[Congressional Record Volume 159, Number 43 (Friday, March 22, 2013)]
[Senate]
[Pages S2334-S2338]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. CORNYN:
  S. 652. A bill to protect investors by fostering transparency and 
accountability of attorneys in private securities litigation; to the 
Committee on Banking, Housing, and Urban Affairs.
  Mr. CORNYN. 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. 652

       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 ``Securities Litigation 
     Attorney Accountability and Transparency Act''.

     SEC. 2. DISCLOSURES OF PAYMENTS, FEE ARRANGEMENTS, 
                   CONTRIBUTIONS, AND OTHER POTENTIAL CONFLICTS OF 
                   INTEREST BETWEEN PLAINTIFF AND ATTORNEYS.

       (a) Securities Exchange Act of 1934.--Section 21D(a) of the 
     Securities Exchange Act of 1934 (15 U.S.C. 78u-4(a)) is 
     amended by adding at the end the following:
       ``(10) Disclosures regarding payments.--
       ``(A) Sworn certifications required.--
       ``(i) In general.--In any private action arising under this 
     title, each plaintiff and any attorney for such plaintiff 
     shall provide sworn certifications, which shall--

       ``(I) be personally signed by such plaintiff and each such 
     attorney, respectively;
       ``(II) be filed with the complaint; and
       ``(III) identify any direct or indirect payment, or promise 
     of any payment, by such attorney, or any person affiliated 
     with such attorney, to such plaintiff, or any person 
     affiliated with such plaintiff, beyond the pro rata share of 
     any recovery received by the plaintiff, except as ordered or 
     approved by the court in accordance with paragraph (4).

       ``(ii) Court actions.--Upon disclosure of any payment or 
     promise of payment described in clause (i), the court shall 
     disqualify the attorney from representing the plaintiff.
       ``(B) Definition.--For purposes of this paragraph, the term 
     `payment' includes the transfer of money and any other thing 
     of value, including the provision of services, other than 
     representation of the plaintiff in the private action arising 
     under this title.
       ``(11) Disclosures regarding legal representations.--
       ``(A) In general.--In any private action arising under this 
     title, each plaintiff and any attorney for such plaintiff 
     shall provide sworn certifications, which shall--
       ``(i) be personally signed by such plaintiff and each such 
     attorney, respectively;
       ``(ii) be filed with the complaint; and
       ``(iii) identify the nature and terms of any legal 
     representation provided by such attorney, or any person 
     affiliated with such attorney, to such plaintiff, or any 
     person affiliated with such plaintiff, other than the 
     representation of the plaintiff in the private action arising 
     under this title.
       ``(B) Court actions.--The court--
       ``(i) may allow certifications under subparagraph (A) to be 
     made under seal;
       ``(ii) shall review such certifications to determine 
     whether cause exists to believe that the nature or terms of 
     the fee arrangement for any other matter influenced the 
     selection and retention of counsel in the private action 
     arising under this title;
       ``(iii) may conduct a factual inquiry or refer the question 
     to a magistrate, if the court makes a finding described in 
     clause (ii); and
       ``(iv) shall disqualify the attorney from representing the 
     plaintiff in any action arising under this title, if the 
     court finds, after such inquiry, that the nature or terms of 
     the fee arrangement for any other matter influenced the 
     selection and retention of counsel in any such action.
       ``(12) Disclosures regarding contributions.--In any private 
     action arising under this title, each plaintiff and any 
     attorney for such plaintiff shall provide sworn 
     certifications, which shall--
       ``(A) be personally signed by such plaintiff and each such 
     attorney, respectively;
       ``(B) be filed with the complaint; and
       ``(C) identify any contribution made during the 5-year 
     period preceding the date of filing

[[Page S2335]]

     of the complaint by such attorney, any person affiliated with 
     such attorney, or any political action committee controlled 
     by such attorney, to any elected official with real or 
     apparent authority to retain counsel for such plaintiff or to 
     select or appoint, influence the selection or appointment of, 
     or oversee any individual or group of individuals with that 
     authority.''.
       (b) Securities Act of 1933.--Section 27(a) of the 
     Securities Act of 1933 (15 U.S.C. 77z-1(a)) is amended by 
     adding at the end the following:
       ``(9) Disclosures regarding payments.--
       ``(A) Sworn certifications required.--
       ``(i) In general.--In any private action arising under this 
     title, each plaintiff and any attorney for such plaintiff 
     shall provide sworn certifications, which shall--

       ``(I) be personally signed by such plaintiff and each such 
     attorney, respectively;
       ``(II) be filed with the complaint; and
       ``(III) identify any direct or indirect payment, or promise 
     of any payment, by such attorney, or any person affiliated 
     with such attorney, to such plaintiff, or any person 
     affiliated with such plaintiff, beyond the pro rata share of 
     any recovery received by the plaintiff, except as ordered or 
     approved by the court in accordance with paragraph (4).

