[Congressional Record Volume 155, Number 67 (Monday, May 4, 2009)]
[Senate]
[Pages S5067-S5085]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. LEVIN (for himself and Ms. Collins):
  S. 961. A bill to authorize the regulation of credit default swaps 
and other swap agreements, and for other purposes; to the Committee on 
Banking, Housing, and Urban Affairs.
  Mr. LEVIN. Mr. President, I am introducing legislation today, along 
with Senator Collins, to strengthen the transparency, accountability, 
and stability of a key aspect of our nation's financial system. Right 
now, trillions of dollars in complex financial transactions known as 
swap agreements are being marketed, traded, and implemented by 
financial institutions operating in the U.S. without adequate oversight 
or regulation.
  Swaps are typically an agreement between two parties placing a bet on 
future cash flows. Some swaps bet on whether a stock price, interest 
rate, commodity price, or currency value will rise or fall; others bet 
on whether a company will default on payment of a bond. Stock price 
bets are referred to as equity swaps; bets on whether companies will be 
unable to pay their debts are referred to as credit default swaps.
  As of June 2008, according to data compiled by the Bank of 
International Settlements, worldwide swaps markets included credit 
default swaps with a total notional value of $57 trillion; commodity 
swaps with a notional value of $13 trillion; equity swaps with a 
notional value of $10 trillion; foreign currency swaps with a notional 
value of $62 trillion; and interest rate swaps with a notional value of 
$458 trillion. These multi-trillion-dollar swap transactions are going 
on full bore, without appropriate U.S. disclosure requirements, 
clearing requirements, capital or liquidity safeguards, or other 
measures to protect the U.S. financial system against systemic risk.
  Why? Because current law prohibits key Federal financial regulators--
including the Securities and Exchange Commission, SEC, and the 
Commodities Futures Trading Commission, CFTC--from exercising oversight 
or issuing regulations to ensure the safety and soundness of swap 
transactions. That prohibition has been in place for nearly 10 years 
now, since the year 2000; it has never made any sense; it helped cause 
the financial crisis that is engulfing the American economy; and it 
ought to be eliminated immediately.
  The bill we are introducing today, the Authorizing the Regulation of 
Swaps Act, would do just that. It would immediately repeal the 
statutory prohibition on the SEC and CFTC from regulating swaps. In 
addition, the bill would give authority to federal financial 
regulators, including bank, securities, and commodities regulators, to 
oversee and regulate all types of swap agreements, whether traded on an 
exchange or over-the-counter, including credit default, commodity, 
equity, foreign currency, and interest rate swaps. The bill would 
enable financial regulators, for the first time since 2000, to exercise 
oversight of the now largely hidden and unregulated swaps markets.
  To understand why this legislation is needed and should be enacted 
promptly without waiting for the larger financial reform bill that's 
coming, I want to review some history. Twelve years ago, in 1997, 
Brooksley Born, then the head of the CFTC, raised a red flag about the 
growing use of over-the-counter swaps and other derivatives that were 
being traded outside of regulated exchanges and outside of normal 
federal oversight. She called for a study of those over-the-counter 
transactions and for comments on whether they should be subject to some 
type of regulation.
  Her effort was immediately met with resistance, however, from not 
only the financial industry that profited from swaps trading, but also 
other Federal regulators then in office. For example, then Federal 
Reserve Chairman Alan Greenspan, then Treasury Secretary Robert Rubin, 
and then SEC Chairman Arthur Levitt all opposed her effort to even 
examine over-the-counter swap agreements. The dominant view at the time 
was that regulation was unnecessary and would only slow down a booming 
market.
  In 1998, at the urging of then Chairman Greenspan, Secretary Rubin, 
Chairman Levitt, and others, Congress enacted legislation which 
actually barred the CFTC from conducting the study that Chairman Born 
wanted and from developing any regulatory alternatives for over-the-
counter swaps.
  In 2000, Congress went farther. In late December, during the final 
days of the 106th Congress, legislation affecting a range of financial 
issues was slipped without notice into a conference report of an 
omnibus appropriations bill. That legislation, called the Commodity 
Futures Modernization Act, included provisions which together created a 
flat out prohibition on the regulation of every kind of swap the 
authors could

[[Page S5068]]

think of, including credit default, commodity, equity, foreign 
currency, interest rate, and even weather swaps. That type of sweeping 
statutory prohibition had never been included in any bill voted on by 
the Senate before being inserted into a must-pass appropriations bill 
in December 2000. That omnibus appropriations bill was approved by the 
Senate on a voice vote.
  Today we are living with the disastrous consequences of that ill-
conceived prohibition on the regulation of swaps.
  One example says it all: AIG. AIG is a financial holding company 
that, all by itself, has cost taxpayers more than $150 billion so far. 
Over a period of years, AIG had issued more than $400 billion in credit 
default swaps without setting aside sufficient capital or liquidity 
reserves. After its swaps began losing value, AIG's counterparties 
required AIG to post multi-billion-dollar collateral to secure payment 
on those swaps, and a credit rating downgrade threatened to increase 
its collateral calls, AIG came pleading for a taxpayer bailout. The 
$150 billion in taxpayer dollars was needed not only to keep AIG 
afloat, but also to bail out a dozen other large financial institutions 
that had purchased credit protection from AIG, including Goldman Sachs, 
Merrill Lynch, and Bank of America.
  Apparently, none of those credit default swap exposures had been 
known to Federal regulators until AIG informed the Federal Reserve on a 
Friday that it was likely to go out of business the following week 
unless provided billions in taxpayer support. When regulators 
understood how far in the hole AIG had fallen and how many financial 
institutions would be affected by its financial collapse, they 
determined that they had no choice but to prop up the whole mess with 
taxpayer dollars.
  AIG is not the only financial institution with risky credit default 
swaps. But even if federal regulators know of other high-risk problems, 
the law has tied their hands in terms of what steps can be taken in 
response. Even measures that most experts believe would reduce systemic 
risks, such as requiring companies to use credit default swap 
clearinghouses or requiring traders to disclose all credit default swap 
transactions, cannot be fully implemented, because Federal agencies 
lack the authority to regulate swaps.
  Seven months ago, during a Senate hearing in September 2008, 
Christopher Cox, then chairman of the SEC, testified that the credit 
default swap market was ``completely lacking in transparency'' and 
``ripe for fraud and manipulation.'' A few days later he called on 
Congress to take ``swift action'' to give regulators the authority to 
oversee credit default swaps. But the statutory barriers prohibiting 
swaps regulation have remained in place.
  Giving the regulators what they have asked for is long overdue. It 
does not make sense for Federal regulators to be statutorily barred 
from requiring disclosure of swap transactions, mandating use of 
clearinghouses, or imposing other safeguards particularly in light of 
the size of the swaps market with trillions of dollars in credit 
default swap, interest rate, commodity, equity, foreign currency, and 
other swaps.
  Even some past opponents of swaps regulation have rethought their 
opposition.
  Alan Greenspan acknowledged last October that there are ``serious 
problems'' associated with credit default swaps.
  Robert Rubin recently acknowledged that derivatives, which include 
swaps, ``create systemic risk.''
  Arthur Levitt said it was a mistake not to have regulated swap 
agreements.
  Top financial officials in the Obama Administration, including 
Treasury Secretary Tim Geithner, National Economic Council Chairman 
Larry Summers, SEC Chair Mary Schapiro, and CFTC nominee Gary Gensler 
have all called publicly for stronger regulation of over-the-counter 
transactions, including swap agreements.
  Congress and the Administration are now engaged in an effort to enact 
comprehensive financial reforms to safeguard our economy. While some of 
those reforms require a lot of time and deliberation to get right, 
others can--and should--be implemented more quickly. Removing the 
prohibition on regulating swaps is one of those reforms that can and 
should be done now, so our regulators can begin, without the hindrance 
of ill-conceived statutory barriers, to design a sensible regulatory 
framework for swaps.
  Here is what my bill would do. First, it would repeal about a dozen 
provisions in the Commodity Futures Modernization Act and other laws 
that prevent federal financial regulators from overseeing and 
regulating swap agreements. Second, it would give Federal financial 
regulators, including bank, securities, and commodity regulators, 
immediate authority to oversee and regulate swaps involving the 
financial institutions and exchanges that they already regulate. To 
ensure regulators have sufficient authority, the bill would use the 
same comprehensive definition of swap agreement that is used in current 
law to prohibit swaps regulation.
  These measures would give regulators immediate authority to acquire 
swap-related data. That would allow them to evaluate swap risks at 
specific companies as well as across the financial system. Regulators 
could then use this data to look into what additional safeguards are 
needed and what abuses need to be stopped.
  One thing the bill would not do is require federal financial 
regulators to regulate swaps or tell them how to regulate swaps if they 
decide to do so. That is left for the larger regulatory reform bill 
coming later this year. The only instruction provided in this bill is 
that, if any regulator decides to act, it must consult, work, and 
cooperate with all of the other federal financial regulators to ensure 
swaps are treated in a consistent way.
  I see this bill as a necessary first step to eliminate harmful 
statutory barriers that tie regulators' hands, impede oversight of the 
multi-trillion-dollar swaps markets, and create systemic risk. The bill 
does not take the needed second step of laying out ways to regulate 
swaps. It does not, for example, specify swaps recordkeeping, 
disclosure requirements, clearing requirements, capital or liquidity 
safeguards, or other measures. Senator Collins has another bill that, 
in part, addresses credit default swaps clearinghouses; I have a 
separate bill that specifies safeguards in the area of commodity swaps. 
Other colleagues have introduced bills that address a variety of swaps 
issues. The legislation we are introducing today does not contradict or 
preclude any of those other approaches it is an interim measure that 
would clear the way for more specific swaps requirements in subsequent 
reform legislation.
  The Levin-Collins bill offers a limited, commonsense way to restore 
immediate federal authority over a high-risk, high-dollar financial 
sector that has operated for too long in the shadows, and whose failure 
has cost us hundreds of billions of dollars so far. Due to the 
trillions of dollars and financial risk involved, I urge the Senate to 
act on this bill as soon as possible.
  I would also like to take a moment to extend my thanks and 
appreciation to the SEC, CFTC, and Treasury officials who took the time 
to provide technical assistance in drafting this legislation. I hope 
those agencies, and the Obama Administration as a whole, will announce 
their support for the bill and work for its enactment.
  Mr. President, I ask unanimous consent that a summary of the bill be 
printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

    Summary of Levin-Collins Authorizing the Regulation of Swaps Act

       The Authorizing the Regulation of Swaps Act, introduced by 
     Senator Carl Levin, D-Mich., and cosponsored by Senator Susan 
     Collins, R-Maine, is intended to give federal financial 
     regulators immediate authority over swap agreements in light 
     of the fact that trillions of dollars in swap transactions 
     continue to be marketed, traded, and implemented in the 
     United States without adequate federal oversight or 
     regulatory authority. Hundreds of billions of taxpayer 
     dollars have already been expended to overcome the failures 
     of firms that engaged in unregulated swaps. The bill contains 
     the following provisions.
       Repeal Existing Prohibitions on Regulating Swaps. The bill 
     would repeal over a dozen provisions in existing law, 
     including in the Commodity Futures Modernization Act of 2000, 
     which prohibit federal financial regulators from regulating 
     swap agreements.
       Authorize the Regulation of Swaps. The bill would give 
     authority to federal financial

[[Page S5069]]

     regulators, including bank, securities and commodities 
     regulators, to oversee and regulate all types of swap 
     agreements, including credit default, commodity, equity, 
     interest rate, and foreign currency swaps. The bill uses the 
     same definition of swap agreement that is used in current law 
     to prohibit swaps regulation, and would authorize federal 
     oversight and regulation of all exchange-traded and over-the-
     counter swaps.
       Require Consistent Treatment of Swaps. The bill does not 
     require federal regulators to regulate swap agreements--it 
     merely authorizes such regulation and removes barriers that 
     have prevented this regulation since 2000. Nor does the bill 
     provide any direction to federal financial regulators on how 
     to regulate swaps other than to require them to consult, 
     work, and cooperate with each other to promote consistency in 
     the treatment of swap agreements.
       Establish Interim Authority. By removing existing statutory 
     prohibitions and providing federal financial regulators with 
     authority to oversee and regulate swaps, the bill would 
     eliminate harmful statutory barriers, give regulators 
     immediate interim authority over multi-trillion-dollar swaps 
     markets, and clear the way for more specific swaps 
     requirements in subsequent comprehensive financial reform 
     legislation later this year.
                                 ______
                                 
      By Mr. KERRY (for himself and Mr. Lugar):
  S. 962. A bill to authorize appropriations for fiscal years 2009 
through 2013 to promote an enhanced strategic partnership with Pakistan 
and its people, and for other purposes; to the Committee on Foreign 
Relations.
  Mr. KERRY. Mr. President, I rise today to join my colleague, the 
ranking member of the Foreign Relations Committee, Senator Lugar, in 
introducing what we consider to be an important piece of legislation 
from our committee and an important initiative for the administration 
and for the Congress and the American people. We are joining today to 
introduce the Enhanced Partnership with Pakistan Act. I believe the 
legislation has already been placed at the desk.
  This is legislation that will fundamentally change America's policy 
toward Pakistan, and I hope over time it will fundamentally change 
America's relationship with the people of Pakistan as well.
  I especially thank Senator Lugar for his partnership in crafting this 
legislation and for his ongoing leadership on this issue.
  It is hard to overstate the importance of Pakistan to our national 
security. In fact, every day the newspapers are full of events that are 
transpiring there and of the challenges we face. Pakistan is a nation 
which could either serve as a force for stability and progress in a 
volatile region or it could become an epicenter for radicalism and 
violence on a cataclysmic scale.
  This is a nation of striking contradictions and on divergent paths 
forward.
  On one hand, we all know Pakistan is a nation where Osama bin Laden 
and the leadership of al-Qaida have found sanctuary for the past 7 
years--a haven from which they and their confederates have plotted and 
carried out attacks on their host country, on neighboring countries, 
and on sites around the globe--a nation that has in recent weeks seen 
the Taliban advance to within 60 miles of its capital, and a nation 
with a full arsenal of nuclear weapons and ballistic missiles capable 
of delivering them anywhere in a 1,000-kilometer range.
  On the other hand, Pakistan is also a nation whose 170 million people 
are overwhelmingly moderate, overwhelmingly committed to democracy and 
rule of law; a major non-NATO ally that has sacrificed the lives of 
1,500 of its soldiers and police in the fight against terrorism and 
insurgency; and a nation that has lost more of its citizens to the 
scourge of terrorism than all but a tiny handful of countries 
throughout the world.
  In short, Pakistan has the potential either to be crippled by the 
Taliban or to serve as a bulwark against everything the Taliban 
represents. That is why the Obama administration and many of us in 
Congress see the need for a bold new strategy for Pakistan. The status 
quo has not brought success, the stakes could not be higher, and we 
have little choice but to think differently--in fact, to think bigger--
about what these challenges are. The Enhanced Partnership With Pakistan 
Act is the centerpiece of this new approach, which is why President 
Obama has called on Congress to pass it.

  An earlier version of this bill was reported out of the Foreign 
Relations Committee in July with overwhelming bipartisan support. This 
version builds upon its predecessor in a number of important ways. 
First, this new legislation directs $100 million toward an urgent need: 
police reform and equipping. Second, it mandates strict accountability 
from the administration as to every dollar that is spent, using 
benchmarks and metrics to measure and adapt our performance. Third, in 
light of the acute security challenge on the ground today, this bill 
gives our Ambassador the flexibility needed to respond to events as 
they unfold.
  We believe this bill is urgently needed. For decades, the United 
States has sought the cooperation of Pakistani decisionmakers through 
military aid--almost exclusively military aid--while paying scant 
attention to the wishes and urgent needs of the population itself. This 
arrangement is, frankly, rapidly disintegrating. We believe we are 
paying too much for one thing and getting too little for a broad number 
of things we really need. When I say ``we,'' I really emphasize the 
Pakistani people's needs. The desires and aspirations of the Pakistani 
people have never been adequately focused on or attended to 
sufficiently in these policies. Most Pakistanis understand that they 
have been, frankly, left out of the policy in broad terms. As a result, 
an alarming percentage of the Pakistani population now sees America as 
a greater threat than al-Qaida. Until we change that perception, there 
is, frankly, very little chance of ending tolerance for terrorist 
groups or persuading any Pakistani Government to devote the political 
capital necessary to deny such groups and to deny them the sanctuary 
they have been able to receive, particularly in the western part of the 
country, as well as to deny them the covert material support which they 
have also been able to get from a number of different sources.
  The dangers of inaction are rising almost every day. So when people 
measure this legislation, that is really what they have to consider. 
What happens if you do nothing? Well, if you do nothing, it is clear 
that the march of terror that is taking hold in a number of different 
places clearly threatens nuclear weapons that might then potentially 
fall into hands that are completely unpredictable. In fact, to whatever 
degree they might be predictable, one can only see danger in that kind 
of eventuality. The dangers of inaction are real. Almost any scenario 
played out plays against the broader interests of the Pakistani people 
and of the democratic Government which struggles today to provide 
services and to govern them.
  In the month since President Obama called on Congress to pass the 
bill we are now introducing, the situation on the ground in Pakistan 
has deteriorated significantly. The Government struck what many of us 
believed and said at the time was an ill-advised deal that effectively 
surrendered the Swat Valley to the Taliban. The deal, predictably--as 
many of us said--emboldened the Taliban to deploy the same brutal 
tactics they had used in both Pakistan and Afghanistan and to use their 
base in Swat to then extend their reach ever closer to the country's 
heartland.
  I emphasize--I know Senator Lugar will join me in emphasizing this--
ultimately, it is not the United States or the policy of the United 
States that is going to decide what happens in Pakistan. Ultimately, it 
will be Pakistanis, not Americans, who must determine their nation's 
future. But we can change the nature of our relationship and we can 
empower those Pakistanis who are fighting to steer the world's second 
largest Muslim country onto a path of moderation and stability and 
regional cooperation. That is the foundation of the bill Senator Lugar 
and I are introducing.
  Frankly, I have seen firsthand how this approach works. Following the 
2005 Kashmir earthquake, the United States spent nearly $1 billion on 
relief efforts. Having visited places, as I did then, such as Mansehra 
and Muzaffarabad in the earthquake's aftermath, I can personally attest 
to the awesome power of the operation we launched. I will never forget 
flying up in a helicopter to the northwest part of Pakistan, not far 
from the big Himalayas, where one could see off in the distance, and 
landing in a small spot by the river and meeting kids in a

