[Congressional Record (Bound Edition), Volume 147 (2001), Part 10]
[Senate]
[Pages 13618-13621]
[From the U.S. Government Publishing Office, www.gpo.gov]


[[Page 13618]]

          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. LOTT (for himself and Mr. Daschle).
  S. 1190. A bill to amend the Internal Revenue Code of 1986 to rename 
the education individual retirement accounts as the Coverdell education 
savings account; considered and passed.
  Mr. LOTT. Mr. President, I ask unanimous consent that the text of the 
bill be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1190

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

     SECTION 1. RENAMING EDUCATION INDIVIDUAL RETIREMENT ACCOUNTS 
                   AS COVERDELL EDUCATION SAVINGS ACCOUNTS.

       (a) In General.--
       (1) Section 530 of the Internal Revenue Code of 1986 is 
     amended by striking ``an education individual retirement 
     account'' each place it appears and inserting ``a Coverdell 
     education savings account''.
       (2) Section 530(a) of such Code is amended--
       (A) by striking ``An education individual retirement 
     account'' and inserting ``A Coverdell education savings 
     account'', and
       (B) by striking ``the education individual retirement 
     account'' and inserting ``the Coverdell education savings 
     account''.
       (3) Section 530(b)(1) of such Code is amended--
       (A) by striking ``education individual retirement account'' 
     in the text and inserting ``Coverdell education savings 
     account'', and
       (B) by striking ``Education individual retirement account'' 
     in the heading and inserting ``Coverdell education savings 
     account''.
       (4) Sections 530(d)(5) and 530(e) of such Code are amended 
     by striking ``education individual retirement account'' each 
     place it appears and inserting ``Coverdell education savings 
     account''.
       (5) The heading for section 530 of such Code is amended to 
     read as follows:

     ``SEC. 530. COVERDELL EDUCATION SAVINGS ACCOUNTS.''.

       (6) The item in the table of contents for part VII of 
     subchapter F of chapter 1 of such Code relating to section 
     530 is amended to read as follows:

``Sec. 530. Coverdell education savings accounts.''.

       (b) Conforming Amendments.--
       (1) The following provisions of the Internal Revenue Code 
     of 1986 are amended by striking ``an education individual 
     retirement'' each place it appears and inserting ``a 
     Coverdell education savings'':
       (A) Section 72(e)(9).
       (B) Section 135(c)(2)(C).
       (C) Section 4973(a).
       (D) Subsections (c) and (e) of section 4975.
       (2) The following provisions of such Code are amended by 
     striking ``education individual retirement'' each place it 
     appears in the text and inserting ``Coverdell education 
     savings'':
       (A) Section 26(b)(2)(E).
       (B) Section 4973(e).
       (C) Section 6693(a)(2)(D).
       (3) The headings for the following provisions of such Code 
     are amended by striking ``education individual retirement'' 
     each place it appears and inserting ``coverdell education 
     savings''.
       (A) Section 72(e)(9).
       (B) Section 135(c)(2)(C).
       (C) Section 529(c)(3)(B)(vi).
       (D) Section 4975(c)(5).
       (4) The heading for section 4973(e) of such Code is amended 
     by striking ``Education Individual Retirement'' and inserting 
     ``Coverdell Education Savings''.
       (c) Effective Date.--The amendments made by this section 
     shall take effect on the date of the enactment of this Act.
                                 ______
                                 
