Congressional Record, Volume 156 Issue 17 (Thursday, February 4, 2010)

[Congressional Record Volume 156, Number 17 (Thursday, February 4, 2010)]
[Senate]
[Pages S484-S500]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

By Mr. KERRY (for himself, Mrs. Boxer, Ms. Snowe, and Ms.
Collins):
S. 2982. A bill to combat international violence against women and
girls; to the Common on Foreign Relations.
Mr. CARDIN. Mr. President, I rise today to express my support for the
International Violence Against Women Act, introduced today by Senators
Kerry, Boxer, Snowe, and Collins. I am proud to be an original
cosponsor on this legislation simply because it has the power to save
the lives of women and girls around the world while increasing our
safety here at home.
This bill is particularly significant because it would be a very
significant effort by the U.S. to tackle this egregious and widespread
problem. One out of every three women worldwide will be physically,
sexually or otherwise abused during her lifetime, with rates reaching
70 percent in some countries.
Ranging from rape to domestic violence and acid burnings to dowry
deaths and so-called honor killings, violence against women and girls
is an extreme human rights violation, a public health epidemic and a
barrier to solving global challenges such as extreme poverty, HIV/AIDS
and conflict. It devastates the lives of millions of women and girls--
in peacetime and in conflict--and knows no national or cultural
barriers.
Women who are abused are not only more likely to face serious injury
or death because of abuse, but are at much greater risk of dying in
pregnancy, having children who die in childhood, and contracting HIV/
AIDS.
What many people don't realize though is that violence against women
and girls is a major cause of poverty. Women are much more likely to be
among the world's poorest, living on a $1 a day or less, and the
violence they face keeps them poor. It prevents them from getting an
education, going to work, and earning the income they need to lift
their families out of poverty. In turn, women's poverty means they are
not free to escape abuse, perpetuating a vicious cycle that keeps women
from making better lives for themselves and their families.
In Nicaragua, for example, a study found that children of victims of
violence left school an average of 4 years earlier than other children.
In India, it has been found that women who experienced even a single
incident of violence lost an average of 7 working days. Sometimes, the
workplace itself can be a source of abuse: in Kenya, 95 percent of the
women who had experienced sexual abuse in their workplace were afraid
to report the problem for fear of losing their jobs.
Greater economic opportunity and earning capacity not only allows
women an option of escaping violent situations, but more importantly,
it increases equality and mutual respect within households, reducing
women's vulnerability to abuse in the first place.
Women around the world are working desperately to change the laws and
customs in their countries that routinely allow women and girls to be
raped, beaten or deprived of any legal rights, even the ability to see
a doctor or leave the house alone. But they need our help.
IVAWA is a good step in that direction.
The bill was developed in consultation with more than 150 expert
organizations, including the input of 40 women's groups from all around
the world.
Highlighting the cross-cutting nature of the issue of violence, the
bill is supported by a diverse coalition of almost 200 NGOs, including
Amnesty International USA, Women Thrive Worldwide, Jewish Women
International, Family Violence Prevention Fund, CARE, United Methodist
Church, and Refugees International.
This bill would direct the State Department to create a comprehensive
5-year strategy to reduce violence against women and girls in up to 20
countries and provide vital funds to foster programs in these countries
that address violence in a coordinated, comprehensive way. It would do
this by reforming legal and health sectors, helping to change social
norms and attitudes that condone rape and abuse, and improving
education and economic opportunities for women and girls.
Because violence against women is often rampant in countries
embroiled in conflict or crisis, this bill also requires that the U.S.
act in cases of extreme outbreaks of violence against women and girls,
like the horrific levels of rape experienced by women in the Democratic
Republic of Congo.
This legislation is necessary because this is not an academic issue--
we must remember that the scourge of gender-based violence effects real
women around the world.
But there are solutions.
When Dulce Marlen Contreras started her organization with seven of
her friends, the first thing on her mind was how to help the women of
Honduras protect themselves from domestic violence. A daughter of
farmers in the rural region of La Paz, Honduras, Marlen was tired of
watching the women of her community endure widespread alcoholism and
household abuse.
In 1993, Marlen founded the Coordinadora de Mujeres Campesinas de La
Paz, or COMUCAP, to raise awareness about women's rights. The
organization started by educating women in the community about their
rights and training them to stand up for themselves.
As time went on, Marlen noticed something was missing. While
awareness-building was critical, in order to reduce violence for the
long-term COMUCAP had to attack the problem at its root: poverty. ``We
realized that until women are economically empowered, they will not be
empowered to escape abuse for good,'' says Marlen. Seeing this link
changed the way COMUCAP approached its work. It started training women
to grow and sell organic coffee and aloe vera, helping them to earn an
income for their families.
Initially the reaction from the community was hostile--women's
empowerment was seen as a threat to families. As COMUCAP's programs
grew, however, they started seeing results--the more money women made,
the more power they were able to assert in the household.
As the community started to view the women of COMUCAP as economic
contributors to its families, more and more women made decisions
jointly with their husbands and stood up for themselves and their
children in the face of abuse. Today COMUCAP provides employment and
income to over 256 women in its community. Household violence has
reduced drastically within the families of COMUCAP.
This example clearly illustrates that violence against women is
preventable and that there are proven solutions that work. Even more
inspiring, there are many thousands of local organizations like COMUCAP
worldwide, which work within their own communities to support women in
violent situations, help them find ways to support themselves and
change cultural attitudes within their communities.
By supporting funding to overseas women's organizations to enable
them

[[Page S485]]

to work independently, IVAWA encourages this type of grassroots
sustainability that will be crucial to any permanent solution to
violence.
Violence has a profound effect on the lives of women and girls, and
therefore, all communities around the world. As a member of the Senate
Foreign Relations Committee, I am committed to continue to work with my
colleagues to fight to end it and to provide any assistance and
resources necessary to achieve this goal.
______

By Ms. LANDRIEU:
S. 2986. A bill to authorize the Administrator of the Small Business
Administration to waive interest for certain loans relating to damage
caused by Hurricane Katrina, Hurricane Rita, Hurricane Gustav, or
Hurricane Ike; to the Committee on Small Business and Entrepreneurship.
Ms. LANDRIEU. Mr. President, I come to the floor today to speak on an
issue that is of great importance to my home State of Louisiana:
disaster recovery from Hurricanes Katrina and Rita of 2005 and
Hurricanes Gustav and Ike of 2008. Almost 5 years after these first two
devastating storms, our eyes are still fixed on our shores during
hurricane season as our communities and businesses in the hardest-hit
areas continue to rebuild. As chair of the Senate Committee on Small
Business and Entrepreneurship, I remain focused on their ongoing
recovery efforts and am here today to introduce a bill that I believe
will help these struggling small businesses become successful once
again and hire new workers.
Charles R. ``Ray'' Bergeron and his wife's Fleur de Lis Car Care
Center in New Orleans, Louisiana, is one of the businesses that need
this type of assistance. Small Business Administrator Karen Mills and I
toured the Bergerons' business back in June. Pre-Katrina, Fleur de Lis,
which opened in 1988, had nine employees. After Hurricane Katrina hit,
Mr. and Mrs. Bergeron found themselves having to take out two loans,
one for their house and another for their small business. As of our
visit in June, the Bergerons were down to two employees, not including
themselves, and their business was back at about 40 percent of pre-
Katrina sales, due in large measure to the population not returning.
Their neighborhood is mostly empty homes, which Mr. Bergeron attributes
in part to high flood insurance premiums, high property taxes and high
homeowner's insurance.
As of June when I met with them, the Bergerons had a $225,000 SBA
disaster loan with a standard 30-year term, which Mr. Bergeron says he
will not pay off until he is 101 years old. But just yesterday, Mrs.
Bergeron contacted my office requesting SBA assistance with their loan
repayment after work to repair the flood-damaged roads surrounding
their gas station had cut access to their business for even their most
loyal customers. Since the project began, Fleur de Lis' sales have been
cut almost in half. This latest challenge comes on the heels of the
economic downturn, which caused the station to lay off two employees
earlier last year.
The Bergeron's story is one I have heard from countless businesses.
Coupled with their recovery from the 2005 and 2008 hurricanes, and more
recently, the economic downturn, these businesses--the ones that took
the initiative to quickly reopen after the storms--are today struggling
with one challenge after another. Yet these ``pioneer'' businesses are
the ones rebuilding communities need the most because they serve as
anchors. If residents see the Bergeron's gas station, or their favorite
restaurant, open, they are more likely to come back to rebuild their
homes.
To help ongoing recovery efforts in the Gulf Coast, and to give these
struggling businesses immediate assistance, I am introducing today the
Southeast Hurricanes Small Business Disaster Relief Act of 2010. I
thank my colleague Representative Charlie Melancon for introducing the
House companion bill. Our legislation would provide targeted assistance
to as many as 22,000 businesses in Louisiana, Mississippi, and Texas.
What these particular businesses have in common is that they received
SBA disaster loans following the 2005 or 2008 hurricanes. While they
have made payments on these loans, I have heard from countless
businesses in my State that they could expand operations if they had
additional cash flow. This legislation would inject immediate capital
into these hardest-hit businesses by giving SBA the authority to waive
up to $15,000 of interest payments over 3 years, helping to create or
save up to 81,000 jobs.
Under this program, SBA is required to give priority to applications
from businesses with 50 employees or less and businesses that re-opened
between September 2005 and October 2006 for the 2005 storms or
September and December 2008 for the 2008 hurricanes. This ensures that
SBA first helps true small businesses and those ``pioneer'' businesses
that were the first to re-open after the disaster. The program would
end on December 31, 2010.
This program makes a difference because for some businesses,
depending on the loan term and loan amount, their total principal/
interest payments could run as high as $1,000 per month. For example,
for a $114,000 disaster loan with a 4 percent interest rate and a 25-
year term, a business could be paying as much as $400 in monthly
interest. In one year, this adds up to $4,800 and almost $14,500 in 3
years. While this is not a lot of money for Wall Street banks or
Fortune 500 companies, $15,000 makes a major impact for a gas station
with two employees, like Fleur de Lis, or a neighborhood restaurant
with 10 employees. These businesses have seen their bottom lines shrink
as others on Wall Street received extravagant bonuses. I, for one,
believe it is time to help these Main Street businesses, as they are
the backbone of our communities.
My legislation also follows legislation approved by a previous
Congress. The prior bill came after Hurricane Betsy devastated Florida,
Louisiana and Mississippi in September 1965. According to Red Cross
reports at the time, between 800,000 and 1 million people were
adversely impacted by the hurricane. Before this storm, the only
previous disaster of that magnitude was the 1937 Ohio-Mississippi River
floods, which forced more than a million people from their homes. In
total, Betsy destroyed more than 1,500 homes, damaged more than
150,000, and damaged more than 2,000 trailers. Hurricane Betsy also
destroyed 1,400 farm buildings and 2,600 small businesses. At the time,
the Senate Committee on Public Works noted in Committee Report 89-917
that, ``The overwhelming magnitude of the vicious storm, surprising
even to experienced disaster workers, was more apparent every day as
storm victims continued to register for long-term recovery help in
rebuilding their lives and homes.''
As part of the review to provide Hurricane Betsy victims appropriate
assistance, including a field hearing in Louisiana, Congress determined
that the massive scale of this disaster required targeted, disaster-
specific programs. In particular, Congress approved the Southeast
Hurricane Disaster Relief Act of 1965, Public Law 89-339. This bill
authorized various business, homeowner, and agricultural disaster
assistance, including loans and temporary rental assistance. In its
committee report on the legislation, which is referenced above, the
Senate Committee on Public Works wrote, ``This bill contains what the
committee believes is needed and necessary to give further aid to the
disaster-stricken areas . . . including special measures to help these
States in the reconstruction and rehabilitation of devastated areas.''
Among other provisions, Section 3 of the bill authorized SBA to waive
interest--for loans above $500--due on the loan over a period of 3
years, but not to exceed $1,800 in interest. The bill was signed into
law in November 1965 and Congress later approved $35 million to
implement provisions in the Act.
Just as with Hurricane Betsy in 1965, in 2005, Mississippi and
Louisiana again saw a catastrophic disaster hit their businesses,
farms, and homes. Everyone now knows the impact Hurricanes Katrina and
Rita had on the New Orleans area and the southeast part of our State.
Images from the devastation following these storms, and the
subsequent Federal levee breaks, were transmitted across the country
and around the world. Katrina ended up being the deadliest natural
disaster in United States history, with 1,800 people killed--1,500 in
Louisiana alone. Katrina was also the costliest natural

[[Page S486]]

disaster in U.S. history, with more than $81.2 billion reported in
damage.

In Louisiana, we had 18,000 businesses catastrophically destroyed and
81,000 businesses economically impacted. I believe that, across the
entire Gulf Coast, some estimates ran as high as 125,000 businesses
impacted by Katrina and Rita. Many of these businesses, for various
reasons, have not returned or re-opened. By mid-2007, Orleans Parish
was still down 2,000 employers, or 23 percent of its pre-Katrina
business level. Nearby St. Bernard Parish--which had up to 80 percent
of its homes damaged--had the largest percentage decline of 48 percent
fewer businesses open, according to Louisiana State University and the
Louisiana Recovery Authority. These disasters were followed by the 2008
hurricanes that hit the same areas in Texas and Louisiana. With this in
mind, on September 25, 2009, I chaired a committee field hearing in
Galveston, Texas. At this hearing, we received a progress report from
Federal, State and local officials on the recovery from Hurricane Ike
in 2008. We also heard from individual business owners in Galveston who
were still struggling a year on from the hurricane.
These Galveston business owners, the Bergeron's Fleur de Lis gas
station, and many other ``pioneer'' businesses did choose to re-open
and are now struggling to stay alive. As is clear from the Bergerons'
story, these businesses have suffered from not one disaster, but three:
Hurricane Katrina/Rita in 2005, Hurricane Gustav/Ike in 2008, and the
economic downturn. My home State of Louisiana was slow to feel the
brunt of the credit crunch and economic meltdown, but last year we
began to see the drying up of investments and the shrinking of
consumers' pocketbooks. I believe the special program implemented
following Hurricane Betsy in 1965 would today greatly benefit
businesses in these three states hardest hit by Katrina, Rita, Gustav
and Ike. Given the urgent needs of many of these impacted businesses, I
will be reaching out to my colleagues in Texas, Louisiana, and
Mississippi to hopefully gain their support for quick passage of this
assistance. While I recognize that these are the hardest hit states, I
am also interested to hear from my other Gulf Coast colleagues on
whether this program would benefit their impacted businesses as well.
In closing, I would like to note that Congress has been generous in
providing essential recovery funds following the 2005 and 2008 storms.
However, as we approach the fifth anniversary of the 2005 disasters, we
must now ensure that impacted businesses can make it past this
anniversary--preventing thousands more workers from being unemployed or
additional defaults on SBA disaster loans. One important way that this
Congress can ensure that these workers remain employed and that these
businesses survive, and even grow, would be to relieve some of the
interest on these SBA disaster loans. For this reason, I urge my Senate
colleagues to support this commonsense legislation which would make a
difference for up to 22,000 Main Street business owners and their
estimated 81,000 employees in the Gulf Coast.
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. 2986

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 ``Southeast Hurricanes Small
Business Disaster Relief Act of 2010''.