[[Page S5070]]

tent city because this was the first time those kids had ever come out 
of the mountains and, in fact, the first time any of those kids had 
ever gone to school. It was extraordinary to see the sight of American 
service men and women saving the lives of Pakistani citizens. Frankly, 
it was invaluable in changing the perceptions of America in Pakistan. 
At that period of time, while we provided that assistance and while we 
were visibly involved in saving lives, not in taking them, the fact is 
that the reputation of the United States in the country as it was 
measured by polls at the time markedly increased, very dramatically 
increased.
  In the wake of that natural disaster, we weren't the only ones to 
recognize the need for public diplomacy based in deeds rather than in 
words. The front group for the terrorist organization Lashkar-e Taiba 
set up a string of professional relief camps throughout the region 
trying to mimic what we were doing. But our effort was far more 
effective, and the permanent gift of the U.S. Army's last mobile Army 
surgical hospital, or MASH, had a profound impact on the perceptions of 
people in the region. For a brief period, America was going toe-to-toe 
with extremists in a true battle of hearts and minds, and we were 
winning.
  It is up to us to recreate this kind of success on a broader scale, 
without waiting for a natural or even a manmade disaster. The question 
is, How can we most effectively demonstrate the true friendship of the 
American people for the Pakistani people?
  We believe this bill is an important first step. It is a prime 
example of what we call ``smart power'' because it uses both economic 
and military aid to achieve an overall effect that is greater than the 
sum of its parts. On the economic side, this bill triples nonmilitary 
aid to $1.5 billion annually for 5 years and urges an additional 5 
years of funding. These funds will be used to build schools, roads, and 
clinics. In other words, they aim to do on a regular basis what we 
briefly achieved with our earthquake relief and what the Pakistani 
Government, because of the economic crisis as well as political crisis 
in the country, has been unable to do to date. But this money will do a 
great deal more than just good deeds. It will empower the fledgling 
civilian Government to show that it can deliver the citizens of 
Pakistan a better life. It will empower the moderates, who will have 
something concrete to put forward as evidence that friendship with 
America actually brings rewards, not just perils, and it will empower 
the vast majority of Pakistanis who reject the terrifying vision of al-
Qaida and Taliban but who have been angered and frustrated by the 
perception that their own leaders and America's leaders don't care 
about their daily struggle.
  To do this right, we must make a long-term commitment. Most 
Pakistanis think that America has used and abandoned their country in 
the past, most notably after the jihad against the Soviets in 
Afghanistan. They fear we will just desert them again the moment the 
threat from al-Qaida subsides. It is this history and this fear that 
cause Pakistan to hedge its bets.
  If we ever expect Pakistan to break decisively with the Taliban and 
other extremist groups, then we need to provide firm assurance that we 
are not just foul-weather friends. By authorizing funds through 2013, 
and hopefully longer, this bill offers the chance to clearly state 
America's longer term concerns and interests.
  On the security side, the bill places conditions on military aid that 
will ensure the money is used for the intended purposes, which was not 
the case over the last 8 years. In order for Pakistan to receive any 
military assistance, it will need to meet an annual certification that 
its army and spy services are genuine partners in this endeavor.

  In the struggle against al-Qaida and other terrorist groups, 
including Lashkar-e Taiba--as we all know, Lashkar-e Taiba was the 
perpetrator of the Mumbai massacre of last November. We also will need 
a certification of their partnership in the battle against the Taliban 
and its affiliates who threaten our troops in Afghanistan from their 
sanctuaries in the Pakistani tribal areas, as well as in the effort to 
solidify democratic governance and the rule of law in Pakistan. We 
believe these conditions are eminently reasonable, and they should be 
easy to meet for any nation receiving American aid.
  As important as the economic and military components of the bill are 
is the question of how they fit together. Making this unequivocal 
commitment to the Pakistani people enables us to calibrate our military 
assistance more effectively. In any given year, we may choose to 
increase it or decrease it or to simply leave its level unchanged, but 
we will have the flexibility which we haven't had in prior years. For 
too long, the Pakistani military frankly believed we were bluffing when 
we threatened to cut funding for a particular weapons system or an 
expensive piece of hardware because that was the only game, if you 
will. It was the only money on the table. This bill will change that. 
Up to now, frankly, they were right about the unwillingness of the 
United States to take alternative routes. But if our economic aid 
becomes the centerpiece of our aid policy and it is tripled to $1.5 
billion, then we can actually guarantee that we pay more attention to 
how the military assistance is being spent and what is occurring. We 
will finally be able to make the choice of expenditure on the basis of 
both of our natural security interests rather than simply the 
institutional interests of the security forces in Pakistan.
  Let me be clear on the issue of military aid. The bill does not take 
any position on the level of such assistance deliberately. It is 
possible to envision a significant increase in military aid, just as 
easily as one could envision a decrease. The Pakistani army needs more 
helicopters. It needs more night-vision capability, more training and 
counterinsurgency techniques. So instead of locking in a figure for 
future years, what this bill does is provide us the ability to target 
our military aid directly to the areas that best serve both of our 
national security interests, which are fighting terrorism, fighting the 
insurgency, and keeping the people of Pakistan safe from the most dire 
threats.
  Moreover, this bill allows us to fine-tune our approach in response 
to the level of will and competence displayed by Pakistan's military: 
When we see the genuine commitment, then we can help increase 
capabilities, and if we see at any time that commitment is lacking, we 
have the ability to adjust and redirect assistance rather than permit 
it to be wasted. We have spent some $10 billion in military aid and 
compensation over the past 8 years. Still, the militants got within 60 
miles of the capital recently and al-Qaida continues to enjoy a 
sanctuary. So it is long past time we figure out how to work more 
effectively with the Pakistanis and the Pakistan Government on a more 
effective approach. That is what we hope this achieves.
  This bill is not a short-term fix. It aims for the medium term and 
especially the long term. It won't drive the Taliban out of Swat Valley 
next week or next month. Its aim is, once the Taliban is driven from 
Swat and from Bajaur and from Dir, to help keep them out. To put it in 
terms of basic counterinsurgency doctrine made familiar by General 
Petraeus, the Pakistani military is already able to handle the 
``clear'' phase of the struggle. The United States will now be 
assisting this mission through other vehicles. But the bill Senator 
Lugar and I are introducing will provide vital help for the ``hold'' 
and the ``build'' parts of the mission. Nor is this bill intended to be 
a silver bullet. It provides powerful tools, but these tools are only 
as effective as the policymakers who wield them. I am confident 
President Obama and his team will use wisely whatever policy tools are 
at their disposal.
  We need to approach this endeavor with a large dose of humility. The 
truth is that our leverage is limited.
  This bill aims to increase that leverage significantly. But we need 
to be realistic about what we can accomplish. Americans can influence 
events in Pakistan, but we cannot and we should not decide them. 
Ultimately, the decisionmakers are the people and the leaders of 
Pakistan.
  Ask any resident of Lahore, Karachi, or Peshawar what these places 
used to be like and you will hear a long statement of the reveries of 
the time that now seems a world away. We need to help Pakistan once 
again become a nation of stability, security, and prosperity, enjoying 
peace at home and abroad--a nation, in short, that older

[[Page S5071]]

Pakistanis remember from their childhoods.
  It is this nation that most Pakistanis desperately wish to reclaim. 
The bill that Senator Lugar and I now introduce will help America 
ensure that Pakistanis have the resources necessary to choose a 
peaceful, stable future. It offers them a helping hand in getting 
there. I urge our colleagues to join us in supporting this bill.
  The ACTING PRESIDENT pro tempore. The Senator from Indiana is 
recognized.
  Mr. LUGAR. Mr. President, I am pleased and honored to join our 
chairman, John Kerry, in introducing the Enhanced Partnership with 
Pakistan Act of 2009. Then-Senator Joe Biden and I originally 
introduced this legislation in July 2008. I have been especially 
pleased to continue the bipartisan effort on this bill with Senator 
Kerry.
  Senators Biden and Kerry and I have worked closely over the past year 
with the State Department, USAID, the Defense Department, and the 
National Security Council to craft this legislation.
  On March 27 of this year, President Obama announced a comprehensive 
strategy for Afghanistan and Pakistan. In his speech he called on 
Congress ``to pass a bipartisan bill cosponsored by John Kerry and 
Richard Lugar that authorizes $1.5 billion in direct support to the 
Pakistani people every year over the next 5 years--resources that will 
build schools, roads, and hospitals, and strengthen Pakistan's 
democracy.''
  Chairman of the Joint Chiefs of Staff ADM Mike Mullen and CENTCOM 
Commander David Petraeus repeatedly advocated expanding foreign 
assistance to Pakistan as an essential element of our national 
security. Defense Secretary Robert Gates and Secretary of State Hillary 
Clinton both have testified that strengthening democracy and countering 
terrorism in Pakistan go hand in hand. Secretary Clinton said at a 
Senate Appropriations Committee meeting last week:

       As President Obama has consistently maintained, success in 
     Afghanistan depends on success in Pakistan. We have seen how 
     difficult it is for the government there to make progress, 
     and the Taliban continues to make inroads. Counterinsurgency 
     training is critical. But of equal importance are diplomacy 
     and development to provide economic stability and diminish 
     the conditions that feed extremism. This is the intent of the 
     comprehensive strategy laid out by Senator Kerry and Senator 
     Lugar, which President Obama has endorsed.

  I take the time to detail administration backing for this bill and 
its concepts because any U.S. policy related to Pakistan will require 
the cooperation and active support of both the executive and 
legislative branches of our Government. It also will require that 
policy toward Pakistan be closely integrated with United States efforts 
throughout the region.
  I do not regard the Kerry-Lugar bill as a congressionally driven 
initiative in which we are bargaining for support of the 
administration; rather, Senator Kerry and I are trying to play a 
constructive role in facilitating a consensus position between branches 
that will undergird a rational approach to the region with the best 
chance of success. With this in mind, it is vital that the 
administration's message on Pakistan be clear and consistent. The 
administration also must continue to actively consult with Congress on 
elements of strategy, not just lobby us for funds.
  The United States has an intense strategic interest in Pakistan and 
the surrounding region. The U.S. National Intelligence Estimate last 
year painted a bleak picture of the converging crises in Pakistan. A 
growing al-Qaida sanctuary, an expanding Taliban insurgency, political 
brinksmanship, and a failing economy are intensifying the turmoil and 
violence in that country. These circumstances are a threat to Pakistan, 
the region, and the United States of America.
  We should make clear to the people of Pakistan that our interests are 
focused on democracy, pluralism, stability, and the fight against 
terrorism. These are values supported by a large majority of Pakistani 
people. If Pakistan is to break its debilitating cycle of instability, 
it will need to achieve progress on fighting corruption, delivering 
government services, and promoting broad-based economic growth. The 
international community and the United States should support reforms 
that contribute to the strengthening of Pakistani civilian 
institutions.
  This legislation marks an important step toward those goals. While 
our bill envisions sustained economic and political cooperation with 
Pakistan, it is not a blank check. It expects that the military 
institutions in Pakistan will turn their attention to the extremist 
dangers within Pakistan's borders. The bill subjects our security 
assistance to a certification that the Pakistani Government is using 
the money for its intended purpose--namely, to combat the Taliban and 
al-Qaida. The bill also calls for tangible progress in governance, 
including an independent judiciary, greater accountability by the 
central government, respect for human rights, and civilian control of 
the levers of power, including the military and the intelligence 
agencies.
  In providing substantial resources to enhance a strategic partnership 
with Pakistan, our bill contains provisions to help ensure that this 
money is spent effectively and efficiently. The bill stipulates that 
the administration must provide Congress with a comprehensive 
assistance strategy before additional assistance is made available. 
This strategy is expected to detail clear objectives, enumerate 
projects the administration intends to implement, and identify criteria 
that the administration will use to measure the effectiveness of our 
assistance.
  Once money begins to flow, the administration must report every 6 
months on how the money is spent and what impact it is having. In 
addition, the bill provides that before the administration spends more 
than half of the $1.5 billion authorized in any fiscal year, it must 
certify that the assistance provided to that date is making substantial 
progress toward the principal objectives contained in the 
administration's strategy report. We also have asked the Government 
Accountability Office to review annually the administration's progress 
on stated goals. To ensure that sufficient resources will be available 
to oversee our program in Pakistan, we authorize $20 million each year 
for audits and program reviews by the inspectors general of the State 
Department, USAID, and other relevant agencies.
  I look forward to working with the administration of President Obama 
and with congressional colleagues on a policy toward Pakistan that 
builds our relationship with that nation and protects vital interests 
of the United States.
  Again, I thank Senator Kerry for his partnership and leadership on 
this bill.
                                 ______
                                 
      By Mr. BINGAMAN (for himself and Mr. Udall of New Mexico):
  S. 965. A bill to approve the Taos Pueblo Indian Water Rights 
Settlement Agreement, and for other purposes; to the Committee on 
Indian Affairs.
  Mr. BINGAMAN. Mr. President, today Senator Udall and I are 
introducing a bill that will end an ongoing water rights dispute in 
northern New Mexico. The bill accomplishes this by authorizing a water 
rights settlement resolving Taos Pueblo's water rights claims in the 
Rio Pueblo de Taos, a tributary to the Rio Grande.
  The Rio Pueblo de Taos adjudication is a dispute that is almost 40 
years old. The parties have been in settlement discussions for well 
over a decade but it was not until the last 5 years that the 
discussions took on the sense of urgency needed to resolve the issues 
at hand. A settlement agreement was signed by the Pueblo, State, and 
other interested parties in March 2006. Federal legislation was then 
finalized and introduced last year. Progress was made on the bill, 
including hearings in both the House and Senate which resulted in the 
identification of a few more issues which needed to be addressed. The 
parties negotiated a resolution to these issues and legislation to 
authorize and implement the settlement is now ready to move forward.
  The settlement will fulfill the rights of the Pueblo consistent with 
the Federal trust responsibility. It will also continue the tradition 
of sharing precious water resources in a manner necessary to protect 
the sustainability of traditional agricultural communities. Finally, 
the Town of Taos and other local entities are assured of accessing the 
water necessary to meet municipal and domestic needs. In sum, the Taos 
Pueblo Indian Water Rights Settlement Act represents a commonsense

[[Page S5072]]

set of solutions that all parties to the adjudication have a stake in 
implementing.
  This legislation is widely supported in the Taos Valley, probably as 
close to a consensus as any water-related agreement can get in the 
West. The State of New Mexico, under Governor Richardson's leadership, 
deserves recognition for actively pursuing a settlement in this matter 
and committing financial resources in recognition of the importance of 
this matter to all water users in the basin.
  This bill, as with any water rights settlement, is crucial to New 
Mexico's future. In an arid State such as ours, the legal system is 
poorly equipped to allocate water and create the infrastructure needed 
for its efficient use. Negotiated agreements between the parties, the 
State Engineer, and the Federal Government are much more likely to lead 
to long-term solutions that allow for the use of water in a sustainable 
manner. This legislation builds upon the provisions included in the 
Navajo water rights settlement enacted into law on March 30, 2009 as 
part of the Omnibus Public Lands bill. That settlement, and each 
subsequent one, will help provide more certainty and less conflict with 
respect to the allocation and use of water in New Mexico. I look 
forward to working with my colleagues in the Senate, as well as the 
House of Representatives, to see that this bill gets enacted into law.
  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. 965

       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 ``Taos 
     Pueblo Indian Water Rights Settlement Act''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Purpose.
Sec. 3. Definitions.
Sec. 4. Pueblo rights.
Sec. 5. Pueblo water infrastructure and watershed enhancement.
Sec. 6. Taos Pueblo Water Development Fund.
Sec. 7. Marketing.
Sec. 8. Mutual-Benefit Projects.
Sec. 9. San Juan-Chama Project contracts.
Sec. 10. Authorizations, ratifications, confirmations, and conditions 
              precedent.
Sec. 11. Waivers and releases.
Sec. 12. Interpretation and enforcement.
Sec. 13. Disclaimer.

     SEC. 2. PURPOSE.

       The purposes of this Act are--
       (1) to approve, ratify, and confirm the Taos Pueblo Indian 
     Water Rights Settlement Agreement;
       (2) to authorize and direct the Secretary to execute the 
     Settlement Agreement and to perform all obligations of the 
     Secretary under the Settlement Agreement and this Act; and
       (3) to authorize all actions and appropriations necessary 
     for the United States to meet its obligations under the 
     Settlement Agreement and this Act.

     SEC. 3. DEFINITIONS.