      By Mr. CLELAND (for himself, Ms. Snowe, Mr. Schumer, and Mr. 
        Hollings):
  S. 1192. A bill to amend the Internal Revenue Code of 1986 to provide 
a tax credit for modifications to intercity buses required under the 
Americans with Disabilities Act of 1990; to the Committee on Finance.
  Mr. CLELAND. Mr. President, in the summer of 1990, President George 
Bush signed the Americans with Disabilities Act, ADA, into law saying, 
``Let the shameful wall of exclusion finally come tumbling down.'' With 
intercity buses playing an important role in transporting millions of 
passengers throughout the country, we must ensure the means are 
available for all Americans to access this transportation mode. That is 
why I am introducing, along with Senators Snowe, Hollings, and Schumer, 
a bill to provide tax credits to intercity bus companies which purchase 
coaches in compliance with the ADA. Our bill expands a current tax 
credit to give bus owners a 50 percent tax credit of the cost of 
purchasing and installing hydraulic wheelchair lifts and other devices 
to improve accessibility.
  As my colleagues know, I have long been a proponent of ensuring 
accessibility. In fact, while I was a member of the Georgia State 
Senate in the early 1970s, I sponsored a bill to make public facilities 
accessible to the disabled, and this bill became law. Georgia was a 
national leader at that time, and I have been pleased to see the 
changes throughout the country with regard to accessibility over the 
past three decades. However, there is more that can and should be done.
  With their reliability, safety and low cost, over the road buses are 
the preferred mode of transportation for millions of Americans, and 
with the 2012 deadline to have all over the road buses be wheelchair 
accessible approaching, it is time for Congress to aid in meeting this 
mandate. The Transportation Research Board estimates that the annual 
coast of upgrading and replacing the over the road bus fleet could 
average $25-$27 million, not to mention the extra training and 
maintenance costs. At the heart of the intercity bus industry are small 
businesses, on which this deadline would impose a significant toll. If 
these small businesses can not meet this deadline, the rural 
communities that have no other means of transportation will suffer, or 
large portions of the upgrade costs will be passed on to consumers in 
the form of higher fares, that is, unless Congress provides some 
assistance. Our legislation would do exactly that.
  I believe that bus service is destined to play an ever important role 
in transportation planning. In my home State of Georgia, many of the 
metropolitan counties have been declared as out of attainment with the 
Clean Air Act. As a result, Georgia is re-evaluating its transportation 
priorities, which includes moving people between intercity 
destinations. Personally, I envision a Georgia, and a United States, 
where buses play an important role in transporting people to hub cities 
for work or to transfer to another mode of transportation.
  The cost to us if we lose bus services is incalculable. All segments 
of the community will obviously be affected and not for the better. 
However, by working together, legislators, the disabled, the elderly, 
and the bus industry can and must strengthen bus service for all 
communities and the millions of Americans who use the service of over 
the road buses. I encourage my colleagues to join in support of this 
legislation.
                                 ______
                                 
      By Mr. SPECTER (for himself, Ms. Stabenow, and Mr. Warner):
  S. 1194. A bill to impose certain limitations on the receipt of out-
of-State municipal solid waste, to authorize State and local controls 
over the flow of municipal solid waste, and for other purposes; to the 
Committee on environment and Public Works.
  Mr. SPECTER. Mr. President, I have sought recognition to introduce a 
bill that would allow States to pass laws limiting the import of waste 
from other States. Addressing the interstate shipment of solid waste is 
a top environmental priority for millions of Pennsylvanians and for me. 
As you are aware, Congress came very close to enacting legislation to 
address this issue in 1994, and the Senate passed interstate waste and 
flow control legislation in May, 1995 by an overwhelming 94-6 margin, 
only to see it die in the House of Representatives. I look forward to 
my new role as a member of the Senate Committee on Environment and 
Public Works and am confident that with the strong leadership of my 
colleagues Chairmen Chafee and Smith, we can get quick action on a 
strong waste bill and put the necessary pressure on the other body to 
conclude this effort once and for all.
  As you are aware, the Supreme Court has put us in the position of 
having to intervene in the issue of trash shipments. In recent years, 
the Court has struck down State laws restricting the importation of 
solid waste from other jurisdictions under the Interstate Commerce 
Clause of the U.S. Constitution.