       ``(ii) Court actions.--Upon disclosure of any payment or 
     promise of payment described in clause (i), the court shall 
     disqualify the attorney from representing the plaintiff.
       ``(B) Definition.--For purposes of this paragraph, the term 
     `payment' shall include the transfer of money and any other 
     thing of value, including the provision of services, other 
     than representation of the plaintiff in the private action 
     arising under this title.
       ``(10) Disclosures regarding legal representations.--
       ``(A) In general.--In any private action arising under this 
     title, each plaintiff and any attorney for such plaintiff 
     shall provide sworn certifications, which shall--
       ``(i) be personally signed by such plaintiff and each such 
     attorney, respectively;
       ``(ii) be filed with the complaint; and
       ``(iii) identify the nature and terms of any legal 
     representation provided by such attorney, or any person 
     affiliated with such attorney, to such plaintiff, or any 
     person affiliated with such plaintiff, other than the 
     representation of the plaintiff in the private action arising 
     under this title.
       ``(B) Court actions.--The court--
       ``(i) may allow certifications under subparagraph (A) to be 
     made under seal;
       ``(ii) shall review such certifications to determine 
     whether cause exists to believe that the nature or terms of 
     the fee arrangement for any other matter influenced the 
     selection and retention of counsel in the private action 
     arising under this title;
       ``(iii) may conduct a factual inquiry or refer the question 
     to a magistrate, if the court makes a finding described in 
     clause (ii); and
       ``(iv) shall disqualify the attorney from representing the 
     plaintiff in any action arising under this title, if the 
     court finds, after such inquiry, that the nature or terms of 
     the fee arrangement for any other matter influenced the 
     selection and retention of counsel in the private action 
     arising under this title.
       ``(11) Disclosures regarding contributions.--In any private 
     action arising under this title, each plaintiff and any 
     attorney for such plaintiff shall provide sworn 
     certifications, which shall--
       ``(A) be personally signed by such plaintiff and each such 
     attorney, respectively;
       ``(B) be filed with the complaint; and
       ``(C) identify any contribution made during the 5-year 
     period preceding the date of filing of the complaint by such 
     attorney, any person affiliated with such attorney, or any 
     political action committee controlled by such attorney, to 
     any elected official with real or apparent authority to 
     retain counsel for such plaintiff or to select or appoint, 
     influence the selection or appointment of, or oversee any 
     individual or group of individuals with that authority.''.

     SEC. 3. SELECTION OF LEAD COUNSEL.

       (a) Securities Exchange Act of 1934.--Section 
     21D(a)(3)(B)(v) of the Securities Exchange Act of 1934 (15 
     U.S.C. 78u-4(a)(3)(B)(v)) is amended by adding at the end the 
     following: ``In exercising the discretion of the court over 
     the approval of lead counsel, the court shall employ a 
     competitive bidding process as one of the criteria in the 
     selection and retention of counsel for the most adequate 
     plaintiff, unless the court determines on the record that 
     such a process is not feasible.''.
       (b) Securities Act of 1933.--Section 27(a)(3)(B)(v) of the 
     Securities Act of 1933 (15 U.S.C. 77z-1(a)(3)(B)(v)) is 
     amended by adding at the end the following: ``In exercising 
     the discretion of the court over the approval of lead 
     counsel, the court shall employ a competitive bidding process 
     as one of the criteria in the selection and retention of 
     counsel for the most adequate plaintiff, unless the court 
     determines on the record that such a process is not 
     feasible.''.

     SEC. 4. STUDY OF AVERAGE HOURLY FEES IN SECURITIES CLASS 
                   ACTIONS.