       In this Act:
       (1) Eligible non-pueblo entities.--The term ``Eligible Non-
     Pueblo Entities'' means the Town of Taos, El Prado Water and 
     Sanitation District (``EPWSD''), and the New Mexico 
     Department of Finance and Administration Local Government 
     Division on behalf of the Acequia Madre del Rio Lucero y del 
     Arroyo Seco, the Acequia Madre del Prado, the Acequia del 
     Monte, the Acequia Madre del Rio Chiquito, the Upper 
     Ranchitos Mutual Domestic Water Consumers Association, the 
     Upper Arroyo Hondo Mutual Domestic Water Consumers 
     Association, and the Llano Quemado Mutual Domestic Water 
     Consumers Association.
       (2) Enforcement date.--The term ``Enforcement Date'' means 
     the date upon which the Secretary publishes the notice 
     required by section 10(f)(1).
       (3) Mutual-benefit projects.--The term ``Mutual-Benefit 
     Projects'' means the projects described and identified in 
     articles 6 and 10.1 of the Settlement Agreement.
       (4) Partial final decree.--The term ``Partial Final 
     Decree'' means the Decree entered in New Mexico v. Abeyta and 
     New Mexico v. Arellano, Civil Nos. 7896-BB (U.S. D.N.M.) and 
     7939-BB (U.S. D.N.M) (consolidated), for the resolution of 
     the Pueblo's water right claims and which is substantially in 
     the form agreed to by the Parties and attached to the 
     Settlement Agreement as Attachment 5.
       (5) Parties.--The term ``Parties'' means the Parties to the 
     Settlement Agreement, as identified in article 1 of the 
     Settlement Agreement.
       (6) Pueblo.--The term ``Pueblo'' means the Taos Pueblo, a 
     sovereign Indian Tribe duly recognized by the United States 
     of America.
       (7) Pueblo lands.--The term ``Pueblo lands'' means those 
     lands located within the Taos Valley to which the Pueblo, or 
     the United States in its capacity as trustee for the Pueblo, 
     holds title subject to Federal law limitations on alienation. 
     Such lands include Tracts A, B, and C, the Pueblo's land 
     grant, the Blue Lake Wilderness Area, and the Tenorio and 
     Karavas Tracts and are generally depicted in Attachment 2 to 
     the Settlement Agreement.
       (8) San juan-chama project.--The term ``San Juan-Chama 
     Project'' means the Project authorized by section 8 of the 
     Act of June 13, 1962 (76 Stat. 96, 97), and the Act of April 
     11, 1956 (70 Stat. 105).
       (9) Secretary.--The term ``Secretary'' means the Secretary 
     of the Interior.
       (10) Settlement agreement.--The term ``Settlement 
     Agreement'' means the contract dated March 31, 2006, between 
     and among--
       (A) the United States, acting solely in its capacity as 
     trustee for Taos Pueblo;
       (B) the Taos Pueblo, on its own behalf;
       (C) the State of New Mexico;
       (D) the Taos Valley Acequia Association and its 55 member 
     ditches (``TVAA'');
       (E) the Town of Taos;
       (F) EPWSD; and
       (G) the 12 Taos area Mutual Domestic Water Consumers 
     Associations (``MDWCAs''), as amended to conform with this 
     Act.
       (11) State engineer.--The term ``State Engineer'' means the 
     New Mexico State Engineer.
       (12) Taos valley.--The term ``Taos Valley'' means the 
     geographic area depicted in Attachment 4 of the Settlement 
     Agreement.

     SEC. 4. PUEBLO RIGHTS.

       (a) In General.--Those rights to which the Pueblo is 
     entitled under the Partial Final Decree shall be held in 
     trust by the United States on behalf of the Pueblo and shall 
     not be subject to forfeiture, abandonment, or permanent 
     alienation.
       (b) Subsequent Act of Congress.--The Pueblo shall not be 
     denied all or any part of its rights held in trust absent its 
     consent unless such rights are explicitly abrogated by an Act 
     of Congress hereafter enacted.

     SEC. 5. PUEBLO WATER INFRASTRUCTURE AND WATERSHED 
                   ENHANCEMENT.

       (a) In General.--The Secretary, acting through the 
     Commissioner of Reclamation, shall provide grants and 
     technical assistance to the Pueblo on a nonreimbursable basis 
     to--
       (1) plan, permit, design, engineer, construct, reconstruct, 
     replace, or rehabilitate water production, treatment, and 
     delivery infrastructure;
       (2) restore, preserve, and protect the environment 
     associated with the Buffalo Pasture area; and
       (3) protect and enhance watershed conditions.
       (b) Availability of Grants.--Upon the Enforcement Date, all 
     amounts appropriated pursuant to section 10(c)(1) or made 
     available from other authorized sources, shall be available 
     in grants to the Pueblo after the requirements of subsection 
     (c) have been met.
       (c) Plan.--The Secretary shall provide financial assistance 
     pursuant to subsection (a) upon the Pueblo's submittal of a 
     plan that identifies the projects to be implemented 
     consistent with the purposes of this section and describes 
     how such projects are consistent with the Settlement 
     Agreement.
       (d) Early Funds.--Notwithstanding subsection (b), 
     $10,000,000 of the monies authorized to be appropriated 
     pursuant to section 10(c)(1)--
       (1) shall be made available in grants to the Pueblo by the 
     Secretary upon appropriation or availability of the funds 
     from other authorized sources; and
       (2) shall be distributed by the Secretary to the Pueblo on 
     receipt by the Secretary from the Pueblo of a written notice, 
     a Tribal Council resolution that describes the purposes under 
     subsection (a) for which the monies will be used, and a plan 
     under subsection (c) for this portion of the funding.

     SEC. 6. TAOS PUEBLO WATER DEVELOPMENT FUND.

       (a) Establishment.--There is established in the Treasury of 
     the United States a fund to be known as the ``Taos Pueblo 
     Water Development Fund'' (hereinafter, ``Fund'') to be used 
     to pay or reimburse costs incurred by the Pueblo for--
       (1) acquiring water rights;
       (2) planning, permitting, designing, engineering, 
     constructing, reconstructing, replacing, rehabilitating, 
     operating, or repairing water production, treatment or 
     delivery infrastructure, on-farm improvements, or wastewater 
     infrastructure;
       (3) restoring, preserving and protecting the Buffalo 
     Pasture, including planning, permitting, designing, 
     engineering, constructing, operating, managing and replacing 
     the Buffalo Pasture Recharge Project;
       (4) administering the Pueblo's water rights acquisition 
     program and water management and administration system; and
       (5) for watershed protection and enhancement, support of 
     agriculture, water-related Pueblo community welfare and 
     economic development, and costs related to the negotiation, 
     authorization, and implementation of the Settlement 
     Agreement.
       (b) Management of the Fund.--The Secretary shall manage the 
     Fund, invest amounts in the Fund, and make monies available 
     from the Fund for distribution to

[[Page S5073]]

     the Pueblo consistent with the American Indian Trust Fund 
     Management Reform Act of 1994 (25 U.S.C. 4001, et seq.) 
     (hereinafter, ``Trust Fund Reform Act''), this Act, and the 
     Settlement Agreement.
       (c) Investment of the Fund.--Upon the Enforcement Date, the 
     Secretary shall invest amounts in the Fund in accordance 
     with--
       (1) the Act of April 1, 1880 (21 Stat. 70, ch. 41, 25 
     U.S.C. 161);
       (2) the first section of the Act of June 24, 1938 (52 Stat. 
     1037, ch. 648, 25 U.S.C. 162a); and
       (3) the American Indian Trust Fund Management Reform Act of 
     1994 (25 U.S.C. 4001 et seq.).
       (d) Availability of Amounts From the Fund.--Upon the 
     Enforcement Date, all monies deposited in the Fund pursuant 
     to section 10(c)(2) or made available from other authorized 
     sources, shall be available to the Pueblo for expenditure or 
     withdrawal after the requirements of subsection (e) have been 
     met.
       (e) Expenditures and Withdrawal.--
       (1) Tribal management plan.--
       (A) In general.--The Pueblo may withdraw all or part of the 
     Fund on approval by the Secretary of a tribal management plan 
     as described in the Trust Fund Reform Act.
       (B) Requirements.--In addition to the requirements under 
     the Trust Fund Reform Act, the tribal management plan shall 
     require that the Pueblo spend any funds in accordance with 
     the purposes described in subsection (a).
       (2) Enforcement.--The Secretary may take judicial or 
     administrative action to enforce the requirement that monies 
     withdrawn from the Fund are used for the purposes specified 
     in subsection (a).
       (3) Liability.--If the Pueblo exercises the right to 
     withdraw monies from the Fund, neither the Secretary nor the 
     Secretary of the Treasury shall retain any liability for the 
     expenditure or investment of the monies withdrawn.
       (4) Expenditure plan.--
       (A) In general.--The Pueblo shall submit to the Secretary 
     for approval an expenditure plan for any portions of the 
     funds made available under this Act that the Pueblo does not 
     withdraw under paragraph (1)(A).
       (B) Description.--The expenditure plan shall describe the 
     manner in which, and the purposes for which, amounts 
     remaining in the Fund will be used.
       (C) Approval.--On receipt of an expenditure plan under 
     subparagraph (A), the Secretary shall approve the plan if the 
     Secretary determines that the plan is reasonable and 
     consistent with this Act.
       (5) Annual report.--The Pueblo shall submit to the 
     Secretary an annual report that describes all expenditures 
     from the Fund during the year covered by the report.
       (f) Funds Available Upon Appropriation.--Notwithstanding 
     subsection (d), $15,000,000 of the monies authorized to be 
     appropriated pursuant to section 10(c)(2)--
       (1) shall be available upon appropriation or made available 
     from other authorized sources for the Pueblo's acquisition of 
     water rights pursuant to Article 5.1.1.2.3 of the Settlement 
     Agreement, the Buffalo Pasture Recharge Project, 
     implementation of the Pueblo's water rights acquisition 
     program and water management and administration system, the 
     design, planning, and permitting of water or wastewater 
     infrastructure eligible for funding under sections 5 or 6, or 
     costs related to the negotiation, authorization, and 
     implementation of the Settlement Agreement; and
       (2) shall be distributed by the Secretary to the Pueblo on 
     receipt by the Secretary from the Pueblo of a written notice 
     and a Tribal Council resolution that describes the purposes 
     under paragraph (1) for which the monies will be used.
       (g) No Per Capita Distributions.--No part of the Fund shall 
     be distributed on a per capita basis to members of the 
     Pueblo.

     SEC. 7. MARKETING.

       (a) Pueblo Water Rights.--Subject to the approval of the 
     Secretary in accordance with subsection (e), the Pueblo may 
     market water rights secured to it under the Settlement 
     Agreement and Partial Final Decree, provided that such 
     marketing is in accordance with this section.
       (b) Pueblo Contract Rights to San Juan-Chama Project 
     Water.--Subject to the approval of the Secretary in 
     accordance with subsection (e), the Pueblo may subcontract 
     water made available to the Pueblo under the contract 
     authorized under section 9(b)(1)(A) to third parties to 
     supply water for use within or without the Taos Valley, 
     provided that the delivery obligations under such subcontract 
     are not inconsistent with the Secretary's existing San Juan-
     Chama Project obligations and such subcontract is in 
     accordance with this section.
       (c) Limitation.--
       (1) In general.--Diversion or use of water off Pueblo lands 
     pursuant to Pueblo water rights or Pueblo contract rights to 
     San Juan-Chama Project water shall be subject to and not 
     inconsistent with the same requirements and conditions of 
     State law, any applicable Federal law, and any applicable 
     interstate compact as apply to the exercise of water rights 
     or contract rights to San Juan-Chama Project water held by 
     non-Federal, non-Indian entities, including all applicable 
     State Engineer permitting and reporting requirements.
       (2) Effect on water rights.--Such diversion or use off 
     Pueblo lands under paragraph (1) shall not impair water 
     rights or increase surface water depletions within the Taos 
     Valley.
       (d) Maximum Term.--
       (1) In general.--The maximum term of any water use lease or 
     subcontract, including all renewals, shall not exceed 99 
     years in duration.
       (2) Alienation of rights.--The Pueblo shall not permanently 
     alienate any rights it has under the Settlement Agreement, 
     the Partial Final Decree, and this Act.
       (e) Approval of Secretary.--The Secretary shall approve or 
     disapprove any lease or subcontract submitted by the Pueblo 
     for approval not later than--
       (1) 180 days after submission; or
       (2) 60 days after compliance, if required, with section 
     102(2)(C) of the National Environmental Policy Act of 1969 
     (42 U.S.C. 4332(2)(C)), or any other requirement of Federal 
     law, whichever is later, provided that no Secretarial 
     approval shall be required for any water use lease or 
     subcontract with a term of less than 7 years.
       (f) No Forfeiture or Abandonment.--The nonuse by a lessee 
     or subcontractor of the Pueblo of any right to which the 
     Pueblo is entitled under the Partial Final Decree shall in no 
     event result in a forfeiture, abandonment, relinquishment, or 
     other loss of all or any part of those rights.
       (g) No Preemption.--
       (1) In general.--The approval authority of the Secretary 
     provided under subsection (e) shall not amend, construe, 
     supersede, or preempt any State or Federal law, interstate 
     compact, or international treaty that pertains to the 
     Colorado River, the Rio Grande, or any of their tributaries, 
     including the appropriation, use, development, storage, 
     regulation, allocation, conservation, exportation, or 
     quantity of those waters.
       (2) Applicable law.--The provisions of section 2116 of the 
     Revised Statutes (25 U.S.C. 177) shall not apply to any water 
     made available under the Settlement Agreement.
       (h) No Prejudice.--Nothing in this Act shall be construed 
     to establish, address, prejudice, or prevent any party from 
     litigating whether or to what extent any applicable State 
     law, Federal law, or interstate compact does or does not 
     permit, govern, or apply to the use of the Pueblo's water 
     outside of New Mexico.

     SEC. 8. MUTUAL-BENEFIT PROJECTS.

       (a) In General.--Upon the Enforcement Date, the Secretary, 
     acting through the Commissioner of Reclamation, shall provide 
     financial assistance in the form of grants on a 
     nonreimbursable basis to Eligible Non-Pueblo Entities to 
     plan, permit, design, engineer, and construct the Mutual-
     Benefit Projects in accordance with the Settlement 
     Agreement--
       (1) to minimize adverse impacts on the Pueblo's water 
     resources by moving future non-Indian ground water pumping 
     away from the Pueblo's Buffalo Pasture; and
       (2) to implement the resolution of a dispute over the 
     allocation of certain surface water flows between the Pueblo 
     and non-Indian irrigation water right owners in the community 
     of Arroyo Seco Arriba.
       (b) Cost-Sharing.--
       (1) Federal share.--The Federal share of the total cost of 
     planning, designing, and constructing the Mutual-Benefit 
     Projects authorized in subsection (a) shall be 75 percent and 
     shall be nonreimbursable.
       (2) Non-federal share.--The non-Federal share of the total 
     cost of planning, designing, and constructing the Mutual-
     Benefit Projects shall be 25 percent and may be in the form 
     of in-kind contributions, including the contribution of any 
     valuable asset or service that the Secretary determines would 
     substantially contribute to completing the Mutual-Benefit 
     Projects.

     SEC. 9. SAN JUAN-CHAMA PROJECT CONTRACTS.

       (a) In General.--Contracts issued under this section shall 
     be in accordance with this Act and the Settlement Agreement.
       (b) Contracts for San Juan-Chama Project Water.--
       (1) In general.--The Secretary shall enter into 3 repayment 
     contracts by December 31, 2009, for the delivery of San Juan-
     Chama Project water in the following amounts:
       (A) 2,215 acre-feet/annum to the Pueblo.
       (B) 366 acre-feet/annum to the Town of Taos.
       (C) 40 acre-feet/annum to EPWSD.
       (2) Requirements.--Each such contract shall provide that if 
     the conditions precedent set forth in section 10(f)(2) have 
     not been fulfilled by December 31, 2015, the contract shall 
     expire on that date.
       (3) Applicable law.--Public Law 87-483 (76 Stat. 97) 
     applies to the contracts entered into under paragraph (1) and 
     no preference shall be applied as a result of section 4(a) 
     with regard to the delivery or distribution of San Juan-Chama 
     Project water or the management or operation of the San Juan-
     Chama Project.
       (c) Waiver.--With respect to the contract authorized and 
     required by subsection (b)(1)(A) and notwithstanding the 
     provisions of Public Law 87-483 (76 Stat. 96) or any other 
     provision of law--
       (1) the Secretary shall waive the entirety of the Pueblo's 
     share of the construction costs, both principal and the 
     interest, for the San Juan-Chama Project and pursuant to that 
     waiver, the Pueblo's share of all construction costs for the 
     San Juan-Chama Project, inclusive of both principal and 
     interest shall be nonreimbursable; and
       (2) the Secretary's waiver of the Pueblo's share of the 
     construction costs for the San Juan-Chama Project will not 
     result in an increase in the pro rata shares of other San

[[Page S5074]]

     Juan-Chama Project water contractors, but such costs shall be 
     absorbed by the United States Treasury or otherwise 
     appropriated to the Department of the Interior.

     SEC. 10. AUTHORIZATIONS, RATIFICATIONS, CONFIRMATIONS, AND 
                   CONDITIONS PRECEDENT.

