[Congressional Record (Bound Edition), Volume 147 (2001), Part 10]
[House]
[Pages 13759-13820]
[From the U.S. Government Publishing Office, www.gpo.gov]



                    COMMUNITY SOLUTIONS ACT OF 2001

  Ms. PRYCE of Ohio. Mr. Speaker, by direction of the Committee on 
Rules, I call up House Resolution 196 and ask for its immediate 
consideration.
  The Clerk read the resolution, as follows:

                              H. Res. 196

       Resolved, That upon the adoption of this resolution it 
     shall be in order without intervention of any point of order 
     to consider in the House the bill (H.R. 7) to provide 
     incentives for charitable contributions by individuals and 
     businesses, to improve the effectiveness and efficiency of 
     government program delivery to individuals and families in 
     need, and to enhance the ability of low-income Americans to 
     gain financial security by building assets. The bill shall be 
     considered as read for amendment. In lieu of the amendments 
     recommended by the Committees on Ways and Means and the 
     Judiciary now printed in the bill, the amendment in the 
     nature of a substitute printed in the Congressional Record 
     and numbered 1 pursuant to clause 8 of rule XVIII shall be 
     considered as adopted. The previous question shall be 
     considered as ordered on the bill, as amended, and on any 
     further amendment thereto to final passage without 
     intervening motion except: (1) one hour of debate on the 
     bill, as amended, equally divided and controlled by the 
     chairman and ranking minority member of the Committee on Ways 
     and Means; (2) the further amendment in the nature of a 
     substitute printed in the report of the Committee on Rules 
     accompanying this resolution, if offered by Representative 
     Rangel of New York, Representative Conyers of Michigan, or a 
     designee, which shall be in order without intervention of any 
     point of order, shall be considered as read, and shall be 
     separately debatable for one hour equally divided and 
     controlled by the proponent and an opponent; and (3) one 
     motion to recommit with or without instructions.

  The SPEAKER pro tempore (Mr. Bonilla). The gentlewoman from Ohio (Ms. 
Pryce) is recognized for 1 hour.
  Ms. PRYCE of Ohio. Mr. Speaker, for the purpose of debate only, I 
yield the customary 30 minutes to the gentleman from Ohio (Mr. Hall), 
pending which I yield myself such time as I may consume. During 
consideration of this resolution, all time yielded is for the purpose 
of debate only.
  Mr. Speaker, to quote the chairman of the Committee on Ways and 
Means, House Resolution 196 is an ``appropriate'' and fair rule 
providing for the consideration of H.R. 7, the Community Solutions Act 
of 2001; and it is consistent with previous rules that our committee 
has reported and the House has adopted on legislation that amends the 
Tax Code. This rule provides for 1 hour of general debate equally 
divided between the chairman and ranking minority member of the 
Committee on Ways and Means.
  After general debate, it will be in order to consider a substitute 
amendment offered by the minority which is printed in the Committee on 
Rules report and will be debatable for 1 hour. Finally, the rule 
permits the minority another opportunity to amend the bill through a 
motion to recommit, with or without instructions. The rule waives all 
points of order against consideration of the bill as well as the 
amendment in the nature of a substitute.
  Mr. Speaker, before I go any further, let me take this opportunity to 
congratulate the gentleman from Oklahoma (Mr. Watts) and the gentleman 
from Ohio (Mr. Hall) for all their hard work on this legislation. They 
are certainly dedicated leaders in the quest to help the poor and the 
needy, both here and abroad. As our President, George W. Bush, has 
stated, the Community Solutions Act will allow us ``to enlist, equip, 
enable, empower, and expand the heroic works of faith-based and 
community groups all across America.''
  The Community Solutions Act features three primary provisions to 
encourage charitable works. First, it provides important tax incentives 
to increase charitable giving by allowing

