[Congressional Record (Bound Edition), Volume 145 (1999), Part 20]
[Senate]
[Pages 29075-29100]
[From the U.S. Government Publishing Office, www.gpo.gov]



                        LABOR-HHS APPROPRIATIONS

  Mr. SPECTER. Mr. President, I wish to make a brief comment, if I may, 
on one of the items referred to in a statement by the majority leader 
about the appropriations process, which I think will be of interest to 
our colleagues and perhaps to others who may be watching on C-SPAN 2.
  We had negotiations beginning at 4 o'clock on Sunday afternoon with 
officials from the White House, and we are trying to resolve those 
issues in a spirit of accommodation. With respect to the dollars 
involved, the bill which came out of the Appropriations Committee was 
$93.7 billion for the three Departments. That was $600 million more 
than the President's figure, and it was $300 million more than the 
President's figure on education.
  I worked on a bipartisan basis with my distinguished colleague, 
Senator Harkin. The bill was crafted with what we thought was the right 
dollar amount--frankly, the maximum amount--to pass with votes in 
substantial numbers from Republicans and an amount which would be 
acceptable to Democrats and to the President because it was somewhat 
higher than his figure and we emphasized increased funding for the 
National Institutes of Health.
  The administration has come back with a figure of $2.3 billion 
additional, and Congressman Porter and I made an offer yesterday to add 
$228 million, provided we could find offsets because it is very 
important that we not go into the Social Security trust funds. So that 
whatever dollars we add to accommodate the President's priorities--we 
are going to have to have offsets on priorities which the Congress has 
established. We are prepared to meet him halfway on priorities on 
dollars--we are going to have to have offsets on priorities which the 
Congress has established.
  There is a much more difficult issue in this matter than the dollars, 
although the dollars are obviously of great importance, and the issue 
which is extremely contentious is what will be done on the President's 
demand to have $1.4 billion to reduce classroom size to have additional 
teachers.
  The Senate bill has appropriated $1.2 billion which maintains the 
high level of last year's funding. When it comes to the issue of the 
utilization of that money, we are prepared to acknowledge the 
President's first priority of reduction of classroom size for teachers. 
But if the local school board makes a factual determination that is not 
the real need of the local school board,

[[Page 29076]]

then we propose that the second priority be teacher training. If the 
local school board decides that is not where the money ought to be 
spent, then we propose to give it to the school board the discretion as 
to the spending to local education, as opposed to a straitjacket out of 
Washington.
  The White House Press Secretary has issued a statement this morning 
saying that these funds could be used for vouchers, and that is not 
true. That is a red herring. To allay any concern, we will make it 
explicit in the bill that the President's concern about the use of 
these funds for vouchers will be allayed. We are prepared to make that 
accommodation, although there had never been any intent to use it for 
vouchers. However, we will make that intent explicit in the bill.
  Behind the issue of classroom size and the President's demand is a 
much greater constitutional issue. That is the constitutional issue of 
who controls the power of the purse. The Constitution gives the 
authority to the Congress to establish spending priorities, and we have 
seen a process evolve in the past few years which does not follow the 
constitutional format. The Constitution is very specific that each 
House will decide on a bill, have a conference, and send that bill to 
the President for his signature or for his veto; and if he vetoes it, 
the bill then comes back to the Congress for reenactment. But what has 
happened in the immediate past has been that executive branch officials 
sit in with the appropriators and are a part of the legislative 
process, which is a violation of the principle of separation of powers. 
Now, I must say that I have been a party to those meetings because that 
is what is going on. But I want to identify it as a process which is 
not in conformity with the Constitution. It is something we ought to 
change. When it comes to the power and the control, what we have seen 
happen in the last 4 years is that the President has really made an 
effort, and to a substantial extent a successful effort, to take over 
the prerogative of the Congress on the power of the purse.
  When the Government was closed in late 1995 and early 1996, the 
Republican-controlled Congress was blamed for the closure. That, 
candidly, has made the Congress gun-shy to challenge the President on 
spending issues. Since that time there has been a concession to the 
President on whatever it is that he wants, sort of ``pay a price to get 
out of town'' when people are anxious to have the congressional session 
adjourn.
  Speaking for myself and I think quite a few others in the Congress 
are not going to put on the pressure to get out of town. We are going 
to do the job and do it right. Senator Lott held a news conference 
yesterday and was asked about the termination time. He said he thought 
it was possible to finish the public's business by the close of the 
legislative session on Wednesday, which is tomorrow, but it was more 
important, as Senator Lott articulated, to do it right than get it 
finished by any arbitrary deadline. I concur totally with Senator Lott. 
I think it is possible to get the business finished by the end of the 
working day tomorrow. But it is more important to get it right than to 
get it finished on any prescribed schedule. In modern times there is 
too much concern about getting out of town, than perhaps getting the 
job done right. But we are determined to get it done and to get it done 
right. If we can get it done by the end of business tomorrow, that is 
what our goal is. But we are not going to sacrifice getting it done 
right in order to be able to finish up by Wednesday afternoon to get 
out of town.
  Mr. KENNEDY. Will the Senator yield for a question? Will the Senator 
yield for a question?
  Mr. SPECTER. No, I will not yield here, but I will in just a minute.
  What we have seen is the President's ultimatum. He says this issue on 
schoolteachers is nonnegotiable. That is hardly the way you get into a 
negotiation session. Then his Chief of Staff, John Podesta, said on 
Sunday that if the Congress wants to get out of town they are going to 
have to accede to the President's demands on teachers, to do it his 
way. I think that is not appropriate. Congress has the power of the 
purse under the Constitution. It is our fundamental responsibility on 
appropriations. We are prepared to negotiate, but we are not prepared 
to deal with nonnegotiable demands. We are not prepared to deal with 
ultimatums. We are going back into a session--I don't know whether I 
should call it a negotiating session or not, because the President 
talks about nonnegotiable demands. Frankly, I am prepared to meet that 
with a nonnegotiable demand, not giving up on our prerogative to make a 
determination as to how the money is to be spent and getting local 
control over a Presidential straitjacket.
  Now I would be delighted to yield to my distinguished colleague from 
Massachusetts.
  Mr. KENNEDY. I wanted to inquire of the desk what the Senate business 
was supposed to be? I was under the impression we were supposed to be, 
at 9:30, on the minimum wage.
  The PRESIDING OFFICER. Does the Senator yield the floor?
  Mr. SPECTER. I have concluded. I yield the floor.
  The PRESIDING OFFICER. The Senator from Massachusetts.
  Mr. KENNEDY. Mr. President, I ask we extend the time. How much time 
did the Senator from Pennsylvania expend?
  Mr. DOMENICI. What was the question?
  Mr. KENNEDY. I asked how much time the Senator from Pennsylvania 
used?
  The PRESIDING OFFICER. The Republican side has 19 minutes left.
  Mr. KENNEDY. Just as a matter of inquiry, were taken out of the time 
of the debate. Is that correct?
  The PRESIDING OFFICER. Taken out of the Republican time.
  Mr. KENNEDY. OK. Mr. President, I yield myself 12 minutes.
  The PRESIDING OFFICER. The Senator from Massachusetts.
  Mr. KENNEDY. Mr. President, I listened to the Senator from 
Pennsylvania's comments with great interest. I will mention very 
briefly in defense of the administration, although they can make the 
case quite well for themselves that if the Appropriations Committee had 
finished their business on time we would not be in this particular 
dilemma. Only four appropriations bills were actually completed on time 
for the fiscal year. So with all respect to our friend on the other 
side, if the appropriators had placed, particularly the HEW 
appropriations, first rather than last, I do not think we would be 
having these kinds of problems in the areas of negotiation between the 
President and the Congress.
  Second, the basic program which the President has been fighting for 
in this negotiation is almost identical to what the Republicans 
supported last year. With all respect to the comments we have just 
heard, the fact is if the classes reach the goals, the 15 percent set-
aside for funding for smaller class sizes can be used to enhance the 
teacher training. If the school had already achieved the lower class 
size of 18, it would be used for special needs or other kinds of 
professional purposes.
  So it is difficult for me to understand the frustration of the 
Senator from Pennsylvania when the Republican leaders all effectively 
endorse what the President talked about last year. If their position is 
not sustained, there are going to be 30,000 teachers who are teaching 
in first, second, and third grades who are going to get pink slips. I 
don't think the problem in education is having fewer schoolteachers 
teach in the early grades but to have more.
  I want to make clear I am not a part of those negotiations this year, 
but I was last year. I know what the particular issue is. With all 
respect to those who are watching C-SPAN II, I want them to know the 
President is fighting for smaller class sizes as well as for better 
trained teachers. We have seen Senator Murray make that presentation 
and make it effectively time and again. I think it is something that 
parents support, teachers understand, and children have benefited from. 
No one makes that case more eloquently than the Senator from the State 
of Washington. But I certainly hope the

[[Page 29077]]

President will continue that commitment. We have scarce Federal 
resources. They are targeted in areas of particular need. That is the 
purpose of these negotiations. I hope we can conclude a successful 
negotiation.
  Mr. DOMENICI. Will the Senator yield on my time?
  Mr. KENNEDY. On your time, yes.
  Mr. DOMENICI. Just for an observation. He might want to answer it.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, the truth of the matter is if schools 
want the new teachers, under the proposal of the distinguished chairman 
who just took to the floor to explain the obstinacy of the President, 
they can have the money for teachers. That is what he is saying. It is 
up to them. If they want all the money that comes from this 
appropriation used for teachers, they can have it. If they say, we 
don't need them, we don't want them, he is saying there is a second 
priority.
  Frankly, I think that is excellent policy with reference to the 
schools of our country. I believe the Senator from Pennsylvania makes a 
good point. For the President to continue to say we are not going to 
get this bill unless we do it exactly his way leaves us with no 
alternative. We have some prerogatives, too. The fact is, if you read 
the Constitution, he doesn't appropriate; the Congress does.
  I yield the floor.
  Mr. KENNEDY addressed the Chair.
  The PRESIDING OFFICER. The Senator from Massachusetts.
  Mr. KENNEDY. Mr. President, just to respond, we have a need for 2 
million teachers. We have scarce Federal resources. If the States or 
local communities want to do whatever the Senator from New Mexico says, 
all well and good. But we are talking about scarce Federal resources 
that are targeted in ways that have been proven effective in enhancing 
academic achievement and accomplishment.
  I am again surprised. The Republicans were taking credit for this 
last year. I was in the negotiations. Mr. Goodling and Mr. Gingrich--as 
we were waiting to find out whether the powers that be, the Speaker, 
was going to endorse this, when we were waiting and having 
negotiations--went out and announced it and took credit for it. They 
took credit for this proposal of the President.
  I find it a little difficult to understand this kind of frustration 
that is being demonstrated here. But we will come back to this and 
Senator Murray can address these issues at a later time. I certainly 
hope the President will not flinch in his commitment to getting smaller 
class sizes and better trained teachers and after school programs. That 
is what this President has been fighting for. I hope he will not yield 
at this time in these final negotiations, after we have only had four 
appropriations that have met the deadline. Before we get all excited 
about these negotiations, if our appropriators had completed this work 
in time, we would not be here.
  Mr. DURBIN. Will the Senator yield for a question?
  Mr. KENNEDY. How much time do we have? I will be glad to yield.
  The PRESIDING OFFICER. The Senator has 24 minutes.
  Mr. KENNEDY. Good. I am glad to yield.
  Mr. DURBIN. Mr. President, briefly, I ask my colleague, is it not 
true this appropriation for education was the last of the bills 
considered by the Appropriations Committee? Is it not true that we 
waited until the very last day to even bring up this issue of 
education, the highest priority for American families? Now we find 
ourselves trying to adjourn, stuck on an issue that could have been 
resolved months ago had we made education as high a priority on Capitol 
Hill as it is in family rooms across America.
  Mr. KENNEDY. The Senator is absolutely correct. The Senator from 
Illinois, the Senator from California, and I know the Senator from 
Washington as well, had hoped--and I believe I can speak for our 
Democratic leader--this would be the No. 1 appropriation and not the 
last one. If we had this as the No. 1 appropriation on the issue of 
education, we would not have these little statements we have heard this 
morning. But it is the last one. That is not by accident; that is by 
choice of the Republican leadership.
  Mr. President, how much time do I have remaining?
  The PRESIDING OFFICER. Twenty-three minutes.
  Mr. KENNEDY. Mr. President, I yield myself 7 minutes.
  In a few moments, we will be voting on the minimum wage issue that is 
before the Senate. I want to review what the record has been over the 
last 2 years.
  In September of 1998, we brought up the minimum wage issue, and were 
unable to bring that to a vote on the basis of the merits. The 
Republican leadership said no.
  In March of 1999, we tried to bring up this issue. Again, we were 
denied an opportunity to vote on it.
  In April of 1999, we brought it up again as an amendment on Y2K. We 
were denied an opportunity to have a full debate.
  In July of 1999, we brought it up again, and again we were turned 
down.
  Now we have the minimum wage legislation before us, and in a cynical 
move, the Republican leadership said: Even if you get the passage of 
the minimum wage, it ``ain't'' going to go any further; the President 
isn't going to see it; it is going to end.
  It is a sham. Their effort is basically a sham. That is the position 
in which we find ourselves today.
  We know Americans are working longer and harder. The working poor are 
working longer and harder than at any time in the history of our 
country. We know that over the last 10 years, women are working 3 weeks 
longer a year in order to earn the minimum wage and men are averaging 
50 hours a week. These are some of the hardest working men and women in 
the country.
  At the height of the minimum wage in the late 1960s, it had the 
purchasing power that $7.49 would have today. If we are not able to 
raise the minimum wage this year and next, its value will be at an all-
time low--in a time of extraordinary prosperity in this country. That 
is fundamentally wrong.
  A vote for the Republican amendment will not help working families. 
It is, in fact, an insult to low-wage workers. It robs them of over 
$1,200 as compared to the Democratic proposal, and it drastically 
undermines the overtime provisions in the Fair Labor Standards Act 
which has been the law for over 60 years.
  The Republican proposal jeopardizes the overtime pay of 73 million 
Americans. The Republicans did not water down their own pay increase of 
$4,600. They are now watering down the increase in the minimum wage, 
and they are watering down overtime. On the one hand, they are giving 
an inadequate increase in the minimum wage and taking it back by 
cutting back on overtime. That is a sham. That is a cynical attempt to 
try to win support for working families from those who are trying to do 
justice for those individuals.
  We can ask, What difference does an increase in the minimum wage 
make?
  Cathi Zeman, 52 years old, works at a Rite Aid in Canseburg, PA. She 
earns $5.68 an hour. She is the primary earner in the family because 
her husband has a heart condition and is only able to work 
sporadically. What difference would an increase in the minimum wage 
mean to Cathi and her family? It would cover 6 months of utility bills 
for Cathi's family.
  Kimberly Frazier, a full-time child care aide from Philadelphia 
testified her pay of $5.20 an hour barely covers her rent, utilities, 
and clothes for her children. Our proposal would mean over 4 months of 
groceries for Kimberly and her kids.
  The stories of these families remind us that it is long past time to 
raise the minimum wage by $1 over 2 years. We cannot delay it. We 
cannot stretch it out. We cannot use it to cut overtime. And we cannot 
use it as an excuse to give bloated tax breaks to the rich.
  Members of Congress did not blink in giving themselves a $4,600 pay 
raise. Yet they deny a modest increase for those workers at the bottom 
of the economic ladder. I do not know how Members who voted for their 
own pay increase but I do not know how Members

[[Page 29078]]

who vote against our minimum wage proposal will be able to face their 
constituents and explain their actions.
  It is hypocritical and irresponsible to deny a fair pay raise to the 
country's lowest paid workers. Above all, raising the minimum wage $1 
over 2 years and protecting overtime pay is about fairness and dignity. 
It is about fairness and dignity for men and women who are working 50 
hours a week, 52 weeks of the year trying to provide for their children 
and their families.
  This is a women's issue because a great majority of the minimum-wage 
workers are women. It is a children's issue because the majority of 
these women have children. It is a civil rights issue because the 
majority of individuals who make the minimum wage are men and women of 
color. And it is a fairness issue. At a time of extraordinary 
prosperity this country ought to be willing to grant an increase to the 
hardest working Americans in the nation--the day-care workers, the 
teachers aides. They deserve this increase. Our amendment will provide 
it, and the Republican amendment will not.
  Mrs. BOXER. Will the Senator yield for a question?
  Mr. KENNEDY. I yield for a question.
  Mrs. BOXER. I thank my colleague for yielding. I say to the Senator 
from Massachusetts how much I appreciate him pushing this forward and 
how important it is to all of our States. I bring out an article that 
ran in the paper yesterday and today about the status of children in my 
home State of California, by far the largest State. I want my friend to 
respond to these numbers because they really say it.
  This is what it says:

       Despite a booming economy that has seen a tide of 
     prosperity wash over California in recent years, nearly 1 in 
     4 children under 18 in the Golden State lives in poverty. . . 
     .
       Although the annual ``California Report Card 1999'' laments 
     that so many children live in poverty, it paints an 
     especially bleak portrait of a child's first four years of 
     life.

  Lois Salisbury, president of Children Now, says:

       Among all of California's children, our littlest ones . . . 
     face the most stressful conditions of all. . . .
       At a time when a child's sense of self and security is 
     influenced most powerfully, California deals them a 
     [terrible] hand.

  I say to my friend, this issue he is raising is so critical. We all 
say how much we care about the children. Every one of us has made that 
speech. Today the rubber meets the road. If you care about children, 
you have to make sure their parents can support them.
  My last point is, and I will yield for the answer, I wonder if my 
friend has seen the New York Times editorial that says:

       The Senate will vote today on a Republican-sponsored 
     amendment to raise the minimum wage and they say sadly the 
     Republicans are not content to do this good deed and go home. 
     They have loaded the amendment with tax cuts that are 
     fiscally damaging and cynically focused on wealthy workers. 
     Almost all of the Republican tax cuts go to the wealthy.

  One of the economists who looked at this said:

       It would encourage the reduction of contributions made by 
     employers to the pensions of the lowest paid workers.

  Can my friend comment on the importance of this proposal to children 
and also this cynical proposal that our colleagues on the other side 
are presenting?
  Mr. KENNEDY. The Senator has raised an enormously important point. 
Americans who are working in poverty, which is at the highest level in 
20 years, are working longer and harder than ever. The men work 50 
hours a week or more on average and the women work an average of 3 
weeks more a year. They have less time--22 hours less--to spend with 
their children than they did 10 years ago. That is why this is a 
children's issue, as the Senator has pointed out.
  On the issue the difference between the Republican and the Democratic 
proposals, the Republicans say that their proposal makes some 
difference for those individuals who are going to get an increase in 
the minimum wage over 3 years.
  This is a raw deal for them. On the one hand, they give them an 
increase in the minimum wage, and on the other hand they take back the 
overtime for 73 million Americans. It is a cynical sham, and it is a 
cynical sham because the majority leader has said even if it passes, it 
will never go out of this Chamber. That is the attitude toward hard-
working men and women who are trying to play by the rules and get along 
at a time when they have the lowest purchasing power in the history of 
the minimum wage and we have the most extraordinary prosperity. And 
then they insult these workers even further by adding a $75 billion tax 
break over 10 years. And then we just heard about the difficulty we are 
having in conference about $1 billion on education because they say we 
cannot afford to do things, but the same side is suggesting a $75 
billion tax break. Where are they getting their money? So it is a 
cynical play.
  I reserve the remainder of my time.
  The PRESIDING OFFICER (Mr. Crapo). Who yields time?
  Mr. DOMENICI. Mr. President, I yield 5 minutes to the Senator from 
Minnesota off our time.
  The PRESIDING OFFICER. The Senator from Minnesota.
  Mr. GRAMS. I thank the Senator from New Mexico.
  Mr. President, I rise today to offer my enthusiastic support for the 
package of tax proposals introduced by Senator Domenici. I'm 
enthusiastic, in part, because it contains a provision that is very 
important to me--above-the-line deductibility of health insurance for 
individuals.
  Over 40 million American workers didn't have health insurance in 
1997. The number has increased in the last two years to 44 million. 
This is disturbing, but I believe there is something Congress can do to 
help without resorting to a national health care system.
  Mr. President, when employers purchase a health plan for their 
employees, he or she can fully deduct the costs of providing that 
insurance, effectively lowering the actual costs of providing coverage.
  However, when an employee purchases an individual policy on their 
own, they must do so with after tax-dollars. They don't have the 
ability or the advantage offered to employers to reduce the actual 
costs of the policy by deducting premiums from their taxes every year. 
Therefore, they often wind up without any health coverage at all.
  Earlier this year, I introduced the Health Care Access Act, which 
would have ended this discrimination within the Tax Code and make 
health care available for many more Americans by allowing the full 
deduction of health insurance for those without access to employer-
subsidized health coverage.
  We have a tax code that discriminates against some, while favoring 
others. Clearly, this results in fewer people being covered.
  The amendment before us today takes a slightly different approach, 
but its goal is the same--to level the tax-playing field. By allowing 
individuals without access to employer-sponsored health insurance, or 
those whose employers do not cover more than 50 percent of the cost of 
coverage, to deduct those costs regardless of whether they itemize or 
not, we can address a growing segment of our uninsured population by 
doing this.
  Under this amendment, from 2002 to 2004, eligible employees can 
deduct 25 percent of costs, 35 percent in 2005, 65 percent in 2006, and 
100 percent after that.
  If there are no changes in the health care system and no significant 
downturn of the economy, we can expect the number of uninsured to reach 
53 million over the next ten years. This translates into 25 percent of 
non-elderly Americans without coverage.
  Forty-three percent of the uninsured are in families with incomes 
above 200 percent of the federal poverty level. Twenty-eight percent of 
the uninsured work for small firms and 18 percent of all uninsured are 
between the ages of 18 and 24.
  The question that comes to mind is, if we're experiencing record 
growth in our economy and the unemployment rate is declining, why is 
the number of uninsured continuing to rise? The answer is costs.