       (a) Ratification.--
       (1) In general.--Except to the extent that any provision of 
     the Settlement Agreement conflicts with any provision of this 
     Act, the Settlement Agreement is authorized, ratified, and 
     confirmed.
       (2) Amendments.--To the extent amendments are executed to 
     make the Settlement Agreement consistent with this Act, such 
     amendments are also authorized, ratified, and confirmed.
       (b) Execution of Settlement Agreement.--To the extent that 
     the Settlement Agreement does not conflict with this Act, the 
     Secretary shall execute the Settlement Agreement, including 
     all exhibits to the Settlement Agreement requiring the 
     signature of the Secretary and any amendments necessary to 
     make the Settlement Agreement consistent with this Act, after 
     the Pueblo has executed the Settlement Agreement and any such 
     amendments.
       (c) Authorization of Appropriations.--
       (1) Taos pueblo infrastructure and watershed fund.--There 
     is authorized to be appropriated to the Secretary to provide 
     grants pursuant to section 5, $30,000,000, as adjusted under 
     paragraph (4), for the period of fiscal years 2010 through 
     2016.
       (2) Taos pueblo water development fund.--There is 
     authorized to be appropriated to the Taos Pueblo Water 
     Development Fund, established at section 6(a), $58,000,000, 
     as adjusted under paragraph (4), for the period of fiscal 
     years 2010 through 2016.
       (3) Mutual-benefit projects funding.--There is further 
     authorized to be appropriated to the Secretary to provide 
     grants pursuant to section 8, a total of $33,000,000, as 
     adjusted under paragraph (4), for the period of fiscal years 
     2010 through 2016.
       (4) Adjustments to amounts authorized.--The amounts 
     authorized to be appropriated under paragraphs (1) through 
     (3) shall be adjusted by such amounts as may be required by 
     reason of changes since April 1, 2007, in construction costs, 
     as indicated by engineering cost indices applicable to the 
     types of construction or rehabilitation involved.
       (5) Deposit in fund.--Except for the funds to be provided 
     to the Pueblo pursuant to section 5(d), the Secretary shall 
     deposit the funds made available pursuant to paragraphs (1) 
     and (3) into a Taos Settlement Fund to be established within 
     the Treasury of the United States so that such funds may be 
     made available to the Pueblo and the Eligible Non-Pueblo 
     Entities upon the Enforcement Date as set forth in sections 
     5(b) and 8(a).
       (d) Authority of the Secretary.--The Secretary is 
     authorized to enter into such agreements and to take such 
     measures as the Secretary may deem necessary or appropriate 
     to fulfill the intent of the Settlement Agreement and this 
     Act.
       (e) Environmental Compliance.--
       (1) Effect of execution of settlement agreement.--The 
     Secretary's execution of the Settlement Agreement shall not 
     constitute a major Federal action under the National 
     Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.).
       (2) Compliance with environmental laws.--In carrying out 
     this Act, the Secretary shall comply with each law of the 
     Federal Government relating to the protection of the 
     environment, including--
       (A) the National Environmental Policy Act of 1969 (42 
     U.S.C. 4321 et seq.); and
       (B) the Endangered Species Act of 1973 (16 U.S.C. 1531 et 
     seq.).
       (f) Conditions Precedent and Secretarial Finding.--
       (1) In general.--Upon the fulfillment of the conditions 
     precedent described in paragraph (2), the Secretary shall 
     publish in the Federal Register a statement of finding that 
     the conditions have been fulfilled.
       (2) Conditions.--The conditions precedent referred to in 
     paragraph (1) are the following:
       (A) The President has signed into law the Taos Pueblo 
     Indian Water Rights Settlement Act.
       (B) To the extent that the Settlement Agreement conflicts 
     with this Act, the Settlement Agreement has been revised to 
     conform with this Act.
       (C) The Settlement Agreement, so revised, including waivers 
     and releases pursuant to section 11, has been executed by the 
     Parties and the Secretary prior to the Parties' motion for 
     entry of the Partial Final Decree.
       (D) Congress has fully appropriated or the Secretary has 
     provided from other authorized sources all funds authorized 
     by paragraphs (1) through (3) of subsection (c) so that the 
     entire amounts so authorized have been previously provided to 
     the Pueblo pursuant to sections 5 and 6, or placed in the 
     Taos Pueblo Water Development Fund or the Taos Settlement 
     Fund as directed in subsection (c).
       (E) The Legislature of the State of New Mexico has fully 
     appropriated the funds for the State contributions as 
     specified in the Settlement Agreement, and those funds have 
     been deposited in appropriate accounts.
       (F) The State of New Mexico has enacted legislation that 
     amends NMSA 1978, section 72-6-3 to state that a water use 
     due under a water right secured to the Pueblo under the 
     Settlement Agreement or the Partial Final Decree may be 
     leased for a term, including all renewals, not to exceed 99 
     years, provided that this condition shall not be construed to 
     require that said amendment state that any State law based 
     water rights acquired by the Pueblo or by the United States 
     on behalf of the Pueblo may be leased for said term.
       (G) A Partial Final Decree that sets forth the water rights 
     and contract rights to water to which the Pueblo is entitled 
     under the Settlement Agreement and this Act and that 
     substantially conforms to the Settlement Agreement and 
     Attachment 5 thereto has been approved by the Court and has 
     become final and nonappealable.
       (g) Enforcement Date.--The Settlement Agreement shall 
     become enforceable, and the waivers and releases executed 
     pursuant to section 11 and the limited waiver of sovereign 
     immunity set forth in section 12(a) shall become effective, 
     as of the date that the Secretary publishes the notice 
     required by subsection (f)(1).
       (h) Expiration Date.--
       (1) In general.--If all of the conditions precedent 
     described in section (f)(2) have not been fulfilled by 
     December 31, 2016, the Settlement Agreement shall be null and 
     void, the waivers and releases executed pursuant to section 
     11 and the sovereign immunity waivers in section 12(a) shall 
     not become effective, and any unexpended Federal funds, 
     together with any income earned thereon, and title to any 
     property acquired or constructed with expended Federal funds, 
     shall be returned to the Federal Government, unless otherwise 
     agreed to by the Parties in writing and approved by Congress.
       (2) Exception.--Notwithstanding subsection (h)(1) or any 
     other provision of law, any unexpended Federal funds, 
     together with any income earned thereon, made available under 
     sections 5(d) and 6(f) and title to any property acquired or 
     constructed with expended Federal funds made available under 
     sections 5(d) and 6(f) shall be retained by the Pueblo.
       (3) Right to set-off.--In the event the conditions 
     precedent set forth in subsection (f)(2) have not been 
     fulfilled by December 31, 2016, the United States shall be 
     entitled to set off any funds expended or withdrawn from the 
     amount appropriated pursuant to paragraphs (1) and (2) of 
     subsection (c) or made available from other authorized 
     sources, together with any interest accrued, against any 
     claims asserted by the Pueblo against the United States 
     relating to water rights in the Taos Valley.

     SEC. 11. WAIVERS AND RELEASES.

       (a) Claims by the Pueblo and the United States.--In return 
     for recognition of the Pueblo's water rights and other 
     benefits, including but not limited to the commitments by 
     non-Pueblo parties, as set forth in the Settlement Agreement 
     and this Act, the Pueblo, on behalf of itself and its 
     members, and the United States acting in its capacity as 
     trustee for the Pueblo are authorized to execute a waiver and 
     release of claims against the parties to New Mexico v. Abeyta 
     and New Mexico v. Arellano, Civil Nos. 7896-BB (U.S.6 D.N.M.) 
     and 7939-BB (U.S. D.N.M.) (consolidated) from--
       (1) all claims for water rights in the Taos Valley that the 
     Pueblo, or the United States acting in its capacity as 
     trustee for the Pueblo, asserted, or could have asserted, in 
     any proceeding, including but not limited to in New Mexico v. 
     Abeyta and New Mexico v. Arellano, Civil Nos. 7896-BB (U.S.6 
     D.N.M.) and 7939-BB (U.S. D.N.M.) (consolidated), up to and 
     including the Enforcement Date, except to the extent that 
     such rights are recognized in the Settlement Agreement or 
     this Act;
       (2) all claims for water rights, whether for consumptive or 
     nonconsumptive use, in the Rio Grande mainstream or its 
     tributaries that the Pueblo, or the United States acting in 
     its capacity as trustee for the Pueblo, asserted or could 
     assert in any water rights adjudication proceedings except 
     those claims based on Pueblo or United States ownership of 
     lands or water rights acquired after the Enforcement Date, 
     provided that nothing in this paragraph shall prevent the 
     Pueblo or the United States from fully participating in the 
     inter se phase of any such water rights adjudication 
     proceedings;
       (3) all claims for damages, losses or injuries to water 
     rights or claims of interference with, diversion or taking of 
     water (including but not limited to claims for injury to 
     lands resulting from such damages, losses, injuries, 
     interference with, diversion, or taking) in the Rio Grande 
     mainstream or its tributaries or for lands within the Taos 
     Valley that accrued at any time up to and including the 
     Enforcement Date; and
       (4) all claims against the State of New Mexico, its 
     agencies, or employees relating to the negotiation or the 
     adoption of the Settlement Agreement.
       (b) Claims by the Pueblo Against the United States.--The 
     Pueblo, on behalf of itself and its members, is authorized to 
     execute a waiver and release of--
       (1) all claims against the United States, its agencies, or 
     employees relating to claims for water rights in or water of 
     the Taos Valley that the United States acting in its capacity 
     as trustee for the Pueblo asserted, or could have asserted, 
     in any proceeding, including but not limited to in New Mexico 
     v. Abeyta and New Mexico v. Arellano, Civil Nos. 7896-BB 
     (U.S.6 D.N.M.) and 7939-BB (U.S. D.N.M.) (consolidated);
       (2) all claims against the United States, its agencies, or 
     employees relating to damages, losses, or injuries to water, 
     water rights, land, or natural resources due to loss of

[[Page S5075]]

     water or water rights (including but not limited to damages, 
     losses or injuries to hunting, fishing, gathering, or 
     cultural rights due to loss of water or water rights, claims 
     relating to interference with, diversion or taking of water 
     or water rights, or claims relating to failure to protect, 
     acquire, replace, or develop water, water rights or water 
     infrastructure) in the Rio Grande mainstream or its 
     tributaries or within the Taos Valley that first accrued at 
     any time up to and including the Enforcement Date;
       (3) all claims against the United States, its agencies, or 
     employees for an accounting of funds appropriated by the Act 
     of March 4, 1929 (45 Stat. 1562), the Act of March 4, 1931 
     (46 Stat. 1552), the Act of June 22, 1936 (49 Stat. 1757), 
     the Act of August 9, 1937 (50 Stat. 564), and the Act of May 
     9, 1938 (52 Stat. 291) as authorized by the Pueblo Lands Act 
     of June 7, 1924 (43 Stat. 636) and the Pueblo Lands Act of 
     May 31, 1933 ( 48 Stat. 108) and for breach of trust relating 
     to funds for water replacement appropriated by said Acts that 
     first accrued before the date of enactment of this Act;
       (4) all claims against the United States, its agencies, or 
     employees relating to the pending litigation of claims 
     relating to the Pueblo's water rights in New Mexico v. Abeyta 
     and New Mexico v. Arellano, Civil Nos. 7896-BB (U.S.6 D.N.M.) 
     and 7939-BB (U.S. D.N.M.) (consolidated); and
       (5) all claims against the United States, its agencies, or 
     employees relating to the negotiation, Execution or the 
     adoption of the Settlement Agreement, exhibits thereto, the 
     Final Decree, or this Act.
       (c) Reservation of Rights and Retention of Claims.--
     Notwithstanding the waivers and releases authorized in this 
     Act, the Pueblo on behalf of itself and its members and the 
     United States acting in its capacity as trustee for the 
     Pueblo retain--
       (1) all claims for enforcement of the Settlement Agreement, 
     the Final Decree, including the Partial Final Decree, the San 
     Juan-Chama Project contract between the Pueblo and the United 
     States, or this Act;
       (2) all claims against persons other than the Parties to 
     the Settlement Agreement for damages, losses or injuries to 
     water rights or claims of interference with, diversion or 
     taking of water rights (including but not limited to claims 
     for injury to lands resulting from such damages, losses, 
     injuries, interference with, diversion, or taking of water 
     rights) within the Taos Valley arising out of activities 
     occurring outside the Taos Valley or the Taos Valley Stream 
     System;
       (3) all rights to use and protect water rights acquired 
     after the date of enactment of this Act;
       (4) all rights to use and protect water rights acquired 
     pursuant to State law, to the extent not inconsistent with 
     the Partial Final Decree and the Settlement Agreement 
     (including water rights for the land the Pueblo owns in 
     Questa, New Mexico);
       (5) all claims relating to activities affecting the quality 
     of water including but not limited to any claims the Pueblo 
     might have under the Comprehensive Environmental Response, 
     Compensation, and Liability Act of 1980 (42 U.S.C. 9601 et 
     seq.) (including but not limited to claims for damages to 
     natural resources), the Safe Drinking Water Act (42 U.S.C. 
     300f et seq.), the Federal Water Pollution Control Act (33 
     U.S.C. 1251 et seq.), and the regulations implementing those 
     Acts;
       (6) all claims relating to damages, losses, or injuries to 
     land or natural resources not due to loss of water or water 
     rights (including but not limited to hunting, fishing, 
     gathering, or cultural rights); and
       (7) all rights, remedies, privileges, immunities, powers, 
     and claims not specifically waived and released pursuant to 
     this Act and the Settlement Agreement.
       (d) Effect of Section.--Nothing in the Settlement Agreement 
     or this Act--
       (1) affects the ability of the United States acting in its 
     sovereign capacity to take actions authorized by law, 
     including but not limited to any laws relating to health, 
     safety, or the environment, including but not limited to the 
     Federal Water Pollution Control Act (33 U.S.C. 1251 et seq.), 
     the Safe Drinking Water Act (42 U.S.C. 300f et seq.), the 
     Comprehensive Environmental Response, Compensation, and 
     Liability Act of 1980 (42 U.S.C. 9601 et seq.), the Solid 
     Waste Disposal Act (42 U.S.C. 6901 et seq.), and the 
     regulations implementing such Acts;
       (2) affects the ability of the United States to take 
     actions acting in its capacity as trustee for any other 
     Indian Tribe or allottee;
       (3) confers jurisdiction on any State court to--
       (A) interpret Federal law regarding health, safety, or the 
     environment or determine the duties of the United States or 
     other parties pursuant to such Federal law; or
       (B) conduct judicial review of Federal agency action; or
       (4) waives any claim of a member of the Pueblo in an 
     individual capacity that does not derive from a right of the 
     Pueblo.
       (e) Tolling of Claims.--
       (1) In general.--Each applicable period of limitation and 
     time-based equitable defense relating to a claim described in 
     this section shall be tolled for the period beginning on the 
     date of enactment of this Act and ending on the earlier of--
       (A) December 31, 2016; or
       (B) the Enforcement Date.
       (2) Effect of subsection.--Nothing in this subsection 
     revives any claim or tolls any period of limitation or time-
     based equitable defense that expired before the date of 
     enactment of this Act.
       (3) Limitation.--Nothing in this subsection precludes the 
     tolling of any period of limitations or any time-based 
     equitable defense under any other applicable law.

     SEC. 12. INTERPRETATION AND ENFORCEMENT.

       (a) Limited Waiver of Sovereign Immunity.--Upon and after 
     the Enforcement Date, if any Party to the Settlement 
     Agreement brings an action in any court of competent 
     jurisdiction over the subject matter relating only and 
     directly to the interpretation or enforcement of the 
     Settlement Agreement or this Act, and names the United States 
     or the Pueblo as a party, then the United States, the Pueblo, 
     or both may be added as a party to any such action, and any 
     claim by the United States or the Pueblo to sovereign 
     immunity from the action is waived, but only for the limited 
     and sole purpose of such interpretation or enforcement, and 
     no waiver of sovereign immunity is made for any action 
     against the United States or the Pueblo that seeks money 
     damages.
       (b) Subject Matter Jurisdiction Not Affected.--Nothing in 
     this Act shall be deemed as conferring, restricting, 
     enlarging, or determining the subject matter jurisdiction of 
     any court, including the jurisdiction of the court that 
     enters the Partial Final Decree adjudicating the Pueblo's 
     water rights.
       (c) Regulatory Authority Not Affected.--Nothing in this Act 
     shall be deemed to determine or limit any authority of the 
     State or the Pueblo to regulate or administer waters or water 
     rights now or in the future.

     SEC. 13. DISCLAIMER.

       Nothing in the Settlement Agreement or this Act shall be 
     construed in any way to quantify or otherwise adversely 
     affect the land and water rights, claims, or entitlements to 
     water of any other Indian tribe.

  Mr. UDALL of New Mexico. Mr. President, today I join Senator Bingaman 
in introducing a bill to complete the Abeyta water settlement in 
northern New Mexico. Introduction of this bill represents a major 
milestone in the resolution of Taos Pueblo's water rights claims in the 
Rio Pueblo de Taos. Years of work and negotiation have gone into the 
settlement, and I am pleased that the tribes, village, city, county, 
acequias, and community groups involved were able to come to an 
agreement that is mutually beneficial to all the users of this 
tributary to the Rio Grande.
  New Mexico is a State rich with tradition and culture, where the 
water resources are scarce and precious. As is common in most of the 
arid West, this vital but limited commodity can foster conflict between 
communities and individuals, and in a State where the history is long 
and complex, disputes over water are uniquely complicated. But, despite 
the complications surrounding water tenure, New Mexicans are united in 
a common respect for this resource. From the pueblos and tribes of New 
Mexico, to the historic acequias and growing communities, water is 
fundamental to both survival and cultural traditions, and is respected 
as such. The Abeyta settlement is an example of communities and the 
tribe coming together to resolve their differences and find a way to 
ensure that everyone has access to this precious and respected 
resource.
  The Abeyta settlement establishes the water claims of the Pueblo of 
Taos, the Taos Valley Acequia Association, the Village of El Prado, and 
the Town of Taos. These communities depend heavily on agriculture and 
irrigation for both traditional practices and subsistence. The 
settlement ensures water for both agricultural and domestic use, and 
facilitates the rehabilitation of irrigation infrastructure. 
Additionally, the settlement helps to protect the quality of water in 
the watershed by protecting and recharging the wetlands areas of the 
Taos Pueblo's buffalo pasture. After years of negotiation, the parties 
involved in this important settlement have come to an agreement based 
on respect for cultural practices and a commitment to live as good 
neighbors sharing a common resource. I invite my colleagues to take 
note of the unprecedented level of cooperation, negotiation, and mutual 
support manifest in this settlement.
  It has been said that the wars of the future will be fought over 
access to water. In New Mexico, we are setting a different precedent--a 
precedent of respect and compromise. One that will help us move into 
the future with well-established partnerships and a commitment to 
conserve and manage this vital resource to the benefit of all. I am 
honored to join Senator Bingaman today in introducing this legislation 
that will bring the Pueblo of Taos and the surrounding community one 
step closer to establishing a secure water future.