[[Page 13760]]

more than 80 million taxpayers who do not itemize their returns to take 
a deduction for charitable contributions. In doing so, we are 
recognizing that generosity flows not only from the wealthy but just as 
often from the less affluent, some of whom have worked their way out of 
poverty and wish to give something back to struggling communities and 
families. It is not necessarily extra incentives these good souls need, 
but should we not at least show them appreciation for their 
philanthropy through equitable treatment under the Tax Code?
  The bill goes further to encourage philanthropy by also permitting 
tax-free distributions from individual retirement accounts for 
donations to qualified charities.
  In addition to individuals, there are businesses that stand ready and 
willing to help the less fortunate and lift up their communities. H.R. 
7 enables this charity through commonsense policies that allow 
resources to be directed to the needy rather than being discarded. We 
are a wealthy Nation where resources abound, and we cannot succumb to 
the luxury of wastefulness. We must do better by our citizens in need, 
and this legislation embraces that principle.
  For example, through an enhanced tax deduction, H.R. 7 encourages 
restaurants and small businesses to donate food to the hungry that 
might otherwise perish, uneaten, while children go to bed with empty 
bellies and seniors choose medicine over food. The bill also helps the 
business community fulfill their charitable missions by removing the 
threat of frivolous lawsuits that punish the good deeds of donating 
equipment, facilities, or vehicles to nonprofit organizations.
  Mr. Speaker, these are commonsense, meaningful steps that we can take 
to make a real difference in people's lives.
  ``Charitable choice'' is another tenet of H.R. 7. As first 
established in 1996 and expanded in subsequent years, charitable choice 
applies to the Temporary Assistance for Needy Families program, or 
TANF, provisions of welfare and the social services block grant 
program. The Community Solutions Act appropriately expands charitable 
choice provisions to include nine new program areas, including juvenile 
delinquency and prevention, crime prevention, housing, job training, 
senior citizen programs, community development, domestic violence 
prevention and intervention and hunger relief.
  The Community Solutions Act builds on these existing charitable 
choice provisions which were signed into law already on four separate 
occasions. I would note to my colleagues that each of these important 
laws passed this House with wide bipartisan support and well over 300 
votes.
  Mr. Speaker, the charitable choice provisions in this bill prohibit 
the government from discriminating based on religion against 
organizations that apply to provide services under specified federally 
funded programs. In other words, charitable choice provides a level 
playing field for any group, any group, religious or secular, that 
wishes to compete for Federal social service funding. Charitable choice 
says that what an organization believes has no bearing whatsoever on 
how it is evaluated regarding what it can do for the poor and the 
needy.
  In my hometown of Columbus, Ohio, the historic parish of Holy Family 
Church under the direction of Father Kevin Lutz feeds over 500 people 
daily in its soup kitchen and provides clothing and needed medical care 
to those who might otherwise go without. But in addition to the food 
and the clothing and the medicine, Father Lutz and the many volunteers 
of Holy Family are proven providers of care and compassion. I am proud 
of the work they are doing at home in my community. They are able to 
touch the lives of the needy and the poor in ways that government never 
can, because those grounded in faith can often provide the steadiest 
helping hand for those in despair.
  Of course, charitable choice and the Community Solutions Act maintain 
important safeguards to protect the fundamental character of these 
organizations and to prevent them from discriminating against or 
proselytizing to the individuals which they serve. As crafted under the 
bipartisan leadership of the gentleman from Oklahoma (Mr. Watts) and 
the gentleman from Ohio (Mr. Hall) and honed by the Committee on the 
Judiciary, this bill strikes a careful balance between expanding the 
universe of social care and protecting individual and organizational 
religious freedom.
  Finally, the Community Solutions Act creates individual development 
accounts which will allow low-income individuals to save and have 
matching funds so that they can accumulate a small nest egg, maybe 
enough to allow them to reach the dream of buying their first home or 
completing a college education or even starting a small business. It is 
a helping hand for those who need it most, who might never get a leg up 
any other way.
  This is commonsense legislation that encourages charitable giving and 
enlists the strongest of our allies in our effort to provide 
desperately needed social services.
  Mr. Speaker, we should never turn our backs on those who wish to help 
in the battle against despair, poverty, crime, and drug addiction. We 
should never turn our backs on those who have demonstrated an 
incredibly superior capacity to help over and over, one neighbor at a 
time. If we do turn our backs on those who seek to help, we turn our 
backs on those who need the help.
  Mr. Speaker, I reserve the balance of my time.
  Mr. HALL of Ohio. Mr. Speaker, I want to thank the gentlewoman from 
Ohio (Ms. Pryce) for yielding me the time, and I yield myself such time 
as I may consume.
  This is what they call a modified closed rule that will allow for 
consideration of H.R. 7, the Community Solutions Act of 2001, which 
supports the President's faith-based initiative. As my colleague has 
described, this rule permits a Democratic substitute and a motion to 
recommit. This is similar to other rules for tax-related bills.
  When the gentleman from Oklahoma (Mr. Watts) and the White House 
asked if I would be interested in sponsoring this faith-based 
initiative, I did not hesitate. It was not much of a stretch for me. It 
was, as some people have said, a no-brainer. I did not have to think 
too long or hard about it because I have had a lot of experience with 
faith-based programs and people of faith. I admire them and what they 
do.
  I am involved with this issue because I am determined to see an end 
to hunger in America.
  My experience with faith-based programs in my hometown of Dayton, 
Ohio, in Appalachia, here in the District of Columbia and in other 
countries has shown me that people who work in the field are not just 
dedicated, they are inspired. They feel called by their faith to make a 
difference. One of the values of that calling is that it brings new 
perspectives and encourages creativity and ingenuity.
  Over the July 4th recess, I traveled to East Timor and Indonesia and 
visited poverty alleviation projects. I toured squalid neighborhoods in 
Jakarta where hundreds of thousands of people lived in dumps and in 
conditions not fit for humans. As I visited these projects where 
repugnant smells were everywhere and hunger and sickness were rampant, 
I asked the workers why they did this work that they did. I knew what 
they were going to say to me, because when I ask this question, whether 
I am in Indonesia; Dayton, Ohio; or rural Appalachia, I always get the 
same answer. They tell me what motivates them is their faith. I ask 
them if they tell people about their faith. They say, ``We don't have 
to.'' ``We don't have to proselytize or force a sermon on them,'' they 
answer. ``Our faith speaks for itself. We love the people. They respond 
to our love. And they respond to our programs. They recognize our faith 
by the work that we do without us forcing it down their throats.''
  This bill specifically prohibits Federal funds from being used for 
sectarian purposes. We need to include everybody in this fight if we 
ever hope to win the battle against poverty. That