       (a) Study and Review Required.--The Comptroller General of 
     the United States (in this section referred to as the 
     ``Comptroller General'') shall conduct a study and review of 
     fee awards to lead counsel in securities class actions during 
     the 7-year period preceding the date of enactment of this 
     Act, to determine the effective average hourly rate for lead 
     counsel in such actions. Such study and review shall also 
     consider lead counsel perquisites, including travel and 
     accommodation.
       (b) Report Required.--Not later than 1 year after the date 
     of enactment of this Act, the Comptroller General shall 
     submit a report to the Committee on Banking, Housing, and 
     Urban Affairs of the Senate and the Committee on Financial 
     Services of the House of Representatives on the results of 
     the study and review required by this section. The 
     Comptroller General shall submit an updated report every 3 
     years thereafter.
       (c) Definition.--For purposes of this section, the term 
     ``securities class action'' means a private class action 
     arising under the Securities Act of 1933 (15 U.S.C. 77 et 
     seq.) or the Securities Exchange Act of 1934 (15 U.S.C. 78 et 
     seq.) that is brought as a plaintiff class action pursuant to 
     the Federal Rules of Civil Procedure.
                                 ______
                                 
      By Mr. LEAHY (for himself and Mr. Inhofe):
  S. 657. A bill to eliminate conditions in foreign prisons and other 
detention facilities that do not meet primary indicators of health, 
sanitation, and safety, and for other purposes; to the Committee on 
Foreign Relations.
  Mr. LEAHY. Mr. President, I am very pleased to join today with the 
senior Senator from Oklahoma, Senator Inhofe, in reintroducing 
legislation that has already attracted broad support from across the 
social and political spectrum. An almost identical version was reported 
by the Foreign Relations Committee two years ago, and then last 
December it was cleared by both sides for passage by unanimous consent 
but the Senate adjourned shortly before it could be adopted.
  This bill, titled the Foreign Prison Conditions Improvement Act of 
2013, seeks to address a much neglected, global human rights and 
humanitarian problem--the inhumane treatment of people in foreign 
prisons and other detention facilities.
  On any given day, millions of people are languishing in foreign 
prisons, many in pretrial detention having never been brought before a 
judge or formally charged or proven guilty of anything, deprived of 
their freedom in abysmal conditions, often for years longer than they 
could have been sentenced to prison if convicted.
  Others are imprisoned after being convicted of offenses, often after 
woefully unfair trials, including for nothing more than peacefully 
expressing political or religious beliefs or defending human rights. 
Regardless of their status they have one thing in common. They are 
deprived of the most basic rights and necessities--safe water, adequate 
food, essential medical care, personal safety, and dignity.
  Anyone who has been inside one of these facilities, or seen 
photographs or press reports of what they are like, understands that 
this is about the mistreatment of human beings in ways that are 
reminiscent of the Dark Ages.
  A few examples illustrate the point. In Haiti's National Penitentiary 
before the 2010 earthquake, more than 4,100 prisoners were confined in 
a space built for less than 900. Many did not have room to lie down and 
had to sleep standing up. Sanitation was practically non-existent. 
Deadly contagious diseases were rampant. The overwhelming majority of 
inmates had never been formally charged, never seen a lawyer or a 
judge. The earthquake damaged the prison and the prison guards fled, 
leaving the inmates to fend for themselves without food or water. They 
managed to get out, but the squalid facility filled up again.
  Senator Whitehouse and I visited that facility just last month. It 
currently holds more than 3,700 prisoners of which more than 3,400 are 
awaiting trial. Thanks to the State Department, the U.S. Agency for 
International Development, and a small Florida-based organization, 
Health Through Walls, a new infirmary and X-ray machine have 
dramatically reduced the incidence of HIV and tuberculosis. A small 
Vermont-based organization, the Rural Justice Center, is using USAID 
funds to chip away at the pretrial detention problem. These are 
examples of how modest funding can save lives and improve access to 
justice for prisoners in facilities plagued by abysmal conditions.
  I recall a newspaper article about how in Benin, in West Africa, the 
skin of prisoners was ragged from the extraction of fly larvae, an 
affliction that is symptomatic of the deplorable conditions. Many 
inmates suffer from tuberculosis, scabies, parasites, lung infections 
or other illnesses. The prison in Abomey, located in southern Benin,