SEC. 2. DEFINITIONS.

In this Act--
(1) the terms ``Administration'' and ``Administrator'' mean
the Small Business Administration and the Administrator
thereof, respectively;
(2) the term ``covered disaster loan'' means a loan--
(A) made under section 7(b) of the Small Business Act (15
U.S.C. 636(b));
(B) for damage or injury caused by Hurricane Katrina of
2005, Hurricane Rita of 2005, Hurricane Gustav of 2008, or
Hurricane Ike of 2008; and
(C) made to a business located in a declared disaster area;
(3) the term ``declared disaster area'' means an area in
the State of Louisiana, the State of Mississippi, or the
State of Texas for which the President declared a major
disaster under section 401 of the Robert T. Stafford Disaster
Relief and Emergency Assistance Act (42 U.S.C. 5170) relating
to Hurricane Katrina of 2005, Hurricane Rita of 2005,
Hurricane Gustav of 2008, or Hurricane Ike of 2008;
(4) the term ``program'' means the Southeast Hurricanes
Small Business Disaster Relief Program established under
section 3; and
(5) the term ``small business concern'' has the meaning
given that term under section 3(a) of the Small Business Act
(15 U.S.C. 632(a)).

SEC. 3. SOUTHEAST HURRICANES SMALL BUSINESS DISASTER RELIEF
PROGRAM.

(a) Program Established.--Subject to the availability of
appropriations, the Administrator shall establish a Southeast
Hurricanes Small Business Disaster Relief Program, under
which the Administrator may waive payment of interest by a
business on a covered disaster loan--
(1) for not more than 3 years; and
(2) in a total amount of not more than $15,000.
(b) Priority of Applications.--The Administrator shall, to
the extent practicable, give priority to an application for a
waiver of interest under the program by a small business
concern--
(1) with not more than 50 employees; or
(2) that resumed business operations in--
(A) a declared disaster area relating to Hurricane Katrina
of 2005 or Hurricane Rita of 2005, during the period
beginning on September 1, 2005, and ending on October 1,
2006; or
(B) a declared disaster area relating to Hurricane Gustav
of 2008 or Hurricane Ike of 2008, during the period beginning
on September 1, 2008, and ending on January 1, 2009.
(c) Termination of Program.--The Administrator may not
approve an application under the program after December 31,
2010.

SEC. 4. AUTHORIZATION OF APPROPRIATIONS.

There are authorized to be appropriated to the
Administrator such sums as may be necessary to carry out this
Act.
______

By Ms. LANDRIEU (for herself and Ms. Snowe):
S. 2989. A bill to improve the Small Business Act, and for other
purposes; to the Committee on Small Business and Entrepreneurship.
Ms. LANDRIEU. Mr. President, I am pleased today to be introducing the
Small Business Contracting Improvements Act of 2010, legislation
designed to protect the interests of small businesses and boost their
opportunities in the Federal marketplace.
As Chair of the Senate Committee on Small Business and
Entrepreneurship, I have focused a considerable amount of energy
promoting the interests of small businesses in the federal contracting
arena. The legislation I am introducing today marks a critical step
forward in this process.
As the largest purchaser in the world, the Federal Government is
uniquely positioned to offer new and reliable business opportunities
for our Main Street businesses. Government contracts are perhaps one of
the easiest and most inexpensive ways the government can help
immediately increase sales for America's entrepreneurs, giving them the
tools they need to keep our economy strong and create jobs. By
increasing contracts to small businesses by just 1 percent, we can
create more than 100,000 new jobs--and today, we need those jobs more
than ever.
But the reality is, small businesses need all the help they can get
accessing Federal contracts. In fiscal year 2007, according to the
Federal Procurement Data System, the Federal Government missed its 23
percent contracting goal by .992 percent. That .992 percent represents
more than $3.74 billion and 93,500 jobs lost for small businesses. The
numbers are even worse the next fiscal, in fiscal year 2008 the Federal
Procurement Data System reported that the government missed its goal by
1.51 percent--meaning more than $6.51 billion and 162,700 jobs lost.
While these numbers tell the stark story of why this legislation is
vital for our small businesses and our overall economy, they are still
only a part of the story of why this legislation is needed.
Our small businesses have been taking the brunt of this economic
downturn. In this past year, small businesses accounted for more than
85 percent of job losses. This fact was vividly illustrated to me this
weekend when I met with Louisiana business owners and officials. A
small business owner who spoke at our meeting told of how he was down
from 20 plus employees to three. He was clear that if he had access to
federal work he would begin staffing up tomorrow. That is the reason I
am introducing this legislation today. These contracting opportunities
represent job creation for small businesses in a way that is unique.
When large businesses get new work they

[[Page S487]]

typically spread that work among existing employees. When small
businesses get these contracts they must staff up to meet the increased
demand.
Furthermore, last night President Obama made the case that small
businesses need to be the focus of our recovery. I have heard over and
over again that small business is the engine that drives our economy.
Well, if that is true, then it is time to give that engine some gas.
President Obama set the right tone last night and today our bill looks
to act on his words and fill that tank as we consider improvements in
four key areas.
The first area I attempt to make improvements in is the area of
contract bundling. Although contract bundling may have started out as a
good idea, it has now become the prime example of the old saying that
too much of a good thing can be very, very bad. The proliferation of
bundled contracts coupled with the decimation of contracting
professionals within the government threatens to kill small businesses'
ability to compete for federal contracts.
Our bill looks to address those issues by ensuring: accountability of
senior agency management for all incidents of bundling; timely and
accurate reporting of contract bundling information by all federal
agencies; and improved oversight of bundling regulation compliance by
the Small Business Administration, SBA.
The bill also ensures that contract consolidation decisions made by a
department or agency, other than the Defense Department and its
agencies, provide small businesses with appropriate opportunities to
participate as prime contractors and subcontractors.
Another way that this bill attempts to tackle the issue of bundling
is by creating a joint venture and teaming center at the SBA. This
center will provide technical support to associations and businesses
who are interested in bidding on larger contracts as part of small
business teams or joint ventures. The bill will also ease regulations
that serve as a disincentive for small businesses who want to enter
into teaming relationships with one another.
The second area that this bill attempts to address is subcontracting.
The Committee has heard from many businesses about the challenges that
some small business subcontractors face when dealing with prime
contractors. Business owners have related that the way subcontracting
compliance is calculated creates opportunity for abuse. They also
related that many small businesses will spend time, money and effort
preparing bid proposals to be a part of a bid team and that once the
contract is won they never heard from the prime contractor again. Many
also complain about a lack of timely payments after they have completed
work.
This bill attempts to deal with some of these issues by including
provisions designed to prevent misrepresentations in subcontracting by
prime contractors. To accomplish this, the bill: provides guidelines
and procedures for reviewing and evaluating subcontractor participation
in prime contracts and provides for speedier payments to small business
subcontractors who have successfully completed work on behalf of the
prime contractor.
The third area I intend to update is the acquisition process. This
bill aims to increase the number of small business contracting
opportunities by including additional provisions to reduce bundled
contracts by reserving more contracts for small business concerns. The
bill accomplishes this by: authorizing small business set-asides in
multiple-award, multi-agency contracting vehicles; directing the Office
of Federal Procurement Policy to issue guidelines to analyze the use of
government credit cards for the purpose of meeting small business
goals; and requiring that agencies include meeting small business
contracting goals in the performance evaluation of contracting and
program personnel.
The last area that I tackle in this legislation is small business
size and status integrity. The Committee has heard from a number of
small businesses about large businesses parading as small businesses.
It is imperative that small business contracts go to small businesses.
Small businesses may be losing billions of dollars in opportunities
because of size standard loopholes.
This bill attempts to address these issues by making additions to the
Small Business Act that are designed to strengthen the government's
ability to enforce the size and status standards for small business
certification. To achieve this, the new section: establishes a
presumption of loss to the federal government whenever a large business
performs a small business contract; requires that small businesses
annually certify their size status; requires the development of
training programs for small business size standards; requires a
detailed review of the size standards for small businesses by the SBA
within one year; and directs GAO to study the effectiveness of the
mentor-protege program.
It is well past time to provide greater opportunities for the
thousands of small business owners who wish to do business with the
Federal Government. I believe that this legislation is a good step
toward opening those doors of opportunity. I hope all of my colleagues
will join me in supporting this bill and I look forward to working with
them as we work to move this legislation forward.
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. 2989

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 ``Small Business Contracting
Revitalization Act of 2010''.

SEC. 2. TABLE OF CONTENTS.

The table of contents for this Act is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.
Sec. 3. Definitions.

TITLE I--CONTRACT BUNDLING

Sec. 101. Leadership and oversight.
Sec. 102. Consolidation of contract requirements.
Sec. 103. Small business teams pilot program.

TITLE II--SUBCONTRACTING INTEGRITY

Sec. 201. GAO recommendations on subcontracting misrepresentations.
Sec. 202. Small business subcontracting improvements.

TITLE III--ACQUISITION PROCESS

Sec. 301. Reservation of prime contract awards for small businesses.
Sec. 302. Micro-purchase guidelines.
Sec. 303. Agency accountability.
Sec. 304. Payment of subcontractors.
Sec. 305. Repeal of Small Business Competitiveness Demonstration
Program.

TITLE IV--SMALL BUSINESS SIZE AND STATUS INTEGRITY

Sec. 401. Policy and presumptions.
Sec. 402. Annual certification.
Sec. 403. Training for contracting and enforcement personnel.
Sec. 404. Updated size standards.
Sec. 405. Study and report on the mentor-protege program.

SEC. 3. DEFINITIONS.

In this Act--
(1) the terms ``Administration'' and ``Administrator'' mean
the Small Business Administration and the Administrator
thereof, respectively; and
(2) the term ``small business concern'' has the meaning
given that term under section 3 of the Small Business Act (15
U.S.C. 632).
TITLE I--CONTRACT BUNDLING

SEC. 101. LEADERSHIP AND OVERSIGHT.

(a) In General.--Section 15 of the Small Business Act (15
U.S.C. 644) is amended by adding at the end the following:
``(q) Bundling Accountability Measures.--
``(1) Teaming requirements.--Each Federal agency shall
include in each solicitation for any contract award above the
substantial bundling threshold of the Federal agency a
provision soliciting bids by teams and joint ventures of
small business concerns.
``(2) Agency policies on reduction of contract bundling.--
The head of each Federal agency shall--
``(A) not later than 180 days after the date of enactment
of this subsection, publish on the website of the Federal
agency the policy of the Federal agency regarding contracting
bundling and consolidation, including regarding the
solicitation of teaming and joint ventures under paragraph
(1); and
``(B) not later than 30 days after the date on which the
head of the Federal agency submits data certifications to the
Administrator for Federal Procurement Policy, publish on the
website of the Federal agency a list and rationale for any
bundled contract for which the Federal agency solicited bids
or that was awarded by the Federal agency.
``(3) Reporting.--Not later than 90 days after the date of
enactment of this subsection, and every 3 years thereafter,
the Director of Small and Disadvantaged Business Utilization
for each Federal agency shall submit to the Committee on
Small Business

[[Page S488]]

and Entrepreneurship of the Senate and the Committee on Small
Business of the House of Representatives a report regarding
procurement center representatives and commercial market
representatives, which shall--
``(A) identify each area for which the Federal agency has
assigned a procurement center representative or a commercial
market representative;
``(B) explain why the Federal agency selected the areas
identified under subparagraph (A); and
``(C) describe the activities performed by procurement
center representatives and commercial market
representatives.''.
(b) Technical Correction.--Section 15(g) of the Small
Business Act (15 U.S.C. 644(g)) is amended by striking
``Administrator of the Office of Federal Procurement Policy''
each place it appears and inserting ``Administrator for
Federal Procurement Policy''.
(c) Report.--
(1) In general.--Not later than 180 days after the date of
enactment of this Act, the Comptroller General of the United
States shall submit to Congress a report regarding the
procurement center representative program of the
Administration.
(2) Contents.--The report submitted under paragraph (1)
shall--
(A) address ways to improve the effectiveness of the
procurement center representative program in helping small
business concerns obtain Federal contracts;
(B) evaluate the effectiveness of procurement center
representatives and commercial marketing representatives; and
(C) include recommendations, if any, on how to improve the
procurement center representative program.
(d) Electronic Procurement Center Representative.--Not
later than 180 days after the date of enactment of this Act,
the Administrator shall implement an electronic procurement
center representative program.

SEC. 102. CONSOLIDATION OF CONTRACT REQUIREMENTS.

The Small Business Act (15 U.S.C. 631 et seq.) is amended--
(1) by redesignating section 44 as section 45; and
(2) by inserting after section 43 the following:

``SEC. 44. CONSOLIDATION OF CONTRACT REQUIREMENTS.