[[Page 13619]]

The only solution is for Congress to enact legislation conferring such 
authority on the States, which would then be Constitutional.
  It is time that the largest trash exporting States bite the bullet 
and take substantial steps towards self-sufficiency for waste disposal. 
The legislation passed by the Senate in the 103rd and 104th Congresses 
would have provided much-needed relief to Pennsylvania, which is by far 
the largest importer of out-of-State waste in the Nation. According to 
the Pennsylvania Department of Environmental Protection, 3.9 million 
tons of out-of-State municipal solid waste entered Pennsylvania in 
1993, rising to 4.3 million tons in 1994, 5.2 million in 1995, 6.3 
million tons from out-of-State in 1996 and 1997, and a record 7.2 
million tons in 1998, which are the most recent statistics available. 
Most of this trash came from New York and New Jersey, with New York 
responsible for 44 percent and New Jersey responsible for 41 percent of 
the municipal solid waste imported into Pennsylvania in 1998.
  This is not a problem limited to one small corner of my State. 
Millions of tons of trash generated in other States find their final 
resting place in more than 50 landfills throughout Pennsylvania.
  Now, more than ever, we need legislation which will go a long way 
toward resolving the landfill problems facing Pennsylvania, Indiana, 
and similar waste importing States. I am particularly concerned by the 
developments in New York, where the closure of the city's one remaining 
landfill, Fresh Kills, has been announced this year. I am advised that 
13,200 tons per day of New York City trash were sent there and that 
Pennsylvania is a likely destination of this trash.
  I have met with county officials, environmental groups, and other 
Pennsylvanians to discuss the solid waste issue specifically, and it 
often comes up in the public open house town meetings I conduct in all 
of Pennsylvania's 67 counties. I came away from those meetings 
impressed by the deep concerns expressed by the residents of 
communities which host a landfill rapidly filling up with the refuse of 
millions of New Yorkers and New Jerseyans whose States have failed to 
adequately manage the waste they generate.
  Recognizing the recurrent problem of landfill capacity in 
Pennsylvania, since 1989 I have pushed to resolve the interstate waste 
crisis. I have introduced legislation with my late colleague, Senator 
John Heinz, and then with former Senator Dan Coats along with 
cosponsors from both sides of the aisle which would have authorized 
States to restrict the disposal of out-of-State municipal waste in any 
landfill or incinerator within its jurisdiction. I was pleased when 
many of the concepts in our legislation were incorporated in the 
Environment and Public Works Committee's reported bills in the 103rd 
and 104th Congresses, and I supported these measures during floor 
consideration.
  During the 103rd Congress, we encountered a new issue with respect to 
municipal solid waste, the issue of waste flow control authority. On 
May 16, 1994, the Supreme Court held (6-3) in Carbone versus Clarkstown 
that a flow control ordinance, which requires all solid waste to be 
processed at a designated waste management facility, violates the 
Commerce Clause of the United States Constitution. In striking down the 
Clarkstown ordinance, the Court stated that the ordinance discriminated 
against interstate commerce by allowing only the favored operator to 
process waste that is within the town's limits. As a result of the 
Court's decision, flow control ordinances in Pennsylvania and other 
States are considered unconstitutional.
  I have met with country commissioners who have made clear that this 
issue is vitally important to the local governments in Pennsylvania and 
my office has, over the past years received numerous phone calls and 
letters from individual Pennsylvania counties and municipal solid waste 
authorities that support waste flow control legislation. Since 1988, 
flow control has been the primary tool used by Pennsylvania counties to 
enforce solid waste plans and meet waste reduction and recycling goals 
or mandates. Many Pennsylvania jurisdictions have spent a considerable 
amount of public funds on disposal facilities, including upgraded 
sanitary landfills, state-of-the-art resource recovery facilities, and 
co-composting facilities. In the absence of flow control authority, I 
am advised that many of these worthwhile projects could be jeopardized 
and that there has been a fiscal impact on some communities where there 
are debt service obligations.
  In order to fix these problems, my legislation would provide a 
presumptive ban on all out-of-state municipal solid waste, including 
construction and demolition debris, unless a landfill obtains the 
agreement of the local government to allow for the importation of 
waste. It would provide a freeze authority to allow a State to place a 
limit on the amount of out-of-State waste received annually at each 
facility. It would also provide a ratchet authority to allow a State to 
gradually reduce the amount of out-of-state municipal waste that may be 
received at facilities. These provisions will provide a concrete 
incentive for the largest exporting states to get a handle on their 
solid waste management immediately. To address the problem of flow 
control my bill would provide authority to allow local governments to 
designate where privately collected waste must be disposed. This would 
be a narrow fix for only those localities that constructed facilities 
before the 1994 Supreme Court ruling and who relied on their ability to 
regulate the flow of garbage to pay for their municipal bonds.
  This is an issue that affects numerous states, and I urge my 
colleagues to support this very important legislation.
                                 ______
                                 