[[Page 13761]]

means that everybody should have a chance to compete for Federal funds 
to address our problems. Existing government and nonprofit programs do 
not have all the answers to these problems. Some have done tremendous 
work, but we still have 25 million people in the country that are 
hungry, we have homeless people, we have domestic violence, we have a 
horrendous drug problem, we have millions of working families and 
senior citizens that are not making it. The list of challenges goes on 
and on and on.
  Many large faith-based organizations have for years been receiving 
millions of government dollars, and we have been very happy with their 
efforts. But what about the thousands of smaller groups that cannot 
compete for Federal moneys because of burdensome red tape? These 
programs have few employees. They rely instead on volunteers. They have 
small budgets, barely keeping their heads above water financially. That 
is what this bill is about, including these smaller groups that are 
motivated by their love and faith to work in areas where nobody else 
will work.
  In Vinton County which is one of Ohio's poorest counties, I recently 
visited CARE United Methodist Outreach. It is an organization that 
distributes food, household necessities, clothing; it gives help with 
job assistance, almost anything that a person might need. A long way 
from Vinton County, just a few minutes from here across the river in 
Anacostia, is a program called The House. It is an initiative that 
works with youth from Anacostia High School in one of the toughest 
neighborhoods in the District of Columbia.

                              {time}  1045

  These are just two of the thousands of examples of small faith-based 
community-minded organizations working where no one else will go. 
Actually, if these two groups were not there, nobody would be there.
  This bill will allow these religious organizations to compete on a 
level playing field. This is not about favoring certain religions; it 
is about funding the groups that will get the best results in caring 
for the least, the last, and the lost.
  Problems in our country are real, and many are getting worse; and 
none of them are going away without some response. If faith-based 
groups can respond effectively, I think we should encourage them to do 
so.
  I urge my colleagues to make finding solutions to these problems a 
priority, and I hope that they will give faith-based groups no less a 
chance than their secular counterparts have.
  Mr. Speaker, I reserve the balance of my time.
  Ms. PRYCE of Ohio. Mr. Speaker, I am very pleased to yield 2 minutes 
to the distinguished gentleman from Pennsylvania (Mr. Gekas), a member 
of the Committee on the Judiciary.
  Mr. GEKAS. Mr. Speaker, I rise in support of the rule that is before 
us and for the debate that follows.
  At first I had been considering appearing before the Committee on 
Rules to try to make in order some kind of amendment that would prevent 
cults and other fringe groups or groups that would gather together and 
form for the purpose of trying to take advantage of the new programs, 
new spending programs, that would be accorded by this legislation. 
Since then, in reviewing the legislation and in conferences with other 
Members and with other individuals outside the Congress, I am convinced 
that a so-called cult cannot succeed in applying or qualifying for one 
of these programs.
  Why? It is a certainty that these programs are going to be based on 
the experience and track records mostly of existing faith-based 
organizations, rather than doing the kind of work we contemplate for 
years. So we have a foundation upon which these programs can be based.
  In conversations with the gentleman from Wisconsin (Mr. Green), who 
did an extensive study of these very same questions, he further 
satisfied me that my worries about cults being eligible for these 
programs is not founded on reality.
  So, I have no need, did have no need, have no need now, to try to add 
provisions to this to guard specifically against the dangerous cult, as 
I view it.
  Mr. Speaker, I am satisfied that the rule will allow for a full 
debate that will encompass all the purposes of the legislation, without 
indulging in allowing loopholes for fringe groups to enter the process.
  Mr. HALL of Ohio. Mr. Speaker, I yield 2 minutes to the gentleman 
from Massachusetts (Mr. Frank).
  Mr. FRANK. Mr. Speaker, this rule is terribly unfair. The gentleman 
from Ohio said, well, this is how we treat tax bills. But this is 