``(a) Definitions.--In this section--
``(1) the term `Chief Acquisition Officer' means the
employee of a Federal agency designated as the Chief
Acquisition Officer for the Federal agency under section
16(a) of the Office of Federal Procurement Policy Act (41
U.S.C. 414(a));
``(2) the term `consolidation of contract requirements',
with respect to contract requirements of a Federal agency,
means a use of a solicitation to obtain offers for a single
contract or a multiple award contract to satisfy 2 or more
requirements of the Federal agency for goods or services that
have been, are being, or will be provided to, or will be
performed for or would typically be performed for, the
Federal agency under 2 or more separate contracts lower in
cost than the total cost of the contract for which the offers
are solicited;
``(3) the term `Federal agency' does not include the
Department of Defense or any agency of the Department of
Defense;
``(4) the term `multiple award contract' means--
``(A) a multiple award task order contract or delivery
order contract that is entered into under the authority of
sections 303H through 303K of the Federal Property and
Administrative Services Act of 1949 (41 U.S.C. 253h through
253k); and
``(B) any other indefinite delivery, indefinite quantity
contract that is entered into by the head of a Federal agency
with 2 or more sources pursuant to the same solicitation; and
``(5) the term `senior procurement executive' means an
official designated under section 16(c) of the Office of
Federal Procurement Policy Act (41 U.S.C. 414(c)) as the
senior procurement executive for a Federal agency.
``(b) Policy.--The head of each Federal agency shall ensure
that the decisions made by the Federal agency regarding
consolidation of contract requirements of the Federal agency
are made with a view to providing small business concerns
with appropriate opportunities to participate as prime
contractors and subcontractors in the procurements of the
Federal agency.
``(c) Limitation on Use of Acquisition Strategies Involving
Consolidation.--
``(1) In general.--The head of a Federal agency may not
carry out an acquisition strategy that includes a
consolidation of contract requirements of the Federal agency
with a total value of more than $2,000,000, unless the senior
procurement executive or Chief Acquisition Officer for the
Federal agency, before carrying out the acquisition
strategy--
``(A) conducts market research;
``(B) identifies any alternative contracting approaches
that would involve a lesser degree of consolidation of
contract requirements; and
``(C) determines that the consolidation of contract
requirements is necessary and justified.
``(2) Determination that consolidation is necessary and
justified.--
``(A) In general.--A senior procurement executive or Chief
Acquisition Officer may determine that an acquisition
strategy involving a consolidation of contract requirements
is necessary and justified for the purposes of paragraph
(1)(C) if the benefits of the acquisition strategy
substantially exceed the benefits of each of the possible
alternative contracting approaches identified under paragraph
(1)(B).
``(B) Savings in administrative or personnel costs.--For
purposes of subparagraph (A), savings in administrative or
personnel costs alone do not constitute a sufficient
justification for a consolidation of contract requirements in
a procurement unless the expected total amount of the cost
savings, as determined by the senior procurement executive or
Chief Acquisition Officer, is substantial in relation to the
total cost of the procurement.
``(3) Benefits to be considered.--The benefits considered
for the purposes of paragraphs (1) and (2) may include cost
and, regardless of whether quantifiable in dollar amounts--
``(A) quality;
``(B) acquisition cycle;
``(C) terms and conditions; and
``(D) any other benefit.''.

SEC. 103. SMALL BUSINESS TEAMS PILOT PROGRAM.

(a) Definitions.--In this section--
(1) the term ``Center'' means the Center for Small Business
Teaming established under subsection (b); and
(2) the term ``eligible organization'' means a well-
established national organization for small business concerns
with the capacity to provide assistance to small business
concerns (which may be provided with the assistance of the
Center) relating to--
(A) customer relations and outreach;
(B) submitting bids and proposals;
(C) team relations and outreach; and
(D) performance measurement and quality assurance.
(b) Establishment.--The Administrator shall establish a
Center for Small Business Teaming within the Administration
to carry out a pilot program for teaming and joint ventures
involving small business concerns.
(c) Grants.--The Center may make grants to eligible
organizations to assemble teams of small business concerns to
compete for larger procurement contracts.
(d) Contracting Opportunities.--
(1) In general.--The Center shall work with eligible
organizations receiving a grant under this section to
identify appropriate contracting opportunities for teams or
joint ventures of small business concerns.
(2) Restricted competition.--A contracting officer of a
Federal agency may restrict competition for any contract for
the procurement of goods or services by the Federal agency to
teams or joint ventures of small business concerns if
determined appropriate by the contracting officer.
(e) Termination.--The authorities under this section shall
terminate 5 years after the date of enactment of this Act.
(f) Authorization of Appropriations.--There are authorized
to be appropriated for grants by the Center under subsection
(c) $5,000,000 for each of fiscal years 2010 through 2015.
TITLE II--SUBCONTRACTING INTEGRITY

SEC. 201. GAO RECOMMENDATIONS ON SUBCONTRACTING
MISREPRESENTATIONS.

Section 8 of the Small Business Act (15 U.S.C. 637) is
amended by adding at the end the following:
``(o) Prevention of Misrepresentations in Subcontracting;
Implementation of Recommendations of Comptroller General.--
``(1) Statement of policy.--It is the policy of Congress
that the recommendations of the Comptroller General of the
United States in Report No. 05-459, concerning oversight
improvements necessary to ensure maximum practicable
participation by small business concerns in subcontracting,
shall be implemented Government-wide, to the maximum extent
possible.
``(2) Contractor compliance.--Compliance of Federal prime
contractors with subcontracting plans relating to small
business concerns shall be evaluated as a percentage of
obligated prime contract dollars and as a percentage of
subcontracts awarded.
``(3) Issuance of agency policies.--Not later than 180 days
after the date of enactment of this subsection, the head of
each Federal agency shall issue a policy on subcontracting
compliance relating to small business concerns, including
assignment of compliance responsibilities between contracting
offices, small business offices, and program offices and
periodic oversight and review activities.''.

SEC. 202. SMALL BUSINESS SUBCONTRACTING IMPROVEMENTS.

Section 8(d)(6) of the Small Business Act (15 U.S.C.
637(d)(6)) is amended--
(1) in subparagraph (E), by striking ``and'' at the end;
(2) in subparagraph (F), by striking the period at the end
and inserting ``; and''; and
(3) by adding at the end, the following:
``(G) a certification that the offeror or bidder will
acquire articles, equipment, supplies, services, or
materials, or obtain the performance of construction work
from the small business concerns used in preparing and
submitting to the contracting agency the bid or proposal, in
the same amount and quality used in preparing and submitting
the bid or proposal, unless the small business concerns are
no longer in business or can no longer meet the quality,
quantity, or delivery date.''.

[[Page S489]]

TITLE III--ACQUISITION PROCESS

SEC. 301. RESERVATION OF PRIME CONTRACT AWARDS FOR SMALL
BUSINESSES.

Section 15 of the Small Business Act (15 U.S.C. 644), as
amended by this Act, is amended by adding at the end the
following:
``(r) Government-Wide Acquisition Contracts.--Not later
than 180 days after the date of enactment of this subsection,
the Administrator for Federal Procurement Policy and the
Administrator shall jointly, by regulation, establish
criteria for Federal agencies for--
``(1) setting aside part or parts of a multiple award
contract (as defined in section 44), Federal supply schedule
contracts, and other Government-wide acquisition contracts
for small business concerns, including the subcategories of
small business concerns identified in subsection (g)(2);
``(2) setting aside orders placed against multiple award
contracts, Federal supply schedule contracts, and other
Government-wide acquisition contracts for small business
concerns, including the subcategories of small business
concerns identified in subsection (g)(2); and
``(3) reserving 1 or more contract awards for small
business concerns under full and open multiple award
procurements, including the subcategories of small business
concerns identified in subsection (g)(2).''.

SEC. 302. MICRO-PURCHASE GUIDELINES.

Not later than 1 year after the date of enactment of this
Act, the Controller of the Office of Federal Financial
Management shall issue guidelines regarding the analysis of
purchase card expenditures to identify opportunities for
achieving and accurately measuring fair participation of
small business concerns in purchases in an amount not in
excess of the micro-purchase threshold, as defined in section
32 of the Office of Federal Procurement Policy Act (41 U.S.C.
428) (in this section referred to as ``micro-purchases''),
consistent with the national policy on small business
participation in Federal procurements set forth in sections
2(a) and 15(g) of the Small Business Act (15 U.S.C. 631(a)
and 644(g)), and dissemination of best practices for
participation of small business concerns in micro-purchases.

SEC. 303. AGENCY ACCOUNTABILITY.

Section 15(g)(2) of the Small Business Act (15 U.S.C.
644(g)(2)) is amended--
(1) by inserting ``(A)'' after ``(2)'';
(2) by striking ``Goals established'' and inserting the
following:
``(B) Goals established'';
(3) by striking ``Whenever'' and inserting the following:
``(C) Whenever'';
(4) by striking ``For the purpose of'' and inserting the
following:
``(D) For the purpose of'';
(5) by striking ``The head of each Federal agency, in
attempting to attain such participation'' and inserting the
following:
``(E) The head of each Federal agency, in attempting to
attain the participation described in subparagraph (D)''.
(6) in subparagraph (E), as so designated--
(A) by striking ``(A) contracts'' and inserting ``(i)
contracts''; and
(B) by striking ``(B) contracts'' and inserting ``(ii)
contracts''; and
(7) by adding at the end the following:
``(F)(i) Each procurement employee or program manager
described in clause (ii)--
``(I) shall communicate to the subordinates of the
procurement employee or program manager the importance of
achieving small business goals; and
``(II) shall have as a significant factor in the annual
performance evaluation of the procurement employee or program
manager, where appropriate, the success of that procurement
employee or program manager in small business utilization, in
accordance with the goals established under this subsection.
``(ii) A procurement employee or program manager described
in this clause is a senior procurement executive, senior
program manager, or Director of Small and Disadvantaged
Business Utilization of a Federal agency having contracting
authority.''.

SEC. 304. PAYMENT OF SUBCONTRACTORS.

Section 8(d) of the Small Business Act (15 U.S.C. 637(d))
is amended by adding at the end the following:
``(11) Payment of Subcontractors.--
``(A) Definition.--In this paragraph, the term `covered
contract' means a contract relating to which a prime
contractor is required to develop a subcontracting plan under
paragraph (4) or (5).
``(B) Notice.--
``(i) In general.--A prime contractor for a covered
contract shall notify in writing the contracting officer for
the covered contract if the prime contractor pays a reduced
price to a subcontractor for goods and services upon
completion of the responsibilities of the subcontractor or
the payment to a subcontractor is more than 90 days past due
for goods or services provided for the covered contract for
which--
``(I) the Federal agency has paid the prime contractor; or
``(II) the prime contractor has submitted a request for
payment to the Federal agency.
``(ii) Contents.--A prime contractor shall include the
reason for the reduction in a payment to or failure to pay a
subcontractor in any notice made under clause (i).
``(iii) Public availability.--The head of each Federal
agency shall, after redacting information identifying any
subcontractor, make publicly available any notice made under
clause (i).
``(C) Performance.--A contracting officer for a covered
contract shall consider the failure by a prime contractor to
make a full or timely payment to a subcontractor in
evaluating the performance of the prime contractor.
``(D) Control of funds.--A contracting officer for a
covered contract may restrict the authority of a prime
contractor that has a history of untimely payment of
subcontractors (as determined by the contracting officer) to
make expenditures under or control payment of subcontractors
for a covered contract.''.

SEC. 305. REPEAL OF SMALL BUSINESS COMPETITIVENESS
DEMONSTRATION PROGRAM.

(a) In General.--The Business Opportunity Development
Reform Act of 1988 (Public Law 100-656) is amended by
striking title VII (15 U.S.C. 644 note).
(b) Effective Date and Applicability.--The amendment made
by this section--
(1) shall take effect on the date of enactment of this Act;
and
(2) apply to the first full fiscal year after the date of
enactment of this Act.
TITLE IV--SMALL BUSINESS SIZE AND STATUS INTEGRITY

SEC. 401. POLICY AND PRESUMPTIONS.

Section 3 of the Small Business Act (15 U.S.C. 632) is
amended by adding at the end the following:
``(t) Presumption.--
``(1) In general.--In every contract, subcontract,
cooperative agreement, cooperative research and development
agreement, or grant which is set aside, reserved, or
otherwise classified as intended for award to small business
concerns, there shall be a presumption of loss to the United
States based on the total amount expended on the contract,
subcontract, cooperative agreement, cooperative research and
development agreement, or grant whenever it is established
that a business concern other than a small business concern
willfully sought and received the award by misrepresentation.
``(2) Deemed certifications.--The following actions shall
be deemed affirmative, willful, and intentional
certifications of small business size and status:
``(A) Submission of a bid or proposal for a Federal grant,
contract, subcontract, cooperative agreement, or cooperative
research and development agreement reserved, set aside, or
otherwise classified as intended for award to small business
concerns.
``(B) Submission of a bid or proposal for a Federal grant,
contract, subcontract, cooperative agreement, or cooperative
research and development agreement which in any way
encourages a Federal agency to classify the bid or proposal,
if awarded, as an award to a small business concern.
``(C) Registration on any Federal electronic database for
the purpose of being considered for award of a Federal grant,
contract, subcontract, cooperative agreement, or cooperative
research agreement, as a small business concern.
``(3) Certification by signature of responsible official.--
``(A) In general.--Each solicitation, bid, or application
for a Federal contract, subcontract, or grant shall contain a
certification concerning the small business size and status
of a business concern seeking the Federal contract,
subcontract, or grant.
``(B) Content of certifications.--A certification that a
business concern qualifies as a small business concern of the
exact size and status claimed by the business concern for
purposes of bidding on a Federal contract or subcontract, or
applying for a Federal grant, shall contain the signature of
a director, officer, or counsel on the same page on which the
certification is contained.
``(4) Regulations.--The Administrator shall promulgate
regulations to provide adequate protections to individuals
and business concerns from liability under this subsection in
cases of unintentional errors, technical malfunctions, and
other similar situations.''.

SEC. 402. ANNUAL CERTIFICATION.

Section 3 of the Small Business Act (15 U.S.C. 632), as
amended by this Act, is amended by adding at the end the
following:
``(u) Annual Certification.--
``(1) In general.--Each business certified as a small
business concern under this Act shall annually certify its
small business size and, if appropriate, its small business
status, by means of a confirming entry on the ORCA database
of the Administration, or any successor thereto.
``(2) Regulations.--Not later than 1 year after the date of
enactment of this subsection, the Administrator, in
consultation with the Inspector General and the Chief Counsel
for Advocacy of the Administration, shall promulgate
regulations to ensure that--
``(A) no business concern continues to be certified as a
small business concern on the ORCA database of the
Administration, or any successor thereto, without fulfilling
the requirements for annual certification under this
subsection; and
``(B) the requirements of this subsection are implemented
in a manner presenting the least possible regulatory burden
on small business concerns.
``(3) Determination of size status.--The small business
size or status of a business concern shall be determined at
the time of the award of a Federal--
``(A) contract, except that, in the case of interagency
multiple award contracts (as defined in section 44), small
business size or

[[Page S490]]

status shall be determined annually, except for purposes of
the award of each task or delivery order set aside or
reserved for small business concerns;
``(B) subcontract;
``(C) grant;
``(D) cooperative agreement; or
``(E) cooperative research and development agreement.''.

SEC. 403. TRAINING FOR CONTRACTING AND ENFORCEMENT PERSONNEL.

(a) In General.--Not later than 1 year after the date of
enactment of this Act, the Federal Acquisition Institute, in
consultation with the Administrator for Federal Procurement
Policy, shall develop courses concerning proper
classification of business concerns and small business size
and status for purposes of Federal contracts, subcontracts,
grants, cooperative agreements, and cooperative research and
development agreements.
(b) Policy on Prosecutions of Small Business Size and
Status Fraud.--Section 3 of the Small Business Act (15 U.S.C.
632), as amended by this Act, is amended by adding at the end
the following:
``(v) Policy on Prosecutions of Small Business Size and
Status Fraud.--Not later than 1 year after the date of
enactment of this subsection, the head of each relevant
Federal agency and the Inspector General of the
Administration shall issue a Government-wide policy on
prosecution of small business size and status fraud.''.