      By Mr. SARBANES (for himself, Ms. Mikulski, Mr. Bond, Mr. Reid, 
        Mr. Schumer, Mr. Corzine, and Mr. Durbin):
  S. 1195. A bill to amend the National Housing Act to clarify the 
authority of the Secretary of Housing and Urban Development to 
terminate mortgagee origination approval for poorly performing 
mortgagees; to the Committee on Banking, Housing, and Urban Affairs.
  Mr. SARBANES. Mr. President, today Senator Mikulski, Senator Bond, 
and I, along with a number of our colleagues, are introducing, ``The 
Credit Watch Act of 2001,'' a bill that will authorize the Federal 
Housing Administration (FHA), to identify lenders who have excessively 
high early default and claim rates and consequently terminate their 
origination approval. This legislation is necessary to protect the FHA 
fund and take action against lenders who are contributing to the 
deterioration of our neighborhoods.
  A rash of FHA loan defaults have led to foreclosures and vacant 
properties in cities around the country. In Baltimore, the effects of 
high foreclosure rates are acute. In some neighborhoods, there are many 
vacant foreclosed homes within just a few block of each other. This can 
often be the beginning of a neighborhood's decline. The high volume of 
vacant properties creates a perception that both the property and the 
neighborhood are not highly valued. In turn, these neighborhoods 
deteriorate physically and often attract criminal activity.
  It's like a rotten apple in a barrel. The rundown appearance of one 
home spreads to the surrounding neighborhood. Stabilization and 
revitalization efforts are undermined by the presence of abandoned 
homes.
  The Department of Housing and Urban Development, HUD, community 
activists, and local law makers have come together to examine the loans 
being made in neighborhoods with high foreclosure rates.
  In Baltimore and other cities, these groups that careless lenders are 
offering the FHA insured loans to families who cannot afford to pay 
them back. This results in defaults and foreclosures. A foreclosed 
property can easily turn into an uninhabited home, which can either 
begin or continue a cycle of decline.
  In an effort to reduce the number of loans that end in foreclosure, 
the FHA

[[Page 13620]]

developed several new oversight methods, one of which is ``Credit 
Watch.''
  ``Credit Watch'' is an automated system that keeps track of the 
number of early foreclosures and claims of lenders in a particular 
area. This legislation authorizes the FHA to revoke the origination 
approval of lenders who have significantly higher rates of early 
defaults and claims than other lenders in the same area. The FHA is 
currently targeting lenders with default rates of 300 percent of the 
area average.
  Credit Watch has been an effective tool in tracking down bad lenders. 
Since HUD launched Credit Watch in May 1999, the Department has 
terminated the origination approval agreements of 77 lender branches. 
An additional 177 lender branches were placed on Credit Watch, warning, 
status.
  The legislation accounts for differing regional by ensuring that 
lenders are only compared to other making loans in the same community. 
It also provides a manner by which terminated lenders may appeal the 
decision of the FHA, if they believe that mitigating factors may 
justify higher default rates.
  When lenders make loans with no regard for the consumer or the health 
of the community, the FHA must be able to take action in a timely 
manner so that costly abuses of the FHA insurance fund can be stopped. 
Quick action not only protects the health of the Mutual Mortgage 
Insurance, MMI, fund, it protect neighborhoods from the detrimental 
effects of high vacancy rates and consumers from the pain of 
foreclosure and serious damage to their credit.
  Lenders that offer loans to individuals who cannot afford them should 
not be able to continue making those loans. It is a bad deal for 
taxpayers. It is a bad deal for neighborhoods. It is a bad deal for the 
families who take out the loan.
  Credit Watch is an useful and efficient way for the FHA to prevent 
these unfortunate foreclosures from happening. While we need to address 
the larger issue of predatory lending in our communities. ``Credit 
Watch'' is an obvious and immediate solution to one part of this 
problem.
                                 ______
                                 
