) shall include districts of varying 
     compositions with respect to size, case load, geography, and 
     racial and ethnic composition.
       (B) Metropolitan areas.--At least 3 of the United States 
     attorneys designated by the Attorney General shall be in 
     Federal districts encompassing metropolitan areas.

     SEC. 4. PLAN AND REPORT.

       (a) In General.--
       (1) United states attorney.--Each United States Attorney 
     shall, in consultation with an advisory group appointed in 
     accordance with paragraph (2), develop and implement a plan 
     in accordance with subsections (b) and (c).
       (2) Advisory group.--
       (A) Appointment.--Not later then 90 days after designation 
     by the Attorney General, the United States Attorney in each 
     of the 10 pilot districts selected pursuant to section 3 
     shall appoint an advisory group, after consultation with the 
     chief judge of the district and criminal justice 
     professionals within the district.
       (B) Membership.--The advisory group of a United States 
     Attorney shall include--
       (i) 1 or more senior social scientists with expertise in 
     research methods or statistics; and
       (ii) individuals and entities who play important roles in 
     the criminal justice process and have broad-based community 
     representation such as--

       (I) Federal and State prosecutors;
       (II) Federal and State defenders, if applicable in the 
     district, and private defense counsel;
       (III) Federal and State judges;
       (IV) Federal and State law enforcement officials and union 
     representatives;
       (V) parole and probation officers;
       (VI) correctional officers;
       (VII) victim's rights representatives;
       (VIII) civil rights organizations;
       (IX) business and professional representatives; and
       (X) faith-based organizations who do criminal justice work.

       (C) Term limit.--Subject to subparagraph (D), a member of 
     the advisory group shall not serve longer than 5 years.
       (D) Permanent members.--Notwithstanding subparagraph (C), 
     the following shall be permanent members of the advisory 
     group for that district:
       (i) The chief judge for the judicial district.
       (ii) The Federal defender for the judicial district.
       (iii) The United States Attorney for the judicial district.
       (E) Reporter.--The United States Attorney may designate a 
     reporter for each advisory group, who may be compensated in 
     accordance with guidelines established by the Executive 
     Office of the United States Attorneys.
       (F) Independent contractors.--The members of an advisory 
     group of a United States Attorney and any person designated 
     as a reporter for such group--
       (i) shall be considered independent contractors of the 
     United States Attorney's Office when in the performance of 
     official duties of the advisory group; and
       (ii) may not, solely by reason of service on or for the 
     advisory group, be prohibited from practicing law before any 
     court.
       (b) Development and Implementation of a Plan and Report.--
       (1) Advisory group report.--The advisory group appointed 
     under subsection (a)(2) shall--
       (A)(i) systematically collect and analyze quantitative data 
     on the race and ethnicity of the defendant and victim at each 
     stage of prosecution, including case intake, bail requests, 
     declinations, selection of charges, diversion from 
     prosecution or incarceration, plea offers, sentencing 
     recommendations, fast-track sentencing, and use of 
     alternative sanctions; and
       (ii) at a minimum, collect aggregate data capable of 
     individualization and tracking through the system so that any 
     cumulative racial or ethnic disadvantage can be analyzed;
       (B) seek to determine the causes of racial and ethnic 
     disparities in a district, and whether these disparities are 
     substantially explained by sound law enforcement policies or 
     if they are at least partially attributable to 
     discrimination, insensitivity, or unconscious bias;
       (C) examine the extent to which racial and ethnic 
     disparities are attributable to--
       (i) law enforcement priorities, prosecutorial priorities, 
     the substantive provisions of legislation enacted by 
     Congress; or
       (ii) the penalty schemes enacted by Congress or implemented 
     by the United States Sentencing Commission;
       (D) examine data including--
       (i) the racial and ethnic demographics of the United States 
     Attorney's district;
       (ii) defendants charged in all categories of offense by 
     race and ethnicity, and, where applicable, the race and 
     ethnicity of any identified victim;
       (iii) substantial assistance motions, whether at sentencing 
     or post-conviction, by race and ethnicity;
       (iv) charging policies, including decisions as to who 
     should be charged in Federal rather than State court when 
     either forum is available, and whether these policies tend to 
     result in racial or ethnic disparities among defendants 
     charged in Federal court, including whether relative 
     disparities exist between State and Federal defendants 
     charged with similar offenses;
       (v) the racial and ethnic composition of the Federal 
     prosecutors in the district; and
       (vi) the extent to which training in the exercise of 
     discretion, including cultural competency, is provided 
     prosecutors;
       (E) consult with an educational or independent research 
     group, if necessary, to conduct work under this subsection; 
     and
       (F) submit to the United States Attorney by the end of the 
     second year after their initial appointment a report and 
     proposed plan, which shall be made available to the public 
     and which shall include--
       (i) factual findings and conclusions on racial and ethnic 
     disparities, if any, and the State of public confidence in 
     the criminal process;
       (ii) recommended measures, rules, and programs for reducing 
     unjustified disparities, if any, and increasing public 
     confidence; and
       (iii) an explanation of the manner in which the recommended 
     plan complies with this paragraph.
       (2) Adoption of plan.--Not later than 60 days after 
     receiving and considering the advisory group's report and 
     proposed plan under paragraph (1), the United States Attorney 
     appointed under section 3 shall adopt and implement a plan.

[[Page S6567]]

       (3) Copy of report.--The United States Attorney shall 
     transmit a copy of the plan and report adopted and 
     implemented, in accordance with this subsection, together 
     with the report and plan recommended by the advisory group, 
     to the Attorney General. The United States Attorney shall 
     include with the plan an explanation of any recommendation of 
     the advisory group that is not included in the plan.
       (4) Congress.--The Attorney General shall transmit to the 
     United States Attorney's in every Federal district and to the 
     Committees on the Judiciary of the Senate and the House of 
     Representatives copies of any plan and accompanying report 
     submitted by a pilot district.
       (c) Periodic United States Attorney Assessment.--After 
     adopting and implementing a plan under subsection (b), each 
     United States attorney in a pilot district shall annually 
     evaluate the efficacy of the plan. In performing such 
     assessment, the United States attorney shall consult with the 
     advisory group appointed in accordance with subsection 
     (a)(2). Each assessment shall be submitted to the Executive 
     Office for United States attorneys for review in accordance 
     with subsection (d).
       (d) Information on the Pilot Program.--
       (1) Report and model plan.--Not later than 5 years after 
     the date of the enactment of this Act, the Attorney General 
     shall--
       (A) prepare a comprehensive report on all plans received 
     pursuant to this section;
       (B) based on all the plans received pursuant to this 
     section the Attorney General shall also develop one or more 
     model plans; and
       (C) transmit copies of the report and model plan or plans 
     to the Committees on the Judiciary of the Senate and the 
     House of Representatives.
       (2) Continued oversight.--The Attorney General shall, on a 
     continuing basis--
       (A) study ways to reduce unwarranted racial and ethnic 
     disparate impact in the Federal criminal system; and
       (B) make recommendations to all United States attorneys on 
     ways to improve the system.

     SEC. 5. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated $3,000,000 for use, 
     at the discretion of the Attorney General, by the United 
     States Attorneys' advisory groups in the development and 
     implementation of plans under this Act.
                                 ______
                                 
      By Mr. CARDIN (for himself, Ms. Snowe, and Ms. Mikulski):
  S. 3246. A bill to amend the Internal Revenue Code of 1986 to allow 
the Secretary of the Treasury to set the standard mileage rate for use 
of a passenger automobile for purposes of the charitable contributions 
deduction; to the Committee on Finance.
  Mr. CARDIN. Mr. President, I rise today to introduce a bill, the Fair 
Deal for Volunteers Act. In today's economic climate, Americans need 
relief from sky-rocketing oil and gas prices. This applies to everyone, 
including people who engage in much-needed volunteer work. My bill will 
provide immediate relief for volunteers serving our elderly, poor, 
frail, and at-risk Americans. It gives the Internal Revenue Service 
authority to change the mileage rate--currently set by statute at 14 
cents per mile--for calculating the deductible cost of operating a 
vehicle for charitable purposes. We can't let an out-of-date mileage 
rate exacerbate the pinch at the pump for volunteers who selflessly 
provide so many vital goods and services in every community across 
America. I'm pleased that the senior Senator from Maine, Senator Snowe, 
and my colleague, the senior Senator from Maryland, Senator Mikulski, 
are original cosponsors of this bill and I thank them for their 
support.
  The Internal Revenue Code does not fix a rate for individuals who are 
required to use their own vehicle for work, or for individuals taking a 
mileage deduction for moving purposes. The IRS is able to increase the 
deduction amount for these purposes to reflect the current economic 
climate and dramatically higher fuel prices. This is exactly what the 
IRS recently did.
  As of July, the IRS modified the standard mileage rates for computing 
the deductible costs of operating an automobile for business, medical, 
or moving expenses. The revised standard mileage rate for business 
purposes increased from 50.5 cents per mile to 58.5 cents. For medical 
and moving expenses, the IRS increased the rate from 19 cents per mile 
to 27 cents per mile. I think the Nation's volunteers who travel on 
behalf of charitable organizations deserve an increase in their mileage 
rate, too.
  My bill gives the IRS flexibility in setting the rate so that 
volunteers for charitable organizations could be given the same tax 
benefit accruing for moving, medical, and business expenses. In today's 
climate of increasing food and fuel prices, this bill will help relieve 
some of the pressure on charitable organizations and their volunteers.
  Take Meals on Wheels, for example. This organization delivers 
nutritious meals and other nutrition services to men and women who are 
elderly, homebound, disabled, frail, or otherwise at-risk. The services 
Meals on Wheels provides significantly improve the recipients' quality 
of life and health, and often help to postpone institutionalization.
  Over the past year, there has been nearly a 20 percent increase in 
fuel and food prices, coupled with reduced government funding and fewer 
donations across the country. Nearly 60 percent of the estimated 5,000 
programs that operate under the auspices of the Meals on Wheels 
Association of America have lost volunteers, in large part because it 
is too expensive for the volunteers to drive back and forth. Nearly 
half the programs have eliminated routes or consolidated meal services. 
About 38 percent of the programs have switched to delivering frozen 
meals, and about 30 percent are cutting personal visits from 5 days a 
week to one.
  In Maryland, the Central Maryland Meals on Wheels has experienced an 
increase of 7 percent in food costs and suppliers are charging higher 
delivery fees. The cost to fill up the vans with gas has increased. 
Fuel costs averaged $72,538.70 in fiscal year 2007; this year, the 
costs have jumped to $86,790.63. This is an organization with 
volunteers serving over 3,100 elderly, disabled, frail and at-risk 
Marylanders. Its volunteers deserve relief from high gas prices just as 
much as people who use their car for work or for medical purposes or 
for moving.
  Throughout the United States, Meals on Wheels served over 3 million 
people and more than 250 million meals in fiscal year 2006. This is 
just one of thousands of charitable organizations. We need to encourage 
and support the Meals on Wheels volunteers and all other volunteers who 
need their cars to help their neighbors and communities. The Fair Deal 
for Volunteers Act will do just that, and I hope my colleagues will 
support it.
  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. 3246

       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 ``Fair Deal for Volunteers Act 
     of 2008''.

     SEC. 2. DETERMINATION OF STANDARD MILEAGE RATE FOR CHARITABLE 
                   CONTRIBUTIONS DEDUCTION.

       (a) In General.--Subsection (i) of section 170 of the 
     Internal Revenue Code of 1986 (relating to standard mileage 
     rate for use of passenger automobile) is amended to read as 
     follows:
       ``(i) Standard Mileage Rate for Use of Passenger 
     Automobile.--For purposes of computing the deduction under 
     this section for use of a passenger automobile, the standard 
     mileage rate shall be the rate determined by the 
     Secretary.''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to miles traveled after the date of the enactment 
     of this Act.
                                 ______
                                 
      By Mr. LIEBERMAN (for himself, Ms. Collins, and Ms. Cantwell):
  S. 3248. A bill to amend the Commodity Exchange Act to clarify 
treatment of purchases of certain commodity futures contracts and 
financial instruments with respect to limits established by the 
Commodity Futures Trading Commission relating to excessive speculation, 
and for other purposes; to the Committee on Agriculture, Nutrition, and 
Forestry.
  Mr. LIEBERMAN. Mr. President, today I am introducing legislation, the 
Commodity Speculation Reform Act of 2008, with my colleague Senator 
Collins, the ranking minority member of our Homeland Security and 
Governmental Affairs Committee. The legislation is designed to wring 
out of the commodity markets the excessive speculation--and I stress 
the word ``excessive''--that we believe has helped lead to the sudden 
and soaring spikes in the prices Americans pay for food and energy.
  We are going to do this by returning the commodity markets to what 
they

[[Page S6568]]