[[Page S2336]]

was built in 1904 to house a maximum of 150 prisoners. A year or two 
ago, more than 1,000 were reportedly confined there.
  Last February, a fire at the Comayagua Prison in Honduras killed 360 
inmates. In one overcrowded cell block only four of 105 prisoners 
survived. More than half of those who died were waiting to be charged 
or tried.
  It is common in prisons from Latin America to the Middle East, 
Africa, and Asia for inmates to be severely malnourished and to go for 
months without being able to wash. Many prisoners depend for survival 
on food brought to them by relatives. In many countries individuals 
awaiting trial, young and old, are housed together with convicted, 
violent criminals.
  Prisoners and other detainees in many countries are also routinely 
victimized by poorly trained, abusive guards who are virtually 
unsupervised and unaccountable to any higher authority. Sexual abuse of 
men, women and children is common.
  Prisoners in many countries die in prison from lack of proper medical 
care. Inmates suffer from AIDS and other illnesses in facilities with 
no medical records, where doctors do not enter. Prisoners intentionally 
cut or otherwise harm themselves in the hope of receiving medical 
attention for life-threatening illnesses. If and when they are released 
they infect the local population.
  A New York Times article described how prisoners in one African 
country were punished by being stripped naked and held in solitary 
confinement in small, windowless cells, sometimes for days on end, in 
ankle-to-calf-high water contaminated with their own excrement. It is 
like something out of The Count of Monte Cristo, only worse because it 
is happening in the 21st Century. But the article went on to describe 
how that country's prison service conducted its own audit, appointed a 
new medical director, and allowed human rights workers access to its 
facilities. The legislation Senator Inhofe and I are introducing seeks 
to provide incentives for those kinds of improvements. Our bill would 
do the following:
  First, it calls attention to this long ignored problem. Most people 
know little if anything about what goes on inside foreign prisons, and 
many would prefer not to know.
  Second, it sets forth primary indicators for the elimination of 
inhumane conditions in foreign prisons and other detention facilities, 
such as human waste facilities that are sanitary and accessible, and 
adequate ventilation, food and safe drinking water.
  Third, it requires the Secretary of State to report annually on the 
conditions in prisons and other detention facilities in at least 30 
countries receiving United States assistance or under sanction by the 
United States, selected by the Secretary's determination that such 
conditions raise the most serious human rights or humanitarian 
concerns.
  Fourth, it encourages the Secretary and the Administrator of the U.S. 
Agency for International Development to furnish assistance for the 
purpose of eliminating inhumane conditions where such assistance would 
be appropriate and beneficial.
  For countries that are not making significant efforts to eliminate 
such conditions, the Secretary is to enter into consultations with 
their government to achieve the purposes of the Act.
  The legislation also provides for training of Foreign Service 
Officers, and directs the Secretary to designate, within the Department 
of State's Bureau for Democracy, Human Rights, and Labor, an official 
with responsibility for implementing the provisions of the Act.
  Finally, it authorizes the expenditure of funds to implement the Act.
  Once enacted, the Foreign Prison Conditions Improvement Act of 2013 
will help foreign governments ensure that prisoners in their countries 
are treated as any people deprived of their freedom should be--as human 
beings, with dignity, in safety, and provided the basic necessities of 
life.
  In countries around the world, the United States is helping to reform 
justice systems and strengthen the rule of law. No justice system can 
claim to deliver justice if prisoners and other detainees are treated 
like animals, or worse. By helping to change attitudes, and showing how 
with relatively little money prison conditions can be significantly 
improved, we can help advance the cause of justice more broadly.
  Millions of people around the world look to the United States as a 
defender of justice. This legislation will further that goal and it 
reflects the best instincts of the American people. It has been 
endorsed by a wide range of groups, including Amnesty International, 
USA; Baptist World Alliance, Division of Freedom and Justice; Ethics 
and Religious Liberty Commission of the Southern Baptist Convention; 
Human Rights First; Human Rights Watch; International CURE; 
International Justice Mission; International Prison Chaplains' 
Association; Jewish Council for Public Affairs; Just Detention 
International; Justice Fellowship/Prison Fellowship Ministries; 
National Association of Evangelicals; National Religious Campaign 
Against Torture; New Evangelical Partnership for the Common Good; Open 
Society Policy Center; Penal Reform International; Religious Action 
Center of Reform Judaism; United Methodist Church, General Board of 
Church and Society; and the United States Conference of Catholic 
Bishops. I want to thank these groups for their support and their 
efforts to focus attention on this urgent problem.
  Identical legislation is planned for reintroduction in the House by 
Representative Chris Smith who cares deeply about this issue, so this 
is a bipartisan, bicameral effort.
  Finally, I want to thank Senator Inhofe, who has visited many African 
countries and has witnessed the problems this legislation seeks to 
address, as well as his staff, who have been very helpful throughout 
this process. At a time when some people seem to get satisfaction from 
calling Washington broken, this is another example of how two Senators, 
of different parties, whose political views often differ, can work 
together in furtherance of a just cause.
  Mr. INHOFE. Mr. President, it is with great pleasure that I join my 
friend Senator Leahy from Vermont in introducing, the Foreign Prison 
Conditions Improvement Act of 2013.
  As I stated when we introduced this bill in the 112th Congress, our 
bill seeks to identify and eliminate unhealthy and unsafe prison 
conditions found in developing countries like Haiti and on the African 
continent where millions suffer inhumane conditions as well as to 
address the dysfunctions in their legal systems.
  The introduction of this bill comes at an appropriate time because 
Jon Hammer, the imprisoned U.S. Marine being held in the Cedes Prison 
in Matamoras, Mexico was freed this past December 21st.
  Corporal Hammer, who served in Iraq and Afghanistan, was arrested in 
August and charged with a Federal weapons felony--facing up to 15 years 
in prison, for carrying an antique gun into Mexico on his way to Costa 
Rica for a hunting trip, despite, as I understand it, having a required 
permit and attempting to declare the gun. During the past 90 days, he 
faced the same harsh conditions that our bill is trying to address. 
Namely, Hammer was housed in an overcrowded and unsanitary prison, 
beaten by fellow inmates who were members of the murderous Mexican drug 
cartels, threatened with death in an extortion attempt by these inmates 
and chained to a bed.
  I had been involved in seeking Jon's release for several weeks, and I 
was heartened when he was released. His treatment, however, serves as 
an excellent example of the deficiencies found everyday in foreign 
prisons worldwide from Africa to no further away than our southern 
border.
  Our bill focuses on eliminating excessive pre-trial detention and 
dysfunctional justice systems which frequently result in prisoners and 
other detainees spending years in unhealthy prison conditions before 
their cases are even adjudicated. Tragically, inadequate, misplaced or 
lost records often result in the incarcerated being held indefinitely 
because their cases have never been heard. Unbelievably, such poor 
recordkeeping has kept many in prison long after their sentences have 
been served. Our bill also encourages these nations to provide humane 
and sanitary prison conditions so that prisoners can be released in 
good health, and thus stem one of the causes of the spread of HIV and 
tuberculosis among the general public.