[[Page 29079]]

  In the event a small business can offer a health plan to its 
employees, many times it is at a higher cost to the employee than it 
would be if the employee were to have a job at a larger firm. In this 
instance, employees have to decide if they believe their health status 
is such that they can go without health insurance, or if they should 
spend after-tax dollars to pay for a larger portion of their health 
insurance. Here is where we have the difficulty.
  Individuals employed by small businesses which can't afford to pay 
more than 50 percent of the monthly premiums for their employees should 
be able to have the same tax advantage as the employer in paying for 
their health insurance. Under our plan today, they will. In fact, 
because the tax deduction is what we call ``above-the-line,'' meaning 
if would be available to everyone--even if they don't itemize their 
taxes--we attack the most significant barrier to health coverage again, 
which is its costs, and move closer to eliminating all barriers to 
health coverage.
  In other words, get more Americans covered by allowing them the 
deductibility of the costs.
  I am also pleased that this amendment includes many other important 
components such as pension reform and small business tax relief.
  We are talking about tax relief for small businesses, not the 
wealthiest as you hear from the other side of the aisle, but tax relief 
pinpointed at the hard-working Americans in this country who are also 
job providers.
  Retirement income security is crucial for millions of American 
workers. This amendment reforms and enhances current pension laws to 
ensure workers will achieve income security upon retirement. It repeals 
the unnecessary temporary FUTA surtax, which has become a burden to 
many small businesses. The amendment allows millions of self-employed 
Americans to deduct 100 percent of their health insurance costs. This 
is a critical provision because 61 percent of the uninsured in this 
country are from a family headed by an entrepreneur or a small business 
employee.
  The PRESIDING OFFICER. The Senator's time has expired.
  Mr. GRAMS. I ask for 2 more minutes.
  Mr. DOMENICI. I yield the Senator 2 additional minutes.
  Mr. GRAMS. In wrapping up, the amendment increases small business 
expensing to $30,000. This change alone means an extra $3,850 in tax 
savings for each small business in new equipment next year. This 
amendment also allows small business to increase the meal and 
entertainment expense tax deduction. The Work Opportunity Tax Credit 
has helped millions of Americans leave welfare programs and become 
productive workers in our economy. This amendment makes the WOTC 
permanent, so small businesses and former welfare recipients will 
continue to benefit from the Work Opportunity Tax Credit.
  It seems unfair to me that in a time of prosperity we hear our 
colleagues on the other side talking about tax increases. Again, in 
their plan, they would impose new, even higher taxes. They talk about 
minimum wage; they are taxing and taxing and taxing those people as 
they enter the job market. What we need is a plan that will reduce 
taxes, not increase taxes.
  America's small business is the key to our economic growth and 
prosperity. The health care, pension reform and tax relief measures 
included in this amendment will help small business continue to work 
for America and will allow millions of Americans to realize the 
American Dream.
  Again, that is why I rise today to enthusiastically offer my support 
for the tax package proposed by Senator Domenici.
  Mr. President, I yield the floor.
  Mr. DOMENICI. Mr. President, how much time does each side have 
remaining?
  The PRESIDING OFFICER. The Senator from New Mexico controls 11 
minutes 40 seconds; the Senator from Massachusetts controls 13 minutes.
  Mr. DOMENICI. How much time would you like, I ask Senator Nickles?
  Mr. NICKLES. Four or 5 minutes.
  Mr. DOMENICI. I yield 4 minutes to Senator Nickles.
  The PRESIDING OFFICER. The Senator from Oklahoma is recognized.
  Mr. NICKLES. Mr. President, first, I commend my colleague from New 
Mexico for the work that he has done in providing a more realistic 
substitute. But the first vote we are going to have today is voting on 
a motion to table the Kennedy amendment. I urge my colleagues to vote 
against the Kennedy amendment for a lot of different reasons, one of 
which is that it dramatically increases the minimum wage--about 20 
percent over the next 13\1/2\ months. That is a big hit for a lot of 
small businesses. I am afraid it will prevent a lot of people, low-
income people, who want to get their first jobs--they may not be able 
to get them. Estimates by some of the economists, CBO, and others, are 
that it could be 100,000 people; it could be 500,000 people that lose 
their jobs. It is a big hit.
  There are a lot of other reasons to oppose the Kennedy amendment. How 
many of our colleagues know it has a $29 billion tax increase, that it 
extends Superfund taxes? We do not reauthorize the Superfund Program, 
but we extend the taxes. Many of us agree we need to extend the taxes 
when we reauthorize the program, but not before and that is in there 
anyway.
  There is a tax increase on business. I received a letter from all the 
business groups opposing it. It is practically an IRS entitlement 
program, so they can go after anything they want.
  It deals with ``Noneconomic attributes,'' whatever that means, it is 
a $10 billion tax increase. It may sound good and some people say that 
it is just to close loopholes. But it is to give IRS carte blanche to 
go after anything and everything they want. We reformed IRS and curbed 
their appetite somewhat, and regardless of those efforts this would be 
saying: Hey, IRS, go after anybody and everybody.
  There is also a provision in the Democrat proposal that hits hospice 
organizations right between the eyes.
  I have put letters from outside organizations addressing this very 
issue on Members' desks so they may see it for themselves. I ask 
unanimous consent to print in the Record three letters from various 
hospice organizations.
  There being no objection, the letters were ordered to be printed in 
the Record, as follows:

                           National Association for Home Care,

                                 Washington, DC, November 8, 1999.
       Dear Senator: The National Association for Home Care (NAHC) 
     represents home health agencies and hospices nationwide. 
     While generally speaking, NAHC is supportive of efforts to 
     maintain a reasonable minimum wage, a proposed amendment to 
     S. 625 creates serious concerns for hospices across the 
     country.
       The proposed amendment would create a civil monetary 
     penalty for false certification of eligibility for hospice 
     care or partial hospitalization services. This proposal would 
     impose a civil monetary penalty of the greater of $5,000 or 
     three times the amount of payments under Medicare when a 
     physician knowingly executes a false certification claiming 
     that an individual Medicare beneficiary meets hospice 
     coverage standards. On its face, this provision is addressed 
     only to those physicians that intentionally and purposefully 
     execute false certifications. However, the impact of a 
     comparable provision on the access to home health services, 
     as added to the law as Section 232 of the Health Insurance 
     Portability and Accountability Act of 1996, should caution 
     Congress in expanding the provision to apply to hospice 
     services.
       Immediately after the physician community became aware of 
     the 1996 amendment, physicians expressed to home health 
     agencies across the country great hesitancy to remain 
     involved in certifying the homebound status of prospective 
     home health patients. The vagueness of the homebound criteria 
     and the stepped up antifraud efforts of the Health Care 
     Financing Administration brought a chilling effect to 
     physicians. As a result, home health agencies reported that 
     physicians became less involved with homecare patients rather 
     than increasing their involvement as had been recommended by 
     the Office of Inspector General of the U.S. Department of 
     Health and Human Services.
       We believe that a comparable physician reaction will occur 
     if this provision of law is extended to hospice services. A 
     recent study reported in the Journal of the American Medical 
     Association indicates that many eligible people may be denied 
     Medicare hospice benefits because the life expectancy of 
     patients with a chronic illness is nearly impossible to 
     predict with accuracy. Medicare requires that the patient's 
     physician and the

[[Page 29080]]

     hospice medical director certify that the patient has no more 
     than six months to live in order to secure entitlement to the 
     Medicare hospice benefit. The foreseeable result of the 
     proposed amendment would be to further discourage physicians 
     from utilizing hospice services for terminally ill patients. 
     The existing scientific and clinical difficulties in 
     accurately predicting the life expectancy of a patient 
     combined with the threat of additional civil monetary 
     penalties will adversely affect access to necessary hospice 
     services. The experiences with home health services indicate 
     that physicians distance themselves from the affected 
     benefit. While the standard of applicability relates to a 
     knowing and intentional false certification, physicians will 
     react out of fear of inappropriate enforcement actions.
       There are already numerous antifraud provisions within 
     federal law that apply to the exact circumstance subject to 
     the proposed civil monetary penalties. These existing laws 
     include even more serious penalties such as the potential for 
     imprisonment for any false claim.
       We would encourage the Senate to oppose this provision, 
     generally, and in particular, because it is contained in a 
     non-germane legislative effort to increase the federal 
     minimum wage. There is no evidence that physicians engage in 
     any widespread abuse of the Medicare hospice benefit. To the 
     contrary, evidence is growing that hospice services are 
     underutilized as an alternative to more expensive care.
       Thank you for all of your efforts to protect senior 
     citizens in our country.
           Sincerely,
     Val J. Halamandaris.
                                  ____



                               Hospice Association of America,

                                 Washington, DC, November 8, 1999.
       Dear Senator: On behalf of the Hospice Association of 
     America (HAA), a national association representing our member 
     hospice programs, thousands of hospice professionals and 
     volunteers, and those faced with terminal illness and their 
     families, I am requesting your support to reject a proposed 
     amendment to S. 625 that would apply civil monetary penalties 
     for false certification of eligibility for hospice care.
       It is often difficult to make the determination that a 
     patient is terminally ill (life expectancy of six months or 
     less if the terminal illness run its normal course), because 
     the course of terminal is different for each patient and is 
     not predictable. In some rare cases patients have been 
     admitted to hospice care and have improved so as to be 
     discharged from the program. The determination regarding the 
     terminal status of a patient is not an exact science and 
     should not be judged harshly in retrospect.
       In a recent edition of JAMA, The Journal of American 
     Medical Association, researchers reported that the 
     recommended clinical prediction criteria are not effective in 
     a population with a survival prognosis of six months or less. 
     According to Medicare survival data, only 15 percent of 
     patients receiving Medicare hospice survive longer than six 
     months and the median survival of Medicare patients enrolled 
     in hospices is under 40 days. This information demonstrates 
     what has been well known by those working in the hospice 
     community, the science of prognostication is in its infancy 
     and physicians must use the tools that are available, medial 
     guidelines and local medical review policies developed by the 
     Health Care Financing Administration, as well as their best 
     medical judgment.
       Physicians can not be punished for possible overestimation 
     of a terminally ill patient's life expectancy. The only ones 
     to be punished will be the patients in need of hospice 
     services whose physicians will be denied from enrolling 
     appropriate patients, thus denying access to this 
     compassionate, humane, patient and family centered care at 
     the end-of-their lives.
       Please reject the proposed amendment to S. 625.
           Sincerely,
                                                      Karen Woods,
     Executive Director.
                                  ____

                                                     Federation of


                                      American Health Systems,

                                 Washington, DC, November 8, 1999.
     Hon. Don Nickles,
     Assistant Majority leader, U.S. Senate, Washington, DC.
       Dear Assistant Majority Leader: The Federation of American 
     Health Systems, representing 1700 privately-owned and managed 
     community hospitals has generally not taken a position on the 
     minimum wage bill. However, we find it necessary to object to 
     an amendment that will be offered today during consideration 
     of the bill.
       Specifically, we are concerned with an amendment that will 
     apparently address ``partial hospitalization'' issues. While 
     the Federation supports the goal of improving the integrity 
     of the Medicare program by addressing concerns with partial 
     hospitalization, we oppose its attachment to non-Medicare 
     legislation. Clearly, any amendment that reduces Medicare 
     trust fund spending should either be used to enhance the 
     solvency of the trust fund, or for other Medicare trust fund 
     purposes.
       We appreciate your consideration of our position.
           Sincerely,
                                                 Thomas A. Scully,
                                                President and CEO.

  Mr. NICKLES. From the Hospice Association of America:

       . . . . I am requesting your support to reject a proposed 
     amendment to S. 1625 that would apply civil monetary 
     penalties for false certification of eligibility for hospice 
     care.

  I have a letter from the Federation of American Health Systems urging 
opposition to the Kennedy amendment. I have a letter from the National 
Association for Home Care, also in opposition. It says:

       We would encourage the Senate to oppose this provision, 
     generally, and in particular, because it is contained in a 
     nongermane legislative effort to increase the minimum wage.
       The foreseeable result of the proposed amendment would be 
     to further discourage physicians from utilizing hospice 
     services for terminally ill patients.

  Do we want to do that? I don't think so. Certainly we shouldn't do it 
in this legislation. Let's have hearings to find out more about this. 
Let's do it in Medicare reform. Let's do it when we have a chance to 
know exactly what we are doing because this is strongly opposed by 
hospice organizations.
  I encourage my colleagues to oppose it for all the above reasons. I 
urge them to vote yes to table the Kennedy amendment. We will move to 
table it at the appropriate time.
  The PRESIDING OFFICER. Who yields time?
  Mr. KENNEDY. Mr. President, I yield 2 minutes to the Senator from 
Washington.
  The PRESIDING OFFICER. The Senator from Washington.
  Mrs. MURRAY. Mr. President, I rise in support of the Kennedy 
amendment that we will be voting on shortly. It is important to note 
that 59 percent of the over 11 million workers who would receive a pay 
increase as a result of this minimum wage are women--women, by and 
large, with children; women who, because the minimum wage is so low 
today, are working two, three, four jobs. Those losing out in the 
country today because of the lack of a minimum wage increase are our 
children. They are being left home alone. They aren't getting the 
attention they deserve. They are not getting the support they deserve. 
A vote for the Kennedy amendment is a vote for our children.
  While I have the floor, I understand the Senator from Pennsylvania 
came to the floor this morning to question the President's 
constitutional authority to insist on reducing class size. I remind our 
colleagues, reducing class size is something we as Democrats have 
fought for, stood behind, and we stand behind the President in the 
final budget negotiations. This is not about constitutional authority. 
It is about making sure young kids in first, second, and third grade 
get from a good teacher the attention they need in order to read and 
write and do arithmetic. That is a bipartisan agreement we all agreed 
upon a year ago, $1.2 billion to help our local schools reduce class 
size.
  To renege on that commitment 1 year later and to have language which 
takes that money and gives it to whatever else school districts want to 
use it for sounds good except we lose out. A block grant will not 
guarantee that one child will learn to read. A block grant will not 
guarantee that a child who needs attention will have it on the day he 
or she needs it. A block grant will not assure that our children get 
the attention they deserve and learn the skills they need.
  The PRESIDING OFFICER. The Senator's 2 minutes have expired.
  Mrs. MURRAY. I ask for an additional 30 seconds.
  Mr. KENNEDY. Thirty seconds.
  Mrs. MURRAY. Mr. President, what we as Democrats are going to stand 
strong for is a commitment we made a year ago to assure that every 
child in first, second, and third grade gets the attention they 
deserve. If our Republican colleagues want to add additional money to 
the budget for block grants, for needs in our schools that we agree are 
important, we are more than happy to talk to them about it. But we 
believe the commitment we made a year ago is a promise that should be 
kept.

[[Page 29081]]

  I thank the Chair and yield the floor.
  Mr. KENNEDY. How much time, Mr. President?
  The PRESIDING OFFICER. The Senator from Massachusetts controls 10 
minutes 34 seconds. The Senator from New Mexico controls 8 minutes 23 
seconds.
  Mr. KENNEDY. Mr. President, I yield myself 4 minutes.
  I again thank the Senators from California and Washington for 
illustrating in very powerful terms what this issue is all about. It is 
about working women and families.
  With all respect to my friend from Oklahoma, when we had an increase 
in the minimum wage a few years ago, the Republicans fought it. They 
said that it would harm the economy and adversely impact small 
business. In the measure I have introduced we have tried to provide 
some relief for small businesses and we have paid for it. Now we can't 
do that because we have some kind of offsets. Therefore, we can't do 
it.
  The fact is, the Republicans are opposed to any increase in the 
minimum wage. That is the fact. They have been opposed to it even at a 
time of extraordinary prosperity. This minimum wage affects real people 
in a very important way, and there is no group in our society it 
affects more powerfully than women and children. They are the great 
majority of the earners of the minimum wage, and increasingly so.
  These days parents are spending less and less time with their 
families. In the last 10 years, parents were able to spend 22 hours a 
week less with their families. Read the Family and Work Institute's 
report of interviews with small children who are in minimum-wage 
families. They are universal in what they say. They all say: We wish 
our mother--or our father--would be less fatigued. We wish they had 
more time to spend with us. We are tired of seeing our parents come 
home exhausted when they are working one or two minimum-wage jobs.
  That is what this is about. It is about the men and women at the 
bottom rung of the economic ladder. Are they real? Of course they are 
real. I have read the stories. We know who they are. They are out there 
today, this morning, as teacher's aides in our schools. These teacher's 
aides are working with young children, our future, and yet they don't 
earn enough to make ends meet.
  They are there in the day-care centers. We know that day-care center 
workers are often at the bottom of the pay scale, earning the minimum 
wage. As you can see from this graph the purchasing power of the 
minimum wage has declined since the last increase. As their wages lose 
purchasing power, turnover in low paying jobs like child care 
attendants and those who are working in nursing homes, increases. When 
people are forced to leave these jobs, there is a deterioration in 
quality of the service day care centers and nursing homes can offer.
  This is about the most important element of our society. It is about 
fairness. It is about work. We hear all of these speeches on the other 
side of the aisle about the importance of work. We are honoring work. 
We are talking about men and women with dignity who have a sense of 
pride in what they do and are trying to do better and are trying to 
look out after their families. They are being given the back of the 
hand by the Republicans.
  Their proposal is a sham. It is a raw deal for these workers. On the 
one hand, they are dribbling out an increase in the minimum wage; on 
the other hand, they are taking away overtime for 73 million Americans, 
and in the meantime, they are giving tax breaks to the wealthiest 
individuals in our society. That is a sham. Beyond that, they say the 
minimum wage, if we are even fortunate enough to get it to pass the 
Senate, will never go to the President because the Republican 
leadership has made a commitment to whoever it might be that it will 
never go there. That is what we are up against.
  The PRESIDING OFFICER. The Senator's 4 minutes have expired.
  Mr. KENNEDY. I reserve the remainder of my time.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, I say to my friend from Massachusetts 
that I can yell as loud as he. But today I won't do that because I 
believe we have a great bill and a great position.
  The Republicans do support the minimum wage. In fact, they are going 
to vote for the minimum wage that I propose. That is, instead of a 
dollar coming in two installments, it will come in three, of 35 cents, 
35 cents, and 30 cents. Frankly, there will be an overwhelming vote in 
favor of that.
  In addition, we took the opportunity to give small business and some 
other absolutely necessary situations that need it tax relief. We chose 
in this bill to do that. Those have been explained fairly well. I will 
take a minute at the end of my remarks to explain them one more time.
  I suggest that the Democrats are living in an era that has passed.
  If they were here on the floor in the 1930s, they would have a case. 
They would have a case that the minimum wage is going to affect poor 
families supporting their children. That was the issue in the 1930s. 
But I suggest the best research today says that day is gone in terms of 
who is impacted by the minimum wage. It is more likely to impact a 
teenager than it is the head of a household. The fact is, 55 percent of 
the minimum wage applies to people between the ages of 16 and 24. The 
overwhelming number of those are teenagers in part-time jobs, working 
in McDonald's-type restaurants across America. They need these jobs. 
They don't even stay in the minimum-wage position very long, according 
to the research we have seen. If they work well and choose to follow 
the rules and the orders and do an excellent job, they are raised above 
the minimum wage rather quickly.
  To put it another way, to show that the arguments about who benefits 
from the minimum wage are passe 1930 arguments, two-thirds of all 
minimum-wage people are part-time employees. The fact is, the argument 
that these are women heads of households is absolutely dispelled by 
reality. The best we can find out is that 8 percent of the minimum-wage 
employees in America today are women heads of households, not the 
numbers or the tenor and tone of the argument about the slap of the 
hand we are giving to those who work in America. Quite the contrary.
  Our minimum wage reflects a sufficient increase to match up with 
inflation, and we permit many people an opportunity to get into the job 
market. In fact, we make permanent one of the best taxes we have, which 
is now there on an interim basis. It says if you hire minimum-wage 
workers out of the welfare system, and you want to take a chance 
because they aren't capable of doing the jobs and you need to train 
them, you get a credit for that. That is a very good part of the Tax 
Code. We make that permanent so it costs something and it uses up some 
of our tax money.
  As to the argument of how big this tax cut is, it is 12.5 percent of 
the total tax package that the Republicans offered, which passed here 
and the President vetoed. It tries something very new and exciting. It 
says to Americans who want to buy their own insurance--because their 
employers don't furnish it--for the first time, they are going to be 
permitted to deduct the entirety of their health insurance. Heretofore, 
they were punished if they tried to buy it, penalized because they 
didn't get to deduct it while everybody else did. We also made 
permanent the allowance that the self-employed can take the insurance 
deduction. We raise that to 100 percent. Everybody knows that is good. 
Everybody knows that helps with the problem of the uninsured in 
America, and that is good.
  So, for all the talk, the Republicans have come forward with a very 
good bill. I am very pleased that I suggested to the Republicans the 
basics of this bill, that we ought to do it in three installments. Some 
wanted to make it longer. Actually, I think this is exactly the right 
length of time. Add to that the kind of tax relief we have provided 
versus the tax increases on that side, and it seems to me there is no 
choice.
  While everybody is clamoring to do something about the estate tax 
because