SEC. 404. UPDATED SIZE STANDARDS.

Not later than 1 year after the date of enactment of this
Act, and every 5 years thereafter, the Administrator shall--
(1) conduct a detailed review of the size standards for
small business concerns established under section 3(a)(2) of
the Small Business Act (15 U.S.C. 632(a)(2));
(2) make appropriate adjustments to size standards under
that section to reflect market conditions; and
(3) make publically available information regarding--
(A) the factors evaluated as part of the review conducted
under paragraph (1); and
(B) the criteria used for any revised size standards
promulgated under paragraph (2).

SEC. 405. STUDY AND REPORT ON THE MENTOR-PROTEGE PROGRAM.

(a) In General.--The Comptroller General of the United
States shall conduct a study of the mentor-protege program of
the Administration for small business concerns participating
in programs under section 8(a) of the Small Business Act (15
U.S.C. 637(a)), and other relationships and strategic
alliances pairing a larger business and a small business
concern partner to gain access to Federal Government
contracts, to determine whether the programs and
relationships are effectively supporting the goal of
increasing the participation of small business concerns in
Government contracting.
(b) Matters To Be Studied.--The study conducted under this
section shall include--
(1) a review of a broad cross-section of industries; and
(2) an evaluation of--
(A) how each Federal agency carrying out a program
described in subsection (a) administers and monitors the
program;
(B) whether there are systems in place to ensure that the
mentor-protege relationship, or similar affiliation, promotes
real gain to the protege, and is not just a mechanism to
enable participants that would not otherwise qualify under
section 8(a) of the Small Business Act (15 U.S.C. 637(a)) to
receive contracts under that section; and
(C) the degree to which protege businesses become able to
compete for Federal contracts without the assistance of a
mentor.
(c) Report to Congress.--Not later than 180 days after the
date of enactment of this Act, the Comptroller General shall
submit to the Committee on Small Business and
Entrepreneurship of the Senate and the Committee on Small
Business of the House of Representatives a report on the
results of the study conducted under this section.

Ms. SNOWE. Mr. President, as ranking Member of the Senate Committee
on Small Business and Entrepreneurship, I rise today, along with
Senator Landrieu, to introduce the Small Business Contracting
Revitalization Act of 2010. This critical piece of legislation is the
direct result of consensus-building and compromise, and continues the
bipartisan tradition of the Small Business Committee. I also wish to
thank Chair Landrieu for her partnership with me in forging this truly
crucial measure as we work toward contracting parity for small
business, and for her tireless leadership on all concerns confronting
small businesses today.
The Small Business Contracting Revitalization Act of 2010 retains
critical procurement provisions that originate in the comprehensive
contracting bills I introduced or cosponsored in the 109th and 110th
Congresses which were unanimously voted out of the Small Business
Committee. This particular legislation will serve to minimize the use
of contract bundling and consolidation of contracts by the Federal
Government, and increase the ability of small businesses to fairly
compete for such contracts through a host of key improvements,
including allowing small businesses to join together in teams to bid on
certain procurement opportunities. Additional requirements will help to
ensure prompt payment from prime contractors to subcontractors, and
make it easier for the Federal Government to prosecute businesses who
fraudulently identify themselves as small companies.
Since the mid-1990s, with the enactment of acquisition streamlining
reforms and the downsizing of the Federal procurement workforce, small
businesses have faced a litany of hurdles that have deprived them of
Federal contracting dollars. One such impediment is contract bundling
which takes contracting opportunities out of the hands of deserving
small businesses by grouping numerous small contracts and bundling them
into one large award. Ill-equipped to manage the demands of these
consolidated awards due to a lack of resources, small business owners
again find themselves crowded out of the Federal contracting process.
Consequently, the bipartisan measure we are introducing today reflects
the recommendations made by the Government Accountability Office, GAO,
to impose stricter reviews and more comprehensive reporting of bundled
contracts, encourages small business teaming to bid on larger
contracts, and promotes Federal agency publishing and use of best
practices. Additional obstacles to successful small business
contracting include ``bait and switch'' tactics used by prime
contractors who use small firms in developing bids but do not
subcontract with them once a contract has been awarded. Our bill will
address this concern as well as other ongoing problems such as large
businesses posing as small businesses, flawed reporting data, and
agencies who fail to meet their small business contracting goals.
As Ranking Member of the Senate Committee on Small Business and
Entrepreneurship, I am further dismayed by the myriad ways that
government agencies have time and again egregiously failed to meet the
vast majority of their small business statutory ``goaling''
requirements. It is unconscionable that the statutory goal for only one
category of small business--small disadvantaged businesses--has been
met, and that goals for the three other programs--HUBZones, women-owned
small businesses, and service-disabled veterans-owned businesses--have
never been achieved.
Consider that, in 2007, small businesses were eligible for $378
billion in Federal contracting awards, yet received only $83 billion.
This blatant failure to utilize small businesses, thus preventing them
to secure their fair share of Federal contracting dollars, has resulted
in firms losing billions of dollars in contracting opportunities. But
23 percent is only a base goal--we must strive to exceed it, not just
meet it.
In the last two years alone, the Small Business Committee has held
numerous hearings and roundtables to identify and explain small
business' contracting concerns. In addition, the GAO and the Small
Business Administration's Inspector General have issued multiple
reports addressing small business Federal contracting deficiencies. Our
legislation builds on the contracting provisions of previous Small
Business Committee contracting bills by endowing the SBA with
additional tools to meet the demands of an ever-changing 21st century
contracting environment.
That said, I am greatly encouraged by the latest statistics relating
to Federal contracting dollars awarded to small businesses from the
funds appropriated under the American Recovery and Reinvestment Act,
ARRA. Preliminary reports show that, as of February 1, 2010, small
businesses have received over 29 percent of the ARRA Federal
contracting dollars, well-exceeding the imposed 23 percent statutory
goal. This begs the question, if the Federal government can not only
meet but exceed these requirements for the Recovery Act, why can't
these goals be met year in and year out? The simple answer is they can.
I am hopeful that this administration will make a conscious effort to
reverse the government-wide failure to meet small business goals on a
consistent basis.
I am confident that this legislation will result in the changes
necessary to reduce fraud and waste while paving the way for the
Federal government to

[[Page S491]]

maximize the use of America's innovative small businesses in the
contracting arena. Again, I want to recognize Senator Landrieu for her
leadership in this matter, and for her continuing commitment to the
small business community.
______

By Mr. CARPER (for himself, Mr. Alexander, Ms. Klobuchar, Ms.
Collins, Mrs. Feinstein, Mr. Gregg, Mrs. Shaheen, Mr. Graham,
Mr. Kaufman, Mr. Schumer, Mr. Lieberman, and Ms. Snowe):
S. 2995. A bill to amend the Clean Air Act to establish a national
uniform multiple air pollutant regulatory program for the electric
generating sector; to the Committee on Environment and Public Works.
Mr. ALEXANDER. Mr. President, today Senator Carper and I have joined
with Senators Klobuchar, Collins, Gregg, Kaufman, Graham, Feinstein,
Shaheen, Schumer, Lieberman, and Snowe to introduce the Clean Air Act
Amendments of 2010.
This bill is about clean air and the effect of sulfur dioxide,
nitrogen oxides, and mercury emissions of coal-fired power plants on
health, jobs, and tourism. This bill does not address carbon emissions.
To me the most important aspect of this bill is that for the very
first time it puts into federal law requirements that we cut mercury
emissions by 90 percent from coal plants, which produce 50 percent of
our electricity today.
This bill will reduce sulfur dioxide, nitrogen oxides, and mercury
emissions from power plants by directing EPA to cut mercury emissions
at least 90 percent through the best available technology and
strengthening national limits on emissions of sulfur dioxide and
nitrogen oxides from power plants with new trading systems that will
enable cost-effective reductions of these two pollutants.
For Tennesseans this is a bill about our health, it is about tourism
in our State and it is about our jobs.
400,000 Tennesseans have asthma that is affected by the dirty air in
our state. Sulfur dioxide and nitrogen oxides can trigger asthma
attacks and cause chronic lung problems. 400,000 Tennesseans with
asthma are at a daily risk due to poor air quality.
The more we learn about mercury the more we understand that it gets
in our food supply, it gets in our water supply, some of it comes from
our coal plants and it especially affects women and children.
Nationwide, EPA estimates this bill will save more than 215,000 lives
and more than $2 trillion in health care costs by 2025.
In our State, we are privileged to have the most visited national
park in America, the Great Smoky Mountains National Park--we are
intensely proud of it. But we want the 10 million tourists who come
there every year to see the blue haze that the Cherokee Indians used to
sing about, not the smog that is produced by dirty air blowing into our
State and some of the dirty air that we produce.
Finally we have become an automobile State. When auto parts suppliers
move to Tennessee and want to locate near the Nissan plant or near the
Volkswagen plant, one of the first things they have to do is to get a
clean air permit. Our State simply cannot clean up our air all by
ourselves without strong national standards to require the rest of the
country to stop producing dirty air that blows into our State. So for
Tennesseans this is about our health, about our tourism and our
mountains, and this is about our jobs.
The Environmental Protection Agency says the bill will only cost
electricity consumers about 1.5 percent to 2.5 percent increases in
their utility bills by 2020. This may only be about $2 a month per
customer. I think $2 a month is worth it for savings of $2 trillion in
health care costs.
In summary, this bill helps save hundreds of thousands of lives,
saves trillions of health care dollars, enables communities to meet new
EPA air quality requirements and create new jobs, and protects the
scenic beauty of some of our greatest natural treasures.
Cleaner air is something we can all support and I ask my colleagues
to join Senator Carper and me in this effort.
Mr. President, I ask unanimous consent that a description of the bill
be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:

Clean Air Act Amendments of 2010

To reduce sulfur dioxide, nitrogen oxides, and mercury emissions from
power plants

Sponsors and Cosponsors: Carper, Alexander, Klobuchar,
Collins, Gregg, Kaufman, Graham, Feinstein, Shaheen, Schumer,
Lieberman, Snowe.
Background on the Pollutants:
1. Sulfur dioxide (SO2) is a gas that can
quickly trigger asthma attacks, but is most dangerous as one
of the primary raw ingredients in particle pollution.
SO2 converts in the atmosphere into microscopic
fine particles that can lodge deep in the lungs--and increase
the risk of dying early, trigger heart attacks, strokes, and
may cause lung cancer.
2. Nitrogen oxides (NOX) are the key contributor
to ozone smog, which causes respiratory illness and harms
crops and ecosystems.
3. Mercury is a neurotoxin. High exposure to mercury can
harm the brain, heart, kidneys, lungs and immune systems,
especially in children and pregnant women. Also harms crops,
wildlife, and streams.
What this bill does:
Codifies the Clean Air Interstate Rule (CAIR) for 2010 and
2011--setting SO2 and NOX standards for
eastern states.
Strengthens national limits on emissions of SO2
and NOX from power plants and creates new trading
systems that will enable cost-effective reductions of these
two pollutants.
Directs EPA to cut mercury emissions at least 90% through
the best available technology.
Why it is needed--
Jobs: Clean air targets promote job creation in
engineering, construction, and manufacturing of advanced
clean air technologies. Targets help communities meet air
quality standards, so new manufacturers can get clean air
permits, build new facilities, and hire new workers.
In Chattanooga, Tennessee, for example, it will allow more
auto part suppliers to build facilities near the new
Volkswagen plant and employ thousands of Tennesseans.
Health: Cleaner air means residents are less likely to have
chronic lung disease, asthma, or lung cancer.
Nationwide, EPA estimates this bill will save more than
215,000 lives and more than $2 trillion in health care costs
by 2025.
In Tennessee, 400,000 Tennesseans with asthma are at a
daily risk due to poor air quality.
In Delaware, over 18,000 children with asthma are living in
areas of poor air quality.
Tourism: Millions of people a year visit the Great Smoky
Mountains National Park to see the ``Blue Haze'' not the smog
from dirty air. Tennessee has over 85 million tourists visit
the state each year, generating over $14 billion for the
State of Tennessee.
Certainty: Clear targets provide certainty for pubic health
protection and for power sector investment. Predictability
allows companies to find the most cost-effective ways to
employ clean air technologies.
How it works: Through the use of emissions control
equipment, such as ``scrubbers'' on smokestacks, and other
technologies, the bill would require utilities to:
Cut SO2 emissions by 80 percent (from 7.6
million tons in 2008 to 1.5 million tons in 2018).
Cut NOX, emissions by 53 percent (from 3 million
tons in 2008 to 1.6 million tons in 2015).
Cut mercury emissions by at least 90 percent no later than
2015.

CLEAN AIR ACT AMENDMENTS OF 2010
----------------------------------------------------------------------------------------------------------------
Clean Air Act Amendments of 2010
----------------------------------------------------------------------------------------------------------------
Sulfur Dioxide................... Codifies CAIR for 2010 and 2011.
National Caps
Beginning in 2012--3.5 million tons emission cap.
Beginning in 2015--2.0 million tons emission cap.
Beginning in 2018--1.5 million tons emission cap.
Builds on Acid Rain national trading program.
Nitrogen Oxide................... Codifies CAIR for 2010 and 2011.
National Caps
Beginning in 2012--1.79 million tons emission cap.
Beginning in 2015--1.62 million tons emission cap.
Creates two regional trading programs--for the East and the West.
Mercury.......................... Directs EPA to cut mercury emissions from coal plants by at least 90% by 2015
through maximum available control technology enforcement.