[[Page S5076]]

                                 ______
                                 
      By Mr. REID (for Mr. Rockefeller (for himself and Mr. 
        Whitehouse)):
  S. 966. A bill to improve the Federal infrastructure for health care 
quality improvement in the United States; to the Committee on Finance.
  Mr. ROCKEFELLER. Mr. President, I rise today with my colleague, 
Senator Whitehouse of Rhode Island, to introduce the National Health 
Care Quality Act, legislation that makes health care quality a national 
priority. We have before us an overwhelming opportunity to make 
sweeping changes to our health care system. The dramatic change we need 
to improve America's health care delivery system requires a solid 
coordinated infrastructure to guide quality improvement; however this 
infrastructure does not exist today. The lack of a coordinated effort 
to improve health care quality has hindered our nation's ability to 
improve patient health outcomes and reduce inefficiencies in our health 
care system. In order to achieve our goals for true delivery system 
reform, health care quality must be elevated as a national priority.
  As the cost of health care in America continues to increase, the 
quality of care Americans receive continues to decrease. The average 
cost of health insurance premiums has doubled in the last nine years, 
from $5791 in 1999 to $12,680 in 2008. However, less than half of 
adults receive recommended care. More is spent per person on health 
care in the United States than in any other nation in the world, and 
yet America has some of the worst health outcomes. Wide-spread 
inefficiencies plague our health care system. The Congressional Budget 
Office, CBO, estimates that 30 percent of annual health care spending, 
or as much as $700 billion, could be eliminated with little to no 
impact on the system. Additionally, the Commonwealth Fund estimates 
that more than 100,000 American lives could be saved annually by 
improving health care quality to the level of performance achieved in 
other nations.
  Several entities contribute to health care quality improvement in the 
U.S., including numerous federal departments, several key Federal 
agencies within those departments, and additional private-sector 
partners. While there has been some progress to coordinate efforts 
among these entities and create a framework for navigating quality 
improvement efforts, there is no defined structure in place to guide 
the process of quality improvement, prioritize limited resources, and 
provide oversight to ensure these efforts reflect the best interests of 
all patients. Therefore, legislation is needed to modernize our health 
care structure to create better coordination of quality efforts, and 
make certain the decisions about reimbursement and coverage will allow 
the government to effectively deliver care that is of the highest 
quality.
  The National Health Care Quality Act would create a sensible 
infrastructure for health care quality improvement by creating an 
accountable entity--a new Office of National Health Care Quality 
Improvement within the Executive Office of the President--to set health 
care quality priorities for the nation. This office will be led by a 
new Director of National Health Care Quality, who will work with public 
and private stakeholders to establish and routinely update health care 
quality priorities for the nation based on a number of mandatory 
considerations, including the needs of children and the void in 
pediatric quality measures.
  This legislation also puts forth a construct to coordinate health 
care quality improvement efforts across all federal agencies involved 
in purchasing, providing, studying, or regulating health care services. 
The bill statutorily re-establishes the Quality Interagency 
Coordinating Council, QuICC, first created during the Clinton 
administration, within the Office of National Health Care Quality 
Improvement. The purpose of the Quality Interagency Coordinating 
Council is to coordinate health care quality improvement efforts across 
all relevant Federal departments and agencies involved in health care 
services. It also provides a framework for the development and 
implementation of Department- and agency-specific quality improvement 
strategies.
  Lastly, the legislation enhances health care quality improvement 
efforts within the Department of Health and Human Services, HHS, by 
expanding the authority of the Agency for Healthcare Research and 
Quality and elevating the role of the Director of AHRQ to a Senate-
appointed position. By building on and improving the public-private 
process for health care quality measure development, AHRQ can also help 
to streamline the implementation of quality improvement measures within 
federal health programs under the jurisdiction of HHS. AHRQ will 
establish a standardized method for reporting quality measures and data 
to all federal health programs. Lastly, AHRQ would be required to 
develop and launch a public education campaign, aimed at both providers 
and consumers of health care, about health care quality improvement.
  It is my belief that the multi-pronged approach provided in the 
National Health Care Quality Act will lead to vast improvements in the 
coordination of quality efforts and, most importantly, patient health 
outcomes. Given the current problems in the health care system, 
Congress has a responsibility to the American people to guarantee 
individuals have access to high quality, safe and effective care, and I 
urge my colleagues to join us in support of this important bill.
  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. 966

       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 ``National Health Care Quality 
     Act''.

     SEC. 2. DEFINITIONS.

       In this Act:
       (1) Health care quality.--The term ``health care quality'' 
     means the degree to which health services for individuals and 
     populations increase the likelihood of desired health 
     outcomes and are consistent with current professional 
     knowledge, based upon the following criteria:
       (A) Effectiveness.--Health care services should be provided 
     based upon scientific knowledge of all who could benefit.
       (B) Efficiency.--Waste, including waste of equipment, 
     supplies, ideas, and energies, should be avoided.
       (C) Equity.--The provision of health care should not vary 
     in quality because of personal characteristics of the 
     individuals involved.
       (D) Patient-centeredness.--Health care should be responsive 
     to, and respectful of, individual patient preferences.
       (E) Safety.--Injuries to patients from the health care that 
     is supposed to help them should be avoided.
       (F) Timeliness.--Waiting times and harmful delays in 
     providing health care should be reduced.
       (2) Health care quality measure.--The term ``health care 
     quality measure'' means a national consensus standard for 
     measuring the performance and improvement of population 
     health or of institutional providers of services, physicians, 
     and other clinicians in the delivery of health care services, 
     consistent with the health care quality criteria described in 
     paragraph (1).
       (3) Multi-stakeholder group.--The term ``multi-stakeholder 
     group'' means, with respect to a health care quality measure, 
     a voluntary collaborative of public and private organizations 
     representing persons interested in, or affected by, the use 
     of such health care quality measure, including--
       (A) health care providers and practitioners, including 
     providers and practitioners primarily serving children and 
     those with long-term health care needs;
       (B) health care quality entities;
       (C) health plans;
       (D) patient advocates and consumer groups;
       (E) employers;
       (F) public and private purchasers of health care items and 
     services;
       (G) labor organizations;
       (H) relevant departments or agencies of the United States;
       (I) biopharmaceutical companies and manufacturers of 
     medical devices; and
       (J) licensing, credentialing, and accrediting bodies.

     SEC. 3. DEPARTMENT AND AGENCY QUALITY REVIEW.

       Each relevant department and agency of the Federal 
     Government shall review the statutory authority of such 
     department or agency, effective on the date of enactment of 
     this Act, administrative regulations, and policies and 
     procedures for the purpose of determining whether there are 
     any deficiencies or inconsistencies therein which prohibit 
     full compliance with the purposes and provisions of this Act. 
     Each department and agency shall, not later than July 1, 
     2010, propose to the President such measures as may be 
     necessary to bring the authority and policies and procedures 
     of such department or agency into conformity with the intent, 
     purposes, and provisions set forth in this Act.

[[Page S5077]]

     SEC. 4. NATIONAL HEALTH CARE QUALITY PRIORITIES.

       (a) Establishment of the Office of National Health Care 
     Quality Improvement.--There is established within the 
     Executive Office of the President an Office of National 
     Health Care Quality Improvement (``NHCQI'') (referred to in 
     this section as the ``Office''). The Office shall be headed 
     by a Director of National Health Care Quality (referred to in 
     this section as the ``Director'') who shall be appointed by 
     the President and shall report directly to the President.
       (b) Director.--
       (1) Responsibilities.--The Director shall perform the 
     duties of the Office, described in paragraph (3), in a manner 
     consistent with the development of a nationwide health care 
     quality infrastructure that--
       (A) coordinates and implements health care quality 
     research, measurement, and data collection and reporting 
     across all Federal agencies involved in purchasing, 
     providing, studying, or regulating health care services;
       (B) incorporates proven public and private quality 
     improvement best practices;
       (C) includes public and private quality improvement 
     strategies to address activities other than health care 
     quality measurement, such as provider payment models, 
     alternative care models, licensing, professional 
     certification, medical education, alternative staffing 
     models, and public reporting; and
       (D) leads to improved health care outcomes for patients 
     across the United States.
       (2) Qualifications.--The President shall, by and with the 
     advice and consent of the Senate, appoint a Director. The 
     President shall select an individual who has--
       (A) national recognition for expertise in health care 
     quality improvement;
       (B) experience addressing health care quality improvement 
     in more than one health care setting, such as inpatient care, 
     outpatient care, long-term care, public programs, and private 
     programs; and
       (C) experience addressing health care quality as it applies 
     to vulnerable populations, including children, underserved 
     populations, rural populations, individuals with 
     disabilities, the elderly, and racial and ethnic minorities.
       (3) Duties of the director.--The Director shall--
       (A) advise the President on the quality of health care in 
     the United States, including priorities and goals for the 
     future;
       (B) in coordination with public and private stakeholders, 
     determine national priorities for improving health care 
     quality, in accordance with subsection (c);
       (C) establish annual benchmarks for each relevant Federal 
     department and agency to achieve national priorities for 
     health care quality improvement;
       (D) develop an annual report card on the state of the 
     Nation's health as it relates to health care quality;
       (E) in coordination with the heads of other relevant 
     agencies and as part of the annual budget request of 
     Congress, submit funding requirements, in accordance with 
     subsection (d);
       (F) serve as the chairperson of the Quality Interagency 
     Coordinating Council (QuICC), established under section 4; 
     and
       (G) in consultation with the National Coordinator of Health 
     Information Technology, develop an open source framework for 
     Federal quality communication to create and maintain a 
     standardized, electronic language or interface that enables 
     all relevant Federal entities to communicate information or 
     make requests regarding quality research, definitions, 
     activities, or regulations, or to provide any other 
     functionality, as the Director determines.
       (c) National Priorities for Health Care Quality 
     Improvement.--
       (1) In general.--Not later than January 1, 2010 and at 
     least every 5 years thereafter, the Director, in coordination 
     with public and private stakeholders, shall establish 
     national priorities for health care quality improvement.
       (2) Development of priorities.--In establishing the 
     national priorities for health care quality improvement under 
     paragraph (1), the Director shall consider--
       (A) health care outcomes in the United States in comparison 
     to health outcomes in other World Health Organization member 
     countries;
       (B) the burden of disease, including the prevalence, 
     incidence, and cost of disease to the United States;
       (C) demographics;
       (D) variability in practice norms;
       (E) potential to eliminate harm to patients;
       (F) improvements with the potential for the greatest impact 
     on morbidity, mortality, performance, and a focus on the 
     patient;
       (G) quality measures that may be coordinated across 
     different health care settings, including impatient and 
     outpatient measures, primary care, and specialty care;
       (H) the specific quality improvement needs and challenges 
     of rural areas; and
       (I) the unique quality improvement needs disparities and 
     challenges of vulnerable populations, including children, the 
     elderly, individuals with disabilities, individuals near the 
     end of life, and racial and ethnic minorities.
       (3) Initial priorities.--The first set of national 
     priorities established under this subsection shall include as 
     a priority pediatric health care quality improvement, for 
     children up to age 21.
       (4) Collaboration with multi-stakeholder groups.--
       (A) In general.--The Director shall convene and collaborate 
     with multi-stakeholder groups in establishing and updating 
     the national priorities under paragraph (1).
       (B) Transparency.--All collaboration between the Director 
     and multi-stakeholder groups shall be conducted through an 
     open and transparent process.
       (C) Statutory construction.--Notwithstanding any other 
     provision in this paragraph, the Director shall have the 
     final authority to decide whether to accept the 
     recommendations provided by such multi-stakeholder groups.
       (5) Agency- and department-specific strategic plans.--Not 
     later than October 1, 2010 and annually thereafter, the 
     Director, in consultation with the heads of relevant Federal 
     agencies and departments, shall develop agency- and 
     department-specific strategic plans for health care quality 
     improvement to achieve national priorities, including annual 
     benchmarks.
       (d) Annual Budget Request for Resources.--As part of the 
     annual budget request made by the President to Congress, 
     beginning with such budget request made in calendar year 
     2011, the Director, in consultation with the heads of 
     relevant Federal departments and agencies, shall include--
       (1) a description of the agency- and department-specific 
     strategic plans for health care quality improvement; and
       (2) the level of Federal funding required for implementing 
     or maintaining the quality improvement strategic plans 
     described under paragraph (1).
       (e) Monitoring.--
       (1) In general.--The Director shall institute mechanisms 
     for monitoring the progress on achieving national health care 
     quality priorities under subsection (c)(1) as well as 
     department- and agency-specific strategic plans under 
     subsection (c)(5), including objectives, metrics, and 
     benchmarks for the following:
       (A) The benefits and drawbacks of specific quality 
     improvement efforts for public programs and for the health 
     care system at large.
       (B) Coordination and communication of efforts to achieve 
     interagency goals, including information exchange.
       (C) Interagency coordination progress for national quality 
     efforts.
       (D) Methods for ensuring awareness and recognition among 
     health care providers and the public at large of the 
     significance of health care quality improvement.
       (2) Reporting.--
       (A) Reporting.--Not later than December 31, 2011, and by 
     the end of each calendar year thereafter, the Director shall 
     submit to the President and to Congress a report regarding 
     the progress of Federal agencies in achieving the quality 
     improvement priorities under paragraphs (1) and (5) of 
     subsection (c), and shall make such report publicly available 
     through the Internet.
       (B) Annual national health care quality report card.--Not 
     later than January 31, 2011, and annually thereafter, the 
     Director shall publish a national health care quality report 
     card, which shall include--
       (i) the considerations for national health care quality 
     priorities described in subsection (c)(2);
       (ii) an analysis of the progress of the department- and 
     agency-specific strategic plans under subsection (c)(5) in 
     achieving the national health care quality priorities 
     established under subsection (c)(1), and any gaps in such 
     strategic plans;
       (iii) the extent to which private sector strategies have 
     informed Federal quality improvement efforts; and
       (iv) a summary of consumer feedback regarding how well 
     current quality improvement practices work for such consumers 
     and additional ways to improve health care quality.
       (f) Website.--Not later than July 1, 2010, the Director 
     shall create a website to make public information regarding--
       (1) the national priorities for health care quality 
     improvement established under subsection (c)(1);
       (2) the department- and agency-specific strategic plans for 
     health care quality described in subsection (c)(5);
       (3) the annual national health care quality report card 
     described in subsection (e)(2)(B);
       (4) ongoing health care quality research efforts;
       (5) new and innovative health care quality improvement 
     practices in the public and private sectors;
       (6) a consumer feedback mechanism; and
       (7) other information, as the Director determines to be 
     appropriate.
       (g) Staff; Experts and Consultants; Voluntary and 
     Uncompensated Service.--
       (1) Staff.--The Director may employ such officers and 
     employees as may be necessary to enable the Office to carry 
     out its functions under this Act, and may employ and fix the 
     compensation of such officers and employees as may be 
     necessary to carry out its functions under this Act.
       (2) Experts and consultants.--The Director may employ and 
     fix the compensation of such experts and consultants as may 
     be necessary for the carrying out of its functions under this 
     Act, in accordance with section 3109 of title 5, United 
     States Code (without regard to the last sentence).
       (3) Voluntary and uncompensated service.--Notwithstanding 
     section 1342 of title 31, United States Code, the Office may 
     accept and use voluntary and uncompensated services, as the 
     Director determines necessary.

[[Page S5078]]

       (h) Authorization of Appropriations.--There are authorized 
     to carry out this section $50,000,000 for fiscal years 2010 
     through 2014.

     SEC. 5. NATIONAL HEALTH CARE QUALITY COORDINATION.

       (a) Establishment.--As of the date of enactment of this 
     Act, there is established within the Office of National 
     Health Care Quality Improvement, the Quality Interagency 
     Coordinating Council (referred to in this section as the 
     ``QuICC'').
       (b) Purpose.--The purpose of the QuICC is to coordinate 
     health care quality improvement efforts across all Federal 
     agencies involved in purchasing, providing, studying, or 
     regulating health care services in order to achieve the 
     common goal of improving patient health outcomes.
       (c) Organization of the QuICC.--
       (1) Co-chairpersons.--The Director of National Health Care 
     Quality (referred to in this section as the ``Director'') and 
     the Secretary of Health and Human Services shall serve as co-
     chairpersons of the QuICC, and the Director shall manage day-
     to-day operations of the QuICC.
       (2) Federal members.--The Federal members of the QuICC, 
     each of whom shall have equal standing in the QuICC, shall 
     include--
       (A) the Administrator of the Centers for Medicare & 
     Medicaid Services;
       (B) the Director of the National Institutes of Health;
       (C) the Director of the Centers for Disease Control and 
     Prevention;
       (D) the Commissioner of Food and Drugs;
       (E) the Administrator of the Health Resources and Services 
     Administration;
       (F) the Director of the Agency for Healthcare Research and 
     Quality;
       (G) the Assistant Secretary of the Administration for 
     Children and Families;
       (H) the Secretary of Labor;
       (I) the Secretary of Defense;
       (J) the Secretary of Veterans Affairs;
       (K) the Under Secretary for Health of the Veterans Health 
     Administration;
       (L) the Secretary of Commerce;
       (M) the Director of the Office of Personnel Management;
       (N) the Director of the Office of Management and Budget;
       (O) the Commandant of the United States Coast Guard;
       (P) the Director of the Federal Bureau of Prisons;
       (Q) the Administrator of the National Highway Traffic 
     Safety Administration;
       (R) the Chairman of the Federal Trade Commission; and
       (S) the Commissioner of the Social Security Administration.
       (d) Goals.--The goals of the QuICC shall be to achieve the 
     following:
       (1) Collaboration between Federal departments and agencies 
     with respect to developing goals, models, and timetables that 
     are consistent with--
       (A) reducing the underlying causes of illness, injury, and 
     disability;
       (B) reducing health care errors;
       (C) ensuring the appropriate use of health care services;
       (D) expanding research on effectiveness of treatments;
       (E) addressing over-supply and under-supply of health care 
     resources; and
       (F) increasing patient participation in their care.
       (2) Collaboration between Federal departments and agencies 
     with respect to the development and utilization of quality 
     improvement strategies, including quality measurement, for 
     public sector programs that are flexible enough to respond to 
     changing health care needs, technology, and information, 
     while being sufficiently standardized to be comparably 
     measured.
       (3) Cooperation between Federal departments and agencies in 
     the development and dissemination of evidence-based health 
     care information to help guide practitioners' actions in ways 
     that will improve quality and potentially reduce costs.
       (4) Cooperation between Federal departments and agencies in 
     the development and dissemination of user-friendly 
     information for both consumer and business purchasers that 
     facilitates meaningful comparisons of quality performances of 
     health care plans, facilities and practitioners.
       (5) Consultation with multi-stakeholder groups, where 
     appropriate, in order to develop interdepartmental and 
     interagency models for quality improvement.
       (6) Avoidance of inefficient duplication of ongoing health 
     care quality improvement efforts and resources, where 
     feasible and appropriate.
       (7) Coordination and implementation by Federal departments 
     and agencies of a streamlined process for quality reporting 
     and compliance requirements to reduce administrative burdens 
     on private entities who administer, oversee, or participate 
     in the Federal health programs.
       (e) Workgroups.--
       (1) In general.--Not later than 30 days after the 
     establishment of the QuICC, the Director shall establish 
     within the QuICC workgroups for each of the national health 
     care priorities established under section 4(c)(1).
       (2) Purpose.--Each such workgroup shall focus on achieving 
     the goals of the QuICC (described in subsection (d)) for one 
     such priority and shall--
       (A) coordinate the implementation of such priority across 
     all relevant Federal agencies and departments; and
       (B) identify opportunities to improve the process of 
     implementing such health care priority.
       (3) Membership.--
       (A) Leadership.--Each workgroup shall be led by 2 relevant 
     Federal departments or agencies, as determined by the 
     Director.
       (B) Representation.--Each of the Federal members listed in 
     subsection (c)(2) may appoint 1 or more representatives to 
     each workgroup.
       (4) Reporting.--
       (A) Report.--Not later than December 31, 2010, and annually 
     thereafter, the co-chairpersons of the QuICC shall submit a 
     report to the relevant committees of Congress describing--
       (i) the QuICC's progress in meeting the goals described in 
     subsection (d);
       (ii) recommendations for legislation to improve the 
     processes of health care quality coordination and 
     prioritization; and
       (iii) recommendations for new and innovative quality 
     initiatives.
       (B) Publication.--Not later than December 31, 2010, and 
     annually thereafter, the co-chairpersons shall publish the 
     report described in subparagraph (A) on the website of the 
     Office of National Health Care Quality Improvement.
       (f) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section $5,000,000 for 
     fiscal years 2011 through 2014.