[[Page 29082]]

it is a very onerous tax, as if to try to punish people, in a minimum-
wage bill they raise death taxes and inheritance taxes. I don't care 
what kind of American they impose it on. We don't have to do that when 
we are reforming that system because it is somewhat confiscatory. I 
could go on, but if anybody has any doubt, the gross tax increase under 
the Democrat package is $12.5 billion over 5 years, and a $28.9 billion 
tax increase over 10 years. What in the world are we increasing taxes 
for at this point? To pay for a minimum-wage bill? Of course not. It is 
because they want other tax relief and they choose to raise taxes to 
give the benefit to someone else. There is sufficient surplus. This is 
a very small tax cut in our package--12.5 percent of what we perceived 
was adequate and what we could do about 4 months ago with the surpluses 
we have. The President proposed $250 billion, $300 billion in tax 
relief. In this bill, they raise taxes rather than take advantage of 
what we know is the right thing; that is, to reduce taxes in these 
economic times.
  I reserve my remaining time.
  Mr. KENNEDY. Mr. President, how much time remains?
  The PRESIDING OFFICER. The Senator from Massachusetts has 6 minutes 
49 seconds. The Senator from New Mexico has 1 minute 51 seconds.
  Mr. KENNEDY. I yield 3 minutes to the Senator from California.
  The PRESIDING OFFICER. The Senator from California.
  Mrs. BOXER. The Senator from New Mexico said he wasn't going to yell. 
He got a little close to it. But when I hear the yells on that side of 
the aisle, it is usually related to their passion for helping the 
wealthiest among us.
  The Senator from New Mexico says that the Democrats are living in the 
past because we want to increase the minimum wage. Well, I have news 
for the Senator from New Mexico. Compassion for the poorest in our 
society, those at the bottom rung of the ladder, that is a timeless 
value; that is a moral value; that is a religious value; that is a 
value we ought to be proud to have around here. That is not living in 
the past. Come to Los Angeles, I say to my friend from New Mexico, or 
look around your big cities. What you will notice is that the people 
who are living on the minimum wage are adults. We know that to be the 
fact. A majority of minimum-wage workers are adults--70 percent of 
them.
  In the Democratic proposal, out of those who will benefit from this 
modest increase, 60 percent of them are women. So if you want to say 
that we are living in the past, you can say it all you want. But it 
isn't true.
  We saw in September a very chilling story in the L.A. Times about the 
working poor in Southern California. The National Low-Income Housing 
Coalition shows that given the high cost of a two-bedroom apartment in 
L.A., a minimum-wage earner must work 112 hours per week in order to 
make ends meet.
  In San Francisco, it is even worse. A person would have to work 174 
hours at minimum wage in order to pay their bills. According to a 
recent study of the Nation's food banks, 40 percent of all households 
seeking emergency food aid had at least one member who was working. 
That is up from 23 percent in 1994.
  Low-paying jobs, I say to my friend from New Mexico, are the most 
frequently cited cause of hunger today, according to this well-
documented L.A. Times story.
  The L.A. Times, by the way, is now owned by Republicans. So this 
isn't a question of yesterday, I say to my friend. It is a question of 
living today. They have made the same arguments every time we raised 
the minimum wage. The last time they said it would bring the economy 
down. We have never seen such a strong economy. If the people at the 
bottom rung are left behind, it is morally wrong and it is economically 
wrong. It makes no sense. Those are the folks who go out and spend what 
they earn and they definitely stimulate the economy.
  So for anybody to say you are living in the past if you support a 
minimum-wage increase, they don't know what is going on today. I say 
that from my heart. I have respect for the Senator from New Mexico, but 
I think it is insulting to say one lives in the past for wanting to 
fight for those at the bottom rung of the economic ladder--those women 
and those children who are living in poverty.
  I thank the Chair.
  Mr. KENNEDY. Mr. President, how much time remains?
  The PRESIDING OFFICER. The Senator from Massachusetts has 3\1/2\ 
minutes. The Senator from New Mexico has 1 minute 51 seconds.
  Mr. KENNEDY. I yield a minute to the Senator from Connecticut.
  The PRESIDING OFFICER. The Senator from Connecticut is recognized.
  Mr. DODD. Mr. President, to make a couple of quick points, I was 
terribly saddened to see as part of another bill that we have a further 
reduction in child care provisions, which is a major blow again to 
working families out there. We all know that quality child care makes a 
difference for these children. In the midst of all of this, we are 
obviously told you have to come up with some offsets to pay for the 
provisions in this bill, which we do.
  Offsets always attract opposition from one quarter or another. But 
these are modest offsets to pay for the provisions in the bill. What is 
going to happen later today we are going to vote on $75 billion in tax 
cuts and 56 percent of them go to the top 20 percent of income earners, 
and there are no offsets--none.
  One of the great contradictions is, we are being accused of not 
liking the offsets, the pays, from some of the provisions and 
simultaneously we ask our Members to vote for a provision in the bill 
or vote for the whole bill, including a $75 billion tax cut over 10 
years with no offsets.
  Let me underscore, as this millennium date of 50 days away 
approaches, those at the bottom of the economic rung--working people, 
the majority who receive the minimum wage and are working full time; 
they are women, they are Hispanic, they are black--deserve to get a 
fair shake out of this Senate. In a few minutes, we will have an 
opportunity to give them that fair shake by providing an increase in 
the minimum wage, allowing them to enjoy the prosperity of the booming 
economy.
  I yield the floor.
  Mr. KENNEDY. Mr. President, it is important to understand exactly 
what the situation is for our working poor. The number of full-time, 
year-round workers living in poverty is at a 20-year high: 12.6 percent 
of the workforce, says the Bureau of Labor Statistics, as of the last 3 
days. That is the fact. People are working harder, and they are living 
in poverty. These are people who value work.
  Second, the Bureau of Labor Statistics shows that, of those who will 
benefit from a minimum wage increase, 70 percent are adults over age 
20, and about 30 percent will be teenagers.
  If Senators come to Boston and talk to the young people going to the 
University of Massachusetts, they will find 85 percent of their parents 
never went to college and 85 percent of them are working 25 hours a 
week or more. That is true in Boston, in Holyoke, in New Bedford, and 
Fall River, and cities across the country. I don't know what Members 
have against working young people who are trying to pay for their 
education. We have 6 million working in the workforce, and we have 2 
million working at the minimum wage. Why are we complaining about that?
  The Republican proposal is a Thanksgiving turkey with three right 
wings. It has a watered-down increase in the minimum wage, it has a 
poison pill for overtime work, and it has juicy tax provisions for the 
rich. This Republican turkey is stuffed with tax breaks, and it does 
not deserve to be passed. Vote for the real increase in the minimum 
wage; vote for the Daschle increase.
  Mr. LEVIN. Mr. President, as the most prosperous nation in the world, 
our minimum wage should be a living wage, and it is not. When a father 
or mother works full-time, 40 hours a week, year-round, they should be 
able to lift their family out of poverty. $5.15 an hour will not do 
that. A full time minimum wage job should provide a minimum standard of 
living in addition to giving workers the dignity that

[[Page 29083]]

comes with a paycheck. The current minimum wage does not pay a fair 
wage.
  I support the legislation introduced by Representative David Bonior 
in the House and Senator Ted Kennedy in the Senate which increases the 
minimum wage. This legislation, the Fair Minimum Wage Act, will provide 
a 50 cent increase to the minimum wage on January 1, 2000, and a second 
50 cent increase on January 1, 2001. This would raise the minimum wage 
to $6.15 per hour by the year 2001.
  The minimum wage increase passed in 1996 prevented the minimum wage 
from falling to its lowest inflation adjusted level in 40 years. The 
proposed minimum wage increase to $6.15 in 2001 would get the minimum 
wage back to the inflation adjusted level it was in 1982.
  In this era of economic growth, raising the minimum wage is a matter 
of fundamental fairness. We must look around and realize that we have 
the strongest economy in a generation. However, even with our strong 
economy, the benefits of prosperity have not flowed to low-wage 
workers. A full time minimum wage laborer working forty hours a week 
for 52 weeks earns $10,712 per year--more than $3,000 below the poverty 
level for a family of three. The poverty level for a family of three is 
$13,880.
  Some people are saying that it is not time for a minimum wage 
increase, that we just raised the minimum wage in 1996 and in 1997. 
According to the Bureau of Labor Statistics, since the last minimum 
wage increase of 1996-97, the national unemployment rate has fallen to 
4.1%. Not only that, the unemployment rate has dropped in Michigan, it 
is now 3.4%--lower than the national rate. It is only right that we 
help these minimum wage earners when the economy is booming.
  Retail jobs are often cited as the industry hit hardest by an 
increase in the minimum wage. However, according to the Bureau of Labor 
Statistics, 38,900 new retail jobs have been added in Michigan since 
the last minimum wage increase. Moreover, in Michigan, since September 
of 1996, 206,000 new jobs have been created. The opponents claimed that 
the 1996 minimum wage increase would devastate the economy, yet 
clearly, this has not been the case.
  According to the United States Department of Labor, 60% of minimum 
wage earners are women; nearly three-fourths are adults; more than half 
work full time. Under the Fair Minimum Wage Act, approximately 243,000 
Michiganders would get a raise. These hardworking Americans deserve a 
fair deal.
  The Fair Minimum Wage Act will increase the real value of the minimum 
wage in 2001 to the purchasing level it was in 1982. It will generate 
$2,000 in potential income for minimum wage workers. This $2,000 will 
make an enormous impact on minimum wage workers and their families.
  Opponents of the minimum wage have said that the minimum wage hurts 
low income workers. This is not the case. In 1998, seventeen 
economists, including a Nobel Prize winner, a former president of the 
American Economics Assn. and a former Secretary of Labor, wrote to 
President Clinton, supporting an increase in the minimum wage. These 
experts determined that the 1996 and 1997 increases had a beneficial 
effect, not only on those whose earnings were increased, but also on 
the economy as a whole. In addition to directly impacting workers, 
billions in added consumer demand helped fuel our expanding economy in 
those years.
  With a prosperous economy, it is only fair that we also reward those 
who are at the low end of the pay scale spectrum. These people do not 
always have the leverage to negotiate a fair salary. It is necessary 
that we act to ensure that they receive a livable wage.
  Mr. JEFFORDS. Mr. President, I rise today in support of an increase 
in the Federal minimum wage. I strongly believe that the time has come 
to raise the minimum wage again and that we should raise the minimum 
wage by a $1.00 an hour increase over the next 2 years.
  The minimum wage is not the only way--or even the best way--to give 
folks in need a helping hand to get out of poverty. But I do believe 
that it should at least keep pace with inflation. Unfortunately, that 
is not happening. Today's minimum wage is 19 percent below the 1979 
level. To give you a better idea of what this means for working 
families, consider that a minimum wage employee working full time earns 
about $10,700 a year--more than $3,000 below the $13,880 poverty line 
for a family of three. Workers deserve better. At a time when our 
economy is booming, we should not allow this trend to continue. 
Instead, we must continue to raise the minimum wage to keep pace with 
the rising cost of life's basic needs
  My home State of Vermont recently raised the minimum wage to $5.75 an 
hour in response to its awareness of the cost of living. Let's follow 
its lead, a dollar-an-hour increase in the Federal minimum wage will 
put $2,000 a year in the pockets of working families at or near the 
poverty line. And given that 2 years has passed since the last 
increase, small businesses have had the time to adjust. Although this 
money will not solve all the problems of the working poor, it will go a 
long way toward helping minimum wage workers obtain basic needs for 
themselves and their families.
  In addition to raising the minimum wage, there are many other things 
that Congress can and should do to assist low wage workers and their 
families. We must continue to search out and support targeted solutions 
such as the Earned Income Tax Credit (EITC). The EITC provides some 20 
million low-income households with a refundable tax credit. Last year, 
the EITC enabled a worker earning minimum wage, who was either a single 
parent or the sole wage earning parent of dependent children, to 
receive up to $ 3,816 in additional income.
  Along with measures that will raise take home pay, I know that we can 
do more to assist low-income families with their basic needs. Over the 
past few years, an organization in Vermont called the Peace and Justice 
Center has examined how low wage workers and their families were faring 
in my home State. The Vermont Wage Gap Study showed that while we are 
enjoying one of the most extraordinary economic booms in the history of 
our country, thousands of workers in my home State are having great 
difficulty making ends meet. The study found that the cost of meeting 
basic needs is more than many of Vermont's low income workers are 
earning.
  For example, the Vermont Job Gap Study indicated that child care and 
health care are among working families largest expenses. Over the past 
few years, I have been pushing for national child care legislation to 
assist these working families with their child care needs. On the 
health care side, we were able to enact the Children's' Health 
Insurance Program which is helping to improve children's health for 
working families who cannot afford health coverage for their children. 
In addition, we should help low income workers in obtaining health 
insurance. I am currently working on a proposal that would provide 
uninsured and under-insured workers with the money they need to buy 
health insurance.
  But the predominant factor influencing an individual's ability to 
support his or her family is not to be found in the minimum wage or the 
tax code. Study after study has found it is education. Simply put, you 
earn what you learn. I urge my colleagues to work with me on continuing 
to pass legislation aimed at improving our educational systems, and job 
training programs. It is my hope that these efforts will improve the 
skills and employability of our workforce and will enable low-wage 
workers to obtain better paying jobs.
  I would like to add that I think it is entirely appropriate that an 
increase in the minimum wage be accompanied by tax breaks for those who 
will have to shoulder higher wage costs, especially small employers. 
And I strongly favor several of the tax breaks in this amendment. In 
particular, I support acceleration of deductibility of health insurance 
costs for the self-employed; increasing the amount of equipment

[[Page 29084]]

purchases that small businesses can deduct each year; and providing tax 
credits to employers who provide on-site child care. At the same time, 
some of the tax provisions bear little relationship to the impact of a 
minimum wage hike on small businesses. In addition, I am concerned that 
we have not had adequate time to explore the implications and effects 
of all of the tax provisions. My vote in support of this amendment 
should not be read as an endorsement of each and every tax provision, 
but rather reflects my fundamental belief that the time has come for a 
minimum wage increase.
  Lastly, I would comment on the language in Senator Kennedy's 
amendment increasing disclosure to participants of cash balance pension 
plans and prohibiting so-called benefit ``wear-aways''. This language 
is being offered in response to the conversion of hundreds of 
traditional defined benefit pension plans into cash balance or other 
hybrid arrangements. I believe that legitimate concerns have been 
raised that notices about the plan changes that were sent to 
participants have been insufficient. In fact, until recently many 
workers have been unaware that their plan was amended to significantly 
reduce the rate at which they are earning benefits. While pension law 
only requires employers to pay what an employee has actually earned 
under the plan, when these changes are made toward the middle of a 
worker's career, the effect can be devastating.
  This legislation will help workers better understand what the changes 
in their plan mean for their retirement plans. It requires plan 
sponsors to give participants notice of the conversions in a more 
timely fashion, in plain English and on an individualized basis. In the 
words of my colleague Senator Moynihan, this disclosure requirement 
helps to make cash balance conversions transparent for the plan 
participants. I feel this change is warranted and urgently needed.
  But this amendment does more. It also prohibits an unfortunate 
pension practice called the benefit ``wear-away''. When some plans are 
converted, workers with long-years of service may not earn any benefits 
for a number of years. I believe this practice is unfair. There is no 
reason why an individual with 20 years of service should not earn any 
benefits while a younger worker earns benefits immediately. The 
language in this amendment will effectively prohibit wear-aways.
  As we conclude the first session of the 106th Congress, I hold 
steadfast in my belief that Congress must do everything in its power to 
help working families. The time has come to raise the minimum wage and 
give the workers who are depending on it a better shot at self-
sufficiency. I believe that a $1.00 increase over the next 2 years will 
certainly help. However, I also believe that a slower increase is 
better than none at all. Therefore if we do not have the votes in the 
Senate to pass a 2-year increase, I will also support a 3-year 
increase.
  Mr. SARBANES. Mr. President, I rise in strong support of Senator 
Kennedy's amendment to raise the Federal minimum wage. I am proud to be 
an original co-sponsor of the legislation upon which this amendment is 
based to raise the minimum wage 50 cents a year over the next two 
years, bringing it to $6.15 per hour by the year 2001.
  For more than half a century, Congress has acted to guarantee minimum 
standards of decency for working Americans. The objective of a Federal 
minimum wage is to make work pay well enough to keep families out of 
poverty and off Government assistance. Any individual who works hard 
and plays by the rules should be assured a living standard for his or 
her family that can keep them out of poverty.
  If nothing is done during the year 2000, the real value of the 
minimum wage will be just $4.90 in 1998 dollars--about what it was 
before Congress last acted to increase the minimum wage in 1996. The 
proposed increase would restore the wage floor slightly above its 1983 
level, still leaving it 13% below its 1979 peak. No one asserts that 
raising the minimum wage will correct every economic injustice, but it 
will certainly make a significant difference to those on the low end of 
the economic scale. We have the opportunity to enact what is in my view 
a modest increase to help curb the erosion of the value of the minimum 
wage in terms of real dollars, and it is an opportunity which we should 
not let pass us by.
  Currently, a full-time minimum wage worker earns just $10,712--$3,000 
below the poverty level for a family of three. In 1998, about 4.4 
million wage and salary workers, paid hourly rates, earned at and below 
the minimum wage--about 1.6 million at the minimum rate and 2.8 million 
below the minimum. A dollar increase in the minimum wage would provide 
a minimum wage worker with an additional $2,080 in income per year, 
helping to bring that family of three closer to the most basic standard 
of living. This extra income will help a family pay their bills and 
quite possibly even allow them to afford something above and beyond the 
bare essentials.
  According to the Department of Labor, 70 percent of workers who will 
benefit from an increase in the minimum wage are adults, 46 percent 
work full time, 60 percent are women and 40 percent are the sole 
breadwinners in their families. Mr. President, these are not the part-
time workers and suburban teenagers many opponents of the minimum wage 
increase would have you believe.
  After 30 years of spiralling deficits, we now have budget surpluses 
projected, unemployment is at a 25-year low, and inflation is at a 30-
year low. However, despite this period of economic prosperity, the 
disparity between the very rich in this country and the very poor 
continues to grow. According to the Economic Policy Institute, 
projections for 1997 indicate that the share of the wealth held by the 
top 1 percent of households grew by almost 2 percent since 1989. Over 
that same period, the share of the wealth held by families in the 
middle fifth of the population fell by half a percent. In light of 
these estimates, consider that the Department of Labor predicts that 57 
percent of the gains from an increase in the minimum wage will go to 
families in the bottom 40 percent of the income scale.
  It is both reasonable and responsible for Congress to enact measures 
which provide a standard that allows decent, hard-working Americans a 
floor upon which they can stand. We did it back in 1996 when we 
approved, by a bipartisan vote of 74-24, a 90 cent increase in the 
minimum wage bringing it to its current level of $5.15 per hour, and it 
is appropriate to do it here again. With the economy strong, we have a 
responsibility to reinforce this basic economic floor for millions of 
American workers to prevent them from sliding further into the 
basement.
  This is, and always has been, an issue of equity and fairness for 
working men and women in this country. I strongly urge my colleagues to 
support this important amendment.
  Mrs. LINCOLN. Mr. President, I support the Minimum Wage Proposal 
offered by Senator Kennedy because it is fair and responsible. It 
provides a minimum wage increase to 228,000 Arkansans and 11 million 
workers nationwide, most of whom are women. It provides important tax 
relief directly to small businesses to help defray costs of a wage 
hike. And, perhaps most importantly, it pays for the tax cuts by: 
offsetting tax adjustments on large estates valued at $17 million and 
above, which the Senate voted overwhelming to do in 1997; extending the 
tax imposed on corporate income for Superfund, which I hope will 
encourage Superfund reform, and closing corporate tax shelters, which 
Congress has been trying to do since Ronald Reagan was in the White 
House.
  A $1 increase in the minimum wage over 2 years is needed to restore 
the purchasing power or real value of the minimum wage, which has been 
greatly diminished over the last 20 years by inflation. In the United 
States, 59% of workers who will gain from a wage increase are women; 
70% are adults age 20 and over, and 40% are the sole breadwinners for 
their families. The bottom line--this proposal will generate $2,000 in 
additional income each year for full-time minimum wage workers. As a 
mother of two young children who balances the check book every month 
and