[[Page S2337]]

  Our bill calls upon the Department of State to submit to Congress an 
annual report for five years that describes inhuman prison conditions 
at least 30 countries receiving U.S. foreign assistance. It gives the 
Secretary of State and Administrator of the U.S. Agency for 
International Development the discretion to restructure, reprogram or 
reduce U.S. foreign assistance to these countries based upon whether 
they are making ``significant efforts'' to eliminate inhuman conditions 
in their prisons and other detention facilities.
  The goals of this bill are noble, but it will take close monitoring 
and hard work by our U.S. Foreign Service personnel on the ground 
overseas to fulfill this work. That is why our bill directs the 
Secretary of State to provide training to these embassy and consulate 
personnel so that they can effectively investigate and assess prison 
conditions in foreign prisons as well as assist these foreign 
governments to adopt substantive prison reforms. The Secretary is also 
directed to designate and task a Deputy Assistant Secretary of State 
within the Bureau of Democracy, Human Rights and Labor with the 
responsibility for gathering the information for the annual report and 
make recommendations to the Secretary based off its conclusions.
  I have made 128 African country visits over the past 16 years, and I 
believe that given the chance, the majority of Africa's leaders will 
welcome the opportunity to interact with our embassy and consulate 
personnel and adopt the best practices for achieving the elimination of 
unhealthy and unsafe conditions in their prisons and other detention 
facilities. It is also my hope that our neighbors to the south will 
adopt safe and sanitary prisons conditions and correct the dysfunctions 
in their justice systems so that another U.S. citizen does not have to 
spend 90 days in prison for a paperwork error.
  The task at hand reminds me of the teaching of Jesus in Matthew 
25:39:40 when he said, `` `When did we see you sick or in prison and 
visit you?' And the King will answer them, `Truly, I say to you, as you 
did it to one of the least of these my brothers, you did it to me.' ''
  We are all our brothers' keepers.
                                 ______
                                 