hardly a tax bill. There is a very small piece of it that is tax 
related. The great bulk of it is the social service aspect. It is very 
important.
  I am very proud of the work I have done with faith-based groups. I 
care a lot about housing, and the Catholic Archdiocese of Boston has a 
wonderful record in housing. In area after area, I have been proud to 
cooperate with them. But none of those organizations have told me that 
they needed the right to discriminate or ignore State and local anti-
discrimination laws.
  That is what this bill does. I will insert into the Record here pages 
from the transcript which will show the chairman of the committee 
acknowledging that it preempts State and local anti-discrimination 
laws, and the gentleman from Florida (Mr. Scarborough) explaining why 
it is important that Jewish groups be allowed to discriminate in the 
serving of soup by not hiring non-Jews. I disagree with both of those. 
I wish we had ample time to debate them.

       Mr. Frank. There are further questions that we have. There 
     is also this list, the non-discrimination statutes, that must 
     be followed. They are the Federal statutes. Some States have 
     decided to go beyond what the Federal Government has done in 
     preventing discrimination, and I would ask, because it's not 
     clear to me, is this preemptive of State employment 
     discrimination laws other than those which might track the 
     Federal one? I would yield to anyone who could give me the 
     answer to that. By specifying the Federal anti-discrimination 
     laws that apply, does this mean that State anti-
     discrimination laws which cover subjects not covered under 
     the Federal law, would be preempted in effect, and the 
     religious organizations would not have to apply--follow them? 
     I would yield to anyone who would answer that.
       Chairman Sensenbrenner. Will the gentleman yield?
       Mr. Frank. Yes, Mr. Chairman.
       Chairman Sensenbrenner. I'll answer the second part of our 
     question and I'll seek my own time for the first part. The 
     second part, relative to Federal preemption. Federal law 
     applies where Federal funds go, and State law does not apply. 
     If the religious organization accepted State funds, and by 
     implication, local government funds, then State laws would 
     apply to them as well.
       Mr. Frank. So it would preempt State laws or allow them 
     to----
       Chairman Sensenbrenner. It would allow them to ignore State 
     laws when Federal--only Federal funds are used, but would not 
     allow them to ignore State laws when State funds are used.
       Mr. Frank. What if there was a mix of Federal funds and 
     private funds?
       Chairman Sensenbrenner. Then they could ignore State laws.
       Mr. Frank. That seems to me to be a serious flaw and hardly 
     consistent with the sporadic States' rights professions that 
     we hear from the other side. The principle ought not to be 
     that you can get out of following a State's enactment because 
     you have accepted some Federal funds, and the Chairman has 
     very straightforwardly made it clear. If you get some Federal 
     funds and you have some of your own funds, you might--not 
     might--you are then allowed to ignore a State law that would 
     otherwise be binding on you. I do not think we ought to be 
     embodying the principle that the acceptance of Federal funds 
     somehow then cancels State law.
       There are a number of things. For instance, the States get 
     highway money from the Federal Government. Does that 
     principal apply? Should we then say that a State highway 
     department can ignore its State's own laws with regard--or 
     contractors getting the State highway money? That, really, 
     frankly, surprises me in the very radical nature of a 
     repudiation of what the State can do. In other words, you are 
     in the State and you have set a policy that there will not be 
     discrimination based on this or that or the other, other than 
     what the Federal Government does. And an organization in your 
     State, which decides to do a program, and it's got 70 percent 
     of its money, and it gets 30 percent of the Federal money, 
     that Federal money now becomes a license to ignore State 
     anti-discrimination law. If there's a conflict between the 
     laws, then the Federal would apply, but I had not previously 
     thought it would be