were meant to be--a place where producers and consumers of specific 
commodities can enter into futures contracts that help hedge the risks 
of price fluctuations common to their industries.
  These commodity market traders--farmers, airlines, refineries--
actually intend to produce or take delivery of specific commodities as 
part of doing business.
  On the other hand, financial speculators, including pension funds, 
university endowments, and other large institutional investors, have 
poured billions and billions of dollars into these markets over the 
past 5 years betting on rising prices--and let's make it clear, that 
these are bets--without ever intending to actually own a barrel of oil 
or a bushel of corn. They are looking for nothing more than paper 
profits.
  In a series of hearings held by our Homeland Security and 
Governmental Affairs Committee, we heard testimony that this kind of 
excessive speculation in the commodity markets may have added as much 
as $40 to $60 to the cost of a barrel of oil.
  Some say these figures are too high. But I would say that even a 
single dollar increase due to excessive speculation is a dollar too 
much because of the inflationary effect it can have not only on the 
U.S. economy, but around the world.
  Consider this: according to the Air Transport Association, every $1 
increase in the price of a barrel of crude oil adds $470 million a year 
in jet fuel costs--almost half a billion dollars--to the U.S. airline 
industry. These costs are passed on to consumers in the forms of higher 
ticket prices and other surcharges that are now keeping potential 
passengers on the ground and has the industry reeling.
  These increases directly hit consumers in the global economy through 
higher gas and food prices. Moreover, the negative effects of commodity 
price inflation ripple through the economy as the high cost of energy 
and raw materials weakens our manufacturing base, and the high cost 
associated with transporting goods impedes international trade.
  The profits made by the speculators do not produce one new barrel of 
oil, put one new acre of farmland into production, put one new mine 
into operation, or add one new gallon of refinery capacity.
  If speculators really want to invest in commodities, they can buy 
stock in an energy company or an agricultural firm. They can purchase 
the royalty rights to land. Any of these options would benefit from 
market trends related to commodity prices and would also bring needed 
investment into means of production that would increase supplies and 
eventually contribute to lower commodity prices.
  Unfortunately, the Commodity Futures Trading Commission has ignored 
the urgent task of providing our front line defense against rampant and 
unmanaged speculation. To this day, the Commission has yet to recognize 
that speculation affects commodity prices.
  Instead, the Commission has delegated much of its regulatory 
authority to the for-profit exchanges. Moreover, in contradiction with 
Congress's original legislative intent, the Commission views its 
mission as confined to a single purpose--preventing market 
manipulation. On the contrary, Congress fully intended the Commission 
to regulate market manipulation AND excessive speculation.
  Our bill effectively closes the door to excessive speculation, but in 
a rational and reasonable way by, in effect, perfecting current law. 
First, it requires the CFTC to consider the overall effect of 
speculation when it sets the position limits that restrict the amount 
that any one investor can invest in a commodity. This is a critical and 
necessary change--if the Commission does not acknowledge and embrace 
its obligation to prevent excessive speculation, all of our efforts 
will be in vain.
  Second, it extends the existing rules that apply to the regulated 
exchanges to currently unregulated over-the-counter and foreign 
markets. Over the last 10 years, over-the-counter trading in 
commodities has exploded. The over-the-counter investment vehicles are 
simply economic substitutes for futures contracts. There is no rational 
reason that they should not be subject to the same laws and regulations 
that apply to futures contracts.
  This change also eliminates the ``swaps loophole'' that allows 
pension funds and other large investors to invest in index funds that 
circumvent the position limits. From 2003 to 2008, investment in 
commodity index funds has swelled from $13 billion to $260 billion and 
has, in effect, chased up prices and taken control of the commodity 
markets away from the industries and producers that must use them as a 
means of doing business.
  Other important provisions would direct that the speculative position 
limits must be set by the CFTC, not the futures exchanges, and repeal 
the CFTC's authority to substitute meaningless reporting requirements 
for actual speculative position limits.
  In the course of our Committee hearings and in later deliberations we 
looked at a number of legislative options, including banning certain 
large investors, such as pension funds, from the commodity markets 
altogether.
  But we feel the approach we've come up with in this bill is a 
reasonable, commonsense approach that will help bring order back to the 
commodity markets while preserving the liquidity it needs to function 
properly.
  Some have suggested that Congressional action will simply push 
investors to foreign markets. Our bill actually discourages flight from 
the major exchanges because it puts all trading platforms under the 
same regulatory umbrella. Speculators are subject to the same position 
limits regardless of whether they invest in New York, London, Dubai, or 
over-the-counter.
  Is excessive speculation the sole cause of rising prices? Of course 
not. Global economic growth, particularly in emerging nations like 
China and India, has put tremendous upward pressure on the prices of 
energy, food and raw materials.
  But there is little doubt--even among most skeptics of our 
legislation--that excessive speculation has had an effect on rising 
prices. Our bill will end that and help create a more orderly market 
for the industries and producers who must deal in commodities as a 
matter of business.
  The father of modern capitalism, Adam Smith, overall wanted to limit 
the role of government in free markets. In fact, in ``The Wealth of 
Nations'' Smith said speculators served many useful functions in a free 
market and many of his observations are still true today.
  But Smith knew there had to be limits, writing: ``those exertions of 
the natural liberty of a few individuals, which may endanger the 
security of the whole society, are, and ought to be, restrained by the 
laws of all governments.''
  With this bill we seek that kind of restraint so that the few don't 
gain exorbitant profits at the expense of the average American reeling 
under spiraling prices for food and fuel.
  Mr. President, I ask unanimous consent that the text of the bill and 
a summary be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                S. 3248

       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 ``Commodity Speculation Reform 
     Act of 2008''.

     SEC. 2. AUTHORITY OF COMMODITY FUTURES TRADING COMMISSION TO 
                   ISSUE NO ACTION LETTERS.

       Section 2(a)(1) of the Commodity Exchange Act (7 U.S.C. 
     2(a)(1)) is amended by adding at the end the following:
       ``(G) Authority to issue no action letters to foreign 
     boards of trade.--
       ``(i) In general.--Except as provided in clause (ii), the 
     Commission may not issue a no action letter to any foreign 
     board of trade that lists a contract the price of which 
     settles on the price of a contract traded on an exchange 
     regulated by the Commission.
       ``(ii) Exception.--The Commission may issue a no action 
     letter to a foreign board of trade described in clause (i) if 
     the foreign board of trade provides to the Commission 
     information and data accessibility the scope of which is 
     comparable to the information and data accessibility provided 
     to the Commission by entities under the jurisdiction of the 
     Commission.''.

     SEC. 3. ADDITIONAL EMPLOYEES.

       Section 2(a)(7) of the Commodity Exchange Act (7 U.S.C. 
     2(a)(7)) is amended by adding at the end the following:
       ``(D) Additional employees.----As soon as practicable after 
     the date of enactment of this subparagraph, the Commission 
     shall appoint at least 100 full-time employees (in addition 
     to the employees employed by the

[[Page S6569]]

     Commission as of the date of enactment of this subparagraph) 
     to assist in carrying out section 4a(a)(2).''.

     SEC. 4. TREATMENT OF PURCHASES OF CERTAIN COMMODITY FUTURES 
                   CONTRACTS AND FINANCIAL INSTRUMENTS.

       (a) In General.--Section 4a of the Commodity Exchange Act 
     (7 U.S.C. 6a) is amended--
       (1) by striking ``sec. 4a. (a) Excessive speculation'' and 
     inserting the following:

     ``SEC. 4A. EXCESSIVE SPECULATION.

       ``(a) Burden on Interstate Commerce; Trading or Position 
     Limits.--
       ``(1) In general.--Excessive speculation and''; and
       (2) in subsection (a) (as amended by paragraph (1)), by 
     adding at the end the following:
       ``(2) Treatment of purchases of certain commodity futures 
     contracts and financial instruments.--
       ``(A) Definitions.--In this paragraph:
       ``(i) Bona fide hedging transaction.--

       ``(I) In general.--The term `bona fide hedging transaction' 
     means a transaction that--

       ``(aa) represents a substitute for a transaction to be made 
     or a position to be taken at a later time in a physical 
     marketing channel;
       ``(bb) is economically appropriate for the reduction of 
     risks in the conduct and management of a commercial 
     enterprise; and
       ``(cc) arises from the potential change in the value of--
       ``(AA) assets that a person owns, produces, manufactures, 
     possesses, or merchandises (or anticipates owning, producing, 
     manufacturing, possessing, or merchandising);
       ``(BB) liabilities that a person incurs or anticipates 
     incurring; or
       ``(CC) services that a person provides or purchases (or 
     anticipates providing or purchasing).

       ``(II) Exclusion.--The term `bona fide hedging transaction' 
     does not include a transaction entered into on a designated 
     contract market for the purpose of offsetting a financial 
     risk arising from an over-the-counter commodity derivative.

       ``(ii) Over-the-counter commodity derivative.--The term 
     `over-the-counter commodity derivative' means any agreement, 
     contract, or transaction that--

       ``(I)(aa) is traded or executed in the United States; or
       ``(bb) is held by a person located in the United States;
       ``(II) is not traded on a designated contract market or 
     derivatives transaction execution facility; and
       ``(III)(aa) is a put, call, cap, floor, collar, or similar 
     option of any kind for the purchase or sale of, or 
     substantially based on the value of, 1 or more qualifying 
     commodities or an economic or financial index or measure of 
     economic or financial risk primarily associated with 1 or 
     more qualifying commodities;
       ``(bb) provides on an executory basis for the applicable 
     transaction, on a fixed or contingent basis, of 1 or more 
     payments substantially based on the value of 1 or more 
     qualifying commodities or an economic or financial index or 
     measure of economic or financial risk primarily associated 
     with 1 or more qualifying commodities, and that transfers 
     between the parties to the transaction, in whole or in part, 
     the economic or financial risk associated with a future 
     change in any such value without also conveying a current or 
     future direct or indirect ownership interest in an asset or 
     liability that incorporates the financial risk that is 
     transferred; or
       ``(cc) is any combination or permutation of, or option on, 
     any agreement, contract, or transaction described in item 
     (aa) or (bb).

       ``(iii) Over-the-counter commodity derivative dealer.--The 
     term `over-the-counter commodity derivative dealer' means a 
     person that regularly offers to enter into, assume, offset, 
     assign, or otherwise terminate positions in over-the-counter 
     commodity derivatives with customers in the ordinary course 
     of a trade or business of the person.
       ``(iv) Qualifying commodity.--The term `qualifying 
     commodity' means--

       ``(I) an agricultural commodity; and
       ``(II) an energy commodity.

       ``(B) Regulations.--
       ``(i) In general.--Not later than 90 days after the date of 
     enactment of this paragraph, in accordance with clauses (ii) 
     and (iii), the Commission shall promulgate regulations to 
     establish and enforce--

       ``(I) speculative position limits for qualifying 
     commodities;
       ``(II) a methodology--

       ``(aa) to enable persons to aggregate the positions held or 
     controlled by the persons on designated contract markets, on 
     derivatives transaction execution facilities, and in over-
     the-counter commodity derivatives; and
       ``(bb) to ensure, to the maximum extent practicable, that 
     the determinations made by the Commission with respect to 
     each person examined under subparagraph (C) accurately 
     reflect the net long and net short positions held or 
     controlled by the person in the underlying qualifying 
     commodity; and

       ``(III) information reporting rules to facilitate the 
     monitoring and enforcement by the Commission of the 
     speculative position limits established under subclause (I), 
     including the monitoring of positions held in over-the-
     counter commodity derivatives.

       ``(ii) Applicability.--

       ``(I) Position limits.--The speculative position limits 
     established under clause (i)(I) shall apply to position 
     limits that, with respect to each applicable position limit, 
     expire during--

       ``(aa) the spot month;
       ``(bb) each separate futures trading month (other than the 
     spot month); or
       ``(cc) the sum of each trading month (including the spot 
     month).

       ``(II) Sum of positions.--The speculative position limits 
     established under clause (i)(I) shall apply to the sum of the 
     positions held by a person--

       ``(aa) on designated contract markets;
       ``(bb) on derivatives transaction execution facilities; and
       ``(cc) in over-the-counter commodity derivatives.
       ``(iii) Maximum level of position limits.--In establishing 
     the speculative position limits under clause (i)(I), the 
     Commission shall set the speculative position limits at the 
     minimum level practicable to ensure sufficient market 
     liquidity for the conduct of bona fide hedging activities.
       ``(C) Prohibition relating to certain positions.--
       ``(i) In general.--Notwithstanding any other provision of 
     this Act, no person may hold or control a position, 
     separately or in combination, net long or net short, for the 
     purchase or sale of a commodity for future delivery or, on a 
     futures-equivalent basis, any option, or an over-the-counter 
     commodity derivative that exceeds a speculative position 
     limit established by the Commission under subparagraph 
     (B)(i)(I).
       ``(ii) Bona fide hedging transactions.--In determining 
     whether the sum of a position held or controlled by a person 
     has exceeded the applicable speculative position limit 
     established by the Commission under subparagraph (B)(i)(I), 
     the Commission shall not consider positions attributable to a 
     bona fide hedging transaction.
       ``(iii) Determination of position limits for over-the-
     counter commodity derivative dealers.--To determine the 
     position of an over-the-counter commodity derivative dealer, 
     the sum of the positions held or controlled by the over-the-
     counter commodity derivative dealer shall be--

       ``(I) calculated on the last day of each month; and
       ``(II) considered, for the monthly period covered by the 
     determination, to be the average daily net position held or 
     controlled by the over-the-counter commodity derivative 
     dealer for the period beginning on the first day of the month 
     and ending on the last day of the month.''.

       (b) Reports.--
       (1) Necessary additional funding.--Not later than 45 days 
     after the date of enactment of this Act, the Commodity 
     Futures Trading Commission (referred to in this subsection as 
     the ``Commission'') shall submit to the Committee on 
     Appropriations of the House of Representatives and the 
     Committee on Appropriations of the Senate a report providing 
     the recommendations of the Commission for any additional 
     funding that the Commission considers to be necessary to 
     carry out the amendments made by subsection (a), including 
     funding for additional staffing and technological needs.
       (2) Speculative activity trends.--
       (A) Study.--The Commission shall conduct a study--
       (i) to identify trends in speculative activity relating to 
     metals; and
       (ii) to determine whether the authority of the Commission 
     under section 4a(a)(2) of the Commodity Exchange Act (7 
     U.S.C. 6a(a)(2)) (as added by subsection (a)(2)) should be 
     extended to cover the trading of metals.
       (B) Report.--Not later than 180 days after the date of 
     enactment of this Act, the Commission shall submit a report 
     containing the results of the study conducted under 
     subparagraph (A) to--
       (i) the Committee on Agriculture of the House of 
     Representatives;
       (ii) the Committee on Agriculture, Nutrition, and Forestry 
     of the Senate; and
       (iii) the Committee on Homeland Security and Governmental 
     Affairs of the Senate.
       (3) Authorization of appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this subsection.
                                  ____


                Commodity Speculation Reform Act of 2008

 (Senators Joseph Lieberman and Susan Collins, Summary of Provisions, 
                             July 10, 2008)

       The legislation closes the ``Swaps Loophole'' and creates a 
     seamless system of speculative position limits that applies 
     to all food and energy-related contracts held by financial 
     speculators, including over-the-counter holdings and futures 
     positions on foreign exchanges.
       In theory, position limits should curb excessive 
     speculation in food and energy markets by imposing caps on 
     the amount of futures contracts that may be held by any one 
     investor. However, the position limits no longer serve their 
     original purpose. Large institutional investors, such as 
     pension funds, can circumvent the position limits by 
     investing in over-the-counter markets. Through a regulatory 
     ``swaps'' loophole, financial institutions that serve the 
     over-the-counter markets also circumvent the position limits.
       The bill will reduce excessive speculation by closing the 
     swaps loophole and eliminating the exemptions that apply to 
     investors that are not taking physical delivery of food and 
     energy commodities. The bill applies the position limits if 
     the position is not

[[Page S6570]]

     related to a bona fide hedging activity. The bill 
     incorporates the CFTC's definition of bona fide hedging, but 
     clarifies that it does not include hedging financial risks 
     associated with over-the-counter derivatives, such as swaps 
     and structured notes.
       In the evolving commodity marketplace, trading is 
     increasingly occurring in unregulated over-the-counter 
     markets or overseas. By extending the position limits to 
     holdings regardless of where they are held, the position 
     limits will no longer create an incentive to trade off-
     exchange or overseas. The bill would require the CFTC to 
     develop a methodology that allows investors to aggregate 
     their positions on the exchanges and in over-the-counter 
     markets for purposes of regulatory enforcement of the 
     position limits.
       The legislation requires the CFTC to set the individual 
     position limits at amounts necessary to prevent excessive 
     speculation while still ensuring sufficient market liquidity.
       The CFTC currently sets the speculative position limits at 
     amounts the Commission believes are necessary to prevent 
     market manipulation by individual market participants. In 
     contradiction with the original intent of the Congress, the 
     CFTC does not set the position limits at amounts necessary to 
     control the harmful inflationary effects of excessive 
     speculation. The bill clarifies that the position limits 
     should be set at amounts no greater than necessary to ensure 
     sufficient market liquidity for the conduct of bona fide 
     hedging activities.
       The legislation directs that the speculative position 
     limits must be set by the CFTC, not the futures exchanges.
       The bill would repeal the CFTC's authority to delegate the 
     responsibility for setting the position limits to the 
     exchanges. The major exchanges are no longer nonprofit 
     entities, but rather for-profit businesses. The position 
     limits should be set by a regulatory entity that has a single 
     mission--serving the public interest.
       The legislation repeals the authority that permits the CFTC 
     to substitute reporting requirements for actual speculative 
     position limits.
       Currently, position limits apply to an investor's holdings 
     in the spot month, any single month, and all months combined. 
     With respect to energy futures contracts, the position limits 
     are replaced with a simple reporting requirement, or 
     ``position accountability level'', in the all-months time 
     period. The bill would extend actual speculative position 
     limits to the all-months time period.
       The legislation requires foreign futures exchanges to 
     provide the CFTC with daily trading information comparable to 
     the information provided by domestic exchanges.
       Increasingly, foreign futures exchanges are offering cash-
     settled futures contracts that are based on commodity prices 
     set by contracts traded on U.S. exchanges. These ``look-
     alike'' contracts arguably offer investors a competitive 
     alternative to contracts that are traded and physically 
     settled through U.S. exchanges. The CFTC recently indicated 
     it will require foreign exchanges offering look-alike 
     contracts to provide trading information comparable to the 
     information provided by domestic exchanges. This provision 
     codifies the new CFTC policy. The provision lays the 
     statutory framework necessary for a seamless system of 
     information reporting and improved transparency that will 
     ensure the CFTC has the ability to monitor and enforce the 
     new speculative position limits.
       The legislation increases the resources available to the 
     CFTC to carry out is its expanded responsibilities under the 
     Act, including additional funds for staffing and technology.
       The legislation constitutes a historic expansion of the 
     CFTC's mission. Significant new resources will be needed to 
     carry out these directives. As soon as practicable after the 
     date of enactment, the legislation requires the CFTC to hire 
     100 additional full-time employees and authorizes such sums 
     as are necessary to implement its new responsibilities. No 
     later than 45 days after enactment, the CFTC must report to 
     the Congressional appropriations committees with an estimate 
     of the additional funding necessary to fully administer the 
     Act.
       The legislation directs the CFTC to review trends in 
     speculative activity related to metals, and report to 
     Congress on whether the Commission's new authority should 
     extend to trading in metals.