     SEC. 6. INCREASED AUTHORITY OF THE AGENCY FOR HEALTHCARE 
                   RESEARCH AND QUALITY WITHIN THE DEPARTMENT OF 
                   HEALTH AND HUMAN SERVICES.

       (a) Director of the Agency for Healthcare Research and 
     Quality.--Section 901(a) of the Public Health Service Act (42 
     U.S.C. 299(a)) is amended by striking ``by the Secretary'' 
     and inserting ``by the President, by and with the advice and 
     consent of the Senate''.
       (b) National Health Care Quality Priorities.--Title IX of 
     the Public Health Service Act (42 U.S.C. 299 et seq.) is 
     amended by adding at the end the following:

           ``PART E--NATIONAL HEALTH CARE QUALITY PRIORITIES

     ``SEC. 940. DEFINITIONS.

       ``In this part:
       ``(1) Health care quality.--The term `health care quality' 
     means the degree to which health services for individuals and 
     populations increase the likelihood of desired health 
     outcomes and are consistent with current professional 
     knowledge, based upon the following criteria:
       ``(A) Effectiveness.--Health care services should be 
     provided based upon scientific knowledge of all who could 
     benefit.
       ``(B) Efficiency.--Waste, including waste of equipment, 
     supplies, ideas, and energies, should be avoided.
       ``(C) Equity.--The provision of health care should not vary 
     in quality because of personal characteristics of the 
     individuals involved.
       ``(D) Patient-centeredness.--Health care should be 
     responsive to, and respectful of, individual patient 
     preferences.
       ``(E) Safety.--Injuries to patients from the health care 
     that is supposed to help them should be avoided.
       ``(F) Timeliness.--Waiting times and harmful delays in 
     providing health care should be reduced.
       ``(2) Health care quality measure.--The term `health care 
     quality measure' means a national consensus standard for 
     measuring the performance and improvement of population 
     health or of institutional providers of services, physicians, 
     and other clinicians in the delivery of health care services, 
     consistent with the health care quality criteria described in 
     paragraph (1).
       ``(3) Multi-stakeholder group.--The term `multi-stakeholder 
     group' means, with respect to a health care quality measure, 
     a voluntary collaborative of public and private organizations 
     representing persons interested in, or affected by, the use 
     of such health care quality measure, including--
       ``(A) health care providers and practitioners, including 
     providers and practitioners primarily serving children and 
     those with long-term health care needs;
       ``(B) health care quality entities;
       ``(C) health plans;
       ``(D) patient advocates and consumer groups;
       ``(E) employers;
       ``(F) public and private purchasers of health care items 
     and services;
       ``(G) labor organizations;
       ``(H) relevant departments or agencies of the United 
     States;
       ``(I) biopharmaceutical companies and manufacturers of 
     medical devices; and
       ``(J) licensing, credentialing, and accrediting bodies.
       ``(4) the term `health care quality measure' means a 
     national consensus standard for measuring the performance and 
     improvement of population health or of institutional 
     providers of services, physicians, and other clinicians in 
     the delivery of health care services; and
       ``(5) the term `multi-stakeholder group' means, with 
     respect to a health care quality measure, a voluntary 
     collaborative of public and private organizations 
     representing persons interested in, or affected by, the use 
     of such health care quality measure, including--
       ``(A) hospitals and other health care settings;
       ``(B) physicians, including pediatricians;

[[Page S5079]]

       ``(C) health care quality alliances;
       ``(D) nurses and other health care practitioners;
       ``(E) health plans;
       ``(F) patient advocates and consumer groups;
       ``(G) employers;
       ``(H) public and private purchasers of health care items 
     and services;
       ``(I) labor organizations;
       ``(J) relevant departments or agencies of the United 
     States;
       ``(K) biopharmaceutical companies and manufacturers of 
     medical devices; and
       ``(L) licensing, credentialing, and accrediting bodies.

     ``SEC. 941. RESEARCH PRIORITIES.

       ``The Director, in consultation with the heads of agencies 
     within the Department of Health and Human Services shall 
     ensure that the health care quality improvement priorities 
     identified by the Director of the Office of National Health 
     Care Quality Improvement, established under section 4 of the 
     National Health Care Quality Act, are taken into 
     consideration in all applicable research conducted under the 
     Department of Health and Human Services, including the 
     National Institutes of Health and the demonstration projects.

     ``SEC. 942. QUALITY MEASURES.

       ``(a) Application of Quality Measures to Programs Under the 
     Department of Health and Human Services.--
       ``(1) In general.--The Director, in consultation with the 
     Administrator of the Centers for Medicare & Medicaid 
     Services, the Director of the Centers for Disease Control and 
     Prevention, the Director of the National Institutes of 
     Health, and a consensus-based entity (as such term is used in 
     section 1890 of the Social Security Act), shall define 
     uniform health care quality measures, which shall apply to 
     Federal health programs under the Department of Health and 
     Human Services, including the following Federal programs, in 
     order of priority:
       ``(A) The Medicare program under title XVIII of the Social 
     Security Act, the rural health and pharmacy programs of the 
     Health Resources and Services Administration, and the health 
     programs of the Administration on Aging.
       ``(B) The Medicaid program under title XIX of the Social 
     Security Act, the Children's Health Insurance program under 
     title XXI of such Act, the health programs of the 
     Administration for Children and Families, and the maternal 
     and child health programs of the Health Resources and 
     Services Administration.
       ``(C) The Indian Health Service.
       ``(D) The Substance Abuse and Mental Health Services 
     Administration.
       ``(E) Programs of the Health Resources and Services 
     Administration other than those described in subparagraph 
     (B).
       ``(F) Centers of the Food and Drug Administration.
       ``(2) Prioritization.--The Director shall apply the health 
     care quality measures under this section to the Federal 
     programs in the order of priority described in paragraph (1).
       ``(3) Considerations regarding quality measure 
     application.--Before applying the health care quality 
     measures described in paragraph (1), the Director shall 
     consider--
       ``(A) the potential of such measures to improve patient 
     outcomes;
       ``(B) the ease of integration as a factor in health care 
     provider reimbursement;
       ``(C) the applicability of such measures across health care 
     settings;
       ``(D) the unique quality improvement needs of vulnerable 
     populations, including children, the elderly, individuals 
     with disabilities, individuals near the end of life, and 
     racial and ethnic minorities;
       ``(E) the burden of disease, including the prevalence, 
     incidence, and cost of disease to the United States; and
       ``(F) payment distortions that encourage certain practice 
     norms which may not lead to greater patient health outcomes.
       ``(4) Updating of the application of quality measures.--The 
     Director, in consultation with the Administrator of the 
     Centers for Medicare & Medicaid Services, the Director of the 
     Centers for Disease Control and Prevention, the Director of 
     the National Institutes of Health, and a consensus-based 
     entity (as such term is used in section 1890 of the Social 
     Security Act), shall develop a process for updating the 
     health care quality measures defined under paragraph (1) as 
     new research and evidence become available.
       ``(b) Quality Measure Reporting to Federal Health 
     Programs.--The Director, in cooperation with the 
     Administrator of the Centers for Medicare & Medicaid 
     Services, the National Coordinator for Health Information 
     Technology, the Administrator of the Health Resources and 
     Services Administration, the Director of the Centers for 
     Disease Control and Prevention, and the Commissioner of Food 
     and Drugs, shall create a streamlined process for health care 
     providers to report quality measures to the heads of relevant 
     agencies and departments for the purpose of quality 
     improvement in the Federal health programs described in 
     subsection (a)(1).
       ``(c) Development of Additional Quality Improvement 
     Strategies.--The Director, in consultation with the 
     Administrator of the Centers for Medicare & Medicaid 
     Services, the Director of the Centers for Disease Control and 
     Prevention, the Director of the National Institutes of 
     Health, and multi-stakeholder groups, shall develop quality 
     improvement strategies to address activities other than 
     health care quality measurement that lead to improved patient 
     outcomes, such as alternative care models, licensing, 
     professional certification, medical education, alternative 
     staffing models, and public reporting.

     ``SEC. 943. PUBLIC EDUCATION CAMPAIGNS.

       ``(a) In General.--The Director shall conduct a public 
     education campaign, designed to educate health care providers 
     and consumers of health care about health care quality 
     improvement.
       ``(b) Consumer Education Campaigns.--
       ``(1) In general.--The Director, in coordination with the 
     Administrator of the Centers for Medicare & Medicaid Services 
     and the Director of the Centers for Disease Control and 
     Prevention, shall create a consumer education campaign to 
     develop accurate and reliable information about health care 
     quality. In compiling the information for the consumer 
     education campaign, the Secretary may use mechanisms and 
     sources of information that are available through other 
     Federal agencies.
       ``(2) Requirements.--The consumer education campaign shall 
     include information regarding--
       ``(A) the importance of quality in health care decisions;
       ``(B) the ways in which health care experts define and 
     identify quality in health care;
       ``(C) the variance of quality among health insurance plans, 
     health care facilities, health care organizations, and health 
     care providers; and
       ``(D) the role of consumers in improving the quality of 
     health care.
       ``(3) Publication.--The Director shall make the information 
     described in paragraph (1) available to the public through 
     the Internet.
       ``(4) Grant program.--The Director shall award grants to 
     States and private nonprofit organizations to assist with the 
     creation and dissemination of the information described in 
     paragraph (1).
       ``(c) Quality Resource Center for Health Care Providers.--
       ``(1) In general.--The Director, in coordination with the 
     Administrator of the Centers for Medicare & Medicaid 
     Services, shall create a National Quality Resource Center 
     (referred to in this subsection as the `NQRC')for health care 
     providers to assist with the understanding and implementation 
     of quality improvement initiatives for health care providers.
       ``(2) Duties.--The national resource center developed under 
     paragraph (1) shall--
       ``(A) inform providers about quality improvement techniques 
     and the value of such techniques to improving quality;
       ``(B) accelerate the transfer of lessons learned from other 
     initiatives in the public and private sectors, including 
     those initiatives receiving Federal financial support;
       ``(C) provide a forum for exchange of knowledge and 
     experience among health care providers;
       ``(D) provide technical assistance to health care providers 
     for implementing quality improvement efforts; and
       ``(E) provide a forum for feedback from health care 
     providers concerning the effect of the efforts under 
     subparagraphs (A) through (D).
       ``(3) National quality support extension grant program.--
       ``(A) In general.--The Director, in coordination with the 
     NQRC, shall award National Quality Support Extension grants 
     (referred to in this paragraph as `NQSE grants' or the `NQSE 
     grant program'), on a competitive basis, to eligible entities 
     for the purpose of supporting and facilitating local health 
     care quality improvement efforts throughout the United 
     States.
       ``(B) Purposes.--The purposes of the NQSE grant program 
     are--
       ``(i) to assist qualified eligible entities in carrying out 
     projects related to health care quality improvement 
     activities among the provider community to help test and 
     acclimate to new, innovative quality improvement activities;
       ``(ii) to facilitate communication among local health care 
     quality groups regarding the best practices in the area of 
     quality improvement and prevention in the clinical setting; 
     and
       ``(iii) to enable, empower, support, and assist local 
     health care quality improvement efforts, particularly those 
     that facilitate collaboration between independent providers.
       ``(C) Eligible entities.--An entity desiring a grant under 
     this paragraph shall--
       ``(i) be a public or private nonprofit entity engaged in 
     health care quality improvement;
       ``(ii) submit to the Director a program design that 
     describes the purpose of the plan for which the entity seeks 
     a grant and the community leadership that will support the 
     entity in carrying out such plan; and
       ``(iii) submit to the Director an application at such time, 
     in such manner, and containing such information as the 
     Director may require.
       ``(4) Implementation assistance.--The Health Information 
     Technology regional extension centers under section 3012(c) 
     shall operate as extension centers for the NQRC, for the 
     purposes of implementation assistance.
       ``(5) Technical assistance for health care providers 
     working with vulnerable populations.--In carrying out this 
     subsection, the Director shall give particular attention to 
     the technical assistance that

[[Page S5080]]

     health care providers who serve vulnerable populations need.

     ``SEC. 944. FUNDING.

       ``(a) Trust Funds.--For purposes of funding the activities 
     under this part, the Secretary shall provide for the transfer 
     from the Federal Hospital Insurance Trust Fund under section 
     1817 of the Social Security Act (42 U.S.C. 1395i) and the 
     Federal Supplementary Insurance Trust Fund under section 1841 
     of the Social Security Act (42 U.S.C. 1395t), including the 
     Medicare Prescription Drug Account in such Trust Fund, in 
     such proportion as determined appropriate by the Secretary, 
     of $150,000,000 for each of fiscal years 2010 through 2014.
       ``(b) American Recovery and Reinvestment Funds.--At the end 
     of the recession adjustment period (as defined in section 
     5001(h)(3) of the American Recovery and Reinvestment Act 
     (Public Law 111-5; 123 Stat. 496), the Secretary of the 
     Treasury shall transfer any funds appropriated under such Act 
     and not otherwise expended to the Agency for purposes of 
     carrying out this part.
       ``(c) Medicaid and Medicare Improvement Funds.--For 
     purposes of funding the activities under this part for fiscal 
     year 2014, the Secretary shall provide for the transfer of 
     $100,000,000 from the Medicaid Improvement Fund under section 
     1898 of the Social Security Act (42 U.S.C. 1395iii), and 
     $100,000,000 from the Medicare Improvement Fund under section 
     1941 of such Act (42 U.S.C 1396w-1).''.
       (c) Technical Amendment.--Section 937(b) of the Public 
     Health Service Act (42 U.S.C. 299c-6(b)) is amended by 
     inserting ``except for part E,'' after ``this title''.
       (d) Development of Quality Measures for Federal Health 
     Programs.--
       (1) Period of contract.--Section 1890(a)(3) of the Social 
     Security Act (42 U.S.C. 1395aaa(a)(3)) is amended--
       (A) by striking ``4 years'' and inserting ``4 years, in the 
     case of the first contract entered into under such paragraph, 
     and 3 years in the case of each subsequent contract entered 
     into under such paragraph''; and
       (B) by inserting ``for a period of 3 years'' after 
     ``renewed''.
       (2) Priority setting process.--Section 1890(b)(1) of the 
     Social Security Act (42 U.S.C. 1395aaa(b)(1)) is amended--
       (A) in the matter preceding subparagraph (A)--
       (i) by striking ``an integrated national strategy and 
     priorities for''; and
       (ii) by inserting ``in a manner consistent with the 
     national priorities for health care quality improvement (as 
     defined in section 4(c)(1))'' after ``settings'';
       (B) in subparagraph (A)--
       (i) by redesignating clauses (i) through (iii) as clauses 
     (ii) through (iv), respectively; and
       (ii) by inserting before clause (ii), as so redesignated, 
     the following new clause:
       ``(i) that are consistent with such national priorities for 
     health care quality improvement;''.
       (3) Annual report to congress.--Section 1890(b)(5) of the 
     Social Security Act (42 U.S.C. 1395aaa(b)(5)) is amended--
       (A) by redesignating clauses (i) through (iii) as clauses 
     (ii) through (iv); and
       (B) by inserting before clause (ii), as so redesignated, 
     the following new clause:
       ``(i) the extent to which the priorities set and the 
     quality improvement measures endorsed by the entity under 
     paragraphs (1) and (2), respectively, are consistent with the 
     national priorities for health care quality improvement (as 
     so defined);''.
       (4) Funding.--Section 1890(d) of the Social Security Act 
     (42 U.S.C. 1395aaa(d)) is amended by inserting ``and, for 
     purposes of carrying out this section under a new or renewed 
     contract, there are authorized to be appropriated such sums 
     as are necessary, taking into consideration the results of 
     the study contained in the 18 month report submitted to 
     Congress under section 183(b)(2) of the Medicare Improvements 
     for Patients and Providers Act of 2008 (Public Law 110-275), 
     for each of fiscal years 2013 through 2015'' before the 
     period at the end.

     SEC. 7. REPORTS TO CONGRESS.