[[Page 13762]]

       Mr. Scarborough. I do believe, although it has not been 
     articulated well, and I'm not trying to persuade you, I'm 
     just merely saying that there are some of us that believe 
     this that may not be able to articulate it very well, that 
     there is a culture in, let's say, an urban Protestant Church 
     that is separate from a culture in, let's say, an urban 
     synagogue or in a Catholic Church that is separate from 
     another.
       And I see Ms. Waters. She's about to explode, and I'm sure 
     I'm going to be a bigot, and this, that, and the other, but 
     I'm just saying there is----
       Chairman Sensenbrenner. The Chair is prepared to declare a 
     30-second recess.
       Mr. Scarborough. Why is that?
       Chairman Sensenbrenner. So that nobody explodes. We don't 
     want that to happen.
       Mr. Scarborough. I love Ms. Waters----
       [Laughter.]
       Mr. Scarborough. I love Ms. Waters, and Ms. Waters loves 
     me. She hugs me on the floor every chance she gets. That's 
     why she got up. She couldn't resist herself. [Laughter.]
       But there is a culture, seriously, there is an inherent 
     culture in these organizations, like, for instance, and I'll 
     talk about my church. I'm Southern Baptist. I disagree with a 
     lot of things they believe about people who are divorced not 
     being able to be deacons or, or women not being able to 
     preach, all right? But I do know that there are Southern--and 
     if that offends me, I can, I can take a hike. But there are, 
     even though I disagree with some of the things that people in 
     the Southern Baptist Church believe in, they can effectively 
     deliver services because of the culture of whether it's First 
     Baptist Church of Pensacola or----
       Mr. Weiner. Will the gentleman yield on that point?
       Mr. Scarborough. Yes, sir, I will.
       Mr. Weiner. Would the gentleman yield on that? And I'm 
     convinced the Southern Baptist Church can deliver those under 
     this bill.
       Perhaps you can enlighten me, and using the example of the 
     Southern Baptist Church or whatever you referred to, someone 
     coming in for a job interview to work in a job training 
     program to teach typing to someone who had been laid off----
       Mr. Scarborough. Right.
       Mr. Weiner. Why is it, give me an example, just so I can 
     fully get my mind around it, why is it necessary that they be 
     Baptist and why is it not only necessary, why is it so 
     important to this program that it means offending 35 or 40 
     Members around here who might be willing to make this a bill 
     that 300 people can vote for?
       Mr. Scarborough. Yeah, well, I don't think it's--reclaiming 
     my time--I don't think it's necessary. And, obviously, I 
     think most of us on this panel, I would hope, would agree 
     that it would be extraordinarily bigoted for any, any 
     organization, be it a faith-based or secular organization, to 
     prevent people from being hired. But I think the biggest 
     concern is compelling, for instance, a synagogue in a certain 
     area to hire a fundamentalist, right wing, religious, 
     whatever, that would, after all----
       Mr. Weiner. Typing teacher?
       Mr. Scarborough. Hold on a second. Hold on a second.
       Mr. Weiner. What does a right-wing typing teacher do, only 
     type with the right hand?
       Mr. Scarborough. We're talking about, and again----
       [Laughter.]
       Mr. Scarborough. Again, if you want to get laughs, that's 
     fine, but, for instance, delivering soup, let's say, for 
     instance, in an area that's heavily served, let's say a 
     synagogue in an urban part of the area, listen, they want to 
     get their soup. They don't want to hear somebody with views 
     that's completely different from their own views. And I 
     understand, I understand what the bill says that they're not 
     allowed to do that. But, again, if you compel these 
     organizations, again, whose culture, many Americans believe, 
     allow faith-based organizations to deliver services more 
     effectively than, say, the Department of HHS----
       Chairman Sensenbrenner. The time of the gentleman has 
     expired.
       Mr. Scarborough [continuing]. There's a risk of changing 
     the very culture of those organizations.
       Ms. Lofgren. Mr. Chairman.
       Chairman Sensenbrenner. The time of the gentleman has 
     expired.
       Mr. Scarborough. Thank you.
       Chairman Sensenbrenner. For what purpose does the 
     gentlewoman from California, Ms. Lofgren, seek recognition?
       Ms. Lofgren. To strike the last word.
       Chairman Sensenbrenner. The gentlewoman is recognized for 5 
     minutes.
       Ms. Lofgren. I--I was fascinated by the last exchange 
     because, apparently, even though there is a prohibition on 
     proselytizing, the reality would be that there would be 
     proselytizing, and therefore we need to make sure that 
     religious institutions can discriminate against people who 
     are not of their religion so that they can violate this 
     statute, which I think is a very odd proposition.
       But I would just, going back to my experience in local 
     government, I would just like to say I think this bill is a, 
     is a solution in search of a problem. I mean, we used all 
     kinds of contracts with religious-based organizations. 
     Catholic Charities ran the Immigration Counseling Center. The 
     only instance in my 14 years on the Board of Supervisors that 
     ever came to my attention that someone, a religious group 
     felt that they might not be--having treated fairly, was an 
     evangelical church who wondered were they being treated 
     fairly, and I met with them, and we made sure that they were 
     brought into the opportunity to provide food through the food 
     service, the largest faith-based group in Santa Clara County, 
     PAC, which has, I think now, 17 parishes and churches. They 
     provide homework centers, the biggest homework centers for 
     all the kids after school. They wouldn't even consider 
     discriminating against a tutor based on their religion, and 
     Catholic Charities wouldn't even consider discriminating 
     against a psychologist in hiring for one of the programs, the 
     mental health programs they run. It would be inconceivable.
       So I really strongly believe that Mr. Scott's amendment is 
     necessary and that this bill is probably not, but I would 
     like to yield to Mr. Scott, at this point.