[[Page 29085]]

shops at the supermarket each week, I honestly don't know how a single 
parent who makes $5.15 an hour can feed their family and provide other 
basic necessities for their children.
  I am also very supportive of the tax relief provisions in this 
amendment which will help those who will be most affected by a minimum 
wage increase--small business owners and family farmers. This common 
sense package will expand access to health insurance by letting self-
employed individuals deduct 100 percent of their health insurance 
costs, a proposal I have supported for many years. I believe providing 
100 percent deductibility now to small business owners and independent 
farmers is more urgent today than ever as our country experiences one 
of the worst farm crises in recent memory. Furthermore, I have never 
understood why we deny a benefit to sole proprietors that is currently 
available to many large corporations.
  This package also includes another priority of mine--estate tax 
relief for family owned-farms and small business. Too often those who 
inherit a business or family farm from a relative must liquidate all or 
a portion of the property just to pay the estate tax which is owed.
  Another provision will help business owners provide child care 
assistance to their employees by allowing a 25% tax credit for 
qualified costs. In addition, this amendment will encourage investment 
in economically depressed areas like the Delta region in Arkansas and 
strengthen retirement security for workers by reducing small 
businesses' cost of setting up employee pension plans.
  Finally, I am hopeful that extending the tax imposed on corporate 
income for Superfund will be an added incentive to roll up our sleeves 
and pass meaningful Superfund reform legislation. I have worked on this 
issue since I came to Congress in 1993. I and millions of Americans are 
still waiting for Congress to fulfill its responsibility. I am sorry 
that our former colleague Senator Chafee, who was very passionate about 
this issue, died before Congress addressed Superfund reform.
  But before I yield the floor, I want to emphasize an important aspect 
of this plan that should not go unnoticed--it is paid for and does not 
threaten our government's ability to meet future obligations to Social 
Security and Medicare beneficiaries. Republicans and Democrats have 
knocked themselves out over the last year trying to blame each other 
for spending the Social Security trust fund, so I fail to understand 
how we can consider a proposal which costs $75 billion over ten years 
with virtually no means to pay for it. That is irresponsible and I 
can't support it.
  In short, Mr. President, the Kennedy amendment is a common sense 
proposal that is good for both employers and employees and I hope my 
colleagues on both sides of the aisle will stand with me in supporting 
this legislation.
  I thank my colleagues and yield the floor.
  Mr. KERRY. Mr. President, since 1938 we have had a minimum standard 
we accept as the lowest possible wage in our society. Today we are 
engaged in debate about the need to raise that standard. The modest 
proposal before us seeks to raise the minimum wage by $1.00 over the 
next two years. Even then--even if we succeed in doing what is so 
obvious, so reasonable, and so fair--Mr. President the real value of 
the lowest acceptable wage will only reach what it was in 1982, over 17 
years ago. We're not really talking about an increase here, we're 
talking about trying to keep pace, about making work pay, about 
restoring minimum wage workers to the purchasing power they had nearly 
two decades ago.
  Mr. President, opponents of a minimum-wage increase argue that it 
increases unemployment rates for entry-level workers, thereby hurting 
the very people it is meant to help. But this is not a radical 
proposal--as some Republicans claim--that will cause a dramatic spike 
in the unemployment rates and cripple small business. Numerous 
empirical studies, Mr. President, have found that recent hikes in the 
minimum wage have had little or no effect on job levels. A 1999 Levy 
Institute survey of small businesses revealed that more than three-
quarters of the firms surveyed said their employment practices would 
not be affected by an increase in the minimum wage to $6.00. A 
September New York Times editorial reported that ``. . . a modest hike 
is not likely to cause higher unemployment, even among low-skilled 
workers. Indeed, jobless rates fell after the 90-cent minimum-wage hike 
of 1996-7.''
  We have not in the past nor are we now advancing a radical proposal 
that will reverberate dangerously throughout our economy. We are merely 
considering a moderate increase in our Nation's wage floor, one that 
will bring us just back to where we were nearly 18 years ago.
  And while the increase is a modest one, it is crucial to today's 
working families. A $1.00 increase in the minimum wage will affect 11.4 
million workers. Full-time workers will make an additional $2,000 each 
year. Many minimum wage jobs do not provide pensions or health care. An 
additional $2,000 each year might mean the difference between being 
sick and getting treatment, the difference between a sickly child and a 
thriving one. An additional $2,000 each year might mean the difference 
between being hungry and being fed.
  Currently, a full-time minimum wage worker earns $10,712 per year--an 
income well below the poverty line for a family of three or four. 
Increasing the minimum wage will bring workers wages up to $12,800 per 
year, an income still below the poverty line for a family of three. So 
while we refer to the minimum wage as the lowest wage acceptable in our 
society, we must acknowledge that even after we pass this modest 
increase, a full-time minimum wage worker cannot safely raise a family 
on his/her earnings.
  Right now we are facing the greatest wage inequality since the Great 
Depression. Income inequality between the Nation's top earners and 
those at the bottom has been widening since the early 1970s. The strong 
economy and these generally prosperous times cause us to overlook the 
struggles faced by hard-working families. The growing wage gap between 
the rich and poor threatens our social fabric and the stability of our 
Nation. It is our job in the Congress to ensure that stability is 
maintained--that hard-working individuals are paid a fair wage--that 
working families can afford the basic necessities of life--that we are 
the kind of country that values work--and which values the 
contributions of each working American. It is time we meet that 
responsibility.
  Mr. FEINGOLD. Mr. President, I rise today to urge my colleagues to 
support efforts to increase the federal minimum wage by adopting the 
amendment offered by the Senator from Massachusetts, Mr. Kennedy, the 
Fair Minimum Wage Act of 1999. This important amendment will provide 
American laborers with a 50-cent increase to the minimum wage on 
January 1, 2000, and a second 50-cent increase on January 1, 2001. This 
modest increase, which would raise the minimum wage to $6.15 per hour, 
will help more than 11 million lower income Americans.
  Our country's economy is growing. Its economic vitality and the 
changes wrought by welfare reform have resulted in a better life for 
many working people--unless those workers are minimum wage workers, 
anchored to the bottom of the wage scale.
  The truth is, even though the economy is roaring, wages at the bottom 
are stagnant, and hard-working people are still living in poverty. 
According to the Center on Budget and Policy Priorities, in the mid-
1990s, there were 89,000 working poor families with children in 
Wisconsin. Seventy-four percent of those families had at least one 
working parent. And sixty-nine percent of these families had at least 
one working parent and still required some form of public assistance. 
In this time of a booming economy and low unemployment, these 
statistics are very troubling. Mr. President, the majority of the poor 
people of our country are working--the problem is that many of them are 
holding down low-paying jobs with stagnant wages that do not allow

[[Page 29086]]

them to finally break free from poverty.
  Despite successes in the welfare to work initiative, a 1998 U.S. 
Conference of Mayors study, entitled ``A Status Report on Hunger and 
Homelessness in American Cities,'' indicates that seventy-eight percent 
of the 30 major U.S. cities surveyed reported an increased demand for 
emergency food assistance. Thirty-seven percent of those people seeking 
food at soup kitchens and shelters in 1998 were employed. City 
officials surveyed listed low-paying jobs as the top cause of hunger in 
their cities. It is an undeniable disgrace that, in many cases, minimum 
wage workers cannot afford to feed themselves or their families.
  Mr. President, no hard working American should have to worry about 
affording groceries, shoes for their kids, or medicines. The people 
this amendment will help are not people who spend their money 
frivolously. These are the families who scrimp and save to provide 
their children with the necessities of life: a decent place to live, 
enough to eat, clothes on their back, a decent education, and some hope 
for a better future.
  The study, ``The State of Working Wisconsin--1998,'' by the Center on 
Wisconsin Strategy, contains some troubling news regarding wages. The 
Wisconsin median hourly wage is still eight-point-four percent below 
its 1979 level. Since 1979, Wisconsin's median wage has declined fifty 
percent faster than the five-point-three percent national decline over 
the same period. These numbers are, sadly, not unique to Wisconsin. 
This is the situation all over the country.
  And this is the situation that the Kennedy amendment will help to 
address. According to the Economic Policy Institute, more than 205,000 
workers in my home state of Wisconsin, or fifteen-point-one percent of 
Wisconsin's workforce, will benefit from the modest increase in this 
amendment. Those are real people, Mr. President. Real people who 
deserve this modest raise in pay for the work they do to support their 
families and to keep the American economy moving.
  Opponents of this increase argue that it will hurt the economy. The 
Bureau of Labor Statistics reports that the 1996 and 1997 raises in the 
minimum wage had a positive impact on the economy. Unemployment has 
dropped to four-point-one percent, the lowest mark in three decades. 
Nine-point-one million new jobs have been created. And there is no 
reason to believe that this proposed increase will not have the same 
result. In fact, history shows that minimum wage increases have not had 
a negative impact on unemployment.
  This modest increase of 50 cents per year is really not a hike at all 
after inflation--over the next two years it will simply restore the 
real value of the minimum wage to its 1982 level. So by the time the 
second installment of this proposed increase would go into effect, the 
buying power of workers scraping by on the minimum wage will be only 
what is was when Ronald Reagan was a new president. Meanwhile, wages at 
the high levels have been climbing steadily while the real value of the 
minimum wage has eroded.
  I urge my colleagues to begin to restore some respect for the dignity 
of work to the federal minimum wage. The lowest paid workers in 
America's labor force deserve a chance to earn a decent living and we 
need to give them the tools. I urge every Senator to support the 
Kennedy amendment. It is a vote to reward work and to support every 
American worker.
  Mr. ROTH. Mr. President, there are a few brief observations that 
would serve us well as we engage in this debate over minimum wage. 
Through the years, members on both sides of this issue have been able 
to come together successfully, to effect minimum wage increases.
  I believe we will be able to come together again, to advance a 
proposal that is good for individuals, as well as for economic growth 
and job creation. And I believe that in this effort it would be good to 
have such a common sense proposal follow the model of our actions in 
1996.
  As my colleagues know, three years ago we successfully enacted the 
Small Business Tax Act, which provided reasonable tax relief for 
businesses most affected by the costs incurred with the minimum wage 
increase. The current minimum wage of $5.15--which took effect on 
September 1, 1997--was established in that act. Minimum wage agreements 
prior to 1997 followed a similar pattern of consensus building.
  This year, as we again consider raising the minimum wage, there are a 
number of tax issues involved. The minimum wage amendment proposed by 
Senator Domenici includes a package of tax measures that were 
previously approved by the Senate Finance Committee. The Finance 
Committee has jurisdiction over these matters, and as these proposal 
had been previously vetted within our committee, I agreed to allow them 
to come straight to the floor.
  On the other hand, I am concerned with the revenue offsets included 
in the minimum wage amendment proposed by Senator Kennedy. Many of 
these provisions are controversial proposals which have been rejected 
by this Congress. And we need to be very careful as we proceed 
considering them.
  What is important is that we progress on this important issue--that 
if we are unable to agree on a compromise in this session as we are so 
close to adjournment, we will be able to successfully conclude this 
matter soon after our return next year.
  The PRESIDING OFFICER. All time of the Senator from Massachusetts has 
expired.
  The Senator from New Mexico has 1 minute 51 seconds.
  Mr. DOMENICI. I thank Senator Kennedy for a good debate. It was 
pretty exciting for so early in the morning. The Senator is pretty 
energetic even at 9 o'clock.
  However, let me close by saying our amendment saves small business 
and gives them an opportunity to grow and prosper and energize this 
economy; at the same time, it gives every opportunity for the young 
people in our country to get into jobs wherein they break into the 
marketplace, that first-level job, and get those kinds of jobs in 
sufficient numbers to be helpful for whatever they are doing. There are 
even high school students doing this. They are 50 percent of the 
minimum-wage people in this country.
  I have nothing against them. I have eight children; six of them 
worked in restaurants before they went to college and saved enough 
money because I didn't have enough money to put them through, having 
that many children. I understand that. They worked hard. They got 
promoted.
  Nothing could be further from the truth that we are trying to hurt 
young people, whatever their status. We want them and their employers 
to continue to have a mutual opportunity--mutual for the small business 
to energize the economy and mutual for job opportunity at the first 
level of employment in the American system.
  If Members are speaking of women heads of households, they are not 
talking about the minimum wage today; they are talking about the 
minimum wage 30 years ago. Eight percent of the minimum-wage earners in 
America today are women with full-time jobs--not 30, 40, or 50; 8 
percent.
  Clearly, we are trying to give everybody an opportunity to get better 
training and move ahead in job opportunities in the United States.
  I move to table the Kennedy amendment, and I ask for the yeas and 
nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.
  The PRESIDING OFFICER. The question is on agreeing to the motion to 
table amendment No. 2751. The yeas and nays have been ordered. The 
clerk will call the roll.
  The legislative assistant called the roll.
  Mr. NICKLES. I announce that the Senator from Arizona (Mr. McCain) is 
necessarily absent.
  Mr. REID. I announce that the Senator from South Carolina (Mr. 
Hollings) is absent because of a death in his family.
  The result was announced--yeas 50, nays 48, as follows:

[[Page 29087]]



                      {Rollcall Vote No. 356 Leg.

                                YEAS--50

     Abraham
     Allard
     Ashcroft
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Campbell
     Cochran
     Collins
     Coverdell
     Craig
     Crapo
     DeWine
     Domenici
     Enzi
     Fitzgerald
     Frist
     Gorton
     Gramm
     Grams
     Grassley
     Gregg
     Hagel
     Hatch
     Helms
     Hutchinson
     Hutchison
     Inhofe
     Kyl
     Lott
     Lugar
     Mack
     McConnell
     Murkowski
     Nickles
     Roberts
     Roth
     Santorum
     Sessions
     Shelby
     Smith (NH)
     Smith (OR)
     Stevens
     Thomas
     Thompson
     Thurmond
     Voinovich
     Warner

                                NAYS--48

     Akaka
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Breaux
     Bryan
     Byrd
     Chafee, L.
     Cleland
     Conrad
     Daschle
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham
     Harkin
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerrey
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Moynihan
     Murray
     Reed
     Reid
     Robb
     Rockefeller
     Sarbanes
     Schumer
     Snowe
     Specter
     Torricelli
     Wellstone
     Wyden

                             NOT VOTING--2

     Hollings
     McCain
       
  The motion was agreed to.
  Mr. NICKLES. I move to reconsider the vote.
  Mr. INHOFE. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                           Amendment No. 2547

  Mr. DOMENICI. Parliamentary inquiry, Mr. President. What is the next 
order of business?
  The PRESIDING OFFICER. There will now be 4 minutes of debate equally 
divided on the Domenici amendment.
  Does the Senator from New Mexico wish to begin debate?
  Mr. DOMENICI. I say to Senator Kennedy, I am prepared to yield back 
my time. Are you?
  Mr. KENNEDY. No. If we could have order, Mr. President.
  The PRESIDING OFFICER. The Senate will be in order. Senators please 
take their conversations off the floor.
  Mr. KENNEDY. The Senator from Maryland would like to address this 
issue, and I yield her the time on our side.
  I would insist on order, if I could.
  The PRESIDING OFFICER. Senators please take their conversations off 
the floor. The Senate will be in order.
  The Senator from Maryland is recognized for 2 minutes.
  Ms. MIKULSKI. Mr. President, I rise in opposition to the Republican 
amendment. I believe it is a watered-down, slowed-down, pennies-to-the-
poor approach.
  Why raise the minimum wage? We are in the greatest prosperity that 
the United States of America has ever seen. We have the opportunity to 
raise the standard of living for the poor. I believe what we need to 
do, now that we have moved hundreds of thousands of people from 
welfare, is to make work worth it.
  Who are the people we are talking about? We are talking about the 
working poor who raise our children, who care for our elderly, many 
working two or three jobs to hold the family together.
  I believe we need to make a commitment to the working poor, as we 
cross into the new century, that if you live in the United States of 
America and you work, you should not be poor.
  The amendment the Senator from Massachusetts proposed was modest. It 
was spread over a 2-year period. It would take us into 2001. Why should 
a day-care worker make less than someone who works 40 hours a week at a 
bank job? We need to make sure that in this country, in order to 
sustain the efforts we have made in improving the standard of living 
for people, if you work, you will not be poor.
  I yield such time as I might have.
  Mr. ABRAHAM. Mr. President, I rise to express my strong support for 
this important amendment. Without touching Social Security, it would 
provide significant assistance to millions of Americans struggling 
economically even during this time of sustained growth.
  I believe this amendment demonstrates my party's continuing 
commitment to fostering economic growth and helping those in need. And 
we should not forget that, despite recent economic good times, there 
are many Americans who remain in economic need.
  African-American youths continue to suffer from an unemployment rate 
three times that of white youths. Hispanic youths suffer from an 
unemployment rate ten points higher than that of whites. And 8 million 
American families continue to live in poverty.
  We can do better. We can do better.
  I believe this amendment constitutes an important step forward in our 
drive to unleash the entrepreneurial energies of the American people; 
energies that can lift individuals out of poverty as they push 
communities to higher levels of prosperity.
  This amendment contains an important provision of the Renewal 
Alliance package I have been working toward since coming to the United 
States Senate. It also contains a number of other provisions that I 
believe represent the responsible way to raise the minimum wage: by 
ensuring that businesses do not find themselves saddled with costs that 
lead them to lay off minimum wage workers, exactly those proponents of 
a minimum wage hike are trying to assist.
  This amendment addresses three major areas of concern to Americans 
striving to work their way into our vast middle class: work 
opportunity, investment, and health insurance.
  First, as to work opportunity. In my view opportunity is the key to 
progress. I have sought to increase this opportunity through the 
Renewal Alliance, a bipartisan group of Senators seeking targeted tax 
benefits to spur economic growth in our nation's distressed urban and 
rural communities. This amendment contains key provisions of the 
Renewal Alliance program.
  Most important is a provision to permanently extend the Work 
Opportunity Tax Credit. A credit of up to $2,400 for wages paid would 
provide businesses with extra funds for investment in growth and 
employee training. As a result, many Americans currently without bright 
futures will receive experience and training--the keys, in my view, to 
economic success.
  Also critical to providing increased work opportunity are provisions 
in this amendment that encourage greater investment, and greater 
investment in small businesses in particular.
  Mr. President, 99 percent of American employers are small businesses. 
Small businesses employ more than half our private work force, and they 
have consistently been the engine of our economic growth, whether in 
traditional industries or on the cutting edge of high technology.
  Further, Mr. President, it is often small business owners who are 
willing to take a chance on someone in need--someone without 
experience, someone who has fallen on hard times.
  If they are to employ more Americans who are in need, Mr. President, 
our small businesses must have access to more investment capital. This 
amendment would addresses our continuing shortage of investment, 
thereby spurring small business growth and hiring.
  First, it would increase the maximum dollar amount small businesses 
can deduct for investment in business property. By increasing this 
amount to $30,000, beginning in 2001, the amendment would provide an 
additional $3,850 in annual tax savings for small businesses investing 
in new equipment.
  Second, the amendment would provide more than 50 provisions 
encouraging investment in pensions. They would expand coverage, enhance 
fairness for women, increase portability, strengthen security and 
reduce regulatory burdens.
  Finally, this amendment would addresses inequities in our tax 
structure that keep an estimated 44 million Americans from affording 
health insurance. 44 million is a distressing number. Equally 
distressing is the fact that fully 81 percent of uninsured Americans 
have jobs.
  Too many Americans, including the self-employed, the unemployed, and 
employees of small companies that do

[[Page 29088]]

not provide health insurance, can't afford coverage. Why not? Because, 
under our tax code, they must pay taxes first, and buy insurance with 
whatever they have left over--if anything.
  Paying with after-tax dollars can make health insurance twice as 
expensive--too expensive for millions of working Americans.
  We must address this inequity in our tax code. This amendment would 
do just that.
  First, it would enable self-employed Americans to deduct the full 
cost of health insurance. Finally, entrepreneurs would get the same tax 
benefits as larger companies.
  Second, this amendment would provide an above-the-line deduction for 
individuals whose employers do not subsidize more than 50% of the cost 
of health coverage. Thus all workers, not just those who itemize, would 
be better able to afford health care costs.
  Taken together, these provisions would provide significantly greater 
economic opportunity for all Americans. They would safeguard our 
economic growth and spur further investment in American workers.
  I urge my colleagues to give this important amendment their full 
support.
  Mr. MOYNIHAN. Mr. President, I wish to point out a concern I have 
with a seemingly innocuous, seemingly beneficial, provision contained 
in the Domenici amendment to S. 625, the ``Bankruptcy Reform Act of 
1999''--Section   68. Modification of Exclusion for Employer Provided 
Transit Passes. The goal of the provision--to expand the use of the 
Federal transit benefit, a ``qualified transportation fringe'' in the 
vernacular--is admirable, but I fear that the way in which the 
provision pursues that goal may, in fact, unintentionally undermine the 
transit benefit.
  The employer-provided Federal transit benefit has evolved since its 
creation within the Deficit Reduction Act of 1984 as a $15 per month 
``de minimis'' benefit. After fourteen years of gradual change, last 
year's Transportation Equity Act for the 21st Century (TEA-21) codified 
the benefit as a ``pre-tax'' benefit of up to $65 per month. The cap 
will increase to $100 in 2002. The ``pre-tax'' aspect was a major 
reform because it provided an economic incentive--payroll tax savings--
for employers to offer the program. Companies would save money by 
offering a benefit of great utility to their workers while 
simultaneously removing automobiles from our choked and congested urban 
streets and highways. It is effective public policy. (As an aside, I 
should note that a similar pre-tax benefit of $175 per month exists for 
parking, and so despite all we know about air pollution and the 
intractable problems of automobile congestion, Congress continues to 
encourage people to drive. Discouraging perhaps, but we're closing the 
gap. If one doesn't have thirty years to devote to social policy, one 
should not get involved!)
  Quite consciously, and conscientiously, Congress established a bias 
in the statute toward the use of vouchers--which employers can 
distribute to employees--over bona fide cash reimbursement 
arrangements. We permitted employers to use cash reimbursement 
arrangements only when a voucher program was not readily available. We 
reasoned that because the vouchers could only be used for transit, we 
would eliminate the need for employees to prove that they were using 
the tax benefit for the intended purpose. Furthermore, by stipulating 
that voucher programs are the clear preference of Congress, we are 
compelling transit authorities to offer better services--monthly 
farecards, unlimited ride passes, smartcards, et al.--to the multitudes 
of working Americans who must presently endure all manner of 
frustrations and indignities during their daily work commute.
  While the new law has only been in effect for little more than a 
year, the program is catching on in our large metropolitan areas and 
should continue to expand. We have been alerted, however, to a 
legitimate concern of large multistate employers. Several of these 
companies have noted that establishing voucher programs can be arduous 
and unwieldy when the companies must craft separate programs in various 
jurisdictions with different transportation authorities. These 
difficulties, coupled with an expertise in administering cash 
reimbursement programs, have convinced the companies that bona fide 
cash reimbursement programs are more practical. Fair enough.
  We should, therefore, make it easier for such companies to offer the 
benefit through cash reimbursement arrangements. While I am committed 
to that end, I have serious reservations about the repeal of the 
voucher preference contained in the Domenici amendment.
  My main objection is that the U.S. Treasury is currently developing 
substantiation regulations for the administration of this benefit 
through cash reimbursement arrangements. These regulations will provide 
companies with a clear understanding of their obligations in the 
verification of their employees' transit usage, an understanding which 
does not exist today. Until these regulations are promulgated, voucher 
programs offer the only true mechanism of verification, as vouchers, 
unlike cash, are useless unless enjoyed for their intended purpose. The 
Congress should not take an action that might rapidly increase the use 
of a tax benefit without the existence of accompanying safeguards to 
ensue the program's integrity.
  I will work with my colleagues on the Finance Committee, with my 
revered Chairman, and any Senator interested in this issue, to improve 
the ease with which companies can offer this important benefit to their 
employees. It is, after all, in our national interest. But I must 
strongly oppose efforts to repeal the voucher preference until the 
Treasury establishes a regulatory framework for cash reimbursement. We 
have been told to expect the regulations by mid-January. We anxiously 
await their arrival.
  Mr. DOMENICI addressed the Chair.
  The PRESIDING OFFICER. The Chair recognizes the Senator from New 
Mexico.
  Mr. DOMENICI. Mr. President, the Republican bill does the following: 
It raises the minimum wage $1 in three installments instead of two. It 
gives great opportunity to small businesspeople and others who have 
been denied relief under the Tax Code of this country.
  Let me explain so everybody will understand the basic ones we try to 
help in this bill. One, we help workers pay for health care. For the 
first time in history, workers in the United States, many who work for 
small businesses, can buy their own health insurance and deduct every 
penny of it. Heretofore, they could not do that. We have a 100 percent 
self-employed health insurance deduction. That should have been the 
case 10 years ago. We finally have it in this bill.
  We made permanent the work opportunity tax credit, which is to help 
employers, mostly small businesses, hire those who cannot get jobs, and 
they get a credit for it. We made that permanent. That is good for 
America since we have reduced the number of welfare recipients in 
America by 48 percent; and we need to make permanent the incentive to 
hire them.
  We have reduced the Federal unemployment surtax. As I said, we have 
made permanent that work opportunity tax credit I just told you about.
  In addition, there is no question that the Democrats decided to raise 
taxes to pay for their wage increases. So they raise taxes almost $13 
billion in the first 5 years, which is not necessary with the kind of 
surpluses that we have. We have used merely 12.5 percent of the tax 
cuts we had proposed 5 months ago. So 12.5 percent of them are in this 
bill.
  This is the right thing to do.
  Let me close by telling you, 55 percent of the minimum wage earners 
in America are young people; two-thirds are part-time workers; and 8 
percent are women who are heads of households working full time.
  I yield the floor.
  Mr. KENNEDY. I yield myself the remaining 30 seconds.
  Mr. President, first, this is a watered-down increase in the minimum 
wage that does not deserve to pass. It is a sham.
  Second, this legislation assaults the whole formula on overtime. It 
threatens overtime for 73 million Americans.