      By Mrs. GILLIBRAND (for herself, Mr. Vitter, Mr. Coons, Mr. 
        Blunt, Ms. Landrieu, Mr. Leahy, Mr. Warner, and Mrs. Murray):
  S. 658. A bill to amend titles 10 and 32, United States Code, to 
enhance capabilities to prepare for and respond to cyber emergencies, 
and for other purposes; to the Committee on Armed Services.
  Mrs. GILLIBRAND. Mr. President, I am pleased to join Senators Vitter, 
Coons, Blunt, Landrieu, Leahy, Warner, and Murray in introducing the 
Cyber Warrior Act of 2013 to build Cyber and Computer Network Incident 
Response Teams in the National Guard.
  This bill would establish a Cyber and Computer Network Incident 
Response Team, CCNIRT, in each state and the District of Columbia, 
which could provide a scalable response, called into support by the 
Governor in case of a domestic initial response or by the Secretary of 
Defense in a Title 10 status when the situation warrants it. These 
teams would combine both Active and Traditional Guard Members, thereby 
leveraging the private sector IT expertise and experience. The use of 
the Guard would also support the goal of retaining the cyber training 
of military personnel when they retire.
  The bill would allow the Guard to further develop cyber capabilities 
to address existing and potential future surge needs. This bill would 
also allow the National Guard to support existing DHS, DOJ, Secret 
Service, and State and Local cyber efforts with their unique 
capabilities and expertise, as well as leverage their private sector 
expertise.
  The Guard members under this bill would add to existing Guard end 
strengths. The funding to support this mission is intended to be born 
by the active duty, but not incur any new budgetary authority.
  The bill would also authorize Governors to ask their National Guard 
to help train State and Local Law Enforcement and other Cyber 
Responders in cyber security, and help them develop sound best 
practices that allow more cohesive interaction with Federal-level 
responders.
  The bill requires cyber Guard Members to receive the same level of 
training that is available to the Active Duty cyber personnel, to the 
extent practicable. The bill would require the Secretary of Defense to 
report on such training.
  The bill would also require the Secretary of Defense to report to 
committees of jurisdiction on the following ways to attract and retain 
more cyber warriors.
  The bill requires description and assessment of various mechanisms to 
recruit and retain members of the regular and reserve components of the 
Armed Forces; an assessment of the use virtual and/or short term 
deployments in case of cyber incident responses; and a description of 
the training requirements and physical demands in the cyber 
specialties.
                                 ______
                                 
      By Mr. WYDEN:
  S. 659. A bill to reauthorize the Reclamation States Emergency 
Drought Relief Act of 1991, and for other purposes; to the Committee on 
Energy and Natural Resources.
  Mr. WYDEN. Mr. President, I would like to speak for a few minutes 
today on the importance of reauthorizing the Reclamation States 
Emergency Drought Relief Act.
  This past year was the warmest on record and we are witnessing more 
climate-driven events, including drought. Over 60 percent of the nation 
experienced some form of drought during 2012. In my home State of 
Oregon, serious drought is likely to persist in the southeastern part 
of the State.
  Last summer marked the Nation's most widespread drought in 60 years, 
stretching across 29 States and threatening crop production and power 
plant operations. The levels in many lakes and reservoirs have declined 
putting at risk a crucial part of our Nation's drinking water supplies. 
The impacts of the drought are profound and the outlook for this summer 
isn't any better.
  The Drought Act was originally reported out of the Senate Energy and 
Natural Resources Committee in 1992. Since then it has provided over 
$74 million in drought assistance activities to States across the West. 
It not only authorizes the Bureau of Reclamation to undertake 
construction, management and conservation activities that will minimize 
and mitigate the losses and damages resulting from drought conditions, 
but it also gives specific considerations to the needs of fish and 
wildlife.
  My proposed legislation would reauthorize the Reclamation States 
Emergency Drought Relief Act, which expired last year, for an 
additional 5 years. Given the drought last year and the forecast for 
prolonged drought in parts of this country, it is reasonable to raise 
the authorization level by $20 million, which this legislation does. As 
one indication of the associated costs of drought, in 2012 the drought 
caused an estimated $50 billion in damages.
  In closing, I look forward to working with this administration and my 
colleagues in the Senate to reauthorize this vital program and to 
ensure the Bureau of Reclamation has the resources it needs to 
adequately address the drought conditions.
                                 ______
                                 