       (a) Evaluation of the Consumer Education Campaign.--Not 
     later than 18 months after the establishment of the quality 
     resource center under section 943(c) of the Public Health 
     Service Act (as added by section 6), the Comptroller General 
     of the United States shall submit to Congress a report 
     describing--
       (1) the effectiveness of the quality resource center for 
     health care providers under such section 943(c); and
       (2) the effectiveness of the consumer education program 
     under section 943(b) of such Act (as added by section 6).
       (b) Quality Dissemination Strategies.--Not later than 18 
     months after the date of enactment of this Act, the Secretary 
     of Health and Human Services, acting through the Director of 
     the Agency for Healthcare Research and Quality, shall submit 
     a report to Congress that includes--
       (1) a description of the efforts made to translate clinical 
     information regarding health care quality improvement into 
     reasonable clinical practice;
       (2) the processes through which the Secretary disseminated 
     the information described in paragraph (1); and
       (3) recommendations for the most effective methods for 
     translating and disseminating information concerning health 
     care quality, and required statutory changes to implement the 
     recommended methods.
       (c) IOM Report to Congress Regarding the Value of Quality 
     Measure Reporting.--
       (1) In general.--The Secretary of Health and Human Services 
     shall enter into a contract with the Director of the 
     Institute of Medicine requiring that, not later than 18 
     months after the date of enactment of this Act, the Director 
     submit to Congress a report regarding the value of quality 
     measure reporting in improving patient health outcomes.
       (2) Considerations.--In preparing the report described in 
     paragraph (1), the Director of the Institutes of Medicine 
     shall consider--
       (A) specific instances in the history of existing public 
     health care programs within the Federal Government in which 
     quality measure reporting has been shown, through peer-
     reviewed studies or literature, to result in improved patient 
     health outcomes; and
       (B) instances in which quality measure reporting has been 
     shown to improve existing health disparities among vulnerable 
     populations, including children, underserved populations, 
     rural populations, individuals with disabilities, the 
     elderly, and racial and ethnic minorities.
       (3) Authorization of appropriations.--There are authorized 
     to be appropriated such sums as may be necessary to carry out 
     this subsection.
       (d) GAO Study and Reports.--Section 183(b)(1) of the 
     Medicare Improvements for Patients and Providers Act of 2008 
     (Public Law 110-275; 122 Stat. 2586) is amended--
       (1) in subparagraph (A), by striking ``and'' after the 
     semicolon;
       (2) in subparagraph (B), by striking the period at the end 
     and inserting a semicolon; and
       (3) by inserting after subparagraph (B) the following:
       ``(C) any negative effect on patients, particularly on 
     patients in underserved or vulnerable populations; and
       ``(D) any negative effect on health care providers, 
     particularly health care providers in rural and underserved 
     areas.''.

     SEC. 8. DATA COLLECTION.

       (a) In General.--Not later than January 1, 2011, and at 
     least every 5 years thereafter, the Comptroller General of 
     the United States (referred to in this section as the 
     ``Comptroller General'') shall conduct evaluations of the 
     implementation of the data collection processes for quality 
     measures used by the Federal health programs administered 
     through the Department of Health and Human Services.
       (b) Considerations.--In conducting the evaluations under 
     subsection (a), the Comptroller General shall consider--
       (1) whether the system for the collection of data for 
     quality measures provides for validation of data in a manner 
     that is relevant, fair, and scientifically credible;
       (2) whether data collection efforts under the system--
       (A) use the most efficient and cost-effective means in a 
     manner that minimizes administrative burden on persons 
     required to collect data;
       (B) adequately protects the privacy the personal health 
     information of patients; and
       (C) provides data security;
       (3) whether standards under the system provide for an 
     opportunity for health care providers and institutional 
     providers of services to review and correct any inaccuracies 
     with regard to the findings; and
       (4) the extent to which quality measures--
       (A) assess outcomes and the functional status of patients;
       (B) assess the continuity and coordination of care and care 
     transitions, including episodes of care, for patients across 
     providers and health care settings;
       (C) assess patient experience and patient engagement;
       (D) assess the safety, effectiveness, and timeliness of 
     care;
       (E) assess health disparities, including disparities 
     associated with race, ethnicity, age, gender, place of 
     residence, or language;
       (F) assess the efficiency and use of resources in the 
     provision of care;
       (G) are designed to be collected as part of health 
     information technologies supporting better delivery of health 
     care services; and
       (H) result in direct or indirect costs to users of such 
     measures.
       (c) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section $1,000,000 for 
     fiscal years 2010 through 2014.
                                 ______
                                 
       By Mr. BINGAMAN:
  S. 967. A bill to amend the Energy Policy and Conservation Act to 
create a petroleum product reserve, and for other purposes; to the 
Committee on Energy and Natural Resources.
  Mr. BINGAMAN. Mr. President, I am pleased to introduce The Strategic 
Petroleum Reserve Modernization Act of 2009. This bill will ensure that 
the Strategic Petroleum Reserve will continue to fulfill the goal that 
its creators envisioned for it in 1975, which is to protect Americans 
from the economic consequences of oil supply disruptions.
  This bill includes two key provisions. First, it creates a refined 
petroleum product component within the existing SPR. The Department of 
Energy is required to hold at least 30 million barrels of the total 1 
billion barrel SPR inventory in refined petroleum products, such as 
gasoline and diesel fuel.

[[Page S5081]]

  In the 1970s, the U.S. was vulnerable to supply disruptions in crude 
oil, as it was a significant and growing importer of crude oil. In 
1973, major oil exporting nations embargoed oil exports to the United 
States in retaliation for U.S. support for Israel during that year's 
Arab-Israeli War. The embargo and resulting oil price spikes wreaked 
havoc on the U.S. economy. Preventing a recurrence of this kind of 
geopolitical oil supply disruption was the primary goal of the SPR. 
Because the country then held significant surplus refinery capacity, 
SPR managers decided to hold only crude oil in the SPR.
  In 2009, our domestic oil market has changed. While we are more 
dependent on imported crude oil than ever before, we also import more 
refined petroleum products and have considerably less spare refinery 
capacity. When U.S. refinery operations are disrupted, we require 
imported products from other countries to fill the gap.
  We have also learned in the last 34 years that weather-related events 
are the most frequent source of oil supply disruptions. In history, the 
SPR has been used in connection with only on geopolitical event, during 
the 1990-1991 Iraqi invasion of and removal from Kuwait, while it has 
been used several times in response to hurricanes or other weather 
events, such as dense fog halting tanker traffic in the Houston Ship 
Channel.
  These more frequent weather events are usually as disruptive, if not 
more disruptive, to U.S. refinery operations as to crude oil production 
and imports. Hurricanes Gustav and Ike in September 2008 took much of 
the U.S. Gulf Coast infrastructure offline, and shortages of gasoline 
and diesel were experienced throughout the Southeast through October of 
that year. The SPR was of limited use in mitigating these shortages 
because the refineries affected by the storms were not able to process 
SPR crude oil into gasoline and diesel.
  Including a small volume of refined petroleum products in the SPR, as 
required by The Strategic Petroleum Reserve Modernization Act of 2009, 
would provide a cushion to affected markets while damaged 
infrastructure were brought back online, or until imported gasoline and 
diesel could arrive to service the area.
  The second key provision included in the Strategic Petroleum Reserve 
Modernization Act of 2009 authorizes the Secretary of Energy to release 
emergency oil from the SPR. Under current law, only the President of 
the United States can authorize an emergency sale of SPR oil. Experts 
believe that this requirement creates a disincentive to use SPR oil for 
the purposes for which it is intended, as the President does not want 
to alarm the public by announcing that the country is in an oil supply 
emergency.
  Moving the SPR drawdown authority to the Secretary of Energy would 
allow SPR policy decisions to be made closer to the oil markets that 
the SPR serves. I believe that many of my colleagues share my 
disappointment that recent discussions about when and how to use the 
SPR have become so political that sound decisions, based on the reality 
of our country's oil market, have not been possible.
  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. 967

       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 ``Strategic Petroleum Reserve 
     Modernization Act of 2009''.

     SEC. 2. PETROLEUM PRODUCT RESERVE.

       (a) Strategic Petroleum Reserve.--Section 154(a) of the 
     Energy Policy and Conservation Act (42 U.S.C. 6234(a)) is 
     amended by striking ``1 billion barrels of petroleum 
     products'' and inserting ``1,000,000,000 barrels of petroleum 
     products (including at least 30,000,000 barrels of refined 
     petroleum products)''.
       (b) Plan.--Title I of the Energy Policy and Conservation 
     Act is amended by inserting after section 154 (42 U.S.C. 
     6234) the following:

     ``SEC. 155. PLAN.

       ``Not later than 180 days after the date of enactment of 
     this section, the Secretary shall submit to the President 
     and, if the President approves, to Congress, a plan to 
     include refined petroleum products in the Strategic Petroleum 
     Reserve, including a description of--
       ``(1) the disposition of refined petroleum products that 
     shall be stored in the Reserve, which shall be selected--
       ``(A) to alleviate shortages that might be expected to 
     result from hurricanes, earthquakes, or other acts of nature; 
     and
       ``(B) to minimize the number of different kinds of refined 
     petroleum products that shall be stored;
       ``(2) the method of acquisition of refined petroleum 
     products for storage in the Reserve, which shall--
       ``(A) be intended to minimize both the cost and market 
     disruption associated with the acquisition; and
       ``(B) include--
       ``(i) an analysis of the option of exchanging crude oil 
     from the Reserve for refined petroleum products; and
       ``(ii) the anticipated time requirement for building the 
     inventory of refined petroleum products;
       ``(3) storage facility options for the storage of refined 
     petroleum products, including the anticipated location of 
     existing or new facilities;
       ``(4) the estimated costs of establishment, maintenance, 
     and operation of the refined petroleum product component of 
     the Reserve;
       ``(5) efforts the Department will take to ensure that 
     distributors and importers are not discouraged from 
     maintaining and increasing supplies of refined petroleum 
     products; and
       ``(6) actions that will be taken to ensure quality of 
     refined petroleum products in the Reserve, including the 
     rotation of products stored.''.
       (c) Drawdown and Sale.--Section 161 of the Energy Policy 
     and Conservation Act (42 U.S.C. 6241) is amended--
       (1) by striking subsection (d) and inserting the following:
       ``(d) Limitation on Drawdown and Sale.--
       ``(1) In general.--The drawdown and sale of petroleum 
     products from the Strategic Petroleum Reserve may not be made 
     unless the Secretary determines that--
       ``(A) the drawdown and sale are required by--
       ``(i) a severe energy market supply interruption; or
       ``(ii) obligations of the United States under the 
     international energy program; or
       ``(B) in the case of the refined petroleum product 
     component of the Reserve, a sale of refined petroleum 
     products will mitigate the impacts of weather-related events 
     or other acts of nature that have resulted in a severe energy 
     market disruption.
       ``(2) Severe energy market disruption.--For purpose of this 
     subsection, a severe energy market supply disruption shall be 
     considered to exist if the Secretary determines that--
       ``(A) an emergency situation exists and there is a 
     disruption in global oil markets of significant scope and 
     duration;
       ``(B) a severe increase in the price of petroleum products 
     has resulted, or is likely to result, from the emergency 
     situation; and
       ``(C) the price increase is likely to cause a major adverse 
     impact on the national economy.''; and
       (2) in subsections (h)(1) and (i), by striking 
     ``President'' each place it appears and inserting 
     ``Secretary''.
                                 ______
                                 
      By Mr. REID (for himself, Mr. Pryor, Mrs. Murray, Mr. Menendez, 
        and Mr. Bennet):
  S. 968. A bill to award competitive grants to eligible partnerships 
to enable the partnerships to implement innovative strategies at the 
secondary school level to improve student achievement and prepare at-
risk students for postsecondary education and the workforce; to the 
Committee on Health, Education, Labor, and Pensions.
  Mr. REID. Mr. President, in our global economy, a high school diploma 
has become the minimum qualification necessary for a good job. Yet only 
about a third of the students who enter 9th grade each fall will 
graduate 4 years later prepared for college or the workforce.
  Another third will leave high school with a diploma, but without the 
skills and knowledge they need to succeed. Yet another third will not 
graduate from high school within four years, if at all.
  This trend, across thousands of our Nation's schools, robs millions 
of young Americans--particularly poor and minority students--of their 
best chances to succeed.
  Students in Nevada are hit particularly hard. Less than 70 percent of 
high school students in my home state graduate on time. For African 
American and Latino students, that number is closer to 50 percent. 
Nearly 20,000 students in Nevada who started school with the class of 
2008 did not graduate with their peers.
  Leaving these students behind hurts our economy in both the short- 
and long-run. These students will cost the State's economy an estimated 
$5.1 billion in lost wages over the course of

[[Page S5082]]

their lifetimes, and will earn an average of almost $10,000 less each 
year compared to their classmates who finished high school.
  Almost 90 percent of the fastest-growing and best-paying jobs require 
some postsecondary education. We can no longer afford to ignore our 
unacceptable graduation rates. We can no longer afford to look the 
other way while more and more students remain unprepared to compete in 
the global economy. It is not right for these students, and it is not 
right for our economy.
  That is why Senators Murray and Pryor and I are introducing the 
Secondary School Innovation Fund, a bill to improve the education our 
students get in America's secondary schools. Our future competitiveness 
depends on our ability to transform our Nation's middle- and high-
schools to meet the needs of the 21st century. This legislation aims to 
address some of these challenges.
  Many of our high schools are too large and impersonal. They lack the 
rigor and high expectations that we must set for all of our students. 
Of course, many of the problems that lead students to lose interest or 
drop out of school begin at the middle-school level.
  To meet the challenges of this economy and prepare our young people 
for life after high school, we must give our middle and high schools 
the opportunity to try new ideas and approaches that will improve 
students' performance and their graduation rates.
  We must take proven ideas and put them in the schools that need them 
the most like extending the school day or year; dividing large urban 
schools into smaller, more personal learning academies; expanding 
summer learning opportunities for middle-school students; or partnering 
schools with colleges and universities to allow high school students to 
take and receive credit for college-level courses.
  The good news is that schools throughout my home state of Nevada, and 
across the country, have already started implementing these sorts of 
innovative strategies:
  The Clark County Schools District in southern Nevada--the Nation's 
5th largest and one of the fastest growing--has opened some of the most 
cutting-edge career and technical academies in the country. With 
programs in engineering and design, medical occupations, and media 
communications, a visitor to one of these new academies might think 
they were on a university campus.
  In northern Nevada, the Washoe County School District has teamed up 
with one of the local community colleges. The Truckee Meadows Community 
College High School now allows students to take a combination of 
college and high school courses, and they get credit on both levels. 
Not only do these students complete more challenging, college-level 
coursework, but they are laying the groundwork for success after high 
school.
  Encouraging our secondary schools to meet new, demanding and 
competitive requirements requires replicating these types of school 
models. But they need adequate Federal support to do so. The Secondary 
School Innovation Fund gives them just that.
  President Obama and Secretary Duncan know this as well. The budget we 
passed last week proposes a similar fund that would promote innovation 
and excellence in America's schools. And the economic recovery plan 
that we passed earlier this year includes unprecedented funding for 
improving and reforming our education systems. It also creates a $5 
billion ``Race to the Top Fund'' that rewards states and districts for 
innovation.
  This bill would give states, districts, schools, institutes of higher 
education, businesses and community-based organizations $500 million in 
competitive grants in each of the next 6 years to reform in our 
Nation's secondary schools. By supporting a variety of strategies for 
innovation and creating evidence-based, systemic and replicable models 
of reform, we will improve student achievement and prepare them to 
succeed in school and then in the workforce.
  We also know that every dollar we spend belongs to the American 
people. That is why we will only help programs that can demonstrate 
that their students are improving.
  Democrats are committed to expanding educational opportunities for 
all Americans and preparing them to succeed in the global economy. We 
must give them the best chance to achieve their full potential, and 
this bill will help make that possible. I hope my colleagues will join 
me in supporting this legislation.
  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. 968

       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 ``Secondary School Innovation 
     Fund Act''.

     SEC. 2. FINDINGS.

       Congress finds the following:
       (1) Since almost 90 percent of the fastest growing and best 
     paying jobs now require some postsecondary education, a 
     secondary school diploma and the skills to succeed in 
     postsecondary education and the modern workplace are 
     essential.
       (2) Only \1/3\ of all high school students in the United 
     States graduate in 4 years prepared for a 4-year institution 
     of higher education. Another \1/3\ graduate, but without the 
     skills and qualifications necessary for success in 
     postsecondary education or the workplace, and the rest will 
     not graduate from high school in 4 years, if at all.
       (3) Dropouts from the class of 2008 will cost the United 
     States more that $319,000,000,000 in reduced earnings.
       (4) The Nation's failure to meet the increasing demand for 
     skilled workers means that American companies cannot fill a 
     large number of jobs. 81 percent of American manufacturing 
     companies report experiencing a moderate to severe shortage 
     of qualified workers.
       (5) The education system of the United States should 
     support critical thinking, creativity, and innovative 
     approaches to problem-solving--all skills that cannot easily 
     be outsourced. The Program for International Student 
     Assessment is an international assessment that measures these 
     high-demand skills. Unfortunately, when the results on this 
     assessment of students from the United States are compared to 
     those of students from 27 other countries, many of which are 
     economic competitors of the United States, the United States 
     students rank 24th in problem-solving, 21st in scientific 
     literacy, and 25th in mathematical literacy.
       (6) As the bar for success continues to be raised, the 
     responsibility to engender these attributes with progressive 
     programs and original models lies squarely with the education 
     system. It is imperative that the United States develop and 
     implement new, innovative approaches to fully prepare every 
     student for the 21st century.
       (7) Realigning the education system to meet new, demanding 
     requirements and face intensifying competition requires 
     effective, systemic reform. Identifying effective, replicable 
     models that achieve this goal is a critical step towards 
     enhancing the prospects of all students entering the modern 
     workforce.

     SEC. 3. SECONDARY SCHOOL INNOVATION FUND.

       (a) Secondary School Innovation Fund.--Title I of the 
     Elementary and Secondary Education Act of 1965 (20 U.S.C. 
     6301 et seq.) is amended--
       (1) by redesignating part I as part J; and
       (2) by inserting after section 1830 the following:

               ``PART I--SECONDARY SCHOOL INNOVATION FUND

     ``SEC. 1851. PURPOSES.

       ``The purposes of this part are--
       ``(1) to improve the achievement of at-risk secondary 
     school students and prepare such students for postsecondary 
     education and the workforce;
       ``(2) to create evidence-based, replicable models of 
     innovation in secondary schools at the State and local level; 
     and
       ``(3) to support partnerships to create and inform 
     innovation at the State and local level to improve learning 
     outcomes and transitions for secondary school students.

     ``SEC. 1852. DEFINITIONS.

       ``In this part:
       ``(1) Eligible partnership.--The term `eligible 
     partnership' means a partnership that includes--
       ``(A) not less than 1--
       ``(i) State educational agency; or
       ``(ii) local educational agency that is eligible for 
     assistance under part A; and
       ``(B) not less than 1--
       ``(i) institution of higher education;
       ``(ii) nonprofit organization;
       ``(iii) community-based organization;
       ``(iv) business; or
       ``(v) school development organization or intermediary.
       ``(2) Eligible school.--The term `eligible school' means a 
     public secondary school served by a local educational agency 
     that is eligible for assistance under part A.
       ``(3) High school.--The term `high school' means a public 
     school, including a public charter high school, that provides 
     secondary education, as determined under State law, in 1 or 
     more of grades 9 through 12.
       ``(4) Middle school.--The term `middle school' means a 
     public school, including a public charter middle school, that 
     provides

[[Page S5083]]

     middle or secondary education, as determined under State law, 
     in 1 or more of grades 5 through 8.