  Ms. COLLINS. Mr. President, high energy prices are having a 
devastating impact on our economy and our people--especially in large, 
rural States like Maine. Truckdrivers, loggers, fishermen, farmers, and 
countless others are struggling with the high cost of oil and gasoline. 
In Maine, where 80 percent of homes are heated with oil, many families 
do not know how they can afford to stay warm next winter.
  The high cost of energy is also taking a toll on businesses, both 
large and small. Katahdin Paper recently announced plans to shut down 
its plant in Millinocket due to the cost of oil. If this occurs--and 
everyone is working to prevent it--the community would be devastated by 
the loss of more than 200 good jobs.
  Many factors affect energy prices, including the value of the dollar, 
global tensions, and demand in other countries, such as China and 
India. But Senator Lieberman and I have heard persuasive and troubling 
evidence in hearings of our Committee on Homeland Security and 
Governmental Affairs that another factor is also at work--excessive 
speculation in futures markets for energy commodities.
  At issue is the activity of noncommercial traders who do not produce 
or take delivery of oil or agricultural products, unlike commercial 
traders such as oil producers and heating oil dealers, farmers and 
cereal companies. Instead, these noncommercial investors use futures 
contracts and related transactions solely for financial gain.
  Speculation in commodity markets by noncommercial investors has grown 
enormously. In just the last 5 years, the total value of their futures-
contract and commodity index-fund investments has soared from $13 
billion to $260 billion.
  These massive new holdings of oil-futures contracts by pension funds, 
university endowments, and other institutional investors appear to be 
driving up prices beyond what they would otherwise be. These investors' 
intentions may be simply to provide good returns, a hedge against 
inflation, and diversification, but many experts believe their 
activities are distorting commodity markets.
  I have worked with Senator Lieberman to produce a comprehensive and 
bipartisan bill, the Commodity Speculation Reform Act of 2008, which we 
are introducing today.
  Our bill takes some very strong steps toward countering excessive 
speculation.
  First, it would remedy staffing shortfalls at the Commodity Futures 
Trading Commission by adding 100 staff to improve its market oversight 
and enforcement capabilities. This is a vital step. The CFTC tells us 
that more than 3 billion futures and options contracts were traded last 
year, up from 37 million in 1976. Yet the Commission is operating with 
fewer employees than it had 30 years ago.
  Second, our bill closes the so-called ``swaps loophole,'' which 
currently allows financial institutions to evade position limits on 
commodity contracts that regulators use to prevent unwarranted price 
swings or attempts at manipulation.
  Third, our bill directs the CFTC to establish position limits that 
will apply to an investor's total interest in a commodity, regardless 
of whether they originate on a regulated exchange, the over-the-counter 
market, or on foreign boards of trade that deal in U.S. commodities.
  Fourth, our bill instructs the CFTC to permit no foreign boards of 
trade to deal in U.S.-linked commodity contracts unless they agree to 
reporting and data- accessibility standards at least equivalent to that 
required of U.S.-regulated exchanges. This is not a matter of telling 
other countries what to do: foreign boards of trade request ``no-
action'' letters from the CFTC so they can maintain trading terminals 
here while remaining regulated by their own authorities. The CFTC has 
recently taken positive steps to require comparable reporting, and our 
bill codifies those improvements.
  These are powerful measures, but they are also prudently designed. We 
recognize that producers, handlers, and purchasers of commodities who 
use those markets to lock in prices, hedge risks, and see clues for 
price trends require some level of participation by non- commercial, 
financial investors.
  Our bill does not prevent financial investors from participating in 
commodity markets. It simply places some limits on their presence by 
directing the CFTC to set position limits across trading venues at a 
level no higher than that needed to ensure that commercial participants 
can always find counterparties for their contract needs.
  These and other provisions of our bill--which applies to agricultural 
as well as energy commodities--will provide a stronger regulator, 
improved flows of information, new and more consistent protections 
against excessive speculation, and assurance to both businesses and 
consumers that our markets in basic commodities are transparent, 
competitive, and effectively policed.
  The Commodity Speculation Reform Act of 2008 represents a balanced 
and bipartisan approach. I urge my colleagues to join Senator Lieberman 
and me in supporting it.

[[Page S6571]]

                                 ______
                                 
      By Mr. WYDEN (for himself and Ms. Snowe):
  S. 3249. A bill to restrict any State or local jurisdiction from 
imposing a new discriminatory tax on mobile wireless communications 
services, providers, or property; to the Committee on Finance.
  Mr. WYDEN. Mr. President, 100 years ago the automobile revolutionized 
the way Americans lived and did business. Government responded by 
making a massive investment in infrastructure to support this new 
technology. That investment gave our industries a real competitive 
advantage in the world marketplace for much of the 20th century by 
making it cheaper and easier to move goods around the country.
  Today, information technology has brought an equal, if not greater, 
revolution to American business. But this time, rather than investing 
in infrastructure and fostering growth, we have allowed the country's 
IT infrastructure to be taxed at dangerous and unhealthy levels that 
put American business at a competitive disadvantage.
  The information revolution has changed the way we learn, the way we 
work, the way we hold elections, and the way we communicate as a 
society, among other things that keep our country working. It has made 
vast educational, health care and entrepreneurial opportunities 
accessible to our most remote communities. But telecommunication taxes 
in the U.S. have been levied at a rate much higher than other types of 
sales and business taxes.
  Rather than investing in IT infrastructure, we have left it to the 
private sector to build and maintain our telecommunications networks. 
And while this practice has sometimes served Americans well, we are 
falling behind some major international competitors in far too many 
areas.
  I am not today calling for anything as far-reaching as Federal 
investment in IT infrastructure--today I am simply asking that we stop 
yoking our most innovative IT networks with increased taxes.
  Wireless broadband holds the promise of connecting even our most 
distant communities to the rest of the world. In time, these 
connections will bring health care, educational, communications and 
commercial services to Americans who have been left out for far too 
long. This growth will not happen if we keep burdening this important 
technology with what amounts to discriminatory taxation.
  I have fought for many years to expand the development of the 
Internet and our telecommunications infrastructure. Along with 
colleagues on both sides of the aisle, I worked to successfully protect 
our network providers from content-related litigation. Four times now, 
I have fought to protect the Internet from being hit with multiple 
discriminatory taxes from thousands of State and local tax 
authorities--and have worked to extend that protection indefinitely.
  Today I am proposing something far more modest--if just as 
necessary--that we put a moratorium on new or increased taxes on our 
wireless telecommunications infrastructure and services for the next 5 
years.
  Along with my colleague Senator Snowe, I am introducing the Mobile 
Wireless Tax Fairness Act to keep mobile wireless services and 
facilities free from new discriminatory taxes.
  This bill would not impact a single current tax that has been levied 
by a State or locality. It will not remove a single dollar from their 
communal coffers. What it will do is guarantee our wireless network 
providers protection from even greater taxation at a time when we are 
asking them to implement the largest technology upgrade in history--an 
upgrade that will bring economically important, true broadband speeds 
to wireless customers for the first time.
  I will admit that there are lots of problems with the way Federal, 
State and local taxes are levied on telecommunications services. This 
legislation addresses only one of those problems, but it is a big one.
  Taxes on wireless services are some of the most regressive taxes in 
the Nation. Cell phones and other wireless devices have become 
essential to many working Americans, for their jobs, for their safety 
and for maintaining the communications they need to stay in touch with 
families when both parents work and raise children. Piling increased 
taxes on these families at a time when budgets are being stretched by 
skyrocketing gas and food prices is not only unreasonable, it is 
downright wrong.
  I am proud that my colleague Senator Snowe joins me in introducing 
this important legislation. Senator Snowe has long been an advocate for 
the improvement and expansion of our IT infrastructure and today we 
have taken another important step that will help strengthen our country 
and our economy today and in the future. This proposal joins H.R. 5793 
by Congresswoman Lofgren and Congressman Cannon in the House and I look 
forward to working with them to see this important legislation passed.
  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. 3249

       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 ``Mobile Wireless Tax Fairness 
     Act of 2008''.

     SEC. 2. FINDINGS.

       Congress finds the following:
       (1) It is appropriate to exercise congressional enforcement 
     authority under section 5 of the 14th amendment to the 
     Constitution of the United States and Congress' plenary power 
     under article I, section 8, clause 3 of the Constitution of 
     the United States (commonly known as the ``commerce clause'') 
     in order to ensure that States and political subdivisions 
     thereof do not discriminate against providers and consumers 
     of mobile services by imposing new selective and excessive 
     taxes and other burdens on such providers and consumers.
       (2) In light of the history and pattern of discriminatory 
     taxation faced by providers and consumers of mobile services, 
     the prohibitions against and remedies to correct 
     discriminatory State and local taxation in section 306 of the 
     Railroad Revitalization and Regulatory Reform Act of 1976 (49 
     U.S.C. 11501) provide an appropriate analogy for 
     congressional action, and similar Federal legislative 
     measures are warranted that will prohibit imposing new 
     discriminatory taxes on providers and consumers of mobile 
     services and that will assure an effective, uniform remedy.

     SEC. 3. MORATORIUM.

       (a) In General.--No State or local jurisdiction shall 
     impose a new discriminatory tax on or with respect to mobile 
     services, mobile service providers, or mobile service 
     property, during the 5-year period beginning on the date of 
     the enactment of this Act.
       (b) Definitions.--In this Act:
       (1) Mobile service.--The term ``mobile service'' means 
     commercial mobile radio service, as such term is defined in 
     section 20.3 of title 47, Code of Federal Regulations, as in 
     effect on the date of the enactment of this Act, or any other 
     service that is primarily intended for receipt on, 
     transmission from, or use with a mobile telecommunications 
     device, including the receipt of a digital good.
       (2) Mobile service property.--The term ``mobile service 
     property'' means all property used by a mobile service 
     provider in connection with its business of providing mobile 
     services, whether real, personal, tangible, or intangible and 
     includes goodwill, licenses, customer lists, and other 
     similar intangible property associated with such business.
       (3) Mobile service provider.--The term ``mobile service 
     provider'' means any entity that sells or provides mobile 
     services, but only with respect to the portion of such 
     entity's trade or business that sells or provides such 
     services.
       (4) New discriminatory tax.--The term ``new discriminatory 
     tax'' means any tax imposed by a State or local jurisdiction 
     that--
       (A) is imposed on or with respect to, or is measured by the 
     charges, receipts, or revenues from or value of--
       (i) any mobile service and is not generally imposed, or is 
     generally imposed at a lower rate, on or with respect to, or 
     measured by the charges, receipts, or revenues from, other 
     services or transactions involving tangible personal 
     property;
       (ii) any mobile service provider and is not generally 
     imposed, or is generally imposed at a lower rate, on other 
     persons that are engaged in businesses other than the 
     provision of mobile services; or
       (iii) any mobile service property and is not generally 
     imposed, or is generally imposed at a lower rate, on or with 
     respect to, or measured by the value of, other property that 
     is devoted to a commercial or industrial use and subject to a 
     property tax levy, except public utility property owned by a 
     public utility subject to rate of return regulation by a 
     State or Federal regulatory authority; and
       (B) was not generally imposed and actually enforced on 
     mobile services, mobile service providers, or mobile service 
     property prior to the date of the enactment of this Act.
       (5) State or local jurisdiction.--The term ``State or local 
     jurisdiction'' means any

[[Page S6572]]

     of the several States, the District of Columbia, any 
     territory or possession of the United States, a political 
     subdivision of any State, territory, or possession, or any 
     governmental entity or person acting on behalf of such State, 
     territory, possession, or subdivision and with the authority 
     to assess, impose, levy, or collect taxes or fees.
       (6) Tax.--
       (A) In general.--The term ``tax'' means any charge imposed 
     by any governmental entity for the purpose of generating 
     revenues for governmental purposes, and is not a fee imposed 
     on an individual entity or class of entities for a specific 
     privilege, service, or benefit conferred exclusively on such 
     entity or class of entities.
       (B) Exclusion.--The term ``tax'' does not include any fee 
     or charge--
       (i) used to preserve and advance Federal universal service 
     or similar State programs authorized by section 254 of the 
     Communications Act of 1934 (47 U.S.C. 254); or
       (ii) specifically dedicated by a State or local 
     jurisdiction for the support of E-911 communications systems.
       (c) Rules of Construction.--
       (1) Determination.--For purposes of subsection (b)(4), all 
     taxes, tax rates, exemptions, deductions, credits, 
     incentives, exclusions, and other similar factors shall be 
     taken into account in determining whether a tax is a new 
     discriminatory tax.
       (2) Application of principles.--Except as otherwise 
     provided in this Act, in determining whether a tax on mobile 
     service property is a new discriminatory tax for purposes of 
     subsection (b)(4)(A)(iii), principles similar to those set 
     forth in section 306 of the Railroad Revitalization and 
     Regulatory Reform Act of 1976 (49 U.S.C. 11501) shall apply.
       (3) Exclusions.--Notwithstanding any other provision of 
     this Act--
       (A) the term ``generally imposed'' as used in subsection 
     (b)(4) shall not apply to any tax imposed only on--
       (i) specific services;
       (ii) specific industries or business segments; or
       (iii) specific types of property; and
       (B) the term ``new discriminatory tax'' shall not include a 
     new tax or the modification of an existing tax that--
       (i) replaces one or more taxes that had been imposed on 
     mobile services, mobile service providers, or mobile service 
     property; and
       (ii) is designed so that, based on information available at 
     the time of the enactment of such new tax or such 
     modification, the amount of tax revenues generated thereby 
     with respect to such mobile services, mobile service 
     providers, or mobile service property is reasonably expected 
     not to exceed the amount of tax revenues that would have been 
     generated by the respective replaced tax or taxes with 
     respect to such mobile services, mobile service providers, or 
     mobile service property.