[[Page 29089]]

  And third, it provides $75 billion in tax breaks for wealthy 
individuals that is not paid for.
  It does not deserve the support of the Senate. I hope it will be 
defeated.
  The PRESIDING OFFICER. All time has expired. The question is on the 
amendment.
  Mr. DOMENICI. I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.
  The PRESIDING OFFICER. The question is on agreeing to amendment No. 
2547. The yeas and nays have been ordered. The clerk will call the 
roll.
  The assistant legislative clerk called the roll.
  Mr. NICKLES. I announce that the Senator from Arizona (Mr. McCain) is 
necessarily absent.
  Mr. REID. I announce that the Senator from South Carolina (Mr. 
Hollings) is absent because of a death in the family.
  The result was announced--yeas 54, nays 44, as follows:

                      [Rollcall Vote No. 357 Leg.]

                                YEAS--54

     Abraham
     Allard
     Ashcroft
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Campbell
     Chafee, L.
     Cleland
     Cochran
     Collins
     Coverdell
     Craig
     Crapo
     DeWine
     Domenici
     Enzi
     Fitzgerald
     Frist
     Gorton
     Gramm
     Grams
     Grassley
     Gregg
     Hagel
     Hatch
     Helms
     Hutchinson
     Hutchison
     Inhofe
     Jeffords
     Kyl
     Lott
     Lugar
     Mack
     McConnell
     Murkowski
     Nickles
     Roberts
     Roth
     Santorum
     Sessions
     Shelby
     Smith (NH)
     Smith (OR)
     Snowe
     Specter
     Stevens
     Thomas
     Thompson
     Thurmond
     Warner

                                NAYS--44

     Akaka
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Breaux
     Bryan
     Byrd
     Conrad
     Daschle
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham
     Harkin
     Inouye
     Johnson
     Kennedy
     Kerrey
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Moynihan
     Murray
     Reed
     Reid
     Robb
     Rockefeller
     Sarbanes
     Schumer
     Torricelli
     Voinovich
     Wellstone
     Wyden

                             NOT VOTING--2

     Hollings
     McCain
       
  The amendment (No. 2547) was agreed to.
  Mr. NICKLES. I move to reconsider the vote.
  Mr. LOTT. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  (Mr. ENZI assumed the Chair.)
  Mr. LEAHY. Mr. President, to bring Senators up to date on where we 
are, the distinguished Senator from New Jersey, Mr. Torricelli, and I 
have been working with the distinguished Senators from Iowa and Utah, 
Messrs. Grassley and Hatch, to clear as many amendments as we can agree 
to. Senators Grassley, Hatch, Torricelli, and I have been able to get a 
number of these agreed to. We have more than 10 amendments we are ready 
to accept to show we are making progress on this bill.
  For the benefit of Senators, I will briefly describe these amendments 
we are prepared to accept. We are prepared to accept the Feingold 
amendment No. 2745, an amendment to improve the bill by prohibiting 
retroactive assessments of disposable income. It ensures that farmers 
forced into bankruptcy can continue to carry on their farming 
operations without retroactive assessments against their disposable 
income.
  We are prepared to accept Robb amendment No. 1723 which improves the 
bill by clarifying the trustees shall return any payments not 
previously paid and not yet due and owing to lessors and purchase money 
secured creditors if a plan is not confirmed.
  We are prepared to accept Grassley amendment No. 1731, a bipartisan 
amendment improving the bill by giving bankruptcy judges the discretion 
to waive the $175 filing fee for chapter 7 cases for debtors whose 
annual income is less than 125 percent of the poverty level. Bankruptcy 
is the only civil proceeding where in forma pauperis filing status is 
not permitted. This amendment corrects that anomaly. The Grassley 
amendment is cosponsored by Senators Torricelli, Specter, Feingold, and 
Biden.
  Feingold amendment No. 2743 improves the bill by striking the 
requirement that debtor's attorneys must pay a trustee's attorney fees 
if the debtor is not substantially justified in filing for chapter 7. 
The current requirement that debtor's attorney must pay a trustee 
attorney's fee often causes a chilling effect of discouraging eligible 
debtors from filing chapter 7 for fear of paying future fees. Senator 
Specter is a sponsor of this amendment.
  We have Hatch amendment No. 1714 improving the bill by adding 
procedures for the prosecution of materially fraudulent claims in 
bankruptcy schedules.
  Hatch amendment No. 1715 improves the bill by dismissing bankruptcy 
cases if the debtor commits a crime of violence or a drug trafficking 
crime.
  The Kerry amendment No. 1725 modifies the deadlines for small 
business bankruptcy filings. Small businesses need the reasonable time 
limits of this amendment to reorganize their business.
  We have the Collins amendment No. 1726, a bipartisan amendment 
improving the bill by providing bankruptcy rules for family fishermen. 
The amendment is cosponsored by Senators Kerry of Massachusetts, 
Murray, Stevens, and Kennedy.
  Johnson amendment No. 2654 improves the bill by paying chapter 7 
trustees if a case is dismissed or diverted under the bill's means 
test.
  The DeWine amendment No. 1727 improves the bill by clarifying that a 
debt from a qualified education loan under the Internal Revenue Service 
Code is nondischargable.
  Grassley amendment No. 2514 improves the bill by clarifying a special 
tax assessment on real property secured debts under bankruptcy laws. 
Many municipal governments, particularly in California, depend on these 
real estate taxes or assessments for revenues. The distinguished 
Senator from California, Mrs. Feinstein, is a cosponsor of this 
amendment.
  Senators had been coming to the floor Friday and Monday to offer 
amendments. Even though we had only half a day of debate yesterday, 
Senators from both sides of the aisle offered amendments to improve the 
bill.
  So I urge Senators to continue to do that. We could accept a vote or 
otherwise dispose of the Democratic and Republican amendments. I have 
discussed this with the distinguished Senator from Iowa. Both of us 
would like, if at all possible, to whittle down the number and be able 
to tell our colleagues at what point we are apt to finish the bill. We 
have been working. I don't think we have even had quorum calls.
  I yield the floor.
  The PRESIDING OFFICER. The Chair recognizes the Senator from Iowa.
  Mr. GRASSLEY. Mr. President, first of all, I thank the Senator from 
Vermont for his encouragement of all Members that although we have had 
so many amendments filed, it would be determined that every amendment 
either be offered or else dropped from the list. I hope later on this 
afternoon we can finish that process.
  Mr. LEAHY. I thank my colleague.


 Amendments Nos. 2745, 1723, 1731, 2743, 1714, 1715, 1725, 1726, 2654, 
                           1727, 2514 En Bloc

  Mr. GRASSLEY. With respect to the individual amendments that the 
Senator from Vermont just gave details of, I ask unanimous consent the 
amendments listed be considered en bloc, agreed to en bloc, and the 
motion to reconsider be laid on the table.
  They are amendments Nos. 2745, 1723, 1731, 2743, 1714, 1715, 1725, 
1726, 2654, 1727, 2514.
  Mr. LEAHY. We have no objection.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendments (Nos. 2745, 1723, 1731, 2743, 1714, 1715, 1725, 1726, 
2654, 1727, 2514) were considered and agreed to en bloc, as follows:


                           AMENDMENT NO. 2745

  (Purpose: To prohibit the retroactive assessment of disposal income)

       At the end of title X, insert the following:

[[Page 29090]]



     SEC. __. PROHIBITION OF RETROACTIVE ASSESSMENT OF DISPOSABLE 
                   INCOME.

       (a) In General.--Section 1225(b) of title 11, United States 
     Code, is amended by adding at the end the following:
       ``(3) If the plan provides for specific amounts of property 
     to be distributed on account of allowed unsecured claims as 
     required by paragraph (1)(B), those amounts equal or exceed 
     the debtor's projected disposable income for that period, and 
     the plan meets the requirements for confirmation other than 
     those of this subsection, the plan shall be confirmed.''.
       (b) Modification.--Section 1229 of title 11, United States 
     Code, is amended by adding at the end the following:
       ``(d)(1) A modification of the plan under this section may 
     not increase the amount of payments that were due prior to 
     the date of the order modifying the plan.
       ``(2) A modification of the plan under this section to 
     increase payments based on an increase in the debtor's 
     disposable income may not require payments to unsecured 
     creditors in any particular month greater than the debtor's 
     disposable income for that month unless the debtor proposes 
     such a modification.
       ``(3) A modification of the plan in the last year of the 
     plan shall not require payments that would leave the debtor 
     with insufficient funds to carry on the farming operation 
     after the plan is completed unless the debtor proposes such a 
     modification.''.
                                  ____



                           AMENDMENT NO. 1723

(Purpose: To clarify the amount of payments to be returned to a debtor 
          if a plan is not confirmed, and for other purposes)

       On page 106, line 16, insert ``and not yet due and owing'' 
     after ``previously paid''.
                                  ____



                           AMENDMENT NO. 1731

(Purpose: To provide for a waiver of filing fees in certain bankruptcy 
                     cases, and for other purposes)

       On page 145, between lines 15 and 16, insert the following:

     SEC. 420. BANKRUPTCY FEES.

       Section 1930 of title 28, United States Code, is amended--
       (1) in subsection (a), by striking ``Notwithstanding 
     section 1915 of this title, the parties'' and inserting 
     ``Subject to subsection (f), the parties''; and
       (2) by adding at the end the following:
       ``(f)(1) The Judicial Conference of the United States shall 
     prescribe procedures for waiving fees under this subsection.
       ``(2) Under the procedures described in paragraph (1), the 
     district court or the bankruptcy court may waive a filing fee 
     described in paragraph (3) for a case commenced under chapter 
     7 of title 11 if the court determines that an individual 
     debtor whose income is less than 125 percent of the income 
     official poverty line (as defined by the Office of Management 
     and Budget, and revised annually in accordance with section 
     673(2) of the Omnibus Budget Reconciliation Act of 1981) 
     applicable to a family of the size involved is unable to pay 
     that fee in installments.
       ``(3) A filing fee referred to in paragraph (2) is--
       ``(A) a filing fee under subsection (a)(1); or
       ``(B) any other fee prescribed by the Judicial Conference 
     of the United States under subsection (b) that is payable to 
     the clerk of the district court or the clerk of the 
     bankruptcy court upon the commencement of a case under 
     chapter 7 of title 11.
       ``(4) In addition to waiving a fee under paragraph (2), the 
     district court or the bankruptcy court may waive any other 
     fee prescribed under subsection (b) or (c) if the court 
     determines that the individual with an income at a level 
     described in paragraph (2) is unable to pay that fee in 
     installments.''.
                                  ____



                           AMENDMENT NO. 2743

   (Purpose: To modify the standard for the award of attorneys' fees)

       On page 12, strike line 22 and insert ``frivolous.''.
                                  ____



                           AMENDMENT NO. 1714

 (Purpose: To provide for improved enforcement of criminal bankruptcy 
               filing provisions, and for other purposes)

       On page 28, line 7, after ``debt'', insert ``and materially 
     fraudulent statements in bankruptcy schedules''.
       On page 28, line 12, after the period, insert ``In addition 
     to addressing the violations referred to in the preceding 
     sentence, the individuals described under subsection (b) 
     shall address violations of section 152 or 157 relating to 
     materially fraudulent statements in bankruptcy schedules that 
     are intentionally false or intentionally misleading.''.
       On page 28, line 25, strike the quotation marks and the 
     second period.
       On page 28, after line 25, insert the following:
       ``(d) Bankruptcy Procedures.--The bankruptcy courts shall 
     establish procedures for referring any case which may contain 
     a materially fraudulent statement in a bankruptcy schedule to 
     the individuals designated under this section.''.
       On page 29, strike the item between lines 3 and 4 and 
     insert the following:

``158. Designation of United States attorneys and agents of the Federal 
              Bureau of Investigation to address abusive reaffirmations 
              of debt and materially fraudulent statements in 
              bankruptcy schedules.''.
                                  ____



                           AMENDMENT NO. 1715

  (Purpose: To amend section 707, of title 11, United States Code, to 
  provide for the dismissal of certain cases filed under chapter 7 of 
that title by a debtor who has been convicted of a crime of violence or 
                       a drug trafficking crime)

       On page 14, between lines 14 and 15, insert the following:
       (c) Dismissal for Certain Crimes.--Section 707 of title 11, 
     United States Code, as amended by subsection (a) of this 
     section, is amended by adding at the end the following:
       ``(c)(1) In this subsection--
       ``(A) the term `crime of violence' has the meaning given 
     that term in section 16 of title 18; and
       ``(B) the term `drug trafficking crime' has the meaning 
     given that term in section 924(c)(2) of title 18.
       ``(2) Except as provided in paragraph (3), after notice and 
     a hearing, the court, on a motion by the victim of a crime of 
     violence or a drug trafficking crime, or at the request of a 
     party in interest, shall dismiss a voluntary case filed by an 
     individual debtor under this chapter if that individual was 
     convicted of that crime.
       ``(3) The court may not dismiss a case under paragraph (2) 
     if the debtor establishes by a preponderance of the evidence 
     that the filing of a case under this chapter is necessary to 
     satisfy a claim for a domestic support obligation.''.
       On page 14, line 15, strike ``(c)'' and insert ``(d)''.
                                  ____



                           AMENDMENT NO. 1725

       (Purpose: To amend plan filing and confirmation deadlines)

       On page 155, line 16, strike ``90'' and insert ``180''.
       On page 155, strike through lines 18 and 19.
       On page 155, line 20, strike ``(B)'' and insert ``(A)''.
       On page 155, line 22, strike ``(C)'' and insert ``(B)''.
       On page 155, line 24, strike ``90'' and insert ``300''.
       Beginning on page 156, line 22, strike through page 157, 
     line 8.
       Redesignate sections 430 through 435 as sections 429 
     through 434, respectively.
       On page 159, lines 13 and 14, strike ``, as amended by 
     section 429 of this Act,''.
       On page 250, line 17, strike ``432(2)'' and insert 
     ``431(2)''.
                                  ____



                           AMENDMENT NO. 1726

               (Purpose: To provide for family fishermen)

       At the appropriate place insert the following:

     SEC. __. FAMILY FISHERMEN.

       (a) Definitions.--Section 101 of title 11, United States 
     Code, is amended--
       (1) by inserting after paragraph (7) the following:
       ``(7A) `commercial fishing operation' includes--
       ``(A) the catching or harvesting of fish, shrimp, lobsters, 
     urchins, seaweed, shellfish, or other aquatic species or 
     products;
       ``(B) for purposes of section 109 and chapter 12, 
     aquaculture activities consisting of raising for market any 
     species or product described in subparagraph (A); and
       ``(C) the transporting by vessel of a passenger for hire 
     (as defined in section 2101 of title 46) who is engaged in 
     recreational fishing;
       ``(7B) `commercial fishing vessel' means a vessel used by a 
     fisherman to carry out a commercial fishing operation;'';
       (2) by inserting after paragraph (19) the following:
       ``(19A) `family fisherman' means--
       ``(A) an individual or individual and spouse engaged in a 
     commercial fishing operation (including aquaculture for 
     purposes of chapter 12)--
       ``(i) whose aggregate debts do not exceed $1,500,000 and 
     not less than 80 percent of whose aggregate noncontingent, 
     liquidated debts (excluding a debt for the principal 
     residence of such individual or such individual and spouse, 
     unless such debt arises out of a commercial fishing 
     operation), on the date the case is filed, arise out of a 
     commercial fishing operation owned or operated by such 
     individual or such individual and spouse; and
       ``(ii) who receive from such commercial fishing operation 
     more than 50 percent of such individual's or such 
     individual's and spouse's gross income for the taxable year 
     preceding the taxable year in which the case concerning such 
     individual or such individual and spouse was filed; or
       ``(B) a corporation or partnership--
       ``(i) in which more than 50 percent of the outstanding 
     stock or equity is held by--

       ``(I) 1 family that conducts the commercial fishing 
     operation; or
       ``(II) 1 family and the relatives of the members of such 
     family, and such family or such relatives conduct the 
     commercial fishing operation; and

       ``(ii)(I) more than 80 percent of the value of its assets 
     consists of assets related to the commercial fishing 
     operation;
       ``(II) its aggregate debts do not exceed $1,500,000 and not 
     less than 80 percent of its

[[Page 29091]]

     aggregate noncontingent, liquidated debts (excluding a debt 
     for 1 dwelling which is owned by such corporation or 
     partnership and which a shareholder or partner maintains as a 
     principal residence, unless such debt arises out of a 
     commercial fishing operation), on the date the case is filed, 
     arise out of a commercial fishing operation owned or operated 
     by such corporation or such partnership; and
       ``(III) if such corporation issues stock, such stock is not 
     publicly traded;''; and
       (3) by inserting after paragraph (19A) the following:
       ``(19B) `family fisherman with regular annual income' means 
     a family fisherman whose annual income is sufficiently stable 
     and regular to enable such family fisherman to make payments 
     under a plan under chapter 12 of this title;''.
       (b) Who May Be a Debtor.--Section 109(f) of title 11, 
     United States Code, is amended by inserting ``or family 
     fisherman'' after ``family farmer''.
       (c)  Chapter 12.--Chapter 12 of title 11, United States 
     Code, is amended--
       (1) in the chapter heading, by inserting ``OR FISHERMAN'' 
     after ``FAMILY FARMER'';
       (2) in section 1201, by adding at the end the following:
       ``(e)(1) Notwithstanding any other provision of law, for 
     purposes of this subsection, a guarantor of a claim of a 
     creditor under this section shall be treated in the same 
     manner as a creditor with respect to the operation of a stay 
     under this section.
       ``(2) For purposes of a claim that arises from the 
     ownership or operation of a commercial fishing operation, a 
     co-maker of a loan made by a creditor under this section 
     shall be treated in the same manner as a creditor with 
     respect to the operation of a stay under this section.'';
       (3) in section 1203, by inserting ``or commercial fishing 
     operation'' after ``farm'';
       (4) in section 1206, by striking ``if the property is 
     farmland or farm equipment'' and inserting ``if the property 
     is farmland, farm equipment, or property of a commercial 
     fishing operation (including a commercial fishing vessel)''; 
     and
       (5) by adding at the end the following:

     ``Sec. 1232. Additional provisions relating to family 
       fishermen

       ``(a)(1) Notwithstanding any other provision of law, except 
     as provided in subsection (c), with respect to any commercial 
     fishing vessel of a family fisherman, the debts of that 
     family fisherman shall be treated in the manner prescribed in 
     paragraph (2).
       ``(2)(A) For purposes of this chapter, a claim for a lien 
     described in subsection (b) for a commercial fishing vessel 
     of a family fisherman that could, but for this subsection, be 
     subject to a lien under otherwise applicable maritime law, 
     shall be treated as an unsecured claim.
       ``(B) Subparagraph (A) applies to a claim for a lien 
     resulting from a debt of a family fisherman incurred on or 
     after the date of enactment of this chapter.
       ``(b) A lien described in this subsection is--
       ``(1) a maritime lien under subchapter III of chapter 313 
     of title 46 without regard to whether that lien is recorded 
     under section 31343 of title 46; or
       ``(2) a lien under applicable State law (or the law of a 
     political subdivision thereof).
       ``(c) Subsection (a) shall not apply to--
       ``(1) a claim made by a member of a crew or a seaman 
     including a claim made for--
       ``(A) wages, maintenance, or cure; or
       ``(B) personal injury; or
       ``(2) a preferred ship mortgage that has been perfected 
     under subchapter II of chapter 313 of title 46.
       ``(d) For purposes of this chapter, a mortgage described in 
     subsection (c)(2) shall be treated as a secured claim.''.
       (d) Clerical Amendments.--
       (1) Table of chapters.--In the table of chapters for title 
     11, United States Code, the item relating to chapter 12, is 
     amended to read as follows:

``12. Adjustments of Debts of a Family Farmer or Family Fisherman with 
    Regular Annual Income...................................1201''.....

       (2) Table of sections.--The table of sections for chapter 
     12 of title 11, United States Code, is amended by adding at 
     the end the following new item:

``1232. Additional provisions relating to family fishermen.''.

       (e) Nothing in this title is intended to change, affect, or 
     amend the Magnuson-Stevens Fishery Conservation and 
     Management Act (16 U.S.C. 1801, et seq.).
                                  ____



                           AMENDMENT NO. 2654

 (Purpose: To provide chapter 7 trustees with reasonable compensation 
          for their work in managing the ability to pay test)

       At the appropriate place, insert the following:

     SEC. __. COMPENSATING TRUSTEES.