[[Page S492]]

Carbon Dioxide................... Not included in this legislation.
----------------------------------------------------------------------------------------------------------------

______

By Ms. COLLINS (for herself, Mr. Pryor, Mr. Voinovich, and Ms.
Landrieu):
S. 2996. A bill to extend the chemical facility security program of
the Department of Homeland Security, and for other purposes; to the
Committee on Homeland Security and Governmental Affairs.
Ms. COLLINS. Mr. President, the law granting the Federal Government,
for the first time, the authority to regulate the security of the
nation's highest risk chemical facilities is due to expire at the end
of this fiscal year. Given the success of this law and its vital
importance to all Americans, I am introducing legislation today with
Senators Pryor, Voinovich, and Landrieu to reauthorize it.
The U.S. is home to an astonishing number of facilities that
manufacture, use, or store chemicals for legitimate purposes. From
pharmaceuticals to cosmetics, soaps to plastics and all manner of
industrial, construction, and agricultural products, chemicals enable
the manufacture of more than 70,000 products that improve the well-
being of the American people.
The chemical industry is enormous, diverse, and vital to the American
economy. It approaches half a trillion dollars annually in sales. It is
one of our largest exporters, with exports totaling $174 billion
annually. It directly employs more than 850,000 people nationwide and
supports millions more indirectly.
These facilities are vital parts of our economy and society. But, to
our enemies, they can be potential chemical weapons. Like the airliners
of September 11th, it would only take an attack on a few, or even one,
to cause a horrifying loss of life.
In 2005, as Chairman of the Homeland Security and Governmental
Affairs Committee, I held a series of hearings to examine the terrorist
threat to the nation's chemical facilities and the devastating
consequences that could arise from a successful attack. As a result of
those hearings, I introduced comprehensive, bipartisan legislation to
provide the Department of Homeland Security with the authority
necessary to set and enforce security standards at high-risk chemical
facilities in the U.S. That bill formed the basis for chemical security
legislation signed into law in 2006 as part of the Department of
Homeland Security Appropriations Act, 2007.
Specifically, section 550 requires the Department to issue rules
requiring all high-risk chemical facilities to conduct vulnerability
assessments, develop site security plans to address identified
vulnerabilities, and implement protective measures necessary to satisfy
risk-based performance standards. Section 550 also directs the
Secretary of Homeland Security to review and approve those
vulnerability assessments and site security plans and to audit and
inspect covered chemical facilities for compliance with the performance
standards. It also permits the Secretary to shut down covered
facilities that are non-compliant.
In April 2007, the Department published interim final rules, known as
the Chemical Facilities Anti-Terrorism Standards, CFATS, setting forth
the requirements that high-risk chemical facilities must meet to comply
with the law. Among other things, CFATS establishes 18 risk-based
performance standards which facilities must meet to be in compliance
with the law. These standards cover items such as securing the
perimeter and critical targets, controlling access, deterring the theft
of potentially dangerous chemicals, and preventing internal sabotage.
CFATS, however, does not dictate specific security measures. Instead,
the law allows chemical facilities the flexibility to choose the
security measures or programs that the owner or operator of the
facility decides would best address the particular facility and its
security risks, so long as these security measures satisfy the
Department's 18 performance standards.
Since publishing CFATS in 2007, the Department has worked
aggressively and diligently on implementation. The Department has hired
and trained more than 100 chemical facility field inspectors and
headquarters staff. Indeed, by the end of Fiscal Year 2010, the
Department hopes to employ more than 260 CFATS staff. And, to date, the
Department has received over $200 million in funding to support CFATS.
Given the daunting challenges of establishing such a comprehensive
regulatory program from scratch, the Department wisely decided to
implement CFATS in phases, beginning with those facilities presenting
the very highest security risks.
To determine which facilities presented the highest risks, the
Department first required chemical plants that possessed certain
threshold quantities of specified chemicals to complete an online
security assessment--called ``Top-Screen.'' Based on the Top-Screen and
any other available information, the Department then ascertained
whether a facility ``presented a high level of security risk'' and
preliminarily divided such facilities into four tiers of escalating
risk. While all covered facilities must satisfy the Department's
performance standards, the security measures sufficient to meet them
are more robust for those facilities in the higher tiers, such as Tiers
1 and 2.
For chemical facilities that qualified as ``preliminarily high
risk,'' the Department required the preparation and submission of
security vulnerability assessments. These assessments enabled the
Department to identify more accurately each facility's risk and, thus,
to assign final risk tier rankings. Based on these final tier rankings,
these facilities must develop site security plans and submit to
inspections or audits to ensure their compliance.
The men and women of the Department have processed a tremendous
amount of information in a relatively short period of time. According
to the Department, since establishing CFATS, it has reviewed almost
38,000 Top-Screen submissions and notified more than 7,000 facilities
of their high-risk designations and preliminary tiers.

As of December 2009, CFATS covered only 6,000 facilities. Some
facilities closed; others made material modifications that altered
their risk profile. Of those remaining, the Department has assigned
final tiers to almost 3,000--including all of the facilities in Tiers 1
and 2--and is now reviewing their site security plans.
Although the Department remains in the midst of implementing CFATS,
it has generally received positive reviews for its work. The private
sector has become a partner in the program's success. The collaborative
nature of the program has been praised by many experts as a model for
security-related regulation.
Notwithstanding the Department's success in administering the CFATS
program and the considerable costs that facilities have incurred in
complying with it, some now want to ``swap horses in midstream'' by
radically overhauling the law.
Indeed, in November 2009, the House of Representatives passed
legislation that would dramatically alter the nature of CFATS,
requiring the Department to completely rework the program and stop its
considerable progress--dead in its tracks. Among other things, the
House bill would direct the Secretary of Homeland Security to establish
new risk-based performance standards, require covered chemical
facilities in Tiers 1 and 2 to implement so-called ``inherently safer
technology'', IST, and allow third-party lawsuits against the
Department over CFATS implementation.
Unfortunately, Mr. President, the changes proposed by the House will
in no way enhance the nation's security. They will, however, impose
unnecessary and costly burdens on the economy and destroy the
collaborative public-private partnership critical to CFATS' success.
The House provision that would allow the Department to mandate that
certain chemical facilities implement IST is an example. IST is an
approach

[[Page S493]]

to process engineering involving the use of less dangerous chemicals,
less energetic reaction conditions, or reduced chemical inventories. It
is not, however, a security measure. And because there is no precise
methodology by which to measure whether one technology or process is
safer than another, an IST mandate may actually increase or
unacceptably transfer the risk to other points in the chemical process
or elsewhere on the supply chain.
For example, it is my understanding that after careful evaluations of
the available alternatives, many drinking water utilities have
determined that gaseous chlorine remains their best and most effective
drinking water treatment option. Their decisions were not based solely
on financial cost considerations, but also on many other factors, such
as the characteristics of the region's climate, geography, and source
water supplies, the size and location of the utility's facilities, and
the risks and benefits of gaseous chlorine use compared to those
inherent with the use of alternative treatment processes.

According to one water utility located in an isolated area of the
Northwest, if Congress were to force it to replace its use of gaseous
chlorine with sodium hypochlorite, then the utility would have to use
as much as seven times the current quantity of treatment chemicals to
achieve comparable water quality results. In turn, the utility would
have to arrange for many more bulk chemical deliveries, by trucks, into
the watershed. The greater quantities of chemicals and increased
frequency of truck deliveries would heighten the risk of an accident
resulting in a chemical spill into the watershed. In fact, the
accidental release of sodium hypochlorite into the watershed would
likely cause greater harm to soils, vegetation and streams than a
gaseous chlorine release in this remote area. Because the facility is
so isolated from population centers, the gas released in the event of
an accident would almost certainly dissipate before reaching populated
areas.
Forcing chemical facilities to implement IST could wreak economic
havoc on some facilities and affect the availability of products that
all Americans take for granted. For instance, according to October 2009
testimony by the Society of Chemical Manufacturers and Affiliates
before the House Committee on Energy and Commerce, mandatory IST would
negatively restrict the production of pharmaceuticals and
microelectronics, unnecessarily crippling those industries.
Moreover, the increased cost of a mandatory IST program could
encourage chemical companies to transfer their operations overseas,
costing thousands of American jobs.
To be clear, some owners and operators of chemical facilities will
want to use IST. But the decision to implement IST should be that of
the owner or operator, not a Washington bureaucrat.
In fact, the evidence is quite compelling that many chemical
facilities, based on an assessment of many complex factors, have
already taken steps to avoid the use, storage, and handling of
extremely dangerous chemicals in favor of safer alternative processes.
The Department's own data indicate that nearly 1,000 facilities
voluntarily adopted safer alternative processes.

Notwithstanding all of the other changes to CFATS passed by the
House, the mandatory IST requirement itself will bring CFATS to a
screeching halt. This is neither necessary nor wise. Congress should
not dictate specific industrial processes under the guise of security
when a facility may choose other alternatives that meet the Nation's
security needs.
That is precisely why Senators Pryor, Voinovich, Landrieu, and I are
introducing the Continuing Chemical Facilities Antiterrorism Security
Act of 2010. Instead of directing the Department to start again from
scratch, our legislation would reauthorize section 550 for five more
years. Such an extension would provide the Department with sufficient
time to fully implement the CFATS program in its current form. It would
also provide a stable regulatory environment to encourage chemical
innovation and industry confidence.
Our legislation also contains two improvements, both of which are
based on similar provisions from the Security and Accountability For
Every, SAFE, Port Act of 2006. The first would direct the Secretary to
establish a voluntary Chemical Security Training Program to enhance the
capabilities of Federal, State, and local governments, chemical
industry personnel, and governmental and nongovernmental emergency
response providers to prevent, prepare for, respond to, mitigate
against, and recover from acts of terrorism, natural disasters, and
other emergencies that could affect chemical facilities. The second
would create a voluntary program to test and evaluate these
capabilities.
Not only is the chemical industry vital to our country's economy, but
also it is the linchpin to the important advancements and innovations
in critical fields such as science, technology, agriculture, medicine,
and manufacturing.
As one of the co-authors of the first chemical security law, no one
is more conscious than I am of the risks that attacks on chemical
facilities pose to the nation. The Department has done a remarkable job
developing a comprehensive chemical security program.
If our true intent is to secure high-risk facilities, then it is
incumbent upon Congress to allow the Department to continue doing its
job implementing CFATS.
______

By Mr. UDALL, of Colorado:
S. 2999. A bill to provide consistent enforcement authority to the
Bureau of Land Management, the National Park Service, the United States
Fish and Wildlife Service, and the Forest Service to respond to
violations of regulations regarding the management, use, and protection
of public lands under the jurisdiction of these agencies, and for other
purposes; to the Committee on Energy and Natural Resources.
Mr. UDALL of Colorado. Mr. President, today I am introducing a bill
to improve the management our public lands by increasing the fines and
penalties associated with violations of law--and regulation--governing
the use of these lands.
Throughout the west, and especially in Colorado, increased growth and
development has resulted in an expanded use and enjoyment of our public
lands. These uses have, in some cases, stressed the capacity of the
public land agencies to adequately control and manage such uses. As a
result, many of our public lands are being damaged.
While most users are responsible and law-abiding, some either
knowingly or inadvertently violate these rules and damage these
precious natural resources, which harms wildlife, increases run-off and
sediment loading in rivers and streams, diminishes the enjoyment of
other users, and impacts sensitive high-alpine tundra, desert soils,
and wetlands. In addition, as we have seen over the past decade, the
careless use of fire can catastrophically damage homes and habitat, and
can result in the tragic loss of life.
Often times, when these violations occur, the federal public land
agencies do not have the authority to charge fines commensurate with
the damage that results. For example, under the Federal Land Policy and
Management Act of 1976, the Bureau of Land Management is limited to a
fine of $1,000 no matter how great the damage. That figure has remained
unchanged for a quarter of a century, and does not reflect the fact
that in many cases the damage from violations will cost thousands more
to repair.
The bill I am introducing today would provide for increased fines for
such knowing violations to $100,000, and possible imprisonment, and for
other non-willful violations to $5,000. The bill is similar to one that
I cosponsored in previous Congresses. The need for this legislation was
demonstrated by incidents in several states, including some in
Colorado.
For example, in the summer of 2000, two recreational off-road
vehicles ignored closure signs while four-wheel driving on Bureau of
Land Management land high above Silverton, CO. As a result, they got
stuck for five days on a 70 percent slope at 12,500 feet along the
flanks of Houghton Mountain.
At first, they abandoned their vehicles. Then, they returned with
others to pull them out of the mud and off the mountain. The result was
significant damage to the high alpine tundra, a delicate ecosystem that
may take thousands of years to recover. As noted

[[Page S494]]

in a Denver Post story about this incident, ``alpine plant life has
evolved to withstand freezing temperatures, nearly year-round frost,
drought, high winds and intense solar radiation, but it's helpless
against big tires.''
Despite the extent of the damage, the violators were only fined $600
apiece--hardly adequate to restore the area, or to deter others.
Another example was an event in the mountains near Boulder, CO, that
became popularly known as the ``mudfest.''
Two Denver radio personalities announced that they were going to take
their off-road four-wheel drive vehicles for a weekend's outing on an
area of private property along an existing access road used by
recreational off-road vehicles. Their on-air announcement resulted in
hundreds of people showing up and driving their vehicles in a sensitive
wetland area, an area that is prime habitat of the endangered boreal
toad. As a result, seven acres of wetland were destroyed and another 18
acres were seriously damaged. Estimates of the costs to repair the
damage ranged from $66,000 to hundreds of thousands of dollars.
Most of the ``mudfest'' damage occurred on private property. However,
to get to those lands the off-road vehicle users had to cross a portion
of the Arapaho-Roosevelt National Forest--but the Forest Service only
assessed a $50 fine to the two radio disc jockeys for not securing a
special use permit to cross the lands.
Again, this fine is not commensurate to the seriousness of the
violation or the damage that ensued, and is an ineffective deterrent
for future similar behavior.
These are but two examples. And these violations are not just limited
to off-road vehicle use. Regrettably, there have been many more such
examples not only in Colorado but also throughout the west from a range
of public land uses. These examples underscore the nature of the
problem that this bill would address. If we are to deter such activity
and recover the damaged lands, we need to increase the authorities of
the federal public land agencies.
My bill would do just that. Specifically, it would amend the Federal
Lands Policy and Management Act and other relevant laws governing the
Forest Service, the National Park Service, and the Fish and Wildlife
Service to authorize these agencies to assess greater fines on those
who violate laws and regulations governing the use of these special
lands. The bill would authorize the Secretary of the Interior and the
Secretary of Agriculture to assess up to $100,000 in fines, or up to 12
months in jail, or both, for violations of these laws and regulations.
In addition, the bill establishes that any reckless use of fire on
these public lands shall be punishable by fines of no less than $500.
This bill augments another bill, S. 720, the Federal Land
Restoration, Enhancement, Public Education, and Information Resources
Act or the Federal Land REPAIR Act, which I have introduced this
session with my colleague Senator Bennet. S. 720 would authorize the
Secretary of the Interior and the Secretary of Agriculture to apply any
funds acquired from violations to the area that was damaged or affected
by such violations, and to increase public awareness of the need for
proper recreational use of our federal lands.
With the increase in fines established by this bill, along with the
authorization to apply these funds to restoring damaged lands under the
REPAIR Act, these public land agencies could restore address impacts on
these public lands. Specifically, these bills would allow the public
land agencies to repair damaged wildlife habitat, replant wetland
vegetation, re-vegetate scarred lands, repair trails, roadways, and
embankments to stem erosion and restore riparian ecosystems, and
install barriers and other security measures to help deter violations
in the first place.
Together, these bills can go a long way to giving the federal public
land agencies the tools they need to better protect and restore these
sensitive and critical lands for the use and enjoyment for generations
to come. I ask my colleagues to support this bill.
______