     SEC. 4. ENFORCEMENT.

       (a) In General.--Notwithstanding any provision of section 
     1341 of title 28, United States Code, or the constitution or 
     laws of any State, the district courts of the United States 
     shall have jurisdiction, without regard to amount in 
     controversy or citizenship of the parties, to grant such 
     mandatory or prohibitive injunctive relief, interim equitable 
     relief, and declaratory judgments as may be necessary to 
     prevent, restrain, or terminate any acts in violation of this 
     Act, provided that:
       (1) Jurisdiction.--Such jurisdiction shall not be exclusive 
     of the jurisdiction which any Federal or State court may have 
     in the absence of this section.
       (2) Burden of proof.--The burden of proof in any proceeding 
     brought under this Act shall be upon the party seeking relief 
     and shall be by a preponderance of the evidence on all issues 
     of fact.
       (3) Relief.--In granting relief against a tax which is 
     discriminatory or excessive under this Act with respect to 
     tax rate or amount only, the court shall prevent, restrain, 
     or terminate the imposition, levy, or collection of not more 
     than the discriminatory or excessive portion of the tax as 
     determined by the court.

  Ms. SNOWE. Mr. President, I rise today to join my colleague, Senator 
Wyden, in introducing legislation that will stop the increasing 
financial burden being placed on wireless consumers by discriminatory 
taxes. On average, the typical consumer pays 15.2 percent of his/her 
total wireless bill in Federal, State, and local taxes, fees and 
surcharges--this is compared to the 7.07 percent average tax rate for 
other goods and services.
  The Mobile Wireless Tax Fairness Act of 2008 would ensure that these 
tax rates don't increase further by prohibiting States and local 
governments from imposing any new discriminatory tax on mobile 
services, mobile service providers, or mobile service property for a 
period of 5 years. The bill defines ``new discriminatory tax'' as a tax 
imposed on mobile services, providers, or property that is not 
generally imposed on other types of services or property, or that is 
generally imposed at a lower rate.
  The wireless era has changed the way the world communicates. More and 
more people are using the cell phone as their primary communication 
device as well as for data and Internet services. The increased 
mobility and access wireless communications provide have improved our 
lives, our safety, and the productivity of our work and businesses. To 
date, there are more than 260 million wireless subscribers in the U.S., 
and total usage exceeded 1 trillion minutes in June 2007 alone.
  However, as more consumers embrace wireless technologies and 
applications, more States and local governments are embracing it as a 
revenue source and applying these excessive and discriminatory taxes, 
which show up on consumers' bills each month. In fact, the effective 
rate of taxation on wireless services has increased four times faster 
than the rate on other taxable goods and services between January 2003 
and January 2007.
  These excessive and discriminatory taxes discourage wireless' 
adoption and use, primarily with low-income individuals and families 
that still view a cellular phone as a luxury when many Americans 
consider it a necessity. By banning these taxes, we can equalize the 
taxation of the wireless industry with that of other goods and services 
and protect the wireless consumer from the weight of fees, surcharges, 
and general business taxes. We cannot allow this essential and 
innovative industry as well as the consumers who benefit from its 
amazing services and applications to suffer excessive tax rates.
  Placing a moratorium on new discriminatory wireless taxes will make 
certain consumers continue to reap the benefits of wireless services. 
Congress took similar action with the Internet--passing the Internet 
Tax Freedom Act Amendments Act of 2007 this past fall--because of the 
incredible impact the Internet will continue to have on consumers and 
businesses alike. The future of wireless is just as bright and that is 
why we must ensure its continued growth. That is why I sincerely hope 
that my colleagues join Senator Wyden and me in supporting this 
critical legislation.
                                 ______
                                 
      By Mr. DODD (for himself, Mr. Levin, Mr. Menendez, Mr. Reed, Mr. 
        Tester, Mrs. McCaskill, Mr. Akaka, Mr. Casey, Mr. Obama, Mr. 
        Kerry, Mrs. Clinton, Mr. Sanders, and Mr. Whitehouse):
  S. 3252. A bill to amend the Consumer Credit Protection Act, to ban 
abusive credit practices, enhance consumer disclosures, protect 
underage consumers, and for other purposes; to the Committee on 
Banking, Housing, and Urban Affairs.
  Mr. DODD. Mr. President, my friend and colleague from Michigan is 
here, as well, who has been deeply involved in the issue of credit 
cards and the problems that are occurring.
  I rise with my colleague Senator Levin to introduce legislation that 
would reform and prohibit credit card practices that harm rather than 
help American consumers and their families. The legislation is called 
the Credit Card Accountability, Responsibility and Disclosure Act, or 
the Credit CARD Act. It will, in my view, help bring an end to industry 
practices that candidly cost American families billions of dollars each 
and every year.
  I cannot think of a better time to introduce this much needed 
legislation. This Chamber will, in very short order this evening, or as 
late as tomorrow, pass legislation to address the most important issue 
confronting our Nation's economy and the financial stability of our 
citizens--the collapse of the subprime housing market and the credit 
crisis it has brought about.
  Unfortunately, far too many American families who are already being 
squeezed by the rising cost of food, oil, and gas, now find themselves 
forced to rely on short-term, high-interest credit card debt to finance 
life's daily necessities--including their mortgage payments--because of 
the ongoing credit crisis and a weak economy.
  That growing reliance was highlighted in a report released last week 
by the Federal Reserve. The Fed's study reported that in May, revolving 
consumer debt, which is primarily credit card debt, reached an all-time 
record high of slightly over $961 billion. That is a 7-percent increase 
in the last month alone, which is on top of a 7-percent increase last 
year, and a 6-percent increase in 2006. At this rate, revolving 
consumer debt in our country, which is again primarily credit card 
debt, will

[[Page S6573]]

reach $1 trillion by the Christmas season of this year.
  When I assumed the gavel of the Senate Banking Committee last 
January, one of the very first hearings I held was on the issue of 
credit card practices. At that hearing, I challenged card issuers, 
banks, and associations to stop engaging in practices that they were 
not prepared to defend before the committee.
  It was my hope that the hearing and that warning would encourage the 
credit card industry to go through a period of intense self-
examination. I had hoped the industry would scrutinize its practices 
and policies to ensure that credit was extended in the fairest and most 
transparent of terms to credit card customers. To be fair, some in the 
industry heeded that call. I applaud them and thank them for their 
efforts. Over the past year, a few credit card companies have 
voluntarily made changes to the way they do business, and many 
Americans have benefitted from those improvements.
  Regrettably, however, far too few embraced this call. Even more 
regrettably, some that have made voluntary changes are reconsidering 
those steps in the face of mounting pressure to find new streams of 
revenue and capital, and to compete in a market where other industry 
participants are not engaging in these reforms, as their subprime 
mortgage market-related losses continue to rise. The temptation to go 
back to older practices to increase revenue streams is there. 
Unfortunately, the use of confusing, misleading, and very predatory 
practices, in some cases, appears likely to remain the standard 
operating procedure for many in the credit card industry for the 
foreseeable future if we fail to act. The list of these troubling 
practices is lengthy: Charging predatory rates and fees; engaging in 
deceptive marketing to young people; practices such as universal 
default; double-cycle billing; retroactive interest rate increases; 
``any time, any reason'' repricing; and billings shenanigans--like 
shortening the period consumers have to pay their bills, or charging 
fees for payment by telephone--are just a few of the practices that 
could merit induction into a fairly crowded industry ``hall of shame.''
  Even the financial regulators, whom I have been openly critical of 
for lack of appropriate oversight and response throughout the subprime 
mortgage market crisis, have recognized the harm these sinister 
practices pose not only to credit card customers but to our economy as 
well. In May of this year, the Federal Reserve, the Office of Thrift 
Supervision, and the National Credit Union Administration proposed 
rules aimed at curbing some of the very practices I have identified. In 
my view, this joint rulemaking is an important step in providing needed 
consumer protections in some areas, including a ban on retroactive 
interest rates and rules on payment allocation. But the proposed rules 
fall far short in other important areas--failing to address issues 
including universal default, ``any time, any reason'' repricing, 
multiple over-limit fees, and youth marketing.
  These shortcomings underscore the need for the legislation Senator 
Levin and I will be talking about this evening.
  I want to make it very clear--and I know my colleague feels the same 
way--that we are not opposed to credit cards. They are very valuable, 
very useful tools for consumers. So this bill is not designed in any 
way to deprive consumers of the use of credit cards. That is not the 
issue. When provided on fair terms, and used wisely and responsibly, 
credit cards are a valuable financial tool for millions of our fellow 
citizens. They can help an individual to build his or her credit 
history and to better pursue his or her financial goal.
  But like many credit products, credit cards pose the potential to 
harm consumers as well as help consumers. Card companies have been far 
too apt to exploit the needs of consumers who are increasingly becoming 
``hooked on plastic.'' That potential to harm consumers has grown in 
recent years as credit card usage has risen. Let me share some numbers 
with you to give you some idea of what has happened in this explosion 
of credit card usage by Americans.
  Today, nearly 75 percent of American households have a credit card or 
a debit card, and 700 million credit cards are used to purchase in 
excess of $2.4 trillion in goods and services from over 7 million 
locations in the United States annually. In 1970, only about 16 percent 
of U.S. households used credit cards, and fewer than a million 
businesses accepted them.
  As Americans have become increasingly reliant on credit cards, credit 
card companies have become more and more innovative in finding ways to 
access their customers. Over $17 billion in credit card penalty fees 
have been charged to the American people--new fees--in the last 2 
years, since 2006. That is a tenfold increase from what was charged 10 
years ago. That is $17 billion in new penalties and fees since 2006. 
Credit card companies are turning to innovative ways to profit--
including at the gasoline pump. They are laying on fees to gas station 
owners for each credit card transaction made at the pump. At the very 
time they are watching the price of gasoline skyrocket, the credit card 
companies are gouging the people struggling to meet those fees. Again, 
card companies are laying on fees to gas station owners for each credit 
card transaction made at the pump--a charge that those owners 
immediately pass on to customers, increasing the cost of gas for 
drivers. In some places, these fees can add an average of 3 percent for 
each gasoline transaction.
  The combination of the growing needs for revolving debt and hidden 
fees charged by card companies is contributing to the avalanche of debt 
under which American consumers increasingly find themselves buried. 
Listen to this number, because this is the one that is stunning. To 
give you an idea of what has happened to the average family in this 
country with credit card balances, today the average household that 
carries a credit card balance owes close to $10,000 in revolving debt 
on their credit cards. The average family has a balance of $10,000 in 
revolving debt on their credit cards.
  That is a millstone around the neck of the average American and their 
families--families that are already struggling to make ends meet and 
are under pressure from rising gas prices, food prices, skyrocketing 
health care costs, and a mortgage crisis that has robbed many families 
of their home equity or, worse yet, their homes.
  That is why we are introducing the Credit CARD Act. This bill will 
help reform credit card practices that drag so many American families 
further and further into debt. It strengthens regulation and oversight 
of the credit card industry and prohibits the unfair and deceptive 
practices that in far too many instances work to harm, not help, a 
consumer's efforts to move up the economic ladder.
  Specifically, the CARD Act would prohibit the worst of the industry's 
practices, including imposition of excessive fees; retroactive rate 
increases; universal default; ``any time, any reason'' changes to 
credit card agreements; and unfair payment allocation.
  The bill also, importantly, contains a number of provisions aimed at 
protecting young consumers.
  This legislation builds on legislation I have introduced in previous 
Congresses. It also incorporates several key concepts included in the 
legislative proposals put forth by some of my colleagues, notably my 
colleague from Michigan, Senator Levin, and Senators Menendez, 
McCaskill, and Obama. Each is an important cosponsor of this 
legislation, as are Senators Reed of Rhode Island, Akaka, Tester, 
Clinton, Kerry, Sanders, Whitehouse, and Casey.
  This bill also has the support of a wide array of consumer advocates 
and labor organizations, including the Consumer Federation of America, 
Consumers Union, National Consumer Law Center, the National Council of 
La Raza, Service Employees International Union, the Center for 
Responsible Lending, U.S. PRIG, Consumer Action, Demos, Connecticut 
PRIG, and the National Association of Consumer Advocates.
  As policymakers, we should expect consumers will act responsibly when 
it comes to using credit cards, and that should be an important point 
to make. But we also expect no less when it comes to companies that 
issue these cards. They need to act responsibly, and they are not, in 
my view. The Credit CARD Act will help strike the

[[Page S6574]]

correct balance of responsibility between credit card users and the 
card issuers. And by striking that balance, it will help provide 
American consumers with a fair chance to secure economic security for 
them and their families.
  I thank Senator Levin and others--especially Senator Levin who 
already held hearings on this issue. We have talked about this at 
length over the years. We tried in other Congresses with very modest 
proposals to deal with some of these problems. We have always lost 
those battles. But I think the American consumers, regardless of their 
income, regardless of their social or economic status, feel very angry 
about what is happening to them. As a result, I think there is a 
growing opportunity for us to get something done on this issue.
  So while our focus today has been on foreclosure issues, the credit 
card problem in this country that so many Americans are facing is one 
that I think is ripe for congressional action. Our hope and intention 
is to bring a bill to the floor of this Chamber before we adjourn for 
the year to give our colleagues a chance to express themselves on this 
issue.
  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 
placed in the Record, as follows:

                                S. 3252

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Credit 
     Card Accountability Responsibility and Disclosure Act of 
     2008'' or the ``Credit CARD Act of 2008''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Regulatory authority.

                      TITLE I--CONSUMER PROTECTION

Sec. 101. Prior notice of rate increases required.
Sec. 102. Freeze on interest rate terms and fees on canceled cards.
Sec. 103. Limits on fees and interest charges.
Sec. 104. Consumer right to reject card before notice is provided of 
              open account.
Sec. 105. Use of terms clarified.
Sec. 106. Application of card payments.
Sec. 107. Length of billing period.
Sec. 108. Prohibition on universal default and unilateral changes to 
              cardholder agreements.
Sec. 109. Enhanced penalties.
Sec. 110. Enhanced oversight.
Sec. 111. Clerical amendments.

                TITLE II--ENHANCED CONSUMER DISCLOSURES

Sec. 201. Payoff timing disclosures.
Sec. 202. Requirements relating to late payment deadlines and 
              penalties.
Sec. 203. Renewal disclosures.

                TITLE III--PROTECTION OF YOUNG CONSUMERS

Sec. 301. Extensions of credit to underage consumers.
Sec. 302. Restrictions on certain affinity cards.
Sec. 303. Protection of young consumers from prescreened credit offers.

                 TITLE IV--FEDERAL AGENCY COORDINATION

Sec. 401. Inclusion of all Federal banking agencies.

                   TITLE V--MISCELLANEOUS PROVISIONS

Sec. 501. Study and report.
Sec. 502. Credit Card Safety Rating System Commission.