      By Mr. BOND (for himself and Mr. Kerry):
  S. 1196. A bill to amend the Small Business Investment Act of 1958, 
and for other purposes; to the Committee on Small Business and 
Entrepreneurship.
  Mr. BOND. Mr. President, today I am introducing the Small Business 
Investment Company Amendments Act of 2001. This bill is important for 
one simple reason: once enacted it paves the way for more investment 
capital to be available for more small businesses that are seeking to 
grow and hire new employees.
  In 1958, Congress created the SBIC program to assist small business 
owners in obtaining investment capital. Forty years later, small 
businesses continue to experience difficulty in obtaining investment 
capital from banks and traditional investment sources. Although 
investment capital is readily available to large businesses from 
traditional Wall Street investment firms, small businesses seeking 
investments in the range of $500,000--$3 million have to look 
elsewhere. SBICs are frequently the only sources of investment capital 
for growing small businesses.
  Often we are reminded that the SBIC program has helped some of our 
Nations best known companies. It has provided a financial boost at 
critical points in the early growth period for many companies that are 
familiar to all of us. For example, Federal Express received a needed 
infusion of capital from two SBA-licensed SBICs at a critical juncture 
in its development stage. The SBIC program also helped other well-known 
companies, when they were not so well-known, such as Intel, Outback 
Steakhouse, America Online, and Callaway Golf.
  What is not well known is the extraordinary help the SBIC program 
provides to Main Street America small businesses. These are companies 
we know from home towns all over the United States. Main Street 
companies provide both stability and growth in our local business 
communities. A good example of a Main Street company is Steelweld 
Equipment Company, founded in 1932, which designs and manufactures 
utility truck bodies in St. Clair, Missouri. The truck bodies are 
mounted on chassis made by Chrysler, Ford, and General Motors. 
Steelweld provides truck bodies for Southwestern Bell Telephone Co., 
Texas Utilities, Paragon Cable, GTE, and GE Capital Fleet.
  Steelweld is a privately held, woman-owned corporation. The owner, 
Elaine Hunter, went to work for Steelweld in 1966 as a billing clerk 
right out of high school. She rose through the ranks of the company and 
was selected to serve on the board of directors. In December 1995, 
following the death of Steelweld's founder and owner, Ms. Hunter 
received financing from a Missouri-based SBIC, Capital for Business, 
CFB, Venture Fund II, to help her complete the acquisition of 
Steelweld. CFB provided $500,000 in subordinated debt. Senior bank debt 
and seller debt were also used in the acquisition.
  Since Ms. Hunter acquired Steelweld, its manufacturing process was 
redesigned to make the company run more efficiently. By 1997, 
Steelweld's profitability had doubled, with annual sales of $10 million 
and 115 employees. SBIC program success stories like Ms. Hunter's 
experience at Steelweld occur regularly throughout the United States.
  In 1991, the SBIC program was experiencing major losses, and the 
future of the program was in doubt. Consequently, in 1992 and 1996, the 
Committee on Small Business worked closely with the Small Business 
Administration to correct deficiencies in the law in order to ensure 
the future of the program.
  Today, the SBIC Program is expanding rapidly in an effort to meet the 
growing demands of small business owners for debt and equity investment 
capital. And it is important to focus on the significant role that is 
played by the SBIC program in support of growing small businesses. When 
Fortune Small Business compiled its list 100 fastest growing small 
companies in 2000, 6 of the top 12 businesses on the list received SBIC 
financing during their critical growth years.
  The ``Small Business Investment Company Amendments Act of 2001'' 
would permit the annual interest fee paid by Participating Securities 
SBICs to increase from 1.0 percent to no more than 1.28 percent. In 
addition, the bill would make three technical changes to the Small 
Business Investment Act of 1958, '58 Act, that are intended to make 
improvements in the day-to-day operation of the SBIC program.
  Projected demand for the Participating Securities SBIC program for FY 
2002 is $3.5 billion, a significant increase over the FY 2001 program 
level of $2.5 billion. It is imperative that Congress approve this 
relatively small increase in the annual interest charge paid by the 
Participating Securities SBICs before the end of the fiscal year. This 
fee increase, when combined with an appropriation of $26.2 million for 
FY 2002, the same amount Congress approved for FY 2001, will support a 
program level of $3.5 million.
  The ``Small Business Investment Company Amendments Act of 2001'' 
would also make some relatively technical changes the '58 Act that are 
drafted to improve the operations of the SBIC program. Section 3 would 
remove the requirement that the SBA take out local advertisements when 
it seeks to determine if a conflict of interest exists involving an 
SBIC. This section has been recommended by the SBA, that has informed 
me that is has never received a response to a local advertisement and 
believes the requirement is unnecessary.
  The bill would amend Title 12 and Title 18 of the United States Code 
to insure that false statements made to the SBA under the SBIC program 
would have the same penalty as making false statements to an SBIC. This 
section would make it clear that a false statement to SBA or to an SBIC 
for the purpose of influencing their respective actions taken under the 
'58 Act would be a criminal violation. The courts could then assess 
civil and criminal penalties for such violations.
  Section 5 of the bill would amend Section 313 of the '58 Act to 
permit the