By Mr. McCAIN (for himself and Mr. Dorgan):
S. 3002. A bill to amend the Federal Food, Drug, and Cosmetic Act to
more effectively regulate dietary supplements that may pose safety
risks unknown to consumers; to the Committee on Health, Education,
Labor, and Pensions.
Mr. McCAIN. Mr. President, today I am pleased to introduce the
Dietary Supplement Safety Act of 2010 with my colleague Senator Dorgan.
This bill would strengthen the Food and Drug Administration's, FDA,
regulation of dietary supplements to ensure the safety of the millions
of Americans who use them daily. The proposed legislation would require
manufacturers of dietary supplements to register with the FDA and
disclose a full list of ingredients contained in each supplement.
Currently, these companies do not have to submit such information
before their products are offered for sale to consumers.
A little over a year ago the NFL suspended six players, including two
players from one of the teams competing this Sunday, for violating the
league's anti-doping policy. Several of the players were surprised that
they tested positive for a banned substance because they used a dietary
supplement they believed to be safe and legal. Additionally, a recent
GAO study, GAO-09-250, found that a record number of young Americans
are using dietary supplements naively believing these supplements are
safe and approved by the FDA for sale. However, FDA does not have a
pre-market approval process. In a recent article published in The New
York Times, it was reported that Americans spent almost $24 billion on
dietary supplements last year. Close to $3 billion of that total is
estimated to have come from manufactures that frequently advertise
their products as alternatives to anabolic steroids, which are used for
increasing muscle mass and strength.
The current regulatory process does not adequately address the
problem. Manufactures of dietary supplements are not required to
demonstrate that their product is safe and effective before it is
offered for sale to the public. The dietary supplement industry is one
that is mostly self-regulated. However, manufacturers have failed to
disclose to their customers key ingredients that may harm a consumer's
health.
For this reason, the proposed bill would require manufacturers to
register the locations they manufacture these supplements, the products
they are making, and disclose the ingredients found in their products
with the FDA. Furthermore, dietary supplement companies would be
required to provide a 75 day pre-market notice to the FDA not only for
New Dietary Ingredients, but for all products containing steroids,
including hormones, pro-hormones, and hormone analogues, and must
establish that the product is safe for its intended use.
Lastly, the proposed legislation provides the FDA with mandatory
recall authority if a product is found to be unsafe or harmful. Had
this provision been in place earlier, the FD might not have taken 10
years to ban ephedra, a dietary ingredient that accounted for 64
percent of all adverse reactions in 2001, despite accounting for 1
percent of all total dietary supplement sales. It has been reported
that use of ephedra contributed to the deaths of Baltimore Orioles
pitcher Steve Bechler and Minnesota Vikings player Korey Stringer.
Sadly and unfortunately, there are numerous stories of amateur athletes
who took this supplement and experienced serious health problems.
Legitimate dietary supplement companies should have nothing to fear
from this legislation. These additional requirements are critical to
the FDA's ability to evaluate the safety of particular dietary
ingredients and to quickly identify and notify all dietary supplement
manufacturers and consumers of ingredients with known safety risks.
People's lives and dreams have been significantly impacted by
illegitimate supplements. The purpose of the bill is not to create a
sweeping regulatory structure, but instead a targeted structure that
provides for openness, transparency and safety. All Americans should
know the ingredients of any dietary supplement they use and the FDA
must have the tools necessary to ensure the safety of all Americans.
I am proud that this legislation is supported by all the major sports
leagues, including Major League Baseball, the National Basketball
Association, the National Football League,

[[Page S495]]

and the National Hockey League. Additionally, the legislation is
supported by the United States Anti-Doping Agency, the United States
Olympic Committee, the American College of Sports Medicine, National
College Athletic Association, NCAA, and the PGA Tour. I hope my
colleagues will join these organizations in supporting this needed
legislation.
______

By Mr. DODD:
S. 3003. A bill to enhance Federal efforts focused on public
awareness and education about the risks and dangers associated with
Shaken Baby Syndrome; to the Committee on Health, Education, Labor, and
Pensions.
Mr. DODD. Mr. President, today I rise to introduce the Shaken Baby
Syndrome Prevention Act of 2010, important legislation that promotes
awareness and prevention of Shaken Baby Syndrome/Abusive Head Trauma, a
devastating form of child abuse that results in the severe injury,
disability or death of hundreds of children each year.
Child abuse and neglect is a well-documented tragedy for some of our
youngest and most vulnerable citizens. According to the National Child
Abuse and Neglect Data System, NCANDS, 794,000 children were victims of
abuse and neglect in 2007. Babies are particularly vulnerable; in 2007,
children aged 12 months or younger accounted for nearly 40 percent of
all child abuse and neglect fatalities and children aged 4 years and
younger accounted for almost 77 percent. Yet even these disturbing
statistics may not paint an accurate picture; most experts agree that
child abuse is widely under reported.
Abusive head trauma, including Shaken Baby Syndrome, is the leading
cause of death of physically abused children, in particular for infants
younger than one. When a frustrated caregiver loses control and
violently shakes a baby or impacts the baby's head, the trauma can kill
the child or cause severe injuries, including loss of vision, loss of
hearing, brain damage, paralysis, and/or seizures, resulting in
lifelong disabilities and creating profound grief for many families.
Far too many children have experienced the horrible devastation of
Shaken Baby Syndrome. A 2003 report in the Journal of the American
Medical Association estimates that as a result of Shaken Baby Syndrome,
an average of 300 U.S. children will die each year, and 600 to 1,200
more will be injured, of whom 2/3 will be infants younger than one.
Medical professionals believe that thousands of Shaken Baby Syndrome
cases are misdiagnosed or undetected, as many children do not
immediately exhibit obvious symptoms after the abuse.
Prevention programs can significantly reduce the number of cases of
Shaken Baby Syndrome. For example, the upstate New York SBS Prevention
Project at Children's Hospital of Buffalo has used a simple video to
educate new parents before they leave the hospital, reducing the number
of shaken baby incidents in the area by nearly 50 percent.
In Connecticut, a multifaceted prevention approach involving
hospitals, schools, childcare providers, and community-based
organizations in awareness and training activities, including home
visits and targeted outreach, has raised awareness and encouraged
prevention across the state. Hospitals in many states educate new
parents about the dangers of shaking a baby, yet it is estimated that
less than 60 percent of parents of newborns receive information about
the dangers of shaking a baby. Without more outreach, education, and
training, the risk of Shaken Baby Syndrome will persist.
With the introduction of the Shaken Baby Syndrome Prevention Act of
2010, I hope to reduce the number of children injured or killed by
abusive head trauma, and ultimately to eliminate Shaken Baby Syndrome.
Our initiative provides for the creation of a public health campaign,
including development of a National Action Plan to identify effective,
evidence-based strategies for prevention and awareness of SBS, and
establishment of a cross-disciplinary advisory council to help
coordinate national efforts.
The campaign will educate the general public, parents, child care
providers, health care professionals and others about the dangers of
shaking, as well as healthy preventative approaches for frustrated
parents and caregivers coping with a crying or fussy infant. The
legislation ensures support for families who have been affected by SBS,
and for families and caregivers struggling with infant crying, through
a 24-hour hotline and an informational website. All of these activities
are to be implemented through the coordination of existing programs
and/or the establishment of new efforts, to bring together the best in
current prevention, awareness and education practices to be expanded
into areas in need. Awareness is absolutely critical to prevention.
Families, professionals and caregivers responsible for infants and
young children and must learn about the dangers of violent shaking and
abusive impacts to the head.
Additionally, this bill will include a study to identify the current
data collected on Shaken Baby Syndrome and examine the feasibility of
collecting uniform, accurate data from all states regarding the
incidence rates of Shaken Baby Syndrome, the characteristics of
perpetrators, and the characteristics of victims. It is my hope that
having this information will enable us to better reach those who may be
at risk for Shaken Baby Syndrome and, thus, prevent Shaken Baby
Syndrome.
On behalf of the victims of Shaken Baby Syndrome, including Cynthia
Gibbs from New York, Hannah Juceum from California, Sarah Donohue from
New York, Kierra Harrison from Nevada, Miranda Raymond from
Pennsylvania, Taylor Rogers from Illinois, Cassandra Castens from
Arizona, Gabriela Poole from Florida, Amber Stone from New York,
Bennett Sandwell from Missouri, Jamison Carmichael from Florida,
Margaret Dittman from Texas, Dalton Fish from Indiana, Stephen
Siegfried from Texas, Kaden Isings from Washington, Joseph Wells from
Texas, Dawson Rath from Pennsylvania, Macie McCarty from Minnesota,
Jake Belisle from Maine, Benjamin Zentz from Michigan, Chloe Salazar
from New Mexico, Madison Musser of Oklahoma, Daniel Carbajal from
Texas, Nykkole Becker from Minnesota, Gianna D'Alessio from Rhode
Island, Brynn Ackley from Washington, Rachael Kang from Texas, John
Sprague from Maryland, Ryan Sanders from Virginia, David Sedlet from
California, Reagan Johnson from Virginia, Skipper Lithco from New York,
Brittney Sheets from New York, Madilyne Wentz from Missouri, Nicolette
Klinker from Colorado, Brianna Moore from West Virginia, Shania Maria
from Massachusetts, Dayton Jones from Pennsylvania, Breanna Sherer from
California, Evelyn Biondo from New York, Kenneth Hardy from
Pennsylvania, Alexis Vazquez from Florida, Joshua True from Washington,
Stephen David from California, Michael Blair from Arkansas, Olivia
Thomas from Ohio, Kaleb Schwade from Florida, Aiden Jenkins from
Pennsylvania, Isabella Clark from Pennsylvania, Aaron Cherry from
Texas, Dominic Morelock from Ohio, Emmy Cole from Maine, Chelsea Forant
from Massachusetts, Joshua Cross from Ohio, Gavin Calloway from
Maryland, Christopher Daughtrey from North Carolina, McKynzee Goin from
Oregon, Bryce McCormick from Florida, and many other innocent lives
lost or damaged, I look forward to working with my colleagues to see
that this legislation becomes law so that we can expand efforts to
eradicate Shaken Baby Syndrome.
______

By Mr. BROWN:
S. 3004. A bill to require notification to and prior approval by
shareholders of certain political expenditures by publicly traded
companies, and for other purposes; to the Committee on Banking,
Housing, and Urban Affairs.
Mr. BROWN of Ohio. Mr. President, last month, the Supreme Court ruled
that corporations, U.S. or multinational, are equivalent to people and
should be able to spend an unlimited amount of company money on
political campaigns.
I bet the framers of our constitution could not only tell the
difference between businesses and people, but could predict the result
if businesses are permitted to spend without limit to elect their
favorite politicians.
The top three Fortune 500 companies brought in an average profit of
more than $27 billion last year. The average Ohio household brought
home an income of about $48,000.

[[Page S496]]

If you believe our government should be by the people and for the
people--flesh and blood people--then corporations already have far more
influence on our political process than they should.
In 2009, corporations spent $3.3 billion lobbying Congress to
influence insurance legislation and prescription drug legislation and
financial reform legislation and the list goes on. Now they will be
able to spend unlimited funds to elect their favorite candidates to
Congress, getting in on the ground floor in the hopes that legislation
they don't like will never see the light of day.
Grassroots organizations like, conservative organization and Families
USA, whose members are real people with real concerns, will be left in
the dust by the drug industry and other deep pocketed special
interests.
The bottom-line is that our democratic form of government will sit on
a cushion of corporate cash. If Corporate America wants to decide who
runs our country, they will have a billion ways to do it.
Congress has--and must exercise--its constitutionally granted
authority to minimize the negative impact of this decision. Today, I
introduced The Citizens Right to Know Act, legislation that is intended
to reduce the incentive for corporations to buy out the political
process. It would also put a stop to foreign influence on U.S.
elections.
To protect shareholder investments, this legislation would require
all the shareholders of a corporation to vote for election spending
before it happens, with approval by a majority of shareholders. Each
shareholder would get one vote per share of common stock held. If
shareholders know that millions or billions in potential dividends are
about to be spent on campaign ads, they may help instill some reason
into the, elected, leadership of the corporations they own.
It would also require corporate CEOs to do what political candidates
do when they pay for political advertising: political candidates face
the camera and tell the public that they sponsored the commercial.
Corporate CEOs would have to do the same for their political
advertisements. Issue organizations or trade groups would have to
disclose their three top corporate contributors, and to disclose
funding information for certain radio and print ads on their website.
Shedding sunlight on the political shenanigans of billion dollar
corporations may do a world of good in dampening the effects of their
spending.
Finally, the bill would close a loophole that permits foreign
investors, including foreign governments, to influence U.S. elections
by channeling money through a U.S. affiliate. Any company that has a 51
percent or greater ownership stake from a foreign entity, be it a
foreign individual, business association, or government, would be
prohibited from spending money to influence. I think we can all agree
that foreign governments should not have the same right to contribute
to campaigns as the American people, and it would be outrageous if they
could spend money to influence the outcome of the Presidential or any
other race.
Americans--true, red blooded Americans--should decide who represents
them in our democratic system. Billion dollar corporations make
important contributions to our nation, but tilting our democratic
system their way is not one of them.
______

By Mr. REED:
S. 3005. A bill to create an independent research institute, to be
known as the ``National Institute of Finance'', that will oversee the
collection and standardization of data on financial entities and
activities, and conduct monitoring and other research and analytical
activities to support the work of the Federal financial regulatory
agencies and the Congress; to the Committee on Banking, Housing, and
Urban Affairs.
Mr. REED. Mr. President, today I introduce the National Institute of
Finance Act of 2010, which would create an Institute to provide our
financial regulators with the data and analytic tools needed to prevent
and contain future financial crises.
By establishing this new Institute, my bill offers the foundation for
a new approach to financial regulation that would better protect
Americans from the financial storm they are currently struggling
through.
Over the past 18 months, we have learned that our regulators did not
have the appropriate tools or knowledge to address risks that cut
across different markets and sectors of the financial system. The
recently passed House financial regulatory reform bill and other
proposals take an important step in filling this huge regulatory gap by
establishing centralized systemic risk oversight. However, any new
regulatory structure will be ineffective unless we also equip it with a
strong, independent, and well-funded data, research, and analytic
capacity to fulfill its mission.
The idea for the National Institute of Finance has been endorsed by a
dedicated group of the Nation's top academic researchers, economists,
and statisticians--including Nobel Laureate Harry Markowitz--who
recognize that any financial regulatory reform is incomplete without a
much stronger data, research, and analytic capability.
To further explore these issues, I asked the National Academy of
Sciences in August to study the data and tools needed for systemic risk
regulation. Among the Academy's findings: that the U.S. currently lacks
the technical tools to monitor and manage systemic financial risk with
sufficient comprehensiveness and precision. That market efficiency, in
addition to regulatory capacity, would be enhanced by improved
intelligence about what is going on in the system as a whole. And that
existing capabilities are not a sufficient foundation for systemic risk
management.