     SEC. 2. REGULATORY AUTHORITY.

       The Board of Governors of the Federal Reserve System (in 
     this Act referred to as the ``Board'') may issue such rules 
     and publish such model forms as it considers necessary to 
     carry out this Act and the amendments made by this Act.

                      TITLE I--CONSUMER PROTECTION

     SEC. 101. PRIOR NOTICE OF RATE INCREASES REQUIRED.

       Section 127 of the Truth in Lending Act (15 U.S.C. 1637) is 
     amended by adding at the end the following:
       ``(i) Advance Notice of Increase in Interest Rate 
     Required.--
       ``(1) In general.--In the case of any credit card account 
     under an open end consumer credit plan, no increase in any 
     annual percentage rate (other than an increase due to the 
     expiration of any introductory percentage rate, or due solely 
     to a change in another rate of interest to which such rate is 
     indexed)--
       ``(A) may take effect before the beginning of the billing 
     cycle which begins not earlier than 45 days after the date on 
     which the obligor receives notice of such increase; or
       ``(B) may apply to any outstanding balance of credit under 
     such plan, as of the effective date of the increase required 
     under subparagraph (A).
       ``(2) Notice of right to cancel.--The notice referred to in 
     paragraph (1) shall be made in a clear and conspicuous 
     manner, and shall contain a brief statement of the right of 
     the obligor to cancel the account before the effective date 
     of the increase.''.

     SEC. 102. FREEZE ON INTEREST RATE TERMS AND FEES ON CANCELED 
                   CARDS.

       Section 127 of the Truth in Lending Act (15 U.S.C. 1637) is 
     amended by adding at the end the following:
       ``(j) Freeze on Interest Rate Terms and Fees on Canceled 
     Cards.--
       ``(1) In general.--If an obligor under an open end consumer 
     credit plan closes or cancels a credit card account, the 
     repayment of the outstanding balance after the cancellation 
     shall be subject to all terms and conditions in effect for 
     the obligor immediately before the card was closed or 
     cancelled, including the annual percentage rate and the 
     minimum payment terms in effect immediately prior to such 
     closure or cancellation.
       ``(2) Rule of construction.--Closure or cancellation of an 
     account by the obligor shall not constitute a default under 
     an existing cardholder agreement, and shall not trigger an 
     obligation to immediately repay the obligation in full.''.

     SEC. 103. LIMITS ON FEES AND INTEREST CHARGES.

       Section 127 of the Truth in Lending Act (15 U.S.C. 1637) is 
     amended by adding at the end the following:
       ``(k) Prohibition on Penalties for On-Time Payments.--If an 
     open end consumer credit plan provides a time period within 
     which an obligor may repay any portion of the credit extended 
     without incurring an interest charge, and the obligor repays 
     all or a portion of such credit within the specified time 
     period, the creditor may not impose or collect an interest 
     charge on the portion of the credit that was repaid within 
     the specified time period.
       ``(l) Opt-Out of Creditor Authorization of Over-the-Limit 
     Transactions if Fees Are Imposed.--
       ``(1) In general.--In the case of any credit card account 
     under an open end consumer credit plan under which an over-
     the-limit-fee may be imposed by the creditor for any 
     extension of credit in excess of the amount of credit 
     authorized to be extended under such account, the consumer 
     may elect to prohibit the creditor from completing any over-
     the-limit transaction that will result in a fee or constitute 
     a default under the credit agreement, by notifying the 
     creditor of such election in accordance with paragraph (2).
       ``(2) Notification by consumer.--A consumer shall notify a 
     creditor under paragraph (1)--
       ``(A) through the notification system maintained by the 
     creditor under paragraph (4); or
       ``(B) by submitting to the creditor a signed notice of 
     election, by mail or electronic communication, on a form 
     issued by the creditor for purposes of this subparagraph.
       ``(3) Effectiveness of election.--An election by a consumer 
     under paragraph (1) shall be effective beginning 3 business 
     days after the date on which the consumer notifies the 
     creditor in accordance with paragraph (2), and shall remain 
     effective until the consumer revokes the election.
       ``(4) Notification system.--Each creditor that maintains 
     credit card accounts under an open end consumer credit plan 
     shall establish and maintain a notification system, including 
     a toll-free telephone number, Internet address, and Worldwide 
     Web site, which permits any consumer whose credit card 
     account is maintained by the creditor to notify the creditor 
     of an election under this subsection, in accordance with 
     paragraph (2).
       ``(5) Annual notice to consumers of availability of 
     election.--In the case of any credit card account under an 
     open end consumer credit plan, the creditor shall include a 
     notice, in clear and conspicuous language, of the 
     availability of an election by the consumer under this 
     paragraph as a means of avoiding over-the-limit fees and a 
     higher amount of indebtedness, and the method for providing 
     such election--
       ``(A) in the periodic statement required under subsection 
     (b) with respect to such account at least once each calendar 
     year; and
       ``(B) in any such periodic statement which includes a 
     notice of the imposition of an over-the-limit fee during the 
     period covered by the statement.
       ``(6) No fees if consumer has made an election.--If a 
     consumer has made an election under paragraph (1), no over-
     the-limit fee may be imposed on the account for any reason 
     that has caused the outstanding balance in the account to 
     exceed the credit limit.
       ``(m) Over-the-Limit Fee Restrictions.--With respect to a 
     credit card account under an open end consumer credit plan, 
     an over-the-limit fee, as described in subsection 
     (c)(1)(B)(iii)--
       ``(1) may be imposed on the account only when an extension 
     of credit obtained by the obligor causes the credit limit on 
     such account to be exceeded, and may not be imposed when such 
     credit limit is exceeded due to a fee or interest charge; and
       ``(2) may be imposed only once during a billing cycle if, 
     on the last day of such billing cycle, the credit limit on 
     the account is exceeded, and may not be imposed in a 
     subsequent billing cycle with respect to such excess credit, 
     unless the obligor has obtained an additional extension of 
     credit in excess of such credit limit during such subsequent 
     cycle.

[[Page S6575]]

       ``(n) No Interest Charges on Fees.--With respect to a 
     credit card account under an open end consumer credit plan, 
     if the creditor imposes a transaction fee on the obligor, 
     including a cash advance fee, late fee, over-the-limit fee, 
     or balance transfer fee, the creditor may not impose or 
     collect interest with respect to such fee amount.
       ``(o) Limits on Certain Fees.--
       ``(1) No fee to pay a billing statement.--With respect to a 
     credit card account under an open end consumer credit plan, 
     the creditor may not impose a separate fee to allow the 
     obligor to repay an extension of credit or finance charge, 
     whether such repayment is made by mail, electronic transfer, 
     telephone authorization, or other means.
       ``(2) Reasonable fees for violations.--The amount of any 
     fee or charge that a card issuer may impose in connection 
     with any omission with respect to, or violation of, the 
     cardholder agreement, including any late payment fee, over 
     the limit fee, increase in the applicable annual percentage 
     rate, or any similar fee or charge, shall be reasonably 
     related to the cost to the card issuer of such omission or 
     violation.
       ``(3) Reasonable currency exchange fee.--With respect to a 
     credit card account under an open end consumer credit plan, 
     the creditor may impose a fee for exchanging United States 
     currency with foreign currency in an account transaction, 
     only if--
       ``(A) such fee reasonably reflects the costs incurred by 
     the creditor to perform such currency exchange;
       ``(B) the creditor discloses publicly its method for 
     calculating such fee; and
       ``(C) the primary Federal regulator of such creditor 
     determines that the method for calculating such fee complies 
     with this paragraph.''.

     SEC. 104. CONSUMER RIGHT TO REJECT CARD BEFORE NOTICE IS 
                   PROVIDED OF OPEN ACCOUNT.

       Section 127 of the Truth in Lending Act (15 U.S.C. 1637) is 
     amended by adding at the end the following:
       ``(p) Consumer Right To Reject Card Before Notice of New 
     Account Is Provided to Consumer Reporting Agency.--A creditor 
     may not furnish any information to a consumer reporting 
     agency (as defined in section 603) concerning a newly opened 
     credit card account under an open end consumer credit plan 
     until the credit card has been used or activated by the 
     consumer.''.

     SEC. 105. USE OF TERMS CLARIFIED.

       Section 127 of the Truth in Lending Act (15 U.S.C. 1637) is 
     amended by adding at the end the following:
       ``(q) Use of Terms.--The following requirements shall apply 
     with respect to the terms of any credit card account under 
     any open end consumer credit plan:
       ``(1) Fixed rate.--The term `fixed', when appearing in 
     conjunction with a reference to the annual percentage rate or 
     interest rate applicable with respect to such account, may 
     only be used to refer to an annual percentage rate or 
     interest rate that will not change or vary for any reason 
     over the period specified clearly and conspicuously in the 
     terms of the account.
       ``(2) Prime rate.--The term `prime rate', when appearing in 
     any agreement or contract for any such account, may only be 
     used to refer to the bank prime rate published in the Federal 
     Reserve Statistical Release on selected interest rates (daily 
     or weekly), and commonly referred to as the `H.15 release' 
     (or any successor publication).''.

     SEC. 106. APPLICATION OF CARD PAYMENTS.

       Section 164 of the Truth in Lending Act (15 U.S.C. 1666c) 
     is amended--
       (1) by striking the section heading and all that follows 
     through ``Payments'' and inserting the following:

     ``Sec. 164. Prompt and fair crediting of payments

       ``(a) In General.--Payments'';
       (2) by inserting ``, by 5:00 p.m. on the date on which such 
     payment is due,'' after ``in readily identifiable form'';
       (3) by striking ``manner, location, and time'' and 
     inserting ``manner, and location''; and
       (4) by adding at the end the following:
       ``(b) Application of Payments.--Upon receipt of a payment 
     from a cardholder, the card issuer shall--
       ``(1) apply the payment first to the card balance bearing 
     the highest rate of interest, and then to each successive 
     balance bearing the next highest rate of interest, until the 
     payment is exhausted; and
       ``(2) after complying with paragraph (1), apply the payment 
     in a way that minimizes the amount of any finance charge to 
     the account.
       ``(c) Changes by Card Issuer.--If a card issuer makes a 
     material change in the mailing address, office, or procedures 
     for handling cardholder payments, and such change causes a 
     material delay in the crediting of a cardholder payment made 
     during the 60-day period following the date on which such 
     change took effect, the card issuer may not impose any late 
     fee or finance charge for a late payment on the credit card 
     account to which such payment was credited.
       ``(d) Presumption of Timely Payment.--Any evidence provided 
     by a consumer in the form of a receipt from the United States 
     Postal Service or other common carrier indicating that a 
     payment on a credit card account was sent to the card issuer 
     not less than 7 days before the due date contained in the 
     periodic statement for such payment shall create a 
     presumption that such payment was made by the due date, which 
     may be rebutted by the creditor for fraud or dishonesty on 
     the part of the consumer with respect to the mailing date.''.

     SEC. 107. LENGTH OF BILLING PERIOD.

       Section 163(a) of the Truth in Lending Act (15 U.S.C. 
     1668(a)) is amended by striking ``mailed at least fourteen 
     days prior'' and inserting ``mailed at least 21 days prior''.

     SEC. 108. PROHIBITION ON UNIVERSAL DEFAULT AND UNILATERAL 
                   CHANGES TO CARDHOLDER AGREEMENTS.

       (a) In General.--Chapter 4 of the Truth in Lending Act (15 
     U.S.C. 1666 et seq.) is amended--
       (1) by redesignating section 171 as section 173; and
       (2) by inserting after section 170 the following:

     ``SEC. 171. LIMITS ON INTEREST RATE INCREASES.

       ``(a) In General.--No card issuer may increase any annual 
     percentage rate, fee, or finance charge applicable to a 
     credit card account under an open end consumer credit plan, 
     or terminate early a lower introductory rate, fee, or charge, 
     except as permitted under this section.
       ``(b) Exceptions.--The limitation under subsection (a) 
     shall not apply to--
       ``(1) an increase due to the scheduled expiration of an 
     introductory term;
       ``(2) an increase in a variable annual percentage rate, 
     fee, or finance charge in accordance with a credit card 
     agreement that provides for changes according to an index or 
     formula;
       ``(3) an increase due to a specific, material action or 
     omission of a consumer in violation of an agreement that is 
     directly related to such account and that is specified in the 
     contract or agreement as grounds for an increase, except 
     that--
       ``(A) the creditor may not take into account information 
     not directly related to the account, including adverse 
     information concerning the consumer, information in any 
     consumer report, or changes in the credit score of the 
     consumer; and
       ``(B) an increase described in this paragraph shall 
     terminate not later than 6 months after the date on which it 
     is imposed, if the consumer commits no further violations; or
       ``(4) a change that takes effect upon renewal of the card 
     in accordance with section 172.
       ``(c) Map to Lower Rate.--
       ``(1) In general.--A card issuer that increases an annual 
     percentage rate, fee, or finance charge pursuant to 
     subsection (b)(3) shall include, together with the notice of 
     such increase under section 127(i), a statement, provided in 
     a clear and conspicuous manner--
       ``(A) of the discrete, specific action or omission of the 
     consumer on which the increase was based; and
       ``(B) that the increase will terminate in 6 months if the 
     consumer does not commit further violations.
       ``(2) Board authority.--The Board may, by rule, provide for 
     exceptions to the requirements of subsection (b)(3)(B), if 
     the Board determines that there are other appropriate factors 
     that creditors may consider in determining the appropriate 
     annual percentage rate for particular consumers.

     ``SEC. 172. UNILATERAL CHANGES IN CREDIT CARD AGREEMENT 
                   PROHIBITED.

       ``A card issuer may not amend or change the terms of a 
     credit card contract or agreement under an open end consumer 
     credit plan, until after the date on which the credit card 
     will expire if not renewed.''.
       (b) Clerical Amendment.--The table of sections for chapter 
     4 of the Truth in Lending Act is amended by striking the item 
     relating to section 171 and inserting the following:

``171. Universal defaults prohibited.
``172. Unilateral changes in credit card agreement prohibited.
``173. Applicability of State laws.''.

     SEC. 109. ENHANCED PENALTIES.

       Section 130(a)(2)(A) of the Truth in Lending Act (15 U.S.C. 
     1640(a)(2)(A)) is amended by striking ``or (iii) in the'' and 
     inserting the following: ``(iii) in the case of an individual 
     action relating to an open end consumer credit plan that is 
     not secured by real property or a dwelling, twice the amount 
     of any finance charge in connection with the transaction, 
     with a minimum of $500 and a maximum of $5,000, or such 
     higher amount as may be appropriate in the case of an 
     established pattern or practice of such failures; or (iv) in 
     the''.

     SEC. 110. ENHANCED OVERSIGHT.