      By Mrs. FEINSTEIN:
  S. 663. A bill to provide for the inclusion of the State of 
California as a separate Federal milk marketing order upon the petition 
and approval of California dairy producers of such inclusion; to the 
Committee on Agriculture, Nutrition, and Forestry.
  Mrs. FEINSTEIN. Mr. President, I rise today, on behalf of myself and 
Senator Boxer, to introduce the California Federal Milk Marketing Order 
Act. This legislation will allow California's dairy industry to operate 
on a system that is consistent with the industry in other states.
  The bill is as simple and straight forward as it gets--it's only two 
paragraphs long.
  The first paragraph allows the California dairy producers to create 
their own ``regional order'' within the existing Federal Milk Marketing 
Order Program, if they elect to do so.
  If California dairy farmers do elect to join the Federal order, the 
second paragraph allows California to maintain its existing ``quota 
system,'' which I will explain in a moment.

[[Page S2338]]

  It is important for me to say up front how non-controversial this 
legislation should be.
  The legislation has broad bi-partisan support among the diverse 
California congressional delegation.
  The bill would likely add no new burden to the Federal taxpayer.
  Congress enacted an identical provision in 1996.
  But the provision expired along with the 1996 Farm Bill. So 
essentially, the legislation I am introducing today is simply the 
reauthorization of that no-cost provision.
  More importantly though, this legislation can help the struggling 
dairy industry. Prices have dipped back to near historic lows, and 
farmers are often milking their cows at or below the cost of 
production.
  In California, this has resulted in a drastic consolidation of the 
industry. Forty-eight dairies went out of business in 2011. Eleven left 
the business in 2010. And 100 more left the business in 2009.
  With only 1,668 dairies left in the state in 2011, those losses 
represent more than a 10 percent contraction in just three years.
  But this legislation has the potential to begin the turnaround for 
California by bringing the milk pricing formulas in line with the rest 
of the nation.
  To explain how the turnaround could occur, I'd like to start with the 
basics.
  USDA operates 10 regional Federal Milk Marketing Orders for dairy 
farmers in 42 States. The order sets up a system to pay farmers a set 
price for their milk, even though food manufacturers pay different 
prices based on how the milk is used. For instance, farmers in the 
Federal order receive the same price for milk that is put in a carton 
for drinking as milk that is converted into dry milk powder. This is 
true even though these products sell for significantly different prices 
at the grocery store.

  However, California, the Nation's largest milk producing State, 
operates under a different system. The State elected to run its own 
milk marketing order, so California farmers are paid different values 
for their products, and they are playing by different rules.
  One unique characteristic of the California Marketing Order, and the 
reason for this legislation, is the system known as ``quota,'' which I 
mentioned earlier.
  Producers who own a portion of the ``quota'' receive a premium for 
their milk, roughly five percent more than other producers. Rights to 
quota can be bought or sold on the open market, and economists estimate 
that the combined value associated with quota is roughly $900 million.
  It is this $900 million value that the California Federal Milk 
Marketing Order Act authorizes to be converted into a Federal order.
  Inclusion of the quota will not come at taxpayer expense. Producers 
who own quota receive a higher price for their milk, but the additional 
payment is offset by a marginal increase in prices paid by dairy 
processors.
  I know that dairy support programs can be convoluted and 
controversial. But I want to make sure that my colleagues know that 
this legislation is not.
  The bill simply gives California dairy farmers the option of entering 
into the Federal order, at the time of their choosing. It does not 
mandate a thing.
  I hope my colleagues will see the sense in this legislation and join 
me in supporting our dairy farmers by enacting this bill.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                 S. 663

       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 ``California Milk Marketing 
     Order Act''.

     SEC. 2. INCLUSION OF CALIFORNIA AS SEPARATE MILK MARKETING 
                   ORDER.

       (a) Inclusion Authorized.--Upon the petition and approval 
     of California dairy producers in the manner provided in 
     section 8c of the Agricultural Adjustment Act (7 U.S.C. 
     608c), reenacted with amendments by the Agricultural 
     Marketing Agreement Act of 1937, the Secretary of Agriculture 
     shall designate the State of California as a separate Federal 
     milk marketing order.
       (b) Special Considerations.--If designated under subsection 
     (a), the order covering California shall have the right to 
     reblend and distribute order receipts to recognize quota 
     value.

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