     ``SEC. 1853. SECONDARY SCHOOL INNOVATION FUND.

       ``(a) Program Authorized.--
       ``(1) Grants to eligible partnerships.--The Secretary is 
     authorized to award grants, on a competitive basis, to 
     eligible partnerships to enable the eligible partnerships to 
     pay the Federal share of the costs of implementing innovative 
     strategies described in subsection (f) to improve the 
     achievement of at-risk students in secondary schools.
       ``(2) Subgrants to eligible schools.--An eligible 
     partnership that receives a grant under this part may use the 
     grant funds to award a subgrant to an eligible school to 
     enable the eligible school to implement innovative strategies 
     described in subsection (f) to improve the achievement of at-
     risk students at the eligible school.
       ``(3) Duration of grant period.--A grant awarded under 
     paragraph (1) shall be for not longer than a 5-year period.
       ``(b) Reservation of Funds.--The Secretary shall reserve 5 
     percent of the amounts appropriated under this part for a 
     fiscal year for the evaluation described in subsection (h).
       ``(c) Application.--
       ``(1) In general.--An eligible partnership desiring a grant 
     under this part shall submit an application to the Secretary 
     at such time, in such manner, and containing such information 
     as the Secretary may require.
       ``(2) Contents.--The application described in paragraph (1) 
     shall include--
       ``(A) a description of the eligible partnership, the 
     partners forming the eligible partnership, and the roles and 
     responsibilities of each partner, and a demonstration of each 
     partner's capacity to support the outlined roles and 
     responsibilities;
       ``(B) a description of how funds will be used to improve 
     the achievement of at-risk students in secondary schools;
       ``(C) a description of how the activities funded by the 
     grant will be innovative, systemic, evidence-based, and 
     replicable;
       ``(D) a description of each subgrant the eligible 
     partnership will award to an eligible school, including a 
     description of the eligible school;
       ``(E) a description of how the eligible partnership will 
     measure and report improvement using the data collected under 
     subsection (g) and additional indicators of improvement 
     proposed by the partnership, such as--
       ``(i) student attendance or participation;
       ``(ii) credit accumulation rates;
       ``(iii) core course completion rates;
       ``(iv) college enrollment and persistence rates; or
       ``(v) number or percentage of students taking--

       ``(I) Advanced Placement (AP), International Baccalaureate 
     (IB), or other postsecondary education courses;
       ``(II) rigorous postsecondary education preparatory 
     courses; or
       ``(III) registered apprenticeship and workforce training 
     programs; and

       ``(F) a description of the planning phase of not more than 
     90 days that the eligible partnership will undertake for the 
     grant, including--
       ``(i) the activities and goals of the planning phase; and
       ``(ii) how each partner in the eligible partnership will 
     participate in the planning phase.
       ``(d) Application Review and Award Basis.--
       ``(1) Grant review and approval.--The Secretary shall--
       ``(A) establish a peer review process to assist in the 
     review of the grant applications and approval of the grants 
     under this section; and
       ``(B) appoint to the peer review process--
       ``(i) individuals who are educators and experts in--

       ``(I) secondary school reform;
       ``(II) accountability;
       ``(III) secondary school improvement;
       ``(IV) innovative education models;
       ``(V) postsecondary education preparation and access; and
       ``(VI) workforce preparation;

       ``(ii) not less than 1 parent or community representative; 
     and
       ``(C) ensure that each grant award is of sufficient size 
     and scope to carry out the activities proposed in the grant 
     application, including the evaluation required under 
     subsection (g)(3).
       ``(2) Award basis.--In awarding grants under this part, the 
     Secretary shall ensure, to the extent practicable--
       ``(A) diversity in the type of activities funded under the 
     grants, including statewide and local initiatives;
       ``(B) an equitable geographic distribution of the grants, 
     including urban and rural areas and small and large school 
     districts; and
       ``(C) that the grants support activities--
       ``(i) that target different grade levels of students at the 
     secondary school level;
       ``(ii) in a variety of types of secondary schools, 
     including middle schools and high schools; and
       ``(iii) in secondary schools of varying sizes, including 
     small and large schools.
       ``(e) Federal Share, Non-Federal Share.--
       ``(1) Federal share.--The Federal share of a grant under 
     this part shall be not more than 75 percent of the costs of 
     the activities assisted under the grant.
       ``(2) Non-federal share.--The non-Federal share shall be 
     not less than 25 percent of the costs of the activities 
     assisted under the grant, of which not more than 10 percent 
     of the costs of the activities assisted under the grant may 
     be provided in-kind, fairly evaluated.
       ``(f) Use of Funds.--An eligible partnership receiving a 
     grant under this part, or an eligible school receiving a 
     subgrant under this part, shall use grant or subgrant funds, 
     respectively, to carry out 1 or more of the following 
     effective models or innovative programs:
       ``(1) Effective school models.--
       ``(A) Multiple education pathways.--A model creating a 
     range of academically rigorous multiple education pathways, 
     based on the analysis of student data, that lead to a 
     secondary school diploma, that are consistent with readiness 
     for postsecondary education and the workforce, and that offer 
     students a range of educational options designed to meet the 
     students' needs and interests, including through the creation 
     of new schools. Such pathways may include--
       ``(i) an effective dropout prevention and recovery model 
     that--

       ``(I) prepares students for postsecondary education and 
     career readiness;
       ``(II) uses re-engagement and recuperative strategies based 
     in youth development;
       ``(III) uses innovative strategies for credit recovery and 
     acceleration, such as flexible hours or online access to 
     curricula, courses, assessments, resources, and supports;
       ``(IV) provides competency-based instruction and 
     performance-based assessment to improve educational outcomes 
     for various populations of overaged or undercredited students 
     or students who have previously dropped out of secondary 
     school, such as--

       ``(aa) students not making sufficient progress to graduate 
     with a regular secondary school diploma in the standard 
     number of years;
       ``(bb) students who need to work to support themselves or 
     their families;
       ``(cc) pregnant and parenting teens; and
       ``(dd) students returning from the juvenile justice system; 
     and

       ``(V) combines rigorous academic education with career 
     training for students that are not making sufficient progress 
     to graduate from secondary school in the standard number of 
     years;

       ``(ii) a career and technical education program;
       ``(iii) a career academy or other model that delivers high 
     quality, college preparatory curriculum in the context of a 
     rigorous technical core; and
       ``(iv) creating a more personalized and engaging learning 
     environment for secondary school students, such as--

       ``(I) establishing smaller learning communities;
       ``(II) creating student advisories and developing peer 
     engagement strategies;
       ``(III) creating mechanisms for increased educator 
     collaboration around individual student needs;
       ``(IV) involving students and parents in the development of 
     individualized student plans for secondary school success and 
     graduation and transition to postsecondary education; and
       ``(V) creating mechanisms for increased student 
     participation in school improvement efforts and in decisions 
     affecting the students' own learning, including students 
     leading guidance activities, mentoring, or tutoring efforts.

       ``(B) Early college and dual enrollment schools.--An early 
     college high school or other dual enrollment learning 
     opportunity that provides a course of study that enables a 
     student to earn a secondary school diploma and either an 
     associate degree or not more than 2 years of transferable 
     postsecondary education credit toward a postsecondary degree 
     or credential.
       ``(C) Secondary schools using early warning systems.--A 
     secondary school that enables at-risk students to graduate 
     from secondary school ready to succeed in postsecondary 
     education and the workforce, through use of an early warning 
     indicator and intervention system that combines--
       ``(i) research-based whole school reform focused on 
     improving attendance, behavior, and course performance;
       ``(ii) targeted interventions provided by trained teams of 
     adults working full-time in the school, which may include--

       ``(I) participants or volunteers under the National and 
     Community Service Act of 1990 (42 U.S.C. 12501 et seq.) or 
     the Domestic Volunteer Service Act of 1973 (42 U.S.C. 4950 et 
     seq.);
       ``(II) student and family advocates; and
       ``(III) college and career access and success counselors;

       ``(iii) integrated student services and case-managed 
     interventions for students requiring intensive supports; and
       ``(iv) an on-track indicator system to identify students in 
     need of additional support and to monitor the effectiveness 
     of the interventions described in clause (ii).
       ``(2) Innovative programs.--
       ``(A) Expanded learning-time opportunities.--The creation 
     of an expanded learning-time opportunity, which may include--
       ``(i) establishing a mandatory expanded day, for all 
     students transitioning into the first year of high school, 
     for academic catch-up and enrichment;

[[Page S5084]]

       ``(ii) providing arts, service-learning (as defined in 
     section 101 of the National and Community Service Act of 1990 
     (42 U.S.C. 12511), or youth development opportunities with 
     community-based cultural and civic organizations;
       ``(iii) providing higher education and work-based exposure, 
     experience, and credit-bearing learning opportunities in 
     partnership with postsecondary education institutions and the 
     workforce;
       ``(iv) providing technology-enabled collaboration and 
     access for students to receive assistance from content 
     experts, instructors, and peers and to utilize resources for 
     remediation and enrichment; or
       ``(v) providing quality summer experiences, which may 
     include youth development.
       ``(B) Successful transitions to high school.--A program 
     improving student transitions from middle school to high 
     school and ensuring successful entry into high school, which 
     may include--
       ``(i) establishing summer transition programs for students 
     transitioning from middle school to high school to ensure the 
     students' connection to the students' new high school and to 
     orient the students to the study skills and social skills 
     necessary for success in the high school;
       ``(ii) providing for the sharing of data between high 
     schools and feeder middle schools;
       ``(iii) establishing early warning indicator and 
     intervention programs in high school for students 
     transitioning into the students' first year of high school so 
     that such students do not become truant or fall too far 
     behind in academics;
       ``(iv) increasing the level of student supports, including 
     academic and nonacademic supports that meet the comprehensive 
     needs of struggling students;
       ``(v) aligning academic standards, curricula, and 
     assessments between middle and high schools; and
       ``(vi) providing electronic access to detailed information 
     on student performance and all content and skill areas to 
     students transitioning into high school and their parents.
       ``(C) Successful transitions to postsecondary education and 
     the workforce.--Improvements to assist student transition 
     from secondary school to postsecondary education and the 
     workforce, which may include--
       ``(i) providing for the sharing of data between secondary 
     schools and institutions of higher education, including data 
     on remediation and completion rates;
       ``(ii) enabling dual enrollment and post-secondary credit-
     bearing learning opportunities;
       ``(iii) creating new opportunities to better utilize grades 
     11 and 12 and creating better connections to postsecondary 
     education, which may include internships, externships, job 
     shadowing, and technology-enabled collaboration;
       ``(iv) providing enhanced planning and counseling for 
     postsecondary education, including financial aid counseling; 
     and
       ``(v) aligning the academic standards of secondary school 
     with the academic standards of postsecondary education and 
     the requirements and expectations of the workforce, including 
     partnering with local industry to align technical curricula 
     to workforce needs.
       ``(D) Increased school autonomy and flexibility.--A program 
     of providing secondary schools with increased autonomy and 
     flexibility, which may include--
       ``(i) establishing a process whereby existing schools can 
     apply for flexibility in such areas as scheduling, curricula, 
     budgeting, and governance; and
       ``(ii) starting new small public secondary schools that are 
     guaranteed such autonomy.
       ``(E) Rural opportunities.--A program to improve learning 
     opportunities for secondary school students in rural schools, 
     including through the use of distance-learning opportunities 
     and other technology-based tools.
       ``(F) Middle grade improvements.--A program to improve 
     learning opportunities for students in the middle grades--
       ``(i) to prevent student disengagement and improve 
     achievement; and
       ``(ii) to better respond to early warning signs that 
     students are at risk of dropping out of school, such as poor 
     attendance, poor behavior, or course failure, through the use 
     of an early warning indicator system and interventions.
       ``(G) Improving teaching and academics.--A program of 
     improving teaching and increasing academic rigor at the 
     secondary school level, which may include--
       ``(i) improving the alignment of academic standards with 
     the requirements and expectations of postsecondary education 
     and the workforce;
       ``(ii) improving the teaching and assessment of 21st 
     century skills, including through the development of 
     formative assessment models;
       ``(iii) providing high-quality professional development on 
     data literacy, including on use of data to inform classroom 
     instruction;
       ``(iv) addressing the learning needs of various student 
     populations, including students who are limited English 
     proficient, late entrant English language learners, and 
     students with disabilities; and
       ``(v) developing value-added measures for use in 
     determining teacher ability and effectiveness, including for 
     use in recruitment and hiring decisions.
       ``(H) Improved community and parental involvement.--A 
     program improving community and parental involvement, which 
     may include--
       ``(i) increasing community involvement, including 
     leveraging community-based services and opportunities to 
     provide every student with the academic and comprehensive 
     nonacademic supports necessary for academic success; and
       ``(ii) increasing parental involvement, including providing 
     parents with the tools to navigate, support, and influence 
     their child's academic career and choices through secondary 
     school graduation and into postsecondary education and the 
     workforce, including through electronic access to student 
     data.
       ``(g) Data Collection and Evaluation.--
       ``(1) Collection of data.--Each eligible partnership 
     receiving a grant under this part shall collect and report 
     annually to the Secretary such information on the results of 
     the activities assisted under the grant as the Secretary may 
     reasonably require, including information on--
       ``(A) the number and percentage of students who--
       ``(i) are served by the eligible partnership;
       ``(ii) are assisted under this part; and
       ``(iii) graduate from secondary school with a regular 
     secondary school diploma in the standard number of years;
       ``(B) the number and percentage of students, at each grade 
     level, who are--
       ``(i) served by the eligible partnership;
       ``(ii) assisted under this part; and
       ``(iii) on track to graduate from secondary school with a 
     regular secondary school diploma in the standard number of 
     years;
       ``(C) the number and percentage of students, at each grade 
     level, who--
       ``(i) are served by the eligible partnership;
       ``(ii) are assisted under this part; and
       ``(iii) meet or exceed State challenging student academic 
     achievement standards in mathematics, reading or language 
     arts, or science, as measured by the State academic 
     assessments under section 1111(b)(3);
       ``(D) information consistent with the additional indicators 
     of improvement proposed by the eligible partnership in the 
     grant application; and
       ``(E) other information the Secretary may require as 
     necessary for the evaluation described in subsection (h).
       ``(2) Reporting of data.--Each eligible partnership 
     receiving a grant under this part shall disaggregate the 
     information required under paragraph (1) in the same manner 
     as information is disaggregated under section 
     1111(h)(1)(C)(i).
       ``(3) Evaluation.--
       ``(A) In general.--Each eligible partnership receiving a 
     grant under this part shall, immediately after the receipt of 
     grant funds, enter into a contract with an outside evaluator 
     to enable the evaluator to conduct--
       ``(i) an evaluation of the effects of the grant after the 
     third year of implementation of the grant; and
       ``(ii) an evaluation of the effects of the grant after the 
     final year of the grant period.
       ``(B) Distribution.--Upon completion of an evaluation 
     described in subparagraph (A), the eligible partnership shall 
     submit a copy of the evaluation to the Secretary in a timely 
     manner.
       ``(h) Evaluation; Best Practices.--
       ``(1) In general.--From amounts reserved under subsection 
     (b), the Secretary shall--
       ``(A) enter into a contract with an outside evaluator to 
     enable the evaluator to conduct--
       ``(i) a comprehensive evaluation after the third year of 
     implementation on the effectiveness of all grants awarded 
     under this part;
       ``(ii) a final evaluation following the final year of the 
     grant period--

       ``(I) with a focus on the improvement in student 
     achievement and the indicators described in subsection (g)(1) 
     as a result of innovative strategies; and
       ``(II) to the extent practicable, that compares the 
     relative effectiveness of different types of programs and 
     compares the relative effectiveness of variations in 
     implementation within types of programs; and

       ``(B) disseminate, and provide technical assistance 
     regarding, best practices in improving the achievement of 
     secondary school students.
       ``(2) Peer review.--
       ``(A) In general.--An evaluator receiving a contract under 
     this subsection shall--
       ``(i) establish a peer-review process to assist in the 
     review and approval of the evaluations conducted under this 
     subsection; and
       ``(ii) appoint individuals to the peer-review process who 
     are educators and experts in--

       ``(I) research and evaluation; and
       ``(II) the areas of expertise described in subclauses (I) 
     through (VI) of subsection (d)(1)(B)(i).

       ``(B) Restrictions on use.--The Secretary shall not 
     distribute or use the results of any evaluation described in 
     paragraph (1)(A) until the results are peer-reviewed in 
     accordance with subparagraph (A).
       ``(i) Continuation of Funding.--An eligible partnership 
     that receives a grant under this part shall only be eligible 
     to receive a grant payment for a fourth or fifth year of the 
     grant if the Secretary determines, on the basis of the 
     evaluation of the grant under subsection (h)(1)(A)(i), that 
     the performance of the eligible partnership under the grant 
     has been satisfactory.
       ``(j) Rule of Construction Regarding Discrimination.--
     Nothing in this section shall be construed to permit 
     discrimination on the

[[Page S5085]]

     basis of race, color, religion, sex, national origin, or 
     disability in any program or activity funded under this part.

     ``SEC. 1854. AUTHORIZATION OF APPROPRIATIONS.

       ``There is authorized to be appropriated to carry out this 
     part $500,000,000 for fiscal year 2010 and for each of the 
     succeeding 5 years.''.
       (b) Conforming Amendments.--The table of contents in 
     section 2 of the Elementary and Secondary Education Act of 
     1965 (20 U.S.C. 6301 note) is amended--
       (1) by striking the item relating to Part I and inserting 
     the following:

                  ``Part J--General Provisions''; and

       (2) by inserting after the item relating to section 1830 
     the following:

               ``PART I--Secondary School Innovation Fund

``Sec. 1851. Purposes.
``Sec. 1852. Definitions.
``Sec. 1853. Secondary school innovation fund.
``Sec. 1854. Authorization of appropriations.''.

                          ____________________