       (a) In General.--Section 127 of the Truth in Lending Act 
     (15 U.S.C. 1637) is amended by adding at the end the 
     following:
       ``(s) Evaluation of Credit Card Policies and Procedures.--
       ``(1) In general.--In connection with its examination of a 
     credit card issuer under its supervision, each agency 
     referred to in paragraphs (1), (2), and (3) of section 108(a) 
     shall conduct, as appropriate, an evaluation of the credit 
     card policies and procedures used by such card issuer to 
     ensure compliance with this section and sections 163, 164, 
     171, and 172. Such agency shall promptly require the card 
     issuer to take any corrective action needed to address any 
     violations of any such section.
       ``(2) Annual reports to congress.--Each year, each agency 
     referred to in subsections (a) and (c) of section 108 shall 
     submit a report to Congress concerning the administration of 
     its functions under this section, including such 
     recommendations as the agency deems necessary or appropriate. 
     Each such

[[Page S6576]]

     report shall include an assessment of the extent to which 
     compliance with the requirements of this section is being 
     achieved and a summary of the enforcement actions taken by 
     the agency assigned administrative enforcement 
     responsibilities under subsections (a) and (c) of section 
     108.''.
       (b) Strengthened Credit Card Information Collection.--
     Section 136(b) of the Truth in Lending Act (15 U.S.C. 
     1646(b)) is amended--
       (1) in paragraph (1)--
       (A) by striking ``The Board shall'' and inserting the 
     following:
       ``(A) In general.--The Board shall''; and
       (B) by adding at the end the following:
       ``(B) Information to be included.--The information under 
     subparagraph (A) shall include, as of a date designated by 
     the Board--
       ``(i) a list of each type of transaction or event for which 
     one or more of the card issuers has imposed a separate 
     interest rate upon a cardholder, including purchases, cash 
     advances, and balance transfers;
       ``(ii) for each type of transaction or event identified 
     under clause (i)--

       ``(I) each distinct interest rate charged by the card 
     issuer to a cardholder, as of the designated date;
       ``(II) the number of cardholders to whom each such interest 
     rate was applied during the calendar month immediately 
     preceding the designated date, and the total amount of 
     interest charged to such cardholders at each such rate during 
     such month;
       ``(III) the number of cardholders who are paying the stated 
     default annual percentage rate applicable in cases in which 
     the account is past due or the account holder is otherwise in 
     violation of the terms of the account agreement; and
       ``(IV) the number of cardholders who are paying above such 
     stated default annual percentage rate;

       ``(iii) a list of each type of fee that one or more of the 
     card issuers has imposed upon a cardholder as of the 
     designated date, including any fee imposed for obtaining a 
     cash advance, making a late payment, exceeding the credit 
     limit on an account, making a balance transfer, or exchanging 
     United States dollars for foreign currency;
       ``(iv) for each type of fee identified under clause (iii), 
     the number of cardholders upon whom the fee was imposed 
     during the calendar month immediately preceding the 
     designated date, and the total amount of fees imposed upon 
     cardholders during such month;
       ``(v) the total number of cardholders that incurred any 
     interest charge or any fee during the calendar month 
     immediately preceding the designated date; and
       ``(vi) any other information related to interest rates, 
     fees, or other charges that the Board deems of interest.''; 
     and
       (2) by adding at the end the following:
       ``(5) Report to congress.--The Board shall, on an annual 
     basis, transmit to Congress and make public a report 
     containing an assessment by the Board of the profitability of 
     credit card operations of depository institutions. Such 
     report shall include estimates by the Board of the 
     approximate, relative percentage of income derived by such 
     operations from--
       ``(A) the imposition of interest rates on cardholders, 
     including separate estimates for--
       ``(i) interest with an annual percentage rate of less than 
     25 percent; and
       ``(ii) interest with an annual percentage rate equal to or 
     greater than 25 percent;
       ``(B) the imposition of fees on cardholders;
       ``(C) the imposition of fees on merchants; and
       ``(D) any other material source of income, while specifying 
     the nature of that income.''.

     SEC. 111. CLERICAL AMENDMENTS.

       Section 103(i) of the Truth in Lending Act (15 U.S.C. 
     1602(i)) is amended--
       (1) by striking ``term'' and all that follows through 
     ``means'' and inserting the following: ``terms `open end 
     credit plan' and `open end consumer credit plan' mean''; and
       (2) in the second sentence, by inserting ``or open end 
     consumer credit plan'' after ``credit plan'' each place that 
     term appears.

                TITLE II--ENHANCED CONSUMER DISCLOSURES

     SEC. 201. PAYOFF TIMING DISCLOSURES.

       (a) In General.--Section 127(b)(11) of the Truth in Lending 
     Act (15 U.S.C. 1637(b)(11)) is amended to read as follows:
       ``(11)(A) A written statement in the following form: 
     `Minimum Payment Warning: Making only the minimum payment 
     will increase the interest rate you pay and the time it takes 
     to repay your balance.'.
       ``(B) Repayment information that would apply to the 
     outstanding balance of the consumer under the credit plan, 
     including--
       ``(i) the number of months (rounded to the nearest month) 
     that it would take to pay the entire amount of that balance, 
     if the consumer pays only the required minimum monthly 
     payments and if no further advances are made;
       ``(ii) the total cost to the consumer, including interest 
     and principal payments, of paying that balance in full, if 
     the consumer pays only the required minimum monthly payments 
     and if no further advances are made; and
       ``(iii) the monthly payment amount that would be required 
     for the consumer to eliminate the outstanding balance in 36 
     months, if no further advances are made, and the total cost 
     to the consumer, including interest and principal payments, 
     of paying that balance in full if the consumer pays the 
     balance over 36 months.
       ``(C)(i) Subject to clause (ii), in making the disclosures 
     under subparagraph (B), the creditor shall apply the interest 
     rate or rates in effect on the date on which the disclosure 
     is made until the date on which the balance would be paid in 
     full.
       ``(ii) If the interest rate in effect on the date on which 
     the disclosure is made is a temporary rate that will change 
     under a contractual provision applying an index or formula 
     for subsequent interest rate adjustment, the creditor shall 
     apply the interest rate in effect on the date on which the 
     disclosure is made for as long as that interest rate will 
     apply under that contractual provision, and then apply an 
     interest rate based on the index or formula in effect on the 
     applicable billing date.
       ``(D) All of the information described in subparagraph (B) 
     shall--
       ``(i) be disclosed in the form and manner which the Board 
     shall prescribe, by regulation, and in a manner that avoids 
     duplication; and
       ``(ii) be placed in a conspicuous and prominent location on 
     the billing statement, in typeface that is at least as large 
     as the largest type on the statement.
       ``(E) In the regulations prescribed under subparagraph (D), 
     the Board shall require that the disclosure of such 
     information shall be in the form of a table that--
       ``(i) contains clear and concise headings for each item of 
     such information; and
       ``(ii) provides a clear and concise form stating each item 
     of information required to be disclosed under each such 
     heading.
       ``(F) In prescribing the form of the table under 
     subparagraph (E), the Board shall require that--
       ``(i) all of the information in the table, and not just a 
     reference to the table, be placed on the billing statement, 
     as required by this paragraph; and
       ``(ii) the items required to be included in the table shall 
     be listed in the order in which such items are set forth in 
     subparagraph (B).
       ``(G) In prescribing the form of the table under 
     subparagraph (D), the Board shall employ terminology which is 
     different than the terminology which is employed in 
     subparagraph (B), if such terminology is more easily 
     understood and conveys substantially the same meaning.''.
       (b) Civil Liability.--Section 130(a) of the Truth in 
     Lending Act (15 U.S.C. 1640(a)) is amended, in the 
     undesignated paragraph following paragraph (4), by striking 
     the second sentence and inserting the following: ``In 
     connection with the disclosures referred to in subsections 
     (a) and (b) of section 127, a creditor shall have a liability 
     determined under paragraph (2) only for failing to comply 
     with the requirements of section 125, 127(a), or any of 
     paragraphs (4) through (13) of section 127(b), or for failing 
     to comply with disclosure requirements under State law for 
     any term or item that the Board has determined to be 
     substantially the same in meaning under section 111(a)(2) as 
     any of the terms or items referred to in section 127(a), or 
     any of paragraphs (4) through (13) of section 127(b).''.

     SEC. 202. REQUIREMENTS RELATING TO LATE PAYMENT DEADLINES AND 
                   PENALTIES.

       Section 127(b)(12) of the Truth in Lending Act (15 U.S.C. 
     1637(b)(12)) is amended to read as follows:
       ``(12) Requirements relating to late payment deadlines and 
     penalties.--
       ``(A) Late payment deadline and postmark date required to 
     be disclosed.--In the case of a credit card account under an 
     open end consumer credit plan under which a late fee or 
     charge may be imposed due to the failure of the obligor to 
     make payment on or before the due date for such payment, the 
     periodic statement required under subsection (b) with respect 
     to the account shall include, in a conspicuous location on 
     the billing statement--
       ``(i) the date on which the payment is due or, if 
     different, the date on which a late payment fee will be 
     charged, together with the amount of the fee or charge to be 
     imposed if payment is made after that date; and
       ``(ii) the date by which the payment must be postmarked, if 
     paid by mail, in order to avoid the imposition of a late 
     payment fee with respect to the payment, and a statement to 
     that effect.
       ``(B) Disclosure of increase in interest rates for late 
     payments.--If 1 or more late payments under an open end 
     consumer credit plan may result in an increase in the annual 
     percentage rate applicable to the account, the statement 
     required under subsection (b) with respect to the account 
     shall include conspicuous notice of such fact, together with 
     the applicable penalty annual percentage rate, in close 
     proximity to the disclosure required under subparagraph (A) 
     of the date on which payment is due under the terms of the 
     account.
       ``(C) Requirements relating to postmark date.--
       ``(i) In general.--The date included in a periodic 
     statement pursuant to subparagraph (A)(ii) with regard to the 
     postmark on a payment shall allow, in accordance with 
     regulations prescribed by the Board under clause (ii), a 
     reasonable time for the consumer to make the payment and a 
     reasonable time for the delivery of the payment by the due 
     date.
       ``(ii) Board regulations.--The Board shall prescribe 
     guidelines for determining a reasonable period of time for 
     making a payment and delivery of a payment for purposes of

[[Page S6577]]

     clause (i), after consultation with the Postmaster General of 
     the United States and representatives of consumer and trade 
     organizations.
       ``(D) Payments at local branches.--If the creditor, in the 
     case of a credit card account referred to in subparagraph 
     (A), is a financial institution which maintains branches or 
     offices at which payments on any such account are accepted 
     from the obligor in person, the date on which the obligor 
     makes a payment on the account at such branch or office shall 
     be considered to be the date on which the payment is made for 
     purposes of determining whether a late fee or charge may be 
     imposed due to the failure of the obligor to make payment on 
     or before the due date for such payment.''.

     SEC. 203. RENEWAL DISCLOSURES.

       Section 127(d) of the Truth in Lending Act (15 U.S.C. 
     1637(d)) is amended--
       (1) by striking paragraph (2);
       (2) by redesignating paragraph (3) as paragraph (2); and
       (3) in paragraph (1), by striking ``Except as provided in 
     paragraph (2), a card issuer'' and inserting the following: 
     ``A card issuer that has changed or amended any term of the 
     account since the last renewal or''.

                TITLE III--PROTECTION OF YOUNG CONSUMERS

     SEC. 301. EXTENSIONS OF CREDIT TO UNDERAGE CONSUMERS.

       Section 127(c) of the Truth in Lending Act (15 U.S.C. 
     1637(c)) is amended by adding at the end the following:
       ``(8) Applications from underage consumers.--
       ``(A) Prohibition on issuance.--No credit card may be 
     issued to, or open end consumer credit plan established by or 
     on behalf of, a consumer who has not attained the age of 21, 
     unless the consumer has submitted a written application to 
     the card issuer that meets the requirements of subparagraph 
     (B).
       ``(B) Application requirements.--An application to open a 
     credit card account by an individual who has not attained the 
     age of 21 as of the date of submission of the application 
     shall require--
       ``(i) the signature of the parent, legal guardian, or any 
     other individual over the age of 21 having a means to repay 
     debts incurred by the consumer in connection with the 
     account, indicating joint liability for debts incurred by the 
     consumer in connection with the account before the consumer 
     has attained the age of 21;
       ``(ii) submission by the consumer of financial information 
     indicating an independent means of repaying any obligation 
     arising from the proposed extension of credit in connection 
     with the account; or
       ``(iii) completion of a certified financial literacy or 
     financial education course designed for young consumers.
       ``(C) Certified financial literacy or education courses for 
     young consumers.--
       ``(i) In general.--The Secretary of the Treasury, acting 
     through the Office of Financial Literacy and Education (in 
     this subparagraph referred to as `OFE'), shall make and 
     publish a list of all courses and programs that have been 
     certified for financial literacy or financial education 
     purposes appropriate for young consumers. When developing the 
     certification criteria the OFE shall take into account the 
     course or program's--

       ``(I) proven track record in producing changed consumer 
     behavior; and
       ``(II) use of practices or curricula that have been shown 
     to change consumer behavior.

       ``(ii) Explicit eligibility.--Courses taken that are 
     offered or required by colleges, universities, and high 
     schools may be certified by the OFE for purposes of this 
     subparagraph, as well as other programs and courses. The OFE 
     shall make an effort to provide certification to all types of 
     programs and courses, including those that are conducted by 
     nonprofit, faith-based, or for-profit institutions and State 
     and local governments.
       ``(iii) Select programs.--From among those courses or 
     programs that are certified by the OFE under this 
     subparagraph, the OFE may designate a select number of 
     programs or courses that produce results that are far better 
     than those produced by other certified programs as `highly 
     certified'.''.

     SEC. 302. RESTRICTIONS ON CERTAIN AFFINITY CARDS.

       Section 127 of the Truth in Lending Act (15 U.S.C. 1637), 
     as amended by this Act, is amended by adding at the end the 
     following:
       ``(t) Restrictions on Issuance of Affinity Cards to 
     Students.--No credit card account under an open end consumer 
     credit plan may be established by an individual who has not 
     attained the age of 21 as of the date of submission of the 
     application pursuant to any direct or indirect agreement 
     relating to affinity cards, as defined by the Board, between 
     the creditor and an institution of higher education, as 
     defined in section 101(a) of the Higher Education Act of 1965 
     (20 U.S.C. 1001(a)), unless the requirements of subsection 
     (c)(8) are met with respect to the obligor.''.

     SEC. 303. PROTECTION OF YOUNG CONSUMERS FROM PRESCREENED 
                   CREDIT OFFERS.