       Title 11, United States Code, is amended--
       (1) in section 104(b)(1) in the matter preceding 
     subparagraph (A) by--
       (A) striking ``and 523(a)(2)(C)''; and
       (B) inserting ``523(a)(2)(C), and 1326(b)(3)'' before 
     ``immediately'';
       (2) in section 326, by inserting at the end the following:
       ``(e) Notwithstanding any other provision of this section, 
     if a trustee in a chapter 7 case commences a motion to 
     dismiss or convert under section 707(b) and such motion is 
     granted, the court shall allow reasonable compensation under 
     section 330(a) of this title for the services and expenses of 
     the trustee and the trustee's counsel in preparing and 
     presenting such motion and any related appeals.''; and
       (3) in section 1326(b)--
       (A) in paragraph (1), by striking ``and'';
       (B) in paragraph (2), by striking the period at the end and 
     inserting ``; and''; and
       (C) by adding at the end the following:
       ``(3) if a chapter 7 trustee has been allowed compensation 
     under section 326(e) in a case converted to this chapter or 
     in a case dismissed under section 707(b) in which the debtor 
     in this case was a debtor--
       ``(A) the amount of such unpaid compensation which shall be 
     paid monthly by prorating such amount over the remaining 
     duration of the plan, but a monthly payment shall not exceed 
     the greater of--
       ``(i) $25; or
       ``(ii) the amount payable to unsecured nonpriority 
     creditors as provided by the plan multiplied by 5 percent, 
     and the result divided by the number of months in the plan; 
     and
       ``(B) notwithstanding any other provision of this title--
       ``(i) such compensation is payable and may be collected by 
     the trustee under this paragraph even if such amount has been 
     discharged in a prior proceeding under this title; and
       ``(ii) such compensation is payable in a case under this 
     chapter only to the extent permitted by this paragraph.''.
                                  ____



                           AMENDMENT NO. 1727

(Purpose: To provide for the nondischargeability of certain educational 
                          benefits and loans)

       On page 53, insert between lines 18 and 19 the following:

     SEC. 220. NONDISCHARGEABILITY OF CERTAIN EDUCATIONAL BENEFITS 
                   AND LOANS.

       Section 523(a) of title 11, United States Code, is amended 
     by striking paragraph (8) and inserting the following:
       ``(8) unless excepting such debt from discharge under this 
     paragraph would impose an undue hardship on the debtor and 
     the debtor's dependents, for--
       ``(A)(i) an educational benefit overpayment or loan made, 
     insured, or guaranteed by a governmental unit, or made under 
     any program funded in whole or in part by a governmental unit 
     or nonprofit institution; or
       ``(ii) an obligation to repay funds received as an 
     educational benefit, scholarship, or stipend; or
       ``(B) any other educational loan that is a qualified 
     education loan, as that term is defined in section 221(e)(1) 
     of the Internal Revenue Code of 1986, incurred by an 
     individual debtor;''.
                                  ____



                           amendment no. 2514

         (Purpose: To amend Title 11 of the United States Code)

       Insert at the appropriate place:
       Section 362(b)(18) of title 11, United States Code, is 
     amended to read as follows:
       (18) under subsection (a) of the creation or perfection of 
     a statutory lien for an ad valorem property tax, or a special 
     tax or special assessment on real property whether or not ad 
     valorem, imposed by a governmental unit, if such tax or 
     assessment comes due after the filing of the petition.

  Mr. FEINGOLD. Mr. President, I thank the managers for offering and 
accepting the bipartisan amendment that would allow courts to waive the 
filing fee for chapter 7 filers who cannot afford to pay. This is 
similar to an amendment that Senator Specter and I successfully offered 
on the floor in the last Congress. I am certain we could have repeated 
that success on this bill, but I did not think it was necessary this 
year to have a rollcall vote since the House-passed bankruptcy bill 
includes a similar provision.
  It is unbelievable to me that bankruptcy is the only Federal civil 
proceeding in which a poor person cannot file in forma pauperis. That 
means that in any other federal civil proceeding you can file a case 
without paying the filing fee if the court determines that you are 
unable to afford the fee, but in bankruptcy you either pay the filing 
fee or you are denied access to the system.
  That doesn't make any sense. The bankruptcy system, is by definition 
designed to assist those who have fallen on hard times, but because 
there is no allowance for in forma pauperis filing, the system is 
unavailable to the poorest of the poor. This prohibition against 
debtors filing in forma pauperis is a clear obstacle to the poor 
gaining access to justice.
  Currently the filing fee for consumer bankruptcy is $175, and it may 
well be

[[Page 29092]]

increased in this bill. That's roughly the weekly take home pay of an 
employee working a 40-hour week at the minimum wage. It is unreasonable 
and unrealistic to expect the indigent--people who barely get by from 
week to week, the very people who truly need the protection afforded by 
the bankruptcy system the most--to save money to raise such a fee 
simply to enter the system.
  Congress has already acknowledged that the bankruptcy system may need 
an in forma pauperis proceeding by enacting a three year pilot program 
in six judical districts across the country. The Federal Judicial 
Center recently submitted a comprehensive report to Congress analyzing 
this pilot program in which it found that:
  A fee waiver application was filed in only 3.4 percent of all chapter 
7 cases, and the large majority of these waivers were granted. Indeed, 
the U.S. Trustees Office filed objections to less than 1 percent of the 
applications. In other words, only those very few individuals who 
really needed the fee-waiver applied for it.
  The fee-waiver program enhanced access to the bankruptcy system for 
indigent single women above and beyond any other group. We cannot 
strike another blow against single mothers and their children by 
denying them access to the bankruptcy system because they cannot even 
afford the filing fee.
  The nature of the debt for those who filed for the fee-waiver 
differed from that of other debtors in that their debts related more to 
basic subsistence--education, health, utility services, and housing. 
Moreover, 63 percent of the housing-related debts of those who filed 
for the fee-waiver owed their debts to public housing authorities. 
Therefore, these indigent debtors were not filing bankruptcy to escape 
paying for their boats, or their fancy entertainment systems. They were 
filing bankruptcy merely to subsist.
  Often times the bankruptcy system was the only thing that stood 
between these unfortunate people and homelessness.
  There was only a minimal increase in the number of filings and there 
was no indication that debtors filed for chapter 7 rather than chapter 
13 just to obtain the benefit of the fee-waiver program. Simply stated, 
the debtors did not abuse the system.
  In sum, this amendment would build upon the strong foundation 
established in the pilot program and direct the Judicial Center to 
create a nation-wide in forma pauperis program for the bankruptcy 
system, thus, establishing some fairness in the bankruptcy filing 
process for the most financially strapped debtors.
  We have made one modification in the amendment to make sure that in 
forma pauperis filing status is only available to truly indigent 
people, namely those with an annual income of below 125% of the poverty 
level. That is the same income qualification required for people to 
receive free legal assistance from the Legal Service Corporation. 
Obviously, we don't intend for the bankruptcy filing fee to be waived 
for people who aren't really poor. So I was happy to agree to this 
modification.
  The expenditure of funds required by this amendment is clearly 
justified. We made the decision long ago in this country that our 
judicial system would be open to everyone--those who can pay, and those 
who cannot--and we decided that as a nation, we would absorb the cost 
of allowing those who could not pay to receive the same access as those 
who could. If you are poor, and you cannot afford the fee to file for 
divorce, we absorb the cost. If someone does you wrong and you cannot 
afford the filing fee to sue, we absorb the cost. Likewise, if you are 
in such financial difficulty that you must file for bankruptcy, and you 
cannot afford the filing fee, now, because of this amendment, we must 
also absorb the cost.
  In this bill, where we are giving such advantages to the well-heeled 
landlords and credit companies, I am pleased that we will take this 
small step to ensure that the poorest of the poor are not shut out of 
this very important part of our system of justice. Again, I thank the 
managers for agreeing to this amendment.
  The PRESIDING OFFICER. The Chair recognizes the Senator from 
Connecticut.
  Mr. DODD. Mr. President, if I can get the attention of the floor 
manager of this bill, I think what I am about to do is all right. I 
will call up three amendments and immediately ask for them to be laid 
aside, and then I will call up an amendment which I want to debate.


                  Amendments Nos. 2531, 2532, and 2753

  Mr. DODD. Mr. President, I call up amendments Nos. 2531, 2532, and 
2753.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Connecticut [Mr. Dodd] proposes amendments 
     numbered 2531, 2532, and 2753.

  The amendments are as follows:


                           amendment no. 2531

            (Purpose: To protect certain education savings)

       On page 83, between lines 4 and 5, insert the following:

     SEC. 2   . PROTECTION OF EDUCATION SAVINGS.

       (a) Exclusions.--Section 541 of title 11, United States 
     Code, as amended by section 903, is amended--
       (1) in subsection (b)--
       (A) in paragraph (5), by striking ``or'' at the end;
       (B) by redesignating paragraph (6) as paragraph (8); and
       (C) by inserting after paragraph (5) the following:
       ``(6) funds placed in an education individual retirement 
     account (as defined in section 530(b)(1) of the Internal 
     Revenue Code of 1986) not later than 365 days before the date 
     of filing of the petition, but--
       ``(A) only if the designated beneficiary of such account 
     was a son, daughter, stepson, stepdaughter, grandchild, or 
     step-grandchild of the debtor for the taxable year for which 
     funds were placed in such account;
       ``(B) only to the extent that such funds--
       ``(i) are not pledged or promised to any entity in 
     connection with any extension of credit; and
       ``(ii) are not excess contributions (as described in 
     section 4973(e) of the Internal Revenue Code of 1986); and
       ``(C) in the case of funds placed in all such accounts 
     having the same designated beneficiary not earlier than 720 
     days nor later than 365 days before such date, only so much 
     of such funds as does not exceed $5,000;
       ``(7) funds used to purchase a tuition credit or 
     certificate or contributed to an account in accordance with 
     section 529(b)(1)(A) of the Internal Revenue Code of 1986 
     under a qualified State tuition program (as defined in 
     section 529(b)(1) of such Code) not later than 365 days 
     before the date of filing of the petition, but--
       ``(A) only if the designated beneficiary of the amounts 
     paid or contributed to such tuition program was a son, 
     daughter, stepson, step-daughter, grandchild, or step-
     grandchild of the debtor for the taxable year for which funds 
     were paid or contributed;
       ``(B) with respect to the aggregate amount paid or 
     contributed to such program having the same designated 
     beneficiary, only so much of such amount as does not exceed 
     the total contributions permitted under section 529(b)(7) of 
     such Code with respect to such beneficiary, as adjusted 
     beginning on the date of the filing of the petition by the 
     annual increase or decrease (rounded to the nearest tenth of 
     1 percent) in the education expenditure category of the 
     Consumer Price Index prepared by the Department of Labor; and
       ``(C) in the case of funds paid or contributed to such 
     program having the same designated beneficiary not earlier 
     than 720 days nor later than 365 days before such date, only 
     so much of such funds as does not exceed $5,000; or''; and
       (2) by adding at the end the following:
       ``(f) In determining whether any of the relationships 
     specified in paragraph (6)(A) or (7)(A) of subsection (b) 
     exists, a legally adopted child of an individual (and a child 
     who is a member of an individual's household, if placed with 
     such individual by an authorized placement agency for legal 
     adoption by such individual), or a foster child of an 
     individual (if such child has as the child's principal place 
     of abode the home of the debtor and is a member of the 
     debtor's household) shall be treated as a child of such 
     individual by blood.''.
       (b) Debtor's Duties.--Section 521 of title 11, United 
     States Code, as amended by sections 105(d), 304(c)(1), 
     305(2), 315(b), and 316 of this Act, is amended by adding at 
     the end the following:
       ``(k) In addition to meeting the requirements under 
     subsection (a), a debtor shall file with the court a record 
     of any interest that a debtor has in an education individual 
     retirement account (as defined in section 530(b)(1) of the 
     Internal Revenue Code of 1986) or under a qualified State 
     tuition program (as defined in section 529(b)(1) of such 
     Code).''.
                                  ____

       On page 7, line 15, strike ``(ii)'' and insert ``(ii)(I)''.
       On page 7, between lines 21 and 22, insert the following:

[[Page 29093]]

       ``(II) The expenses referred to in subclause (I) shall 
     include--
       ``(aa) taxes and mandatory withholdings from wages;
       ``(bb) health care;
       ``(cc) alimony, child, and spousal support payments;
       ``(dd) legal fees necessary for the debtor's case;
       ``(ee) child care and the care of elderly or disabled 
     family members;
       ``(ff) reasonable insurance expenses and pension payments;
       ``(gg) religious and charitable contributions;
       ``(hh) educational expenses not to exceed $10,000 per 
     household;
       ``(ii) union dues;
       ``(jj) other expenses necessary for the operation of a 
     business of the debtor or for the debtor's employment;
       ``(kk) utility expenses and home maintenance expenses for a 
     debtor that owns a home;
       ``(ll) ownership costs for a motor vehicle, determined in 
     accordance with Internal Revenue Service transportation 
     standards, reduced by any payments on debts secured by the 
     motor vehicle or vehicle lease payments made by the debtor;
       ``(mm) expenses for children's toys and recreation for 
     children of the debtor;
       ``(nn) tax credits for earned income determined under 
     section 32 of the Internal Revenue Code of 1986; and
       ``(oo) miscellaneous and emergency expenses.
       On page 83, between lines 4 and 5, insert the following:

     SEC. 225. TREATMENT OF TAX REFUNDS AND DOMESTIC SUPPORT 
                   OBLIGATIONS.

       (a) Property of the Estate.--Section 541 of title 11, 
     United States Code, is amended--
       (1) in subsection (a)(5)(B) by inserting ``except as 
     provided under subsection (b)(7),'' before ``as a result''; 
     and
       (2) in subsection (b)--
       (A) in paragraph (4), by striking ``or'' at the end;
       (B) in paragraph (5), by striking the period at the end and 
     inserting a semicolon; and
       (C) by inserting after paragraph (5) the following:
       ``(6) any--
       ``(A) refund of tax due to the debtor under subtitle A of 
     the Internal Revenue Code of 1986 for any taxable year to the 
     extent that the refund does not exceed the amount of an 
     applicable earned income tax credit allowed under section 32 
     of such Code for such year; and
       ``(B) advance payment of an earned income tax credit under 
     section 3507 of the Internal Revenue Code of 1986; or
       ``(7) the right of the debtor to receive alimony, support, 
     or separate maintenance for the debtor or dependent of the 
     debtor.''.
       (b) Protection of Earned Income Tax Credit and Support 
     Payments Under Bankruptcy Repayment Plans in Chapter 12.--
     Section 1225(b)(2) of title 11, United States Code, as 
     amended by section 218 of this Act, is amended--
       (1) by inserting ``(A)'' before ``For purposes'';
       (2) by striking ``(A) for the maintenance'' and inserting 
     ``(i) for the maintenance'';
       (3) by striking ``(B) if the debtor'' and inserting ``(ii) 
     if the debtor''; and
       (4) by adding at the end the following:
       ``(B) In determining disposable income the court shall not 
     consider amounts the debtor receives or is entitled to 
     receive from--
       ``(i) any refund of tax due to the debtor under subtitle A 
     of the Internal Revenue Code of 1986 for any taxable year to 
     the extent that the refund does not exceed the amount of an 
     applicable earned income tax credit allowed by section 32 of 
     the Internal Revenue Code of 1986 for such year;
       ``(ii) any advance payment for an earned income tax credit 
     described in clause (i); or
       ``(iii) child support, foster care, or disability payment 
     for the care of a dependent child in accordance with 
     applicable nonbankruptcy law.''.
       (c) Protection of Earned Income Tax Credit and Support 
     Payments Under Bankruptcy Repayment Plans in Chapter 13.--
     Section 1325(b)(2) of title 11, United States Code, as 
     amended by section 218 of this Act, is amended--
       (1) by inserting ``(A)'' before ``For purposes'';
       (2) by striking ``(A) for the maintenance'' and inserting 
     ``(i) for the maintenance'';
       (3) by striking ``(B) if the debtor'' and inserting ``(ii) 
     if the debtor''; and
       (4) by adding at the end the following:
       ``(B) In determining disposable income the court shall not 
     consider amounts the debtor receives or is entitled to 
     receive from--
       ``(i) any refund of tax due to the debtor under subtitle A 
     of the Internal Revenue Code of 1986 for any taxable year to 
     the extent that the refund does not exceed the amount of an 
     applicable earned income tax credit allowed by section 32 of 
     the Internal Revenue Code of 1986 for such year;
       ``(ii) any advance payment for an earned income tax credit 
     described in clause (i); or
       ``(iii) child support, foster care, or disability payment 
     for the care of a dependent child in accordance with 
     applicable nonbankruptcy law.''.
       (d) Exemptions.--Section 522(d) of title 11, United States 
     Code, as amended by section 224 of this Act, is amended in 
     paragraph (10)--
       (1) in subparagraph (C), by adding ``or'' after the 
     semicolon;
       (2) by striking subparagraph (D); and
       (3) by striking ``(E)'' and inserting ``(D)''.
       On page 92, line 5, strike ``personal property'' and insert 
     ``an item of personal property purchased for more than 
     $3,000''.
       On page 93, line 19, strike ``property'' and insert ``an 
     item of personal property purchased for more than $3,000''.
       On page 97, line 10, strike ``if'' and insert ``to the 
     extent that''.
       On page 97, line 10, after ``incurred'' insert ``to 
     purchase that thing of value''.
       On page 98, line 1, strike ``(27A)'' and insert (27B)''.
       On page 107, line 9, strike ``and aggregating more than 
     $250'' and insert ``for $400 or more per item or service''.
       On page 107, line 11, strike ``90'' and insert ``70''.
       On page 107, line 13, after ``dischargeable'' insert the 
     following: ``if the creditor proves by a preponderance of the 
     evidence at a hearing that the goods or services were not 
     reasonably necessary for the maintenance or support of the 
     debtor''.
       On page 107, line 15, strike ``$750'' and insert 
     ``$1,075''.
       On page 107, line 17, strike ``70'' and insert ``60''.
       Beginning on page 109, strike line 21 and all that follows 
     through page 111, line 15, and insert the following:

     SEC. 314. HOUSEHOLD GOOD DEFINED.

       Section 101 of title 11, United States Code, as amended by 
     section 106(c) of this Act, is amended by inserting before 
     paragraph (27B) the following:
       ``(27A) `household goods'--
       ``(A) includes tangible personal property normally found in 
     or around a residence; and
       ``(B) does not include motor vehicles used for 
     transportation purposes;''.
       On page 112, line 6, strike ``(except that,'' and all that 
     follows through ``debts)'' on line 13.
       On page 113, between lines 3 and 4, insert the following:
       (c) Exceptions to Discharge.--Section 523 of title 11, 
     United States Code, is amended--
       (1) in subsection (c), by inserting ``(14A),'' after 
     ``(6),'' each place it appears; and
       (2) in subsection (d), by striking ``(a)(2)'' and inserting 
     ``(a) (2) or (14A)''.
       On page 263, line 8, insert ``as amended by section 322 of 
     this Act,'' after ``United States Code,''.
       On page 263, line 11, strike ``(4)'' and insert ``(5)''.
       On page 263, line 12, strike ``(5)'' and insert ``(6)''.
       On page 263, line 13, strike ``(6)'' and insert ``(7)''.
       On page 263, line 14, strike ``(4)'' and insert ``(5)''.
       On page 263, line 16, strike ``(5)'' and insert ``(6)''.
                                  ____



                           AMENDMENT NO. 2753

  (Purpose: To amend the Truth in Lending Act to provide for enhanced 
information regarding credit card balance payment terms and conditions, 
 and to provide for enhanced reporting of credit card solicitations to 
 the Board of Governors of the Federal Reserve System and to Congress, 
                        and for other purposes)

       At the appropriate place, insert the following:

     SEC. __. CONSUMER CREDIT.

       (a) Enhanced Disclosures Under an Open End Consumer Credit 
     Plan.--Section 127(b) of the Truth in Lending Act (15 U.S.C. 
     1637(b)) is amended by adding at the end the following:
       ``(11)(A) Repayment information that would apply to the 
     outstanding balance of the consumer under the credit plan, 
     including--
       ``(i) the required minimum monthly payment on that balance, 
     represented as both a dollar figure and as a percentage of 
     that balance;
       ``(ii) the number of months (rounded to the nearest month) 
     that it would take to pay the entire amount of that balance, 
     if the consumer pays only the required minimum monthly 
     payments and if no further advances are made;
       ``(iii) the total cost to the consumer, including interest 
     and principal payments, of paying that balance in full, if 
     the consumer pays only the required minimum monthly payments 
     and if no further advances are made; and
       ``(iv) the monthly payment amount that would be required 
     for the consumer to eliminate the outstanding balance in 36 
     months if no further advances are made.
       ``(B)(i) Subject to clause (ii), in making the disclosures 
     under subparagraph (A) the creditor shall apply the interest 
     rate in effect on the date on which the disclosure is made 
     until the date on which the balance would be paid in full.
       ``(ii) If the interest rate in effect on the date on which 
     the disclosure is made is a temporary rate that will change 
     under a contractual provision applying an index or formula 
     for subsequent interest rate adjustment, the creditor shall 
     apply the interest rate in effect on the date on which the 
     disclosure is made for as long as that interest

[[Page 29094]]

     rate will apply under that contractual provision, and then 
     apply an interest rate based on the index or formula in 
     effect on the applicable billing date.''.
       (b) Civil Liability.--Section 130(a) of the Truth in 
     Lending Act (15 U.S.C. 1640(a)) is amended, in the 
     undesignated paragraph following paragraph (4), by striking 
     the second sentence and inserting the following: ``In 
     connection with the disclosures referred to in subsections 
     (a) and (b) of section 127, a creditor shall have a liability 
     determined under paragraph (2) only for failing to comply 
     with the requirements of section 125, 127(a), or paragraph 
     (4), (5), (6), (7), (8), (9), (10), or (11) of section 
     127(b), or for failing to comply with disclosure requirements 
     under State law for any term or item that the Board has 
     determined to be substantially the same in meaning under 
     section 111(a)(2) as any of the terms or items referred to in 
     section 127(a), or paragraph (4), (5), (6), (7), (8), (9), 
     (10), or (11) of section 127(b).''.

  Mr. DODD. Mr. President, I ask unanimous consent that these three 
amendments be laid aside.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 2754

(Purpose: To amend the Truth in Lending Act with respect to extensions 
              of credit to consumers under the age of 21)

  Mr. DODD. Mr. President, I call up amendment No. 2754 and ask for its 
immediate consideration.
  The PRESIDING OFFICER. Without objection, it is so ordered. The clerk 
will report.
  The legislative clerk read as follows:

       The Senator from Connecticut [Mr. Dodd], for himself and 
     Mr. Kennedy, proposes an amendment numbered 2754.