[[Page 13621]]

SBA to remove or suspend key management officials of an SBIC when they 
have willfully and knowingly committed a substantial violation of the 
'58 Act, any regulation issued by the SBA under the Act, a cease-and 
desist order that has become final, or committed or engaged in any act, 
omission or practice that constitutes a substantial breach of a 
fiduciary duty of that person as a management official.
  The amendment expands the definition of persons covered by Section 
313 to be ``management officials,'' which includes officers, directors, 
general partners, managers, employees, agents of other participants in 
the management or conduct of the SBIC. At the time Section 313 of the 
'58 Act was enacted in November 1966, an SBIC was organized as a 
corporation. Since that time, SBIC has been organized as partnerships 
and Limited Liability Companies (LLCs), and this amendment would take 
into account those organizations.
  Mr. President, I ask unanimous consent that section-by-section 
summary be printed in the Record.
  There being no objection, the summary ordered to be printed in the 
Record, as follows:

 Small Business Investment Company Amendments Act of 2001--Section-by-
                            Section Summary

     Section 1. Short title
       This Act will be called the ``Small Business Investment 
     Company Amendments Act of 2001.''
     Section 2. Subsidy fees
       This section amends the Small Business Investment Act of 
     1958 to permit the SBA to collect an annual interest fee from 
     SBICs in an amount not to exceed 1.28 percent of the 
     outstanding Participating Security and Debenture balance. In 
     no case will the SBA be permitted to charge an interest fee 
     that would reduce the credit subsidy rate to less than 0 
     percent, when combined with other fees and congressional 
     appropriations. This section would take effect on October 1, 
     2001.
     Section 3. Conflicts of interest
       This change would remove the requirement that SBA run local 
     advertisements when it seeks to determine if a conflict of 
     interest is present. SBA has informed me that it has never 
     received a response to a local advertisement and believes the 
     requirement is unnecessary. SBA would continue to publish 
     these notices in the Federal Register. This section would not 
     prohibit the SBA from running local advertisements should it 
     believe it is necessary. It is supported by the SBA.
     Section 4. Penalties for false statements
       This section would amend Title 12 and Title 18 of the 
     United States Code to insure that false statements made to 
     SBA under the SBIC program would have the same penalty as 
     making false statements to an SBIC. The section would make it 
     clear that a false statement to SBA or to an SBIC for the 
     purpose of influencing their respective actions taken under 
     the Small Business Investment Act of 1958 would be a criminal 
     violation. The courts could then assess civil and criminal 
     penalties for such violations.
     Section 5. Removal or suspension of management officials
       This section would amend Section 313 the Small Business 
     Investment Act of 1958 to expand the list of persons who 
     could be removed or suspended by the SBA from the management 
     of an SBIC to include officers, directors, employees, agents, 
     or other participants of an SBIC. The persons subject to this 
     section are called ``Management Officials,'' a new term added 
     by this amendment. The amendment does not change the legal or 
     practical effect of the provisions of Section 313; however, 
     it has been drafted to make its provisions easier to follow.
       Sections 3, 4, and 5 would take effect on enactment of the 
     Act.

                          ____________________