       (a) In General.--Section 604(c)(1)(B) of the Fair Credit 
     Reporting Act (15 U.S.C. 1681b(c)(1)(B)) is amended--
       (1) in clause (ii), by striking ``and'' at the end; and
       (2) in clause (iii), by striking the period at the end and 
     inserting the following: ``; and
       ``(iv) the consumer report indicates that the consumer is 
     age 21 or older, except that a consumer who is at least 18 
     years of age may elect, in accordance with subsection (e)(7), 
     to authorize the consumer reporting agency to include the 
     name and address of the consumer in any list of names 
     provided by the agency pursuant to this paragraph.''.
       (b) Opt-in for Young Consumers.--Section 604(e) of the Fair 
     Credit Reporting Act (15 U.S.C. 1681b(e)) is amended--
       (1) by striking the subsection heading and inserting the 
     following:
       ``(e) Election of Consumers Regarding Lists.--''; and
       (2) by adding at the end the following:
       ``(7) Opt-in for underage consumers.--
       ``(A) In general.--A consumer who is at least 18 years of 
     age, but has not attained his or her 21st birthday, may elect 
     to have the name and address of the consumer included in any 
     list provided by a consumer reporting agency under subsection 
     (c)(1)(B) in connection with a credit or insurance 
     transaction that is not initiated by the consumer by 
     notifying the agency in accordance with subparagraph (B) that 
     the consumer consents to the use of a consumer report 
     relating to the consumer in connection with any credit or 
     insurance transaction that is not initiated by the consumer.
       ``(B) Manner of notification.--An election by a consumer 
     described in subparagraph (A) shall be in writing, using a 
     signed notice of election form issued or made available 
     electronically by the consumer reporting agency at the 
     request of the consumer for purposes of this paragraph.
       ``(C) Effectiveness of election.--An election by a consumer 
     under subparagraph (A) to be included in a list provided by a 
     consumer reporting agency--
       ``(i) shall be effective until the earlier of--

       ``(I) the 21st birthday of the consumer; or
       ``(II) the date on which the consumer notifies the agency, 
     through the notification system established by the agency 
     under paragraph (5), that the election is no longer 
     effective; and

       ``(ii) shall be effective with respect to each affiliate of 
     the agency.
       ``(D) Rule of construction.--An election by a consumer 
     under subparagraph (A) to be included in a list provided by a 
     consumer reporting agency may not be construed to limit the 
     applicability of this subsection to any person age 21 or 
     older, and the consumer may elect to be excluded from any 
     such list after the attainment of his or her 21st birthday in 
     the manner otherwise provided under this subsection.''.

                 TITLE IV--FEDERAL AGENCY COORDINATION

     SEC. 401. INCLUSION OF ALL FEDERAL BANKING AGENCIES.

       (a) In General.--Section 18(f)(1) of the Federal Trade 
     Commission Act (15 U.S.C. 57a(f)(1)) is amended in the second 
     sentence--
       (1) by striking ``The Board of Governors of the Federal 
     Reserve System (with respect to banks) and the Federal Home 
     Loan Bank Board (with respect to savings and loan 
     institutions described in paragraph (3)) and the National 
     Credit Union Administration Board (with respect to Federal 
     credit unions described in paragraph (4))'' and inserting 
     ``Each appropriate Federal banking agency''; and
       (2) by inserting ``in consultation with the Commission'' 
     after ``shall prescribe regulations''.
       (b) FTC Concurrent Rulemaking.--Section 18(f)(1) of the 
     Federal Trade Commission Act (15 U.S.C. 57a(f)(1)) is amended 
     by inserting after the second sentence the following: 
     ``Notwithstanding any other provision of this section, 
     whenever such agencies commence such a rulemaking proceeding, 
     the Commission, with respect to the entities within its 
     jurisdiction under this Act, may commence a rulemaking 
     proceeding and prescribe regulations in accordance with 
     section 553 of title 5, United States Code. The Commission, 
     the Federal banking agencies, and the National Credit Union 
     Administration Board shall consult and coordinate with each 
     other so that the regulations prescribed by each such agency 
     are consistent with and comparable to the regulations 
     prescribed by each other such agency, to the extent 
     practicable.''.
       (c) Preservation of State Law.--Section 18(f)(6) of the 
     Federal Trade Commission Act (15 U.S.C. 57a(f)(6)) is amended 
     to read as follows:
       ``(6) Notwithstanding any other provision of this 
     subsection or any other provision of law, regulations 
     promulgated under this subsection shall be considered 
     supplemental to State laws governing unfair and deceptive 
     acts and practices, and may not be construed to preempt any 
     provision of State law that provides equal or greater 
     protections.''.
       (d) Gao Study and Report.--Not later than 18 months after 
     the date of enactment of this Act, the Comptroller General 
     shall transmit to Congress a report on the status of 
     regulations of the Federal banking agencies and the National 
     Credit Union Administration regarding unfair and deceptive 
     acts or practices by depository institutions and Federal 
     credit unions.
       (e) Technical and Conforming Amendments.--Section 18(f) of 
     the Federal Trade Commission Act (15 U.S.C. 57a(f)) is 
     amended--
       (1) in the subsection heading, by striking ``Board'' and 
     all that follows through ``Administration'' and inserting 
     ``Appropriate Federal Banking Agencies''
       (2) in paragraph (1), in the first sentence--
       (A) by striking ``banks or savings and loan institutions 
     described in paragraph (3), each

[[Page S6578]]

     agency specified in paragraph (2) or (3) of this subsection 
     shall establish'' and inserting ``depository institutions or 
     Federal credit unions, each appropriate Federal banking 
     agency shall establish''; and
       (B) by striking ``banks or savings and loan institutions 
     described in paragraph (3), subject to its jurisdiction'' and 
     inserting ``the depository institutions or Federal credit 
     unions subject to the jurisdiction of such appropriate 
     Federal banking agency'';
       (3) in paragraph (1), in the final sentence--
       (A) by striking ``each such Board'' and inserting ``each 
     such appropriate Federal banking agency'';
       (B) by striking ``banks or savings and loan institutions 
     described in paragraph (3), or Federal credit unions 
     described in paragraph (4), as the case may be,'' each place 
     that term appears and inserting ``depository institutions or 
     Federal credit unions subject to the jurisdiction of such 
     appropriate Federal banking agency'';
       (C) by striking ``(A) any such Board'' and inserting ``(A) 
     any such appropriate Federal banking agency''; and
       (D) by striking ``with respect to banks, savings and loan 
     institutions'' and inserting ``with respect to depository 
     institutions'';
       (4) in paragraph (2)(C), by inserting ``than'' after 
     ``(other'';
       (5) in paragraph (3), by inserting ``by the Director of the 
     Office of Thrift Supervision'' before the period at the end;
       (6) in paragraph (4), by inserting ``by the National Credit 
     Union Administration'' before the period at the end;
       (7) in paragraph (6), by striking ``the Board of Governors 
     of the Federal Reserve System'' and inserting ``any Federal 
     banking agency or the National Credit Union Administration 
     Board''; and
       (8) by adding at the end the following new paragraph:
       ``(8) For purposes of this subsection--
       ``(A) the term `appropriate Federal banking agency' has the 
     same meaning as in section 3 of the Federal Deposit Insurance 
     Act, and includes the National Credit Union Administration 
     Board with respect to Federal credit unions;
       ``(B) the terms `depository institution' and `Federal 
     banking agency' have the same meanings as in section 3 of the 
     Federal Deposit Insurance Act (12 U.S.C. 1813); and
       ``(C) the term `Federal credit union' has the same meaning 
     as in section 101 of the Federal Credit Union Act (12 U.S.C. 
     1752).''.

                   TITLE V--MISCELLANEOUS PROVISIONS

     SEC. 501. STUDY AND REPORT.

       (a) Study Required.--The Comptroller General (in this 
     section referred to as the ``Comptroller'') shall conduct a 
     study on interchange fees and their effects on consumers and 
     merchants. The Comptroller shall review--
       (1) the extent to which interchange fees are required to be 
     disclosed to consumers and merchants, and how such fees are 
     overseen by the Federal banking agencies or other regulators;
       (2) the ways in which the interchange system affects the 
     ability of merchants of varying size to negotiate pricing 
     with card associations and banks;
       (3) the costs and factors incorporated into interchange 
     fees, such as advertising, bonus miles, and rewards, how such 
     costs and factors vary among cards; and
       (4) the consequences of the undisclosed nature of 
     interchange fees on merchants and consumers with regard to 
     prices charged for goods and services.
       (b) Report Required.--Not later than 180 days after the 
     date of enactment of this Act, the Comptroller shall submit a 
     report to the Committee on Banking, Housing, and Urban 
     Affairs of the Senate and the Committee on Financial Services 
     of the House of Representatives containing a detailed summary 
     of the findings and conclusions of the study required by this 
     section, together with such recommendations for legislative 
     or administrative actions as may be appropriate.

     SEC. 502. CREDIT CARD SAFETY RATING SYSTEM COMMISSION STUDY.

       (a) Definition.--In this section, the term ``safety'' 
     refers to the amount of risk to cardholders that results from 
     credit card practices and terms in credit card agreements 
     that are either not well understood by consumers, or are not 
     easily understood, or could have an adverse financial effect 
     on consumers, other than interest rates, periodic fees, or 
     rewards.
       (b) Establishment of Safety Rating System.--The Comptroller 
     General of the United States (in this section referred to as 
     the ``Comptroller'') shall establish an entity to be known as 
     the ``Credit Card Safety Rating System Commission'' (in this 
     section referred to as the ``Commission'').
       (c) Duties.--The duties of the Commission shall be--
       (1) to determine if a rating system to allow cardholders to 
     quickly assess the level of safety of credit card agreements 
     would be beneficial to consumers;
       (2) to assess the impact on credit card transparency and 
     consumer safety of various rating system policy options, 
     including--
       (A) the use of a 5-star rating system to reflect the 
     relative safety of card terms, marketing and customer service 
     practices, and product features;
       (B) making the use of the system mandatory for all cards;
       (C) requiring a graphic display of rating on all marketing 
     material, applications, billing statements, and agreements 
     associated with that credit card, as well as on the back of 
     each such credit card;
       (D) requiring an annual review of the safety rating system, 
     to determine whether the point system is effectively aiding 
     consumers and encouraging transparent competition and 
     fairness to consumers; and
       (E) requiring consumer access to ratings through public 
     website and other outreach programs
       (3) if it is deemed beneficial, to make recommendations to 
     Congress concerning how such a system should be devised;
       (4) to study the effects of such system on the availability 
     and affordability of credit and the implications of changes 
     in credit availability and affordability in the United States 
     and in the general market for credit services due to the 
     rating system; and
       (5) by not later than March 1 of the second year after the 
     date of enactment of this Act, to submit a report to Congress 
     containing detailed results and recommendations, including 
     how to create such system, if creating such system is 
     recommended.
       (d) Membership.--
       (1) Number and appointment.--The Commission shall be 
     composed of 15 members appointed by the Comptroller, in 
     accordance with this section.
       (2) Qualifications.--
       (A) In general.--The membership of the Commission, subject 
     to subparagraph (B), shall include individuals--
       (i) who have achieved national recognition for their 
     expertise in credit cards, debt management, economics, credit 
     availability, consumer protection, and other credit card 
     related issues and fields; and
       (ii) who provide a mix of different professions, a broad 
     geographic representation, and a balance between urban and 
     rural representatives.
       (B) Makeup of commission.--The Commission shall be 
     comprised of--
       (i) 4 representatives from consumer groups;
       (ii) 4 representatives from credit card issuers or banks;
       (iii) 7 representatives from nonprofit research entities or 
     nonpartisan experts in banking and credit cards; and
       (iv) not fewer than 1 of the members described in clauses 
     (i) through (iii) who represents each of--

       (I) the elderly;
       (II) economically disadvantaged consumers;
       (III) racial or ethnic minorities; and
       (IV) students and minors.

       (C) Ethics disclosures.--The Comptroller shall establish a 
     system for public disclosure by members of the Commission of 
     financial and other potential conflicts of interest relating 
     to such members. Members of the Commission shall be treated 
     in the same manner as employees of Congress whose pay is 
     disbursed by the Secretary of the Senate for purposes of 
     title I of the Ethics in Government Act of 1978 (Public Law 
     95-521).
       (3) Chairperson; vice chairperson.--The Comptroller shall 
     designate a member of the Commission, at the time of 
     appointment of the member as Chairperson and a member as Vice 
     Chairperson for that term of appointment, except that in the 
     case of vacancy in the position of Chairperson or Vice 
     Chairperson of the Commission, the Comptroller may designate 
     another member for the remainder of the term of that member.
       (4) Terms.--Members of the Commission shall be appointed 
     for the life of the Commission. Any vacancies shall not 
     affect the power and duties of the Commission but shall be 
     filled in the same manner as the original appointment.
       (5) Compensation.--
       (A) Members.--While serving on the business of the 
     Commission (including travel time), a member of the 
     Commission shall be entitled to compensation at the per diem 
     equivalent of the rate provided for level IV of the Executive 
     Schedule under section 5315 of title 5, United States Code, 
     and while so serving away from home and the regular place of 
     business of the member, the member may be allowed travel 
     expenses, as authorized by the Chairperson.
       (B) Other employees.--For purposes of pay (other than pay 
     of members of the Commission) and employment benefits, 
     rights, and privileges, all employees of the Commission shall 
     be treated as if they were employees of the United States 
     Senate.
       (6) Meetings.--The Commission shall meet at the call of the 
     Chairperson.
       (e) Director and Staff; Experts and Consultants.--Subject 
     to such review as the Comptroller determines necessary to 
     assure the efficient administration of the Commission, the 
     Commission may--
       (1) employ and fix the compensation of an Executive 
     Director (subject to the approval of the Comptroller General) 
     and such other personnel as may be necessary to carry out its 
     duties (without regard to the provisions of title 5, United 
     States Code, governing appointments in the competitive 
     service);
       (2) seek such assistance and support as may be required in 
     the performance of its duties from appropriate Federal 
     departments and agencies;
       (3) enter into contracts or make other arrangements, as may 
     be necessary for the conduct of the work of the Commission 
     (without regard to section 3709 of the Revised Statutes of 
     the United States (41 U.S.C. 5));
       (4) make advance, progress, and other payments which relate 
     to the work of the Commission;
       (5) provide transportation and subsistence for persons 
     serving without compensation; and

[[Page S6579]]

       (6) prescribe such rules and regulations as it determines 
     necessary with respect to the internal organization and 
     operation of the Commission.
       (f) Powers.--
       (1) Obtaining official data.--The Commission may secure 
     directly from any department or agency of the United States 
     information necessary to enable it to carry out this section. 
     Upon request of the Chairperson, the head of that department 
     or agency shall furnish that information to the Commission on 
     an agreed upon schedule.
       (2) Data collection.--In order to carry out its functions, 
     the Commission shall--
       (A) utilize existing information, both published and 
     unpublished, where possible, collected and assessed either by 
     its own staff or under other arrangements made in accordance 
     with this section;
       (B) carry out, or award grants or contracts for, original 
     research and experimentation, where existing information is 
     inadequate; and
       (C) adopt procedures allowing any interested party to 
     submit information for the Commission's use in making reports 
     and recommendations.
       (3) Access of gao information.--The Comptroller shall have 
     unrestricted access to all deliberations, records, and 
     nonproprietary data of the Commission, immediately upon 
     request.
       (4) Periodic audit.--The Commission shall be subject to 
     periodic audit by the Comptroller.
       (g) Administrative and Support Services.--The Comptroller 
     shall provide such administrative and support services to the 
     Commission as may be necessary to carry out this section.
       (h) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Commission such sums as may be 
     necessary to carry out this section.