The bill I introduce today addresses these significant weaknesses by
creating the National Institute of Finance, whose mission will be to
support the community of financial regulatory agencies by collecting
and standardizing the reporting of financial market data; performing
applied and essential long-term research; and developing tools for
measuring and monitoring systemic risk.
The Institute would house a data center that would collect, validate
and maintain key data to perform its mission, including a central
database to map the interconnections between financial institutions,
along with details on their transactions and positions, and their
valuation of their assets and liabilities. By working with banks and
other firms to standardize the format of such data and by providing
standard reference data, such as databases of legal entities and
financial products, the Institute would reduce the costs to regulators
and financial institutions from the currently fragmented and
disorganized systems used to collect and store such information.
Second, the Institute would contain a research and analysis center to
develop the needed metrics and then measure and monitor systemic risk
posed by individual firms and markets. This new Institute would house
some of the country's most-well-respected researchers to collect and
analyze the data needed to understand what is happening in our
financial markets, to conduct investigations of market disruptions, and
to work with regulators to identify new and dangerous trends.
It would conduct and help coordinate applied research on financial
markets and systemic risk, a field that is not well-represented right
now at the Federal Reserve or within our other regulatory agencies. It
would also develop the metrics and tools our regulators need to measure
and monitor systemic risk and help policymakers by conducting studies
and providing advice on the impact of government policies on systemic
risk.
Finally, the Institute would provide independent periodic reports to
Congress on the state of the financial system, ensuring that we are
kept apprised of the overall picture of our markets more effectively
than we have been in the past. The domino effect caused by the
recession will continue to cripple Rhode Island families and Americans
across the country unless we put in place a strong new infrastructure
and shore up our financial markets.
I hope my colleagues will join me in strengthening our financial
system by cosponsoring this legislation and supporting its passage.
Mr. President, I ask unanimous consent that the text of the bill be
printed in the Record.

[[Page S497]]

There being no objection, the text of the bill was ordered to be
printed in the Record, as follows:

S. 3005

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 ``National
Institute of Finance Act of 2010''.
(b) Table of Contents.--The table of contents for this Act
is as follows:

SEC. 2. FINDINGS AND PURPOSES.

(a) Findings.--Congress finds the following:
(1) The United States is experiencing the worst economic
and financial crisis since the Great Depression. The nature
of the current crisis is systemic. It was set in motion not
by the actions of any single entity, but by a loss of
confidence throughout the financial system as a whole.
(2) Such catastrophic events revealed significant
shortcomings in the legal tools available to financial
policymakers. The scale and systemic nature of the crisis
calls for a thorough review of the United States' system of
financial regulation, to assess its capacity to understand,
monitor, and respond to systemic threats. It is critical that
financial regulators have the legal tools they need to act
quickly, decisively, effectively, and when appropriate,
preemptively, to prevent systemic financial crises in the
future and to mitigate their negative impact, should they
recur.
(3) The recent catastrophic events in financial markets
also revealed significant gaps in the information and
analytic tools available to regulators and policymakers
charged with ensuring the health of the financial system.
(4) Systemic risk involves interactions among financial
entities in addition to features of individual firms.
Therefore, to understand and monitor the buildup of systemic
risk in the financial system requires information about such
interactions among institutions.
(5) Operational methods do not exist by which to measure
systemic risks in the United States financial system. Nor do
proven operational techniques exist by which regulators can
identify the buildup of systemic risks in the United States
financial system.
(6) Regulators do not have effective methodologies for
assessing the effects of particular regulatory actions or
approaches on the overall health of the financial system.
(7) Financial regulators do not have the data needed to map
the networks of counterparty relationships through which
systemic contagion could spread. Nor do they have the
analytic tools required to translate such data into useful,
actionable information.
(8) Notwithstanding noteworthy efforts from the research
community, sustained, large-scale programs of applied
research and development necessary to create operational
systems for understanding, measuring, and monitoring systemic
risk in financial systems have not emerged.
(9) There is a substantial amount of high-quality research
in academia in relevant disciplines, including financial
economics, statistics, and operations research, but such
research tends to focus on theoretical or conceptual
innovations that are not immediately reducible to operational
practice.
(10) The incentives confronting academic researchers work
against the production of research that does not yield novel
theoretical insights or computational techniques.
(11) The challenges of gaining access to data and obtaining
funding from government and industry for academic research
severely restrict the number of academics working on
understanding and monitoring systemic risk in the financial
markets.
(12) Some of the largest commercial firms make substantial
investments in research and development in the area of
quantitative finance, but such commercial research programs
are targeted almost exclusively at applications that create
commercial value for the firms undertaking the substantial
investments necessary to support the programs, and focus
primarily on techniques for pricing particular financial
instruments and managing firm-specific risks.
(13) Financial institutions that sponsor research programs
usually protect the results of investigations as commercial
trade secrets. Even those results that might be useful in
application to the analysis of systemic risk are generally
not available to the public.
(14) No organization anywhere has access to the
comprehensive transaction-level data that are necessary to
map the network of counterparty relationships in the
financial system. Absent such data, it is not possible to
evaluate the primary counterparty risks, the extent to which
any given firm is vulnerable to the failure of one of its
counterparties, or broader counterparty network risks.
(15) It is not possible to understand, assess, or predict
how the collapse of one or more institutions might set off a
cascade of failure that destabilizes the entire financial
system.
(16) Without intelligence about the network of counterparty
relationships and the liquidity provided by the members of
the counterparty network, it is difficult even to identify
reliably the set of institutions that regulators should deem
to be systemically important.
(17) Notwithstanding statutory mandates that call for
sharing of information among regulatory agencies, United
States financial regulators do not require that firms report
data in a uniform standard format. The lack of compatibility
in the data formats used by different agencies implies in
practice that agencies find it difficult and expensive to
integrate data from multiple sources.
(18) In periods of financial crisis such as that
experienced in the 2 years preceding the date of enactment of
this Act, absence of data comparability becomes a critical
handicap, in that dispersed information cannot quickly be
integrated into a comprehensive framework that could help
reveal the condition of the financial system as a whole.
Without a capacity quickly to compare and integrate financial
data of diverse types from multiple sources, regulators are
unable to analyze the state of the financial system
accurately and comprehensively. Nor are they able to foresee,
and potentially head off, the onset of a financial crisis.
(19) The events of September 2008 offer a sobering example
of the consequences that can flow from an inability quickly
to integrate financial data from diverse sources. During
several critical days in that month, senior Government
officials contemplated the possible consequences of allowing
the failure of Lehman Brothers Holdings, Inc. Insofar as the
content of their deliberations is accessible in the public
record, there is little evidence that such officials had at
their disposal an intelligence system that could illuminate
the potential consequences of alternative choices.
Notwithstanding that the United States Government, through
its several agencies, collects a broad range of information
from financial firms, the events of September 2008 revealed
that, at this most critical juncture, these data and
accompanying analytics could not provide financial officials
with the information they needed.
(20) The creation of a system for collecting and organizing
a comprehensive financial transaction database that employs
standardized formats is feasible.
(21) The Enterprise Data Management Council, an industry
consortium, is on record as advocating both the feasibility
and desirability of bringing uniform standards to the
collection, reporting, and management of financial
transaction data.
(22) A leading financial firm has developed for its
internal use a system that incorporates comprehensive
reference databases of all legal entities in its counterparty
network and of all of the many types of financial instruments
in which it transacts. Using the system, the firm can compute
its exposure to many of their counterparties within an hour.
(23) A leading information technology firm has developed a
prototype of an operational system that would support a
comprehensive database of financial instruments and
transactions across the entire economy, and in collaboration
with other private sector firms and public sector entities,
is in the process of developing a prototype system for
maintaining the needed system-wide reference databases.
(24) The community of financial regulators can realize
substantial benefits by consolidating into one entity the
highly technical tasks of establishing and maintaining
uniform standards for reporting financial data, organizing
and managing high-volume flows of financial data, providing
analytic and high performance computational services,
performing applied research and development activities, and
conducting, coordinating, and sponsoring essential long term,
fundamental research in the field of financial analysis and
regulatory intelligence.
(25) Such technical tasks benefit from increasing economies
of scale, the total cost of providing such services to the
regulatory community promises to be lower if one agency is
tasked to provide all of such data, instead of creating
redundant and less effective units in each of the several
financial regulatory agencies.
(26) An entity that provides access to data and analytic
tools to all regulatory agencies on a common basis would help
to ensure that all agencies are receiving accurate,
consistent, comparable data and analytic tools that can be
modified for agency-specific needs.
(27) The creation of an entity that creates shared data and
analytic services will provide a natural and regular vehicle
for the exchange of research and collaboration between
regulatory agencies.
(28) The emergence of uniform standards for referencing and
reporting financial transactions would generate substantial
benefits for the financial services industry. There is, at
present, no consistent, comprehensive, and universal system
for coding, transmitting, and storing financial transaction
data. Data reside typically in unconnected databases and
spreadsheets, using multiple formats and inconsistent
definitions. The routine conduct of business obliges firms to
incur substantial costs to translate and transfer data among
otherwise incompatible systems. In addition, this data
incomparability impedes the ability of companies to assess
their risks accurately. The adoption of a common language for
data coding and handling would dramatically reduce costs for
processing transactions and carrying out other administrative
tasks. Standardized reporting would also enable firms to map
their counterparty relationships more clearly and more easily
understand their

[[Page S498]]

credit exposures to other firms, a development that promises
improvements in risk management practices across the
industry.
(29) In August 2008, the Counterparty Risk Management
Policy Group called for the financial industry to move
rapidly toward real-time reconciliation and confirmation of
financial transactions. Industry experts believe that this
change would yield substantial benefits to firms
individually, to the financial services industry, and to the
economy as a whole. Achieving this goal would not be
possible, however, without industry-wide adoption of common
standards for coding and handling financial transaction data.
Despite the clear benefits of data standardization and
despite years of effort by the industry, through consortia
such as the Enterprise Data Management Council, the financial
services industry has not been able to make meaningful
progress towards the goal of universal adoption of uniform,
consistent standards for data handling.
(30) Efforts to see a common set of standards for financial
data adopted universally are impeded by so-called ``network
effects''. The benefits of adoption for any one firm depend
on the extent to which other firms adopt the same common
language. For any one institution, the full benefits are
distinctly limited until a critical number of participants in
the industry adopt the same standards. In light of these
network effects, the adoption of a single data handling
standard by all industry participants presents a daunting
coordination challenge. Each individual firm is discouraged
from making the substantial investments required to upgrade
its own systems, unless and until they receive assurance that
others in the industry will follow suit. Many firms are
deferring significant upgrades to their systems until well-
defined industry-wide standards are accepted.
(31) The financial services industry's historical
experience strongly suggests that the industry is unlikely to
achieve universal adoption of a single data-handling standard
on its own initiative, through either the decentralized
actions of industry participants or through voluntary
coordination at the urging of industry consortia or trade
associations. Standardization of financial data will require
an external mandate.
(32) The new data standards promulgated for reporting by
firms will emerge as the de facto standard for data
management in the finance industry, a standard on which firms
could converge. Firms could then be confident of realizing a
significant return on the investment needed to update their
internal systems, knowing that other industry participants
were doing likewise.
(33) The establishment of Federal requirements for the
maintenance and provision of reference databases and
reporting of transactions and position data to a central
repository would assure individual institutions of a
significant return on the investment needed to update their
internal systems. Firms would benefit from not having to
maintain their own unique reference databases, standardized
reporting would greatly reduce the cost of reconciling trades
and other back office activities, and it would give firms a
clear map of their counterparty relationships, which would
facilitate better risk management across the industry.
(34) Once achieved, the universal adoption of standard
protocols for handling financial transaction data promises to
generate significant and sustained improvements in the
efficiency and productivity of the financial services
industry in the United States. Such improvements will help to
secure and maintain the international leadership position of
United States capital markets.
(35) United States regulators must never again find
themselves confronting a financial crisis without the full
set of legal, data, and analytic tools they need to
understand, measure, monitor, and respond intelligently to
systemic risks that threaten the stability (of the United
States financial system.
(b) Purposes.--The purposes of this Act are--
(1) to ensure that the financial regulatory community is
equipped fully with the data and analytic tools it needs to
fulfill its responsibility to safeguard the United States
financial system;
(2) to reduce the likelihood of another systemic financial
crisis occurring;
(3) to restore integrity and confidence to the financial
markets of the United States;
(4) to provide for the security of the United States
economy from potential external threats to the United States
financial system;
(5) to improve the efficiency of the financial markets in
the United States;
(6) to reduce the cost and increase the effectiveness of
coordinated financial regulation in the United States;
(7) to help maintain the leadership position of the United
States as home to the most efficient, competitive, and
productive capital markets in the world; and
(8) to help restore and maintain conditions in the United
States financial system that will support the creation of
wealth and prosperity in the United States.

SEC. 3. DEFINITIONS.