  Mr. DODD. Mr. President, I ask unanimous consent that the reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

       At the appropriate place, insert the following:

     SEC. __. EXTENSIONS OF CREDIT TO UNDERAGE CONSUMERS.

       (a) In General.--Section 127(c) of the Truth in Lending Act 
     (15 U.S.C. 1637(c)) is amended--
       (1) by redesignating paragraph (5) as paragraph (6); and
       (2) by inserting after paragraph (4) the following:
       ``(5) Applications from underage consumers.--
       ``(A) Prohibition on issuance.--No credit card may be 
     issued to, or open end credit plan established on behalf of, 
     a consumer who has not attained the age of 21 unless the 
     consumer has submitted a written application to the card 
     issuer that meets the requirements of subparagraph (B).
       ``(B) Application requirements.--An application to open a 
     credit card account by an individual who has not attained the 
     age of 21 as of the date of submission of the application 
     shall require--
       ``(i) the signature of the parent, legal guardian, or 
     spouse of the consumer, or any other individual having a 
     means to repay debts incurred by the consumer in connection 
     with the account, indicating joint liability for debts 
     incurred by the consumer in connection with the account 
     before the consumer has attained the age of 21; or
       ``(ii) submission by the consumer of financial information 
     indicating an independent means of repaying any obligation 
     arising from the proposed extension of credit in connection 
     with the account.''.
       (b) Regulatory Authority.--The Board of Governors of the 
     Federal Reserve System may issue such rules or publish such 
     model forms as it considers necessary to carry out section 
     127(c)(5) of the Truth in Lending Act, as amended by this 
     section.

  Mr. DODD. Mr. President, I say to my good friend from Iowa, I know he 
is concerned with the number of amendments and time. We have debated 
this amendment in the past. It will not be a new debate for our 
colleagues. I am more than happy to enter into an agreement, if he 
wants, to move the process along. I have three other amendments I have 
offered and laid aside which also can be dealt with quickly. I am more 
than prepared to enter into a time agreement when the manager wants to 
discuss that with me. I will be brief and explain what this amendment 
does and why it is an important one. I hope our colleagues will be 
willing to support it.
  This amendment is very straightforward and just plain common sense 
and something most Americans have become familiar with already.
  The amendment requires that when a credit card company issues a 
credit card to persons under the age of 21, the issuers of those credit 
cards obtain an application from that individual that does one of two 
things: One, either they have the signature of a parent, guardian, or 
other qualified individual willing to take financial responsibility for 
any debts that may be incurred; or, two, that the applicant provides 
information indicating the individual has independent means of repaying 
any credit card debt. One of those two things: Either have a guardian 
or some qualified person cosign to say they will assume the 
responsibility, or demonstrate the borrower has independent means of 
paying back their debts.
  Why do I suggest this amendment is important and one we ought to do? 
It is becoming an alarming problem in the country. One of the most 
troubling developments in the hotly contested battle between the credit 
card issuers to sign up new customers has been the aggressive way in 
which these companies have targeted people under the age of 21, 
particularly college students.
  Solicitations to this age group have become more intense for a 
variety of reasons. First of all, it is one of the few market segments 
in which there are always some new faces to go after. That certainly is 
understandable. Second, it is an age group in which brand loyalty can 
be established early on. Again, I understand that. In the words of one 
major credit card issuer, ``We are in the relationship business. We 
want to build relationships early on.''
  Recent press reports have reported that people hold on to their first 
credit cards for up to 15 years. That makes sense to me. I do not argue 
with that. That is good business judgment. It is a new crowd coming 
along, and a company knows they can develop loyalties early on, and 
they want to establish that relationship as early as they can for those 
individuals.
  I do not fault the credit card companies for those arguments or those 
ideas from a business perspective. What does worry me is that this 
solicitation and signing people up without having some information 
which indicates these credit cards are going to be paid for is creating 
a very serious problem, including significant dropouts from colleges 
because of the huge debts these individuals are accumulating.
  In fact, people under the age of 21 are such a hot target for credit 
card marketers that the upcoming Card Marketing Conference 98 is 
calling one of its key sessions ``Targeting teens: You never forget 
your first card.''
  Providing fair access to credit is something for which I have fought 
throughout my tenure in the Senate, and credit cards play a valuable 
role in pursuing the American dream. Some credit card issuers, however, 
have, in my view, gone too far in their aggressive solicitations. They 
irresponsibly target the most vulnerable in our society and extend them 
large amounts of credit with absolutely no regard to whether or not 
there is a reasonable expectation of repayment.
  On my first chart, I bring to my colleagues' attention a recent story 
reported in the Rochester Democrat and Chronicle in the State of New 
York. The article relates to the story of a 3-year-old child who 
recently received a platinum credit card with a credit card limit of 
$5,000. The credit card issuers are also enticing college students.
  In the Rochester News, a 3-year-old Rochester toddler was issued a 
platinum credit card after the mother jokingly returned an application 
sent to the child. The child's mother told the bank that the child's 
occupation was ``preschooler'' and left the income portion of the 
application a total blank. A few weeks later, the tot received a $5,000 
credit card limit.
  This is how insane the process has become--filling out the 
application, listing your application as a preschooler, and showing no 
source of income, and you get $5,000 worth of credit.
  We know in this day and age of high technology that these companies 
certainly have the capacity of distinguishing--I hope--between a 
preschooler with no source of income and providing them with $5,000 
worth of credit.
  Credit card issuers are also enticing colleges and universities to 
promote their products. Professor Robert Manning of Georgetown 
University told my staff recently that some colleges receive tens of 
thousands of dollars per

[[Page 29095]]

year for exclusive marketing agreements. Other colleges receive as much 
as 1 percent of all student charges from the credit card issuer in 
return for marketing or affinity agreements. Even those colleges that 
do not enter such agreements are making money.
  Robert Bugai, president of the College Marketing Intelligence, told 
the American Banker recently that colleges charge up to $400 per day 
for each credit card company that sets up a table on their campuses. 
That can run into tens of thousands of dollars by the end of just one 
semester.
  Last February, I went to the main campus of the University of 
Connecticut in my home State to meet with student leaders about this 
issue. Quite honestly, I was surprised at the amount of solicitations 
going on in the student union. Frankly, I also was surprised at the 
degree to which the students themselves were concerned about the 
constant barrage of offers they were receiving for credit cards.
  The offers seemed very attractive. One student who was an intern in 
my office this summer received four solicitations in 2 weeks from 
credit card companies. One promised ``eight cheap flights while you 
still have 18 weeks of vacation.'' Another promised a platinum card 
with what appeared to be a low-interest rate until you read the fine 
print that it applied only to balance transfers, not to the account 
overall. Only one of the four, Discover card, offered a brochure about 
credit terms--and I commend them for it--but, in doing so, also offered 
a spring break sweepstakes to 18-year-olds.
  In fact, the Chicago Tribune recently reported the average college 
freshman receives 50 solicitations during the first few months at 
college. The Tribune further reported college students get green-
lighted--a green light, no yellow light, a green light--for a line of 
credit that can reach more than $10,000 just on the strength of a 
signature and a student ID; $10,000 worth of credit at the age of 18 
with just your student ID and a signature.
  Who do you think is going to pay those bills? The parents do. They 
get socked with it in the end. We have to have some restraint, some 
controls on this. We have a huge problem with the amount of debt that 
is being accumulated by children or being passed on to their parents 
without any requirements at all that they meet some basic minimum 
standards, either independent sources of income or a cosignature by 
someone who can demonstrate the ability to pay.
  It is a serious public policy question about whether people in this 
age bracket can be presumed--and that is what they are doing--presumed 
to be able to make the sensible financial choices that are being forced 
upon them from this barrage of marketing.
  While it is very difficult to get reliable information from the 
credit card issuers about their marketing practices to people under the 
age of 21, the statistics that are available are deeply troubling. Let 
me share some of them with you.
  Let me put up chart No. 2, if I may.
  ``Collegiate credit cards increasing.'' This article appeared just a 
few days ago in the Washington Post here in the Nation's Capital. Let 
me share what the Post talked about. I quote them:

       Alarmed by the trend, hundreds of colleges in recent years 
     have forbidden credit card companies to solicit on their 
     campuses, and Virginia lawmakers are thinking of imposing 
     such a ban at all the State's colleges. Nine other States are 
     considering similar measures.

  The Post goes on to report that:

       An estimated 430 colleges have banned the marketing of 
     credit cards on their campuses.

  The statistics on college credit card debt are truly frightening.
  Nellie Mae, a major student loan provider in the New England States, 
conducted a recent survey of students who had applied for student 
loans. It termed the results ``alarming.'' The survey found that 27 
percent of their undergraduate student applicants had four or more 
credit cards. It found that 14 percent had credit card balances between 
$3,000 and $7,000, while another 10 percent had balances in excess of 
$10,000.
  Let me repeat those statistics because they are truly alarming. 
Twenty-seven percent of college students already had four credit cards; 
14 percent had credit card balances between $3,000 and $7,000; and 10 
percent had credit card balances that were greater than $7,000. That is 
24 percent; that is one out of every four who have debt somewhere 
between $3,000 and above $7,000--one out of every four college students 
with that kind of debt while they are trying to pay off student loans 
and other matters. This is incredible in terms of the amount of 
obligations, while still virtually children in many cases.
  This figure of 24 percent with credit card balances in excess of 
$3,000 is more than double the number from last year when I stood on 
this floor and offered a similar amendment. The trend lines are 
alarming.
  My hope with this amendment, which does not ban at all the 
solicitation among college students--if colleges want to allow them to 
go and solicit, they can--but the amendment merely says two things: 
Either have a guardian or a qualified person cosign, or show you have 
the independent means of paying the credit card debt you incur.
  That is something you would think the credit card companies would 
want to do themselves. Why do they not want this information? Why are 
they willing to extend up to $10,000 worth of debt merely on a student 
signature and an ID? It seems to me that is the height of 
irresponsibility. Then they come around and complain that there is too 
much debt in the country and they want to tighten up the bankruptcy 
laws.
  Why not tighten up your own process? Why not ask for some basic 
information of these young people before watching them build up the 
kind of debt they may spend years trying to pay back? It seems to me 
that if they are unwilling to impose some restraints on who can incur 
this kind of debt, we have an obligation to set some minimum standards.
  Again, it does not ban them from going out to solicit young people to 
become credit card holders. If the young person can have their parents 
or a guardian cosign, or if they can demonstrate independent means of 
payment, no problem, they get their credit card. But just on a student 
ID, and just on their signature, I think this body ought to be on 
record as saying that is what is creating some of the real debt 
problems in the country. We ought to put a stop to it.
  I mentioned the numbers. Moreover, while there is still evidence that 
student debt is skyrocketing, some surveys by credit card issuers 
themselves show that this same group of consumers is woefully 
uninformed about basic credit card terms and issues.
  A 1993 American Express/Consumer Federation of America study--done 
only about 5 or 6 years ago--found that only 22 percent of the more 
than 2,000 college students surveyed knew that the annual percentage 
rate is the best indicator of the true cost of a loan. Only 30 percent 
of those surveyed knew that each bank sets the interest rate on their 
credit cards, so it is possible to shop around for the best rate. Only 
30 percent knew that the interest rate was charged on new purchases if 
you carried a balance over from the previous month.
  Some college administrators, bucking the trend to use credit card 
issuers as a source of income, have become so concerned that they have 
banned credit card companies from their campuses, as I mentioned, and 
even have gone so far as to ban credit card advertisements from the 
campus bookstores.
  Roger Witherspoon, the vice president of student development at John 
Jay College of Criminal Justice in New York, banned credit card 
solicitors, saying indebtedness was causing students to drop out. I 
quote him:

       Middle class parents can bail out their kids when this 
     happens, but lower income parents can't.

  In fact, I argue with the statement. I do not think middle-income 
parents can either. Only the most affluent parents would be able to 
bail out their children from the kind of debts many of them are 
incurring.
  But he goes on to say:

       Kids only find out later how much it messes up their lives 
     [when this debt occurs].


[[Page 29096]]


     If I may, this is chart No. 3, which is from the Consumer 
     Federation of America. This came out last June. The Consumer 
     Federation of America says:

       The average college student who does not pay off his or her 
     balance every month now has an average debt of over $2,000.

  The average college student who does not pay off their balance every 
month has a credit card debt of over $2,000.

       One-fifth--

  One out of every five--

     of these students have debts of more than $10,000. A number 
     of colleges are now citing credit card debt as the most 
     significant cause of college disenrollment.

  Here we stand, day after day, week after week, talking about how 
important it is to get young people into higher education and to keep 
them there. This ought to be a matter of bipartisan concern.
  I know the credit card companies are working overtime on this. But if 
one of the major causes of disenrollment in higher education is credit 
card debt--where one out of every five students in this country has 
debt in excess of $10,000, and the average student who does not pay 
their monthly balance has a $2,000 debt--then something is drastically 
wrong that cries out for some solution.
  Again, I think banning credit card companies from college campuses, 
that ought not to be our decision; leave that up to the college 
campuses. Not allowing them to put their advertisements in bookstores, 
that ought to be the college's decision, not the Congress'.
  But I do not think it is too much to say that we ought to require, as 
part of a bankruptcy bill, when we are trying to reduce the amount of 
bankruptcy filings in this country, that you either have to have 
someone who will cosign with you, if you are under the age of 18, or 
that you have an independent demonstration of the ability to pay.
  I see my good friend from Utah has arrived. We now know that one of 
the most significant reasons of disenrollment in colleges is credit 
card debt. My colleague from Utah, who cares so much about higher 
education, ought to be deeply alarmed. The trend lines are dreadful. It 
is just dreadful what is occurring. Unless we do something to try to 
put some restraints on this, we are going to have this problem continue 
to mount.
  As I said earlier, this amendment does one of two things: If you are 
under 21, have a guardian, a parent, a qualified person cosign, or 
demonstrate you can pay, and then you get your credit card. But to say 
you get a credit card with a student ID and your signature alone, and 
to be able to mount up this kind of debt, crippling these people from 
ever being able to get out from underneath their obligations, I think 
is outrageous.
  The amendment I am proposing does not take any draconian action 
against the credit card industry. I agree with those who argue that 
there are many millions of people under the age of 21, who hold full-
time jobs, who are as deserving of credit cards as anyone over the age 
of 21. I also agree that students should continue to have access to 
credit. They should not try to prohibit the marketing for making credit 
cards available to these people.
  I also recognize that the period of time from 18 to 21 is an age of 
transition from adolescence to adulthood. As we do in so many other 
places in the Federal law, some extra care is needed to make sure that 
mistakes made from youthful inexperience do not haunt these people for 
the rest of their lives. All my amendment does is require that a credit 
card issuer, prior to granting credit, obtain one of two things from 
the applicant under the age of 21: Either they get a signature from a 
parent, a guardian, a qualified individual, or obtain information that 
demonstrates that that person between the ages of 18 and 21 has the 
capability of paying it back.
  This is a vulnerable period. This is an exciting time in their lives. 
For many, it is the first time they are away from home. They are living 
on their own, independent. All of a sudden, as we know, you get 50 
credit card solicitations in the space of one semester; in the case of 
the intern in my office, offering college sweepstakes, springs breaks, 
all sorts of enticements. You sign up. Before you know it, you have 
incurred $2,000, $3,000, $4,000, $6,000 worth of debt. You are 18 or 19 
years of age. Then they come after you to pay. They don't give you a 
break and say: We will wait until you get through college. We will wait 
until you are 25 or 30 to pay it back. They want their money right 
away. They want to get it, immediately, if they can.
  What happens, as we now find out, is one of the reasons for 
disenrollment in college--for one out of five students, $10,000 worth 
of debt by the time they are 19 or 20 years of age. By the way, on 
$10,000, the way the annual rates go and so forth, that probably means 
something like $30,000 or $40,000 because they can't pay it off all at 
once. By the time they get out from underneath this rock, it could end 
up being a fortune for them as they start out their lives with dreams 
and aspirations and hopes.
  Again, I don't object to the credit card companies soliciting, 
advertising, if that is what they want to do and want to have them on 
board. But why do you allow an 18-year-old to get this kind of a debt 
with a student ID and a signature? You don't let that happen with older 
people. You demand some sort of information about their ability to pay. 
Why do you say to an 18-year-old that you can be treated so differently 
than someone who is 25 or 30, where they need demonstrations of ability 
to pay? Why shouldn't we say that if you are going to solicit an 18-
year-old, at least show that they can pay it back. They may not be able 
to, but at least require that or have a guardian or an adult sign on.
  Federal law already says people under the age of 21 shouldn't drink 
alcohol. We made that statement. I know my colleague from Utah was a 
strong supporter of that. We don't allow you to drink anymore on 
college campuses unless you are 21 or older because we were worried 
about them. We were worried what would happen to them. Isn't this a 
problem as well, this kind of debt they can incur?
  The Tax Code makes the presumption that if someone is a full-time 
student under the age of 23, they are financially dependent on their 
parents or guardians. The Tax Code makes that presumption. Is it so 
much to ask that credit card issuers find out if someone under the age 
of 21 is financially capable of paying back the debt or that their 
parents are willing to assume the financial responsibility or someone 
else? Again, I know there are a lot of young people who are out working 
full-time jobs and going to school simultaneously. This isn't a big 
burden --they need to have that credit card--to say to them, look, just 
demonstrate, through a W-2 form or something, that you can pay back or 
you have the ability to pay back. That is not a lot to ask. Believe me, 
the credit card companies can do it on the Internet. They can do it in 
a matter of a nanosecond if they want to.
  Why don't they want to? What is the hesitation? Don't tell me it is 
the bureaucracy. It is not the bureaucracy. They require it of adults 
who are older than that. They don't give platinum credit cards out to 
people who are not in college without getting some information about 
their ability to pay. Why is it in this age group that they are willing 
to give it to you on a signature and a student ID? I think we all know 
the answer why. It is outrageous. It is getting worse all the time. I 
mentioned to you the numbers have almost doubled in a year in terms of 
the amount of debt being held. Last year, when I offered the amendment, 
it was $3,000. Now it is at almost $7,000 worth of debt they are 
incurring.
  I hope our colleagues will be willing to support this modest 
amendment. It is not a great deal to ask. As I mentioned, 430 colleges 
have banned credit cards from soliciting on their campuses. They know 
what the problem is. When we have the president of one of the major 
criminal justice schools in the country talk about what a drastic 
problem this is having on enrollment, these are serious people. They 
are not anticredit card. They are not antibusiness. They are not 
against young people having credit cards. They see what is happening on 
their campuses. We ought to pay attention to

[[Page 29097]]

them and listen to them. To ignore them or to say it doesn't make any 
difference would be an outrage.
  How can we pass a bankruptcy bill, as we try and cut down on the 
number of bankruptcies, and allow this situation to persist where one 
out of every five college students has $10,000 of credit card debt? How 
can we allow that to persist without setting some minimum standards 
that these people have to meet before they can incur that kind of debt? 
I suspect the credit card companies will be probably lax in what 
minimum standards they might even permit, but at least it might put the 
brakes on a little bit, just a little bit.
  We have also received some strong endorsements of this amendment: the 
American Federation of State County Municipal Employees; the 
Communication Workers of America, International Brotherhood of 
Boilermakers, Blacksmiths; International Brotherhood of Teamsters; the 
Union of Needletrades, Industrial & Textile Employees; the United 
Automobile, Aerospace and Agricultural Implement Workers; United Food & 
Commercial Workers International, representing millions of working 
families.
  Why do the unions care about a credit card bill? Because these are 
the parents of these kids. That is why they care about it. This isn't a 
union issue. These are the hard-working parents who are working two and 
three and four jobs to send their kids to college. They turn around and 
some credit card company mounts up a $10,000 debt on their back. Their 
kids have to drop out, after they have worked 20 or 30 years, saving to 
put their families through school, understanding the value of a higher 
education. Now the credit card companies say, no, that is too much to 
ask of us. You are asking way too much, that we require an 18-year-old 
to have a cosigner of the credit card application or to show that they 
have the means of paying back the debt. That is why the millions who 
are represented by these unions have offered such strong support of 
this legislation.
  Mr. President, I ask unanimous consent that this letter be printed in 
the Record at this juncture.
  There being no objection, the letter was ordered to be printed in the 
Record, as follows:

                                                 November 8, 1999.
       Dear Senators Kennedy and Dodd: We support your amendment 
     to the bankruptcy bill (S. 625), that would prohibit credit 
     card issuers from recklessly extending credit to young people 
     who do not have adequate means to repay their debts. 
     Predatory lending by card issuers is one of the most 
     significant reasons why the number of bankruptcies among 
     those under age 25 has grown by 50 percent since 1991.
       This amendment would prohibit the issuance of credit cards 
     to persons under age 21, unless a parent, spouse, guardian or 
     other individual acts as co-signer, or the minor can 
     demonstrate an independent source of income sufficient to 
     repay. The amendment would not limit the extension of credit 
     to the millions of working young Americans who have an 
     adequate income and are as deserving of credit as anyone over 
     the age of 21.
       The serious problem of predatory lending by credit card 
     issuers to young people has been well-documented. Credit card 
     issuers aggressively target young people, especially college 
     students. It is nearly impossible for students, including 
     those in high school, to avoid credit card pitches. Students 
     now receive cards at a younger age, with 81 percent of 
     students who have at least one card having received it before 
     college or during their freshman year.
       The level of revolving debt among young people is rising to 
     alarming levels, with sometimes tragic consequences. Family 
     tensions arise as parents attempt to pay off these 
     obligations. Poor credit ratings hinder young people in the 
     job and real estate markets. Students are forced to drop out 
     of school to pay off their credit card debt.
       Credit card issuers are well aware that most young people 
     lack basic skills in personal finance. A recent survey (1997) 
     of the financial literacy levels of high school seniors 
     showed that only 10.2% scored a ``C'' or better and that 
     students who use credit cards know no more about them then 
     students who don't.
       This amendment is consistent with the opinion of the 
     American public. An April, 1999 poll by the Consumer 
     Federation of America/Opinion Research Corporation 
     International found overwhelming support at all age groups 
     for the terms proposed by this amendment. We join them in 
     supporting it.
       Thank you for your leadership on this important issue.
         American Federation of State, County & Municipal 
           Employees (AFSCME); Communication Workers of America 
           (CWA); International Brotherhood of Boilermarkes, Iron 
           Ship Builders, Blacksmiths, Forgers & Helpers; 
           International Brotherhood of Teamsters; Union of 
           Needletrades, Industrial & Textile Employees (UNITE); 
           United Automobile, Aerospace and Agricultural Implement 
           Workers of America (UAW); United Food & Commercial 
           Workers International Union (UFCW); United Steelworkers 
           of America (USA).