  Mr. LEVIN. Mr. President, I know the Senator from Connecticut has to 
leave, but before he does leave the floor, I congratulate and commend 
him on this bill. He has put a huge amount of effort into this issue 
over the years. This bill reflects that effort. His leadership in this 
matter will make a huge difference in getting this bill enacted. I 
thank him for that leadership and thank him for this bill.
  Mr. DODD. I thank my colleague.
  Mr. LEVIN. Mr. President, the legislation we are introducing today is 
going to combat credit card abuses that have been hurting American 
consumers for far too long. With all the economic hardship facing 
Americans today, from falling home prices to rising gasoline and food 
costs, it is more important than ever for Congress to act now to stop 
credit card abuses and protect American families from unfair credit 
card practices.
  Credit card companies regularly use a host of unfair practices. They 
hike the interest rates of cardholders who pay on time and comply with 
their credit card agreements. They impose interest rates as high as 32 
percent. They charge interest for debt that was paid on time. They 
apply higher interest rates retroactively to existing credit card debt. 
They pile on excessive fees and then have the gall to charge interest 
on those fees. They apply consumer payments first to the debt with the 
least expensive interest rate, saving the higher interest rate debt to 
be paid off last. And they engage in a number of other unfair practices 
that are burying American consumers in a mountain of debt. It is long 
past time to enact legislation to protect American consumers.
  The bill we are introducing today will not only help protect 
consumers, but it will also help ensure that credit card companies 
willing to do the right thing are not put at a competitive disadvantage 
by companies continuing unfair practices.
  Some argue that Congress does not need to ban unfair credit card 
practices. They contend that improved disclosure alone will empower 
consumers to seek out better deals. Sunlight can be a powerful 
disinfectant, but credit cards have become such complex financial 
products that even improved disclosure will not be enough to curb the 
abuses. Some practices are so confusing that consumers cannot easily 
understand them. Additionally, better disclosure does not always lead 
to greater market competition, especially when essentially an entire 
industry is using and benefiting from practices that unfairly hurt 
consumers.
  Credit card issuers like to say they are engaged in a risky business, 
lending unsecured debt to millions of consumers. But it is clear they 
have learned to price credit card products in ways that produce 
enormous profit. For the last decade, credit card issuers have 
maintained their position as the most profitable sector in the consumer 
lending field and reported consistently higher rates of return than 
commercial banks.
  In 2006, Americans used 700 million credit cards to buy about $2 
trillion in goods and services. The average American family now has 
five credit cards. Credit cards are being used to pay for groceries, 
mortgage payments, and even taxes, and they are saddling U.S. 
consumers, from college students to seniors, with a mountain of debt. 
The latest figures show that U.S. credit card debt is now approaching 
$1 trillion. These consumers are routinely being subjected to unfair 
practices that squeeze them for ever more money, sinking them further 
into debt.
  While the remaining legislative days in this Congress are dwindling, 
there is still time to enact strong credit card reform legislation. Too 
many American families are being hurt by too many unfair credit card 
practices to delay action any longer.
  I commend Senator Dodd for tackling credit card reform. I look 
forward to Congress taking the steps needed this session to ban unfair 
practices that are causing so much pain and financial damage to 
American families today.
  Credit card abuse is a topic, as Senator Dodd mentioned, with which I 
have been deeply involved over the past several years through a number 
of investigations in the Permanent Subcommittee on Investigations. We 
held two subcommittee hearings in 2007, and based on our investigative 
hearings, I introduced legislation called the Stop Unfair Practices in 
Credit Cards Act, S. 1395, to ban the outrageous credit card abuses 
that were documented in the hearings. I was pleased that Senators 
McCaskill, Leahy, Durbin, Bingaman, Cantwell, Whitehouse, Kohl, Brown, 
Stevens, and Sanders, our Presiding Officer, joined as cosponsors.
  This new bill, the Dodd-Levin bill introduced today, as Senator Dodd 
mentioned, incorporates almost all the provisions of S. 1395, and it 
adds other important protections as well. It is the strongest credit 
card bill yet in Congress.
  I would like to add to the record more detailing of the provisions of 
this bill, along with an overview of some of the most prevalent abuses 
that we uncovered and some of the stories that American consumers 
shared with us during the course of the inquiries carried out by my 
Permanent Subcommittee on Investigations.
  With regard to excessive fees, the first case history we examined 
illustrates the fact that major credit card issuers today impose a host 
of fees on their cardholders, including late fees and over-the-limit 
fees that are not only substantial in themselves but can contribute to 
years of debt for families unable to immediately pay them.
  Wesley Wannemacher of Lima, OH, testified at our March 2007 hearing. 
In 2001 and 2002, Mr. Wannemacher used a new credit card to pay for 
expenses mostly related to his wedding. He charged a total of about 
$3,200, which exceeded the card's credit limit by $200. He spent the 
next 6 years trying to pay off the debt, averaging payments of about 
$1,000 per year. As of February 2007, he had paid about $6,300 on his 
$3,200 debt, but his billing statement showed he still owed $4,400.
  How is it possible that a man pays $6,300 on a $3,200 credit card 
debt, but still owes $4,400? Here is how. On top of the $3,200 debt, 
Mr. Wannemacher was charged by the credit card issuer about $4,900 in 
interest, $1,100 in late fees, and $1,500 in over-the-limit fees. He 
was hit 47 times with over-limit fees, even though he went over the 
limit only three times and exceeded the limit by only $200. Altogether, 
these fees and the interest charges added up to $7,500, which, on top 
of the original $3,200 credit card debt, produced total charges to him 
of $10,700.
  In other words, the interest charges and fees more than tripled the 
original $3,200 credit card debt, despite payments by the cardholder 
averaging $1,000 per year. Unfair? Clearly, I think, but our 
investigation has shown that sky-high interest charges and fees are not 
uncommon in the credit card industry. While the Wannemacher account 
happened to be at Chase, penalty interest rates and fees are also 
employed by other major credit card issuers.
  The week before the March hearing, Chase decided to forgive the 
remaining

[[Page S6580]]

debt on the Wannemacher account, and while that was great news for the 
Wannemacher family, that decision doesn't begin to resolve the problem 
of excessive credit card fees and sky-high interest rates that trap too 
many hard-working families in a downward spiral of debt.
  These high fees are made worse by the industry-wide practice of 
including all fees in a consumer's outstanding balance so that they 
incur interest charges. It is one thing for a bank to charge interest 
on funds lent to a consumer; charging interest on penalty fees goes too 
far.
  Another galling practice featured in our March hearing involves the 
fact that credit card debt that is paid on time routinely accrues 
interest charges, and credit card bills that are paid on time and in 
full are routinely inflated with what I call ``trailing interest.'' 
Every single credit card issuer contacted by the Subcommittee engaged 
in both of these unfair practices which squeeze additional interest 
charges from responsible cardholders.
  Here is how it works. Suppose a consumer who usually pays his account 
in full, and owes no money on December 1, makes a lot of purchases in 
December, and gets a January 1 credit card bill for $5,020. That bill 
is due January 15. Suppose the consumer pays that bill on time, but 
pays $5,000 instead of the full amount owed. What do you think the 
consumer owes on the next bill?
  If you thought the bill would be the $20 past due plus interest on 
the $20, you would be wrong. In fact, under industry practice today, 
the bill would likely be twice as much. That is because the consumer 
would have to pay interest, not just on the $20 that wasn't paid on 
time, but also on the $5,000 that was paid on time. In other words, the 
consumer would have to pay interest on the entire $5,020 from the first 
day of the new billing month, January 1, until the day the bill was 
paid on January 15, compounded daily. So much for a grace period. In 
addition, the consumer would have to pay the $20 past due, plus 
interest on the $20 from January 15 to January 31, again compounded 
daily. In this example, using an interest rate of 17.99 percent, which 
is the interest rate charged to Mr. Wannamacher, the $20 debt would, in 
one month, rack up $35 in interest charges and balloon into a debt of 
$55.21.
  You might ask--hold on--why does the consumer have to pay any 
interest at all on the $5,000 that was paid on time? Why does anyone 
have to pay interest on the portion of a debt that was paid by the date 
specified in the bill--in other words, on time? The answer is, because 
that is how the credit card industry has operated for years, and they 
have gotten away with it.
  There is more. One might think that once the consumer gets gouged in 
February, paying $55.21 on a $20 debt, and pays that bill on time and 
in full, without making any new purchases, that would be the end of it. 
But you would be wrong again. It's not over.
  Even though, on February 15, the consumer paid the February bill in 
full and on time--all $55.21--the next bill has an additional interest 
charge on it, for what we call ``trailing interest.'' In this case, the 
trailing interest is the interest that accumulated on the $55.21 from 
February 1 to 15, which is time period from the day when the bill was 
sent to the day when it was paid. The total is 38 cents. While some 
issuers will waive trailing interest if the next month's bill is less 
than $1, if a consumer makes a new purchase, a common industry practice 
is to fold the 38 cents into the end-of-month bill reflecting the new 
purchase.
  Now 38 cents isn't much in the big scheme of things. That may be why 
many consumers don't notice these types of extra interest charges or 
try to fight them. Even if someone had questions about the amount of 
interest on a bill, most consumers would be hard pressed to understand 
how the amount was calculated, much less whether it was incorrect. But 
by nickel and diming tens of millions of consumer accounts, credit card 
issuers reap large profits.
  I think it is indefensible to make consumers pay interest on debt 
which they pay on time. It is also just plain wrong to charge trailing 
interest when a bill is paid on time and in full.
  My subcommittee's second hearing focused on another set of unfair 
credit card practices involving unfair interest rate increases. 
Cardholders who had years-long records of paying their credit card 
bills on time, staying below their credit limits, and paying at least 
the minimum amount due, were nevertheless socked with substantial 
interest rate increases. Some saw their credit card interest rates 
double or even triple. At the hearing, three consumers described this 
experience.
  Janet Hard of Freeland, MI, had accrued over $8,000 in debt on her 
Discover card. Although she made payments on time and paid at least the 
minimum due for over 2 years, Discover increased her interest rate from 
18 percent to 24 percent in 2006. At the same time, Discover applied 
the 24 percent rate retroactively to her existing credit card debt, 
increasing her minimum payments and increasing the amount that went to 
finance charges instead of the principal debt. The result was that, 
despite making steady payments totaling $2,400 in 12 months and keeping 
her purchases to less than $100 during that same year, Janet Hard's 
credit card debt went down by only $350. Sky-high interest charges, 
inexplicably increased and unfairly applied, ate up most of her 
payments.
  Millard Glasshof of Milwaukee, WI, a retired senior citizen on a 
fixed income, incurred a debt of about $5,000 on his Chase credit card, 
closed the account, and faithfully paid down his debt with a regular 
monthly payment of $119 for years. In December 2006, Chase increased 
his interest rate from 15 percent to 17 percent, and in February 2007, 
hiked it again to 27 percent. Retroactive application of the 27 percent 
rate to Mr. Glasshof's existing debt meant that, out of his $119 
payment, about $114 went to pay finance charges and only $5 went to 
reducing his principal debt. Despite his making payments totaling 
$1,300 over 12 months, Mr. Glasshof found that, due to high interest 
rates and excessive fees, his credit card debt did not go down at all. 
Later, after the Subcommittee asked about his account, Chase suddenly 
lowered the interest rate to 6 percent. That meant, over a one year 
period, Chase had applied four different interest rates to his closed 
credit card account: 15 percent, 17 percent, 27 percent, and 6 percent, 
which shows how arbitrary those rates are.
  Then there is Bonnie Rushing of Naples, FL. For years, she had paid 
her Bank of America credit card on time, providing at least the minimum 
amount specified on her bills. Despite her record of on-time payments, 
in 2007, Bank of America nearly tripled her interest rate from 8 to 23 
percent. The bank said that it took this sudden action because Ms. 
Rushing's FICO credit score had dropped. When we looked into why it had 
dropped, it was apparently because she had opened Macy's and J.Jill 
credit cards to get discounts on purchases. Despite paying both bills 
on time, the automated FICO system had lowered her credit rating, and 
Bank of America had followed suit by raising her interest rate by a 
factor of three. Ms. Rushing closed her account and complained to the 
Florida attorney general, my subcommittee, and her card sponsor, the 
American Automobile Association. Bank of America eventually restored 
the 8 percent rate on her closed account.
  In addition to these three consumers who testified at the hearing, 
the subcommittee presented case histories for five other consumers who 
experienced substantial interest rate increases despite complying with 
their credit card agreements.
  I would also like to note that, in each of these cases, the credit 
card issuer told our subcommittee that the cardholder had been given a 
chance to opt out of the increased interest rate by closing their 
account and paying off their debt at the prior rate. But each of these 
cardholders denied receiving an opt-out notice, and when several tried 
to close their account and pay their debt at the prior rate, they were 
told they had missed the opt-out deadline and had no choice but to pay 
the higher rate. Our subcommittee examined copies of the opt-out 
notices and found that some were filled with legal jargon, were hard to 
understand, and contained procedures that were hard to follow. When we 
asked the major credit card issuers what percentage of persons offered 
an opt-out actually took it, they told the Subcommittee that 90 percent 
did not opt out of the higher interest

[[Page S6581]]

rate--a percentage that is contrary to all logic and strong evidence 
that current opt-out procedures do not work.
  The case histories presented at our hearings illustrate only a small 
portion of the abusive credit card practices going on today. Since 
early 2007, the subcommittee has received letters and e-mails from 
thousands of credit card cardholders describing unfair credit card 
practices and asking for help to stop them, more complaints than I have 
received in any investigation I have conducted in more than 25 years in 
Congress. The complaints stretch across all income levels, all ages, 
and all areas of the country.
  The bottom line is that these abuses have gone on for too long. In 
fact, these practices have been around for so many years that they 
have, in many cases, become the industry norm, and our investigation 
has shown that many of the practices are too entrenched, too 
profitable, and too immune to consumer pressure for the companies to 
change them on their own.
  Mr. President, in summary, this is what our bill contains:
  No interest on debt paid on time.
  The bill prohibits interest charges on any portion of credit card 
debt which the credit card holder paid on time during the grace period.
  The bill prohibits credit card issuers from increasing interest rates 
on cardholders who are in good standing for reasons unrelated to the 
cardholder's behavior with respect to that card.
  The bill requires increased interest rates to apply only to future 
debt and not to debt incurred prior to the increase.
  The bill prohibits the charging of interest on credit card 
transaction fees, such as late fees and over-the-limit fees.
  The bill prohibits the charging of repeated over-the-limit fees for a 
single instance of exceeding a credit card limit.
  The bill requires payments to be applied first to the credit card 
balance with the highest rate of interest and to minimize finance 
charges.
  The bill requires the credit card issuers must offer consumers the 
option of operating under a fixed credit card limit that cannot be 
exceeded.
  The bill prohibits charging a fee to allow a credit card holder to 
make a payment on credit card debt, whether that payment is by mail, 
telephone, electronic transfer, or otherwise. Believe it or not, many 
credit card companies actually charge you a fee to make your payment.
  The bill contains some of the following provisions as well:
  It requires issuers to lower penalty rates that have been imposed on 
a cardholder after 6 months if the cardholder commits no further 
violations.
  The bill gives each Federal banking agency the authority to prescribe 
regulations governing unfair or deceptive practices by banks and 
savings and loan institutions.
  The bill requires issuers to provide individual consumer account 
information and disclose the total period of time and interest it will 
take to pay off the credit card balance if only minimum monthly 
payments are made.
  And, as the Senator from Connecticut said, the bill contains a number 
of protections for young consumers from credit card solicitations.
  Again, I commend Senator Dodd for taking the leadership on this 
issue. As chairman of the Senate Banking Committee, his leadership will 
make a huge difference. It gives us a real chance of passing reform 
legislation relative to credit card abuses this session of the 
Congress.

                          ____________________