In this Act, the following definitions shall apply:
(1) Financial regulatory agency.--The term ``financial
regulatory agency'' means any Federal regulatory agency or
body charged with regulating, examining, or supervising a
financial entity or activity, including any financial
systemic risk council or agency established by Congress.
(2) Institute; director; board of directors.--The terms
``Institute'', ``Director'', and ``Board of Directors'' mean
the National Institute of Finance, the Director thereof, and
the Board of Directors thereof, respectively.
(3) Financial entity.--
(A) In general.--The term ``financial entity'' means any
corporation, partnership, individual, or other organizational
form, whether public or private, used to engage in any type
of financial activity that may contribute to systemic risk,
including any bank, savings association, credit union,
industrial loan company, trust, pension fund, holding
company, lender, finance company, mortgage broker, broker-
dealer, mutual fund or other investment company, investment
adviser, hedge fund, insurance company, clearinghouse or
other central counterparty, exchange, and any other entity or
institution that the Director determines, at the formation of
the Institute, are necessary for the Institute to complete
its duties under this Act.
(B) Director authority.--The Director may, by rule, add new
types of entities or institutions to be treated as financial
entities for purposes of this Act.
(4) Systemic risk.--The term ``systemic risk'' means the
risk that a failure or default by a financial entity or
entities, or exposures to a financial product or products or
activity will produce--
(A) significant disruptions to the operations of financial
markets;
(B) the spreading of financial losses and failures through
the financial system; or
(C) significant disruption to the broader economy.
(5) Financial contract.--The term ``financial contract''
mean a legally binding agreement between 2 or more
counterparties, describing rights, and obligations relating
to the future delivery of items of intrinsic or extrinsic
value among the counterparties.
(6) Financial instrument.--The term ``financial
instrument'' means a financial contract in which the terms
and conditions are publicly available, and the roles of 1 or
more of the counterparties are assignable without the consent
of any of the other counterparties, including common stock of
a publicly traded company, government bonds, and exchange
traded futures and options contracts.
(7) Financial entity reference database.--The term
``financial entity reference database'' means a comprehensive
list of financial entities that may be counterparties to
financial transactions or referenced in the contractual
structure of a financial instrument. For each financial
entity, the database shall include, but not be limited to a
unique identifier, and sufficient information to
differentiate the entity from every other entity, including
an exact legal name and an address for each company, and an
exact legal name and a social security number for each
American citizen. For financial entities that are legally
owned by or otherwise contained within other financial
entities, the database shall include such information.
(8) Financial instrument reference database.--The term
``financial instrument reference database'' means a
comprehensive list of unique financial instruments. For each
financial instrument, the database shall include a unique
identifier and a comprehensive description of the contractual
structure of the instrument as well as all express terms
governing the interpretation and implementation of the
contract, including jurisdiction, force majeure, and dispute
resolution. The contractual structure shall include the
financial and economic obligations and rights, both express
and implied, and including through legal agreements such as
netting agreements, established among all of the
counterparties having identified roles in the contract,
including advisors, principals, trustees, custodians,
guarantors, prime brokers, executing brokers, clearing
brokers, and issuers of securities. An electronic copy of the
prospectus for each financial instrument for which a
prospectus was created or distributed shall also be contained
in the database.
(9) Financial transaction data.--The term ``financial
transaction'' means the explicit or implicit creation of a
financial contract where at least one of the counterparties
is required to report to the Institute. The data describing
the transaction shall include the structure of the contract
created in the transaction, as well as all express terms
governing the interpretation and implementation of the
contract, including jurisdiction, force majeure, and dispute
resolution. The contractual structure shall include clearly
identified counterparties, clearly identified financial
instruments (when used as part of the structure of the
contract), and the financial and economic obligations and
rights, both express and implied, established among all of
the counterparties with identified roles in the contract.
(10) Position data.--The term ``position'' means a
financial asset or liability held on the balance sheet of a
financial entity. A new position is created, or the quantity
of an existing position is changed, by the execution of a
financial transaction involving the financial entity as a
counterparty. Position data include--
(A) the counterparty identifier;
(B) a contract identifier;
(C) the role of the counterparty on the transaction;
(D) a quantity, if applicable;
(E) a location, if applicable; and

[[Page S499]]

(F) the valuation of the position for the purposes of the
books and records of the financial entity.

SEC. 4. ESTABLISHMENT OF NATIONAL INSTITUTE OF FINANCE;
ADMINISTRATIVE MATTERS.

(a) In General.--
(1) Establishment.--There is established the National
Institute of Finance, which shall be an independent
establishment, as that term is defined in section 104 of
title 5, United States Code.
(2) Mission.--The mission of the Institute is to support
the Federal financial regulatory agencies, including any
systemic risk council or agency established by Congress, by--
(A) collecting and providing data;
(B) standardizing the types and formats of data reported
and collected;
(C) performing applied research and essential long-term
research;
(D) developing tools for risk measurement and monitoring;
(E) performing other related services; and
(F) making the results of its activities available to
financial regulatory agencies.
(b) Director.--
(1) Appointment.--The Institute shall be headed by a
Director, who shall be appointed by the President, by and
with the advice and consent of the Senate.
(2) Term of service.--The Director shall serve for a term
of 15 years.
(3) Executive level and pension.--The position of the
Director shall be at level II of the Executive Schedule, and
a Director who serves a full term, or becomes disabled and
unable to fulfill the responsibilities of the Director after
serving at least 10 years, shall receive a pension at
retirement equal to the salary of that person in the last
year of the term, and that pension shall increase in
subsequent years with the increase in the cost of living.
(4) Vacancy.--In the event that a successor is not
nominated and confirmed by the end of the term of service of
a Director, the Director may continue to serve until such
time as the new Director is appointed and confirmed.
(5) Prohibition on dual service.--The individual serving in
the position of Director may not, during such service, also
serve as the head of any financial regulatory agency.
(6) Responsibilities, duties and authority.--The Director
shall have sole discretion to fulfill the responsibilities
and duties and exercise the authorities described in this
Act, except in cases where specific authorities have been
given to the Board of Directors.
(c) Board of Directors.--The Board of Directors of the
Institute shall be comprised of the Director, the Secretary
of the Treasury, and the head of each financial regulatory
agency.
(d) Membership of the Director on the Board of Directors.--
The Director shall serve as a voting member of the Board of
Directors and as a member of any financial systemic risk
regulatory council or agency established by Congress.
(e) Funding.--
(1) Annual budget.--The Director, in consultation with the
Board of Directors shall establish the initial annual budget.
For all other annual budgets, the Director shall submit an
annual budget for the Institute to the Board of Directors not
later than April 30 of each year. The Board of Directors may,
without amendment, reject the budget with a two-thirds
majority vote. Each time a budget is rejected, the Director
shall submit a revised budget to the Board of Directors
within 60 days, and the Board of Directors may, without
amendment, reject the budget with a two-thirds majority vote.
If the Board of Directors fails to reject the budget within
60 days of submission by the Director, the budget shall be
automatically approved. If a new budget is not approved
before the existing budget expires, the most recent approved
budget shall continue on a pro rata basis. Each submitted
budget and all votes by the Board of Directors on each budget
shall be part of the public record of the Board of Directors.
(2) Assessments.--The Institute shall be funded through
assessments on the financial entities required to report data
to the Institute. The formula by which the budgetary costs
are allocated among the reporting entities shall be
determined by the Board of Directors. If the Board of
Directors fails to establish the formula within 60 days of
submission of a budget by the Director, the Director shall
determine the formula by which the budgetary costs are
allocated among the reporting entities for that year.
(3) Initial funding and start up.--During the first 4 years
of the operation of the Institute, the Institute shall have
authority to borrow against future assessment revenue from
the Federal Financing Bank. Such borrowed funds shall be paid
back to the Federal Financing Bank over a term not to exceed
20 years. The Secretary of the Treasury, and any financial
regulatory agency, may second personnel to the Institute to
assist the operations of the Institute.
(f) Excepted Service Agency.--The Institute shall be an
excepted service agency.
(g) Personnel.--The Board of Directors may fix the
compensation of Institute personnel, without regard to the
provisions of chapter 51 and subchapter III of chapter 53 of
title 5, United States Code, relating to classification of
positions and General Schedule pay rates. The rates of pay
and benefits shall be competitive with and comparable to the
rates of pay and benefits at Federal financial regulatory
agencies that are not covered by title 5, United States Code.
(h) Non-Compete.--The Director and staff of the Institute,
who have had access to the transaction or position data
maintained by the Data Center or other business confidential
information about financial entities required to report to
the Institute, may not, for a period of 1 year after last
having access to such transaction or position data or
business confidential information, be employed by or provide
advice or consulting services to a financial entity,
regardless of whether it is required to report to the
Institute. Individual staff members who notify the Director
of their intention to terminate their employment with the
Institute and to seek employment with a prohibited employer
or in a prohibited activity, shall be transferred for a
period of 12 months to a position that does not provide
access to transaction or position data or other business
confidential information. For staff whose access to business
confidential information was limited, the Board of Directors
may provide, on a case-by-case basis, for a shorter period of
post-employment prohibition, provided that the shorter period
does not compromise business confidential information.
(i) Advisory Boards.--The Institute shall maintain any
advisory boards that the Director determines are needed to
complete the mission of the Institute.
(j) Fellowship Program.--The Institute may establish and
maintain an academic and professional fellowship program,
under which qualified academics and professionals shall be
invited to spend not longer than 2 years at the Institute, to
perform research and to provide advanced training for
Institute personnel.
(k) Executive Schedule Matters.--Section 5312 of title 5,
United States Code, is amended by adding at the end the
following new item:

``Director of the National Institute of Finance.''.

SEC. 5. ORGANIZATIONAL STRUCTURE; RESPONSIBILITIES OF PRIMARY
PROGRAMMATIC UNITS.

(a) In General.--The Institute shall carry out its
programmatic responsibilities through--
(1) the Federal Financial Data Center (in this Act referred
to as the `` `Data Center' ''); and
(2) the Federal Financial Research and Analysis Center (in
this Act referred to as the `` `Research Center' '').
(b) Federal Financial Data Center.--
(1) General duties.--The Data Center shall collect,
validate, and maintain all data necessary to carry out its
duties, as described in this Act.
(2) Responsibilities.--The Data Center shall prepare and
publish, in a manner that is easily accessible to the
public--
(A) a financial entity reference database;
(B) a financial instrument reference database; and
(C) formats and standards for reporting financial
transaction and position data to the Institute.
(3) Data to be collected.--Data referred to in paragraph
(1)--
(A) shall include for each financial entity--
(i) comprehensive financial transaction data on a schedule
determined by the Director;
(ii) comprehensive position data on a schedule determined
by the Director;
(iii) for each financial instrument in the financial
instrument reference database or for any other obligation of
a financial entity that is contingent on the value of an
observable event, where the observable event is not widely
available to the public, the level and changes in the level
of these observable events, on a schedule determined by the
Director; and
(iv) any other data that are considered by the Director to
be important for measuring and monitoring systemic risk, or
for determining the soundness of individual financial
entities; and
(B) may include data regarding policies and procedures,
governance, incentives, compensation practices, contractual
relationships, and any other information deemed by the
Director to be necessary in order for the Institute to carry
out its responsibilities under this Act; and
(C) the Board of Directors may, by a two-thirds vote,
exclude financial entities, which, as a group, will not
contribute to systemic risk for reasons such as size, nature
of their assets and liabilities, volume of transactions, or
other reasonable purposes, from reporting data.
Notwithstanding such exclusions, financial entities shall
comply with all reporting requirements or ensure that
reporting requirements are met for any assets or part of
their balance sheets that are sold to create a financial
instrument or obligation, as described in subparagraph
(A)(iii).
(4) Information security.--The Director and the Board of
Directors shall ensure that data collected and maintained by
the Data Center are kept secure and protected against
unauthorized disclosure.
(5) Catalogue of financial entities and instruments.--The
Data Center shall maintain a catalogue of the financial
entities and instruments reported to the Institute.
(6) Availability to the financial regulatory agencies.--The
Data Center shall make data collected and maintained by the
Data Center available to any financial regulatory agency
represented on the Board of Directors, as needed to support
the regulatory responsibilities of such agency.
(7) Other responsibilities.--The Data Center shall oversee
the management of the

[[Page S500]]

data supply chain, from the point of issuance, in order to
ensure the quality of all data required to be submitted to
the Institute.
(8) Other authority.--The Institute shall, after
consultation with the Board of Directors provide certain data
to financial industry participants and the general public to
increase market transparency and facilitate research on the
financial system, so long as intellectual property rights are
not violated, business confidential information is properly
protected, and the sharing of such information poses no
significant threats to the financial system.
(c) Federal Financial Research and Analysis Center.--
(1) General duties.--The Research Center shall develop and
maintain the independent analytical capabilities and
computing resources--
(A) to measure and monitor systemic risk;
(B) to perform independent risk assessments of individual
financial entities and markets;
(C) to analyze and investigate relationships between the
soundness of individual financial entities and markets and
the soundness of the financial system together as a whole;
and
(D) to provide advice on the financial system.
(2) Responsibilities.--The Research Center shall--
(A) develop and maintain metrics and risk reporting systems
for system-wide risk;
(B) develop and maintain metrics and risk reporting systems
for determining the soundness of financial entities;
(C) monitor, investigate, and report changes in system-wide
risk levels and patterns to the Board of Directors and
Congress, including through the collection of additional
information that the Director deems necessary to understand
such changes;
(D) conduct, coordinate, and sponsor research to support
and improve regulation of financial entities and markets;
(E) benchmark financial risk management practices and
promote best practices for financial risk management;
(F) at the direction of the Board of Directors, or any
member of the Board of Directors, for firms under that
member's purview, develop, oversee, and report on stress
tests or other tests of the valuation and risk management
systems of any of the financial entities required to report
to the Institute;
(G) maintain expertise in such areas as may be necessary to
support specific requests for advice and assistance from
financial regulators;
(H) at the direction of the Board of Directors or at the
request of Congress, conduct studies and provide advice on
financial markets and products, including advice regarding
risks to consumers posed by financial products and practices;
(I) at the direction of the Director, at the discretion of
the Board of Directors, or at the request of Congress,
investigate disruptions and failures in the financial
markets, report findings, and make recommendations to the
Board of Directors and Congress; and
(J) at the direction of the Board of Directors or at the
request of Congress, conduct studies and provide advice on
the impact of policies related to systemic risk.
(d) Reporting Responsibilities.--
(1) Required report.--Commencing 2 years after the date of
the establishment of the Institute, the Institute shall
prepare and submit an annual report to Congress, not later
than 120 days after the end of each fiscal year.
(2) Content.--The report required by this subsection shall
assess the state of the financial system, including an
analysis of any threats to the financial system, the status
of the Institute's efforts in meeting its mission, and key
findings from its research and analysis of the financial
system.
(3) Additional reports.--At the sole discretion of the
Director, the Director may initiate and provide additional
reports to Congress regarding the state of the financial
system. The Director shall notify the Board of Directors of
any additional reports provided to Congress.

SEC. 6. ADMINISTRATIVE AUTHORITIES OF THE INSTITUTE.

The Institute may--
(1) require financial entities to report all data and
information in conformance with reporting standards, as
determined by the Institute, that are necessary to fulfill
the responsibilities of the Institute under this Act;
(2) require reporting on a worldwide basis from the
financial entities and affiliates thereof that are organized
in the United States;
(3) require reporting of United States-based activities by
financial entities that are not organized in the United
States;
(4) enforce and apply sanctions on all financial entities
required to report to the Institute that fail to report data
requested by and in standards, frequency, and time frames, as
determined by rule or regulation by the Institute;
(5) share data and information, as well as software
developed by the Institute, with other financial regulatory
agencies, as determined appropriate by the Board of
Directors, where the shared data and software shall be
maintained with at least the same level of security as is
used by the Institute, and may not be shared with any
individuals or entities without the permission of the Board
of Directors;
(6) purchase and lease software;
(7) sponsor and conduct research projects; and
(8) assist, on a reimbursable basis, with financial
analyses undertaken at the request of governmental agencies,
other than financial regulatory agencies.

SEC. 7. CIVIL PENALTIES.

Any person or entity that violates this Act or fails to
comply with a rule, regulation, or order of the Institute
issued under this Act shall be subject to a civil penalty in
an amount established by the Institute and published in the
Code of Federal Regulations. Each such violation or failure
shall constitute a separate civil offense.

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