  Mr. DODD. I hope we can get a strong vote on this amendment. This 
shouldn't take much time. It is very little to ask. The credit card 
companies are the ones who have asked for this bill on bankruptcy 
reform. I am sympathetic to the bill because I do think there are far 
too many bankruptcies in the country. If we are to try to reduce the 
number of bankruptcies, we have to reduce the rationale or the reason 
why people are going to the bankruptcy courts in the first place. These 
are not all evil people. These are not all scam artists who are trying 
to game the system. The overwhelming majority of people who go to a 
bankruptcy court have gotten in way over their heads. You can say they 
have been irresponsible. That may be the case.
  But I will tell you, for an awful lot of families, they have kids in 
college and those adolescent kids became irresponsible. I know of very 
few who don't get irresponsible in their adolescent years. The danger 
today is that they can get deeply in trouble. It isn't just a college 
prank that may get them in trouble. Now you have major credit card 
companies dumping 50 solicitations into their mailboxes in their 
dormitories in the first semester in college. With a student I.D. and a 
signature, they get themselves $10,000 into trouble. Requiring these 
companies to at least get some basic information may slow down this 
process. It will do a lot to reduce the volume of bankruptcies in this 
country, to reduce the ability of an 18- or 19-year-old, with no 
independent means of paying back their debts, from getting these cards 
in the first place, and saving these families the anguish and heartache 
and the dashed dreams that a young college student has when they go off 
for the first time. Many of them, by the way, are the first people in 
their families ever to go to college. Think how the families feel--the 
excitement, the thrill of a young person going off to college, from a 
blue collar working family in this country who never had that 
opportunity. All of a sudden they get a deluge of platinum credit cards 
flooding their mailboxes, the kids sign up, and the dreams of a family 
go down the drain in a matter of weeks.
  This ought not to be a Democrat or Republican issue, conservative or 
liberal issue. This is a commonsense issue. This is basic common sense, 
which says to these companies that, with 18- to 21-year-olds, there has 
to be some cosigner, or some demonstration of an independent means to 
pay back. If you turn down this amendment and you turn around and say 
we ought to stop these bankruptcies, then you make it harder for these 
families to get out of these obligations and straighten out their 
lives. I know an awful lot of good people who have gotten themselves 
behind the eight ball financially; they are not evil, bad people. 
Because they get into a little trouble, particularly at 18 or 19 --and 
one out of five of them are $10,000 in debt--doesn't mean they ought 
not to have an opportunity to straighten things out. The best way is 
not to get into trouble in the first place. The way not to get into 
trouble in the first place is to put some governor--you know how we do 
with automobiles with young people, where the car can't go more than 60 
miles an hour, because we know there is a danger of a young person 
going too fast. Why not put a governor here on the credit card 
companies and slow them down. They can make their solicitations, send 
the solicitations in there, but require that these young people have a 
cosigner or a demonstration of an independent means to pay. If they 
can't do that, then you move on to someone else who can. But don't sign 
up a young person and put them and their family into harm's way and 
pass a bankruptcy bill that doesn't allow them to take the bankruptcy 
act when those debts mount up.

[[Page 29098]]

  So I hope that our colleagues will support this amendment. This will 
be a good way for us to build strong bipartisan support for this bill.
  With that, I yield the floor.
  The PRESIDING OFFICER. The chair recognizes the Senator from Utah.
  Mr. HATCH. Mr. President, I have to rise in opposition to the 
amendment offered by the distinguished Senator from Connecticut, Mr. 
Dodd. It would require young adults under the age of 21 to obtain 
parental consent or demonstrate an ``independent means of repaying'' in 
order to get a credit card. This amendment also caps the amount of 
credit a young adult can get to $1,500.
  Mr. President, I believe this amendment is well-intentioned. However, 
if adopted, it would unfairly put young adults between the ages of 18 
and 21 at a disadvantage by putting serious obstacles in their way, or, 
in some cases, bar them from obtaining credit cards altogether. Young 
adults today, whether they are serving in our Nation's military, or 
going to college, or trying to support a young family, do not need 
these hurdles placed in their path. This amendment would have an 
adverse effect on temporarily unemployed adults over the age of 18 who 
are independent of their parents, the twenty-year-old single mother, 
the twenty-year-old discharged from the military service, or a twenty-
year-old worker between jobs--often the very person most needing the 
extension of credit.
  I understand how difficult times can be for young adults. When I was 
16 years of age, I was a skilled building tradesman. I knew a trade. I 
went through a formal apprenticeship and became a journeyman. I was 
proud of it. I was capable of supporting my family at that time. I 
worked as a janitor to put myself through college. I believe it is an 
insult to young adults to put in doubt their ability to get credit.
  In addition, this amendment does not appear to be well thought out. 
For example, it makes absolutely no provision for young adults who may 
be estranged from their parents or whose parents or guardians may be 
deceased. It is also unclear what new burdens will be placed on lenders 
to verify the authenticity of a parent's or guardian's signature. I 
also can't resist pointing out that many of the very same folks who 
oppose parental consent for abortion are in favor of parental consent 
for getting a credit card. That seems a little odd to me.
  I can appreciate that there have been some instances when young 
adults have been extended credit beyond their ability to repay. But it 
does not strike me as a reasoned public policy, in an effort to tackle 
the occasional abuse, to discriminate against the many honest, hard-
working, decent young people between the ages of 18 and 21 who rely on 
credit to make their lives a little bit more livable, or even 
sustainable.
  I also must point out that individuals under age 18 cannot enter into 
binding contracts, and therefore any credit inadvertently extended to 
them is unenforceable.
  The amendment would undermine a fundamental purpose of bankruptcy 
reform: to make individuals take more responsibility for their personal 
finances. I believe that the vast majority of young adults between the 
ages of 18 and 21 are responsible citizens, and they do not need the 
big Government to tell them what they can or cannot do in this area. I 
oppose treating adults as if they are children; therefore, I have to 
oppose this amendment.
  Let me make a correction. This amendment does not place a cap on the 
amount of credit a minor can get. I misspoke and I confused it with an 
amendment filed that was identical to this, only it does have the cap. 
So I will make that clear and make that correction.
  Mr. DODD. Will my colleague yield for another correction?
  Mr. HATCH. Yes.
  Mr. DODD. It says parents, guardians, or any other qualified person 
can cosign. It is not limited to parents. If the parents were deceased 
or the guardians were deceased, a qualified person could cosign. So we 
allow for a broader range of options here.
  Mr. HATCH. I thank the Senator. I will certainly make that 
correction.
  I still believe we ought to treat them as young adults. We ought to 
recognize that many people who really qualify for credit cards in these 
age groups ought to be able to get them with or without anybody else's 
consent. Many of them live up to the obligations that they incur; in 
fact, most of them do. I don't think we should, as a public policy 
matter, make this particular change that my dear friend from 
Connecticut has suggested. We are sending these young men and women 
over 18 years of age to war. They can vote at 18. They can do almost 
anything. Now we want to take away their right to have a credit card. I 
think that is bad public policy. I hope our colleagues will defeat this 
amendment when it comes up for a vote. With that, I believe we are 
ready to recess.
  Mr. DODD. Mr. President, I just have one minute in response. As my 
friend from Utah knows, shortly, we have an amendment that we are going 
to offer together on this bill. I am sorry we don't agree on this. As I 
mentioned earlier, we do set some restrictions. We can send men and 
women to war at age 18, but we don't allow them to drink; we set a 
standard of 21. We did so because of the dangers that we decided 
alcohol posed to young people. The Tax Code says there is a rebuttable 
presumption that at 23-year-old college student has an obligation that 
shifts to parents.
  All I am requiring here is that the credit card companies, when they 
solicit an 18 or 19 year old, require that they show they have the 
independent means of paying for it or that they have a guardian or a 
qualified person who will cosign. The same thing would be required of 
someone else. One out of five students has $10,000 worth of financial 
debt and obligation. We are being told now one of the single largest 
reasons for disenrollment in higher education is because of this 
mounting--and it has doubled in the last two years--amount of credit 
card debt among 18-, 19-, and 20-year-olds.
  It ought not to be a great deal to ask they meet these basic, simple 
requirements. They can solicit; they can collect. If they can sign them 
up, God bless them, go to it. However, for a student ID and a signature 
to get $10,000 worth of debt for one out of five college students--and 
the average student has $2,000 worth of debt and was not paying the 
monthly payments--is too much for the families to be burdened with.
  I ask unanimous consent a letter from the Consumer Federation of 
America, the Consumers Union, the National Consumer Law Center, the 
U.S. Public Interest Research Group, and the U.S. Student Association, 
all of which support this amendment, be printed in the Record.
  There being no objection, the letter was ordered to be printed in the 
Record, as follows:

                                                 November 8, 1999.

    RE: Support for Dodd/Kennedy Amendment #2754 to Bankruptcy Bill

       Dear Senator, The undersigned organizations strongly 
     support this amendment to the bankruptcy bill regarding the 
     extension of credit to young Americans. This common sense 
     proposal would forbid banks and other credit card issuers 
     from granting credit to any person under 21 years-of-age, 
     without the signature of a parent or guardian or proof of an 
     independent means of repaying the debt incurred.
       This amendment would not result in denials to credit-worthy 
     young people, but it would protect financially 
     unsophisticated young consumers from being enticed into a 
     financial trap. A recent study by the Consumer Federation of 
     America found that previous research has underestimated the 
     extent of credit card debt by college students, as well as 
     the social impact of this debt on students. The study 
     documents the consequences of high levels of indebtedness for 
     many students, including dropping out of college, difficulty 
     finding good jobs, and in particularly tragic circumstances, 
     extreme psychological stress and suicide.
       Minors are increasingly targeted in credit card marketing 
     campaigns. Direct solicitation of college students has 
     intensified significantly in the past few years as high 
     profitability has encouraged card issuers to take on riskier 
     customers. Cards are available to almost any student with no 
     income, no credit history and no parental signature required. 
     Issuers know that young customers are often ``brand loyal'' 
     to their first card for many years. They also know that many 
     parents will pay off excessive credit card debt accumulated 
     by their children, even though they are under no legal 
     obligation to do so.

[[Page 29099]]

       As a result, approximately 70 percent of undergraduates at 
     four-year colleges possess at least one credit card. 
     Moreover, students are obtaining their first credit card at a 
     young age. Accordingly to the non-profit student loan 
     provider Nellie Mae, 66 percent of college students with at 
     least one card received their first card before college or 
     during their freshman in 1996. By 1998, 81 percent had 
     received their first card by the end of their freshman year.
       Student credit card debt is larger than previously 
     estimated. The Consumer Federation of America study found 
     that college students who do not pay off their balances every 
     month have an average debt of more then $2,000, with one-
     fifth of these students carrying debts of more than $10,000. 
     Additional credit card debt is often ``refinanced'' with 
     student loans or with private debt consolidation loans. At 
     some schools, college loan debt averages $20,000 per 
     graduating senior.
       More than one quarter of all students reported paying late 
     on a credit card at least once in the last two years, 
     according to a 1998 survey by the U.S. Public Interest 
     Research Group. One-quarter of students questioned in the 
     survey also reported using a cash advance to pay their debts. 
     Poor credit records and credit card defaults have lasting 
     consequences, including the classification of the student as 
     a high risk/high rate borrower and decreased access to rental 
     housing, car loans and home mortgage loans.
       Many colleges and universities not only permit aggressive 
     credit card marketing on campus; they actually benefit 
     financially from this marketing. Credit card issuers pay 
     institutions for sponsorship of school programs, for support 
     of student activities, for rental of on-campus solicitation 
     tables, and for exclusive marketing agreements, such as 
     college ``affinity'' credit cards.
       Card issuers are well aware that high school and college 
     students don't have basic financial skills. A 1993 survey of 
     college juniors and seniors by the Consumer Federation of 
     America and American Express found:
       Just 22 percent knew that the APR was the best indicator of 
     the cost of a loan;
       Just 30 percent knew that interest rates on credit cards 
     are set by the issuing bank, not Visa, MasterCard of the 
     government;
       Just 30 percent knew that the grace period was not 
     available when a credit card balance is carried from month-
     to-month.
       The American people strongly support restricting aggressive 
     lending practices by credit card issuers. A national poll 
     conducted for the Consumer Federation of America in April 
     1999 by Opinion Research Corporation found that 80 percent of 
     those surveyed supported restrictions on the extension of 
     credit cards to people under age 21.
       Without this reasonable amendment, direct solicitation of 
     college and high school students without the ability to repay 
     will continue unabated. For more information, contact Travis 
     Plunkett at (202) 387-6121.
           Sincerely,
         Travis B. Plunkett, Consumer Federation of America; Frank 
           Torres, Consumers Union; Gary Klein, National Consumer 
           Law Center; Ed Mierzwinski, U.S. Public Interest 
           Research Group; Kendra Fox-Davis, U.S. Student 
           Association.

  Mr. HATCH. I ask unanimous consent to set the Dodd amendment aside.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. HATCH. I ask unanimous consent I be given an extra minute and a 
half.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 2536

            (Purpose: To protect certain education savings)

  Mr. HATCH. Mr. President, I ask unanimous consent to call up 
amendment No. 2536, a Hatch-Dodd-Gregg amendment relating to the 
protection of educational savings accounts.
  The PRESIDING OFFICER. The clerk will report the amendment.
  The bill clerk read as follows:

       The Senator from Utah [Mr. Hatch], for himself and Mr. Dodd 
     and Mr. Gregg, proposes an amendment numbered 2536.

  Mr. HATCH. I ask unanimous consent reading of the amendment be 
dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

       On page 83, between lines 4 and 5, insert the following:

     SEC. 2__. PROTECTION OF EDUCATION SAVINGS.

       (a) Exclusions.--Section 541 of title 11, United States 
     Code, as amended by section 903, is amended--
       (1) in subsection (b)--
       (A) in paragraph (5), by striking ``or'' at the end;
       (B) by redesignating paragraph (6) as paragraph (8); and
       (C) by inserting after paragraph (5) the following:
       ``(6) funds placed in an education individual retirement 
     account (as defined in section 530(b)(1) of the Internal 
     Revenue Code of 1986) not later than 365 days before the date 
     of filing of the petition, but--
       ``(A) only if the designated beneficiary of such account 
     was a son, daughter, stepson, stepdaughter, grandchild, or 
     step-grandchild of the debtor for the taxable year for which 
     funds were placed in such account;
       ``(B) only to the extent that such funds--
       ``(i) are not pledged or promised to any entity in 
     connection with any extension of credit; and
       ``(ii) are not excess contributions (as described in 
     section 4973(e) of the Internal Revenue Code of 1986); and
       ``(C) in the case of funds placed in all such accounts 
     having the same designated beneficiary not earlier than 720 
     days nor later than 365 days before such date, only so much 
     of such funds as does not exceed $5,000;
       ``(7) funds used to purchase a tuition credit or 
     certificate or contributed to an account in accordance with 
     section 529(b)(1)(A) of the Internal Revenue Code of 1986 
     under a qualified State tuition program (as defined in 
     section 529(b)(1) of such Code) not later than 365 days 
     before the date of filing of the petition, but--
       ``(A) only if the designated beneficiary of the amounts 
     paid or contributed to such tuition program was a son, 
     daughter, stepson, stepdaughter, grandchild, or step-
     grandchild of the debtor for the taxable year for which funds 
     were paid or contributed;
       ``(B) with respect to the aggregate amount paid or 
     contributed to such program having the same designated 
     beneficiary, only so much of such amount as does not exceed 
     the total contributions permitted under section 529(b)(7) of 
     such Code with respect to such beneficiary, as adjusted 
     beginning on the date of the filing of the petition by the 
     annual increase or decrease (rounded to the nearest tenth of 
     1 percent) in the education expenditure category of the 
     Consumer Price Index prepared by the Department of Labor; and
       ``(C) in the case of funds paid or contributed to such 
     program having the same designated beneficiary not earlier 
     than 720 days nor later than 365 days before such date, only 
     so much of such funds as does not exceed $5,000; or''; and
       (2) by adding at the end the following:
       ``(f) In determining whether any of the relationships 
     specified in paragraph (6)(A) or (7)(A) of subsection (b) 
     exists, a legally adopted child of an individual (and a child 
     who is a member of an individual's household, if placed with 
     such individual by an authorized placement agency for legal 
     adoption by such individual), or a foster child of an 
     individual (if such child has as the child's principal place 
     of abode the home of the debtor and is a member of the 
     debtor's household) shall be treated as a child of such 
     individual by blood.''.
       (b) Debtor's Duties.--Section 521 of title 11, United 
     States Code, as amended by sections 105(d), 304(c)(1), 
     305(2), 315(b), and 316 of this Act, is amended by adding at 
     the end the following:
       ``(k) In addition to meeting the requirements under 
     subsection (a), a debtor shall file with the court a record 
     of any interest that a debtor has in an education individual 
     retirement account (as defined in section 530(b)(1) of the 
     Internal Revenue Code of 1986) or under a qualified State 
     tuition program (as defined in section 529(b)(1) of such 
     Code).''.

  Mr. HATCH. Mr. President, I thank Senator Dodd for his efforts and 
cooperation in working on this important amendment.
  I am pleased to offer along with Senators Dodd and Gregg, an 
amendment to S. 625, the Bankruptcy Reform Act of 1999, that will 
protect education IRAs and qualified State tuition savings programs in 
bankruptcy. Education IRAs and qualified State tuition savings programs 
permit parents and grandparents to contribute funds for the tuition and 
other higher education expenses of their children and grandchildren. 
Under current bankruptcy law, creditors may access such accounts to 
satisfy debts owed by parents and grandparents.
  The amendment I offer today balances the interest of encouraging 
families to save for college, with the interest of preventing the 
potential abuse of transferring funds into education savings accounts 
prior to an anticipated bankruptcy. Specifically, the amendment 
provides that contributions to education savings accounts made during 
the year immediately prior to the bankruptcy filing are not protected 
in bankruptcy and may be accessed by creditors; contributions up to 
$5,000 per beneficiary made in the second year prior to filing, 
however, are protected, as are all contributions made more than 2 years 
prior to the bankruptcy filing. To combat potential abuse, debtors must 
disclose their full interest in such accounts in the statement of 
financial affairs filed with the bankruptcy court. With respect to 
education IRAs, there is no limit on the

[[Page 29100]]

amount that may be excluded from the bankruptcy estate, though the size 
of education IRAs are effectively limited by the $500 annual 
contribution limit. With respect to qualified State tuition savings 
programs, the excluded amount is the full, State-established amount 
deemed necessary to provide for the qualified education expenses of a 
beneficiary.
  College savings accounts encourage families to save for college, 
thereby increasing access to higher education. In my home State of 
Utah, 775 children, with account balances nearing $1.2 million, are 
beneficiaries of such accounts. Nationwide, over one million children 
benefit from such accounts. Bona fide contributions to such college 
savings accounts, which are made for the benefit of children, should be 
beyond the reach of creditors. The ability to use dedicated funds to 
pay the educational costs of current and future college students should 
not be jeopardized by a bankruptcy of their parents or grandparents. 
The amendment I offer today prevents bona fide educational accounts of 
children from being accessed by their parents' or grandparents' 
creditors, while also protecting this exclusion from being abused as a 
means of sheltering assets from the bankruptcy estate.
  I urge your support of this amendment.
  Mr. DODD. I ask unanimous consent I be able to speak for up to 2 
minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DODD. I know this will be somewhat confusing to people watching 
the debate over the last 15 or 20 minutes, but this is an amendment 
offered by my distinguished friend and colleague from Utah of which I 
am a cosponsor. This is a very good amendment. We hope our colleagues 
will support it.
  Many parents have put aside money for college education in special 
accounts. This ought not to be the subject of first attack when 
creditors come after family income.
  I commend my colleague from Utah for trying to preserve and protect 
these resources which working families spend years trying to 
accumulate, and then get behind the 8 ball for problems that may not be 
of their own making, and all of a sudden the resources are subject to 
attack. This is a good amendment that will strengthen working families' 
ability to educate their children. I commend my colleague from Utah for 
offering it. I am pleased to be a cosponsor of it.
  The PRESIDING OFFICER. The Senator from Missouri.
  Mr. BOND. I ask unanimous consent, notwithstanding the order for 
recess, I be permitted to speak for 2 minutes as in morning business.
  Mr. FEINGOLD. Mr. President, I ask unanimous consent, as part of the 
request of the Senator from Missouri, I be allowed to speak for up to 
12 minutes. At the conclusion of the 12 minutes, I will call up an 
amendment.
  Mrs. LINCOLN. I ask unanimous consent to be able to address the 
Senate as in morning business for 7 minutes.
  The PRESIDING OFFICER. The problem is, the previous order says 12:30 
so we can attend policy conferences. That runs me past the time for 
making decisions as a part of that conference.
  Is there a way to reduce the time so we can complete statements by 
12:45?
  Mr. BOND. I just asked for 2 minutes, and I will make it shorter than 
that.
  Mr. FEINGOLD. Mr. President, the managers have asked Members to offer 
amendments. I am trying to offer an amendment. I need 11 minutes in 
order to present the amendment. I am trying to facilitate the progress 
on the bill. I thought this would be a good opportunity. It is a total 
of 11 minutes. The conferences don't really begin in earnest until 1 
o'clock anyway.
  I renew my request to be granted 12 minutes total.
  Mrs. LINCOLN. I will certainly try to complete my statement in 5 
minutes.
  The PRESIDING OFFICER. The Chair objects.

                          ____________________