  Mr. Speaker, this rule does a terrible disservice to democracy. This 
is a fundamentally important issue. Many of us are in favor of helping 
the faith-based groups, but want to put some safeguards in. There are 
complicated issues. Instead, we are told we get one substitute and one 
recommittal. The recommittal gets 10 minutes of debate.
  This forces fundamental, philosophical, constitutional, and moral 
issues of great importance into a shoehorn, apparently because the 
majority did not want to debate them.
  We are going to be told, well, you should not lump all these things 
together. We only wanted four or five amendments. We are only getting a 
couple of hours of debate on this fundamental issue, when we spend much 
more time on things of less significance.
  I will say this: Members who say, well, I could not vote for that 
recommittal, I could not vote for that substitute because it did not 
have everything I wanted, it had too much in there, then vote against 
the rule.
  Let us vote down this rule, and let us take this bill up where we can 
offer amendments that deal with these serious moral and constitutional 
issues in a significant way. Unfortunately, we are going to have a 
debate in which there are going to be all kinds of charges of mission 
representation, because the rule does not allow us time to air them.
  But I want to just close by saying again, the chairman of the 
committee honestly acknowledged that it preempts State and local anti-
discrimination laws where they use Federal laws, and others have talked 
about the right to discriminate religiously in hiring for secular 
purposes. Those should not be allowed to stand.
  Ms. PRYCE of Ohio. Mr. Speaker, I am pleased to yield 2 minutes to 
the distinguished gentleman from Wisconsin (Mr. Green).
  Mr. GREEN of Wisconsin. I thank the gentlewoman for yielding me time.
  I do agree with my colleague from Massachusetts that these are 
sensitive issues and weighty subjects that we debated today. Like 
everyone, when I first looked at this legislation, I had questions. It 
is complicated, it is complex, and it does touch upon delicate issues.
  But I am proud of the work that has been done in this bill as it has 
moved forward. I am proud of the work that the gentleman from Wisconsin 
(Chairman Sensenbrenner) and the gentleman from California (Chairman 
Thomas) have done.
  This bill is constitutional, this bill is workable, this bill is the 
right thing to do. It has strong accountability provisions. It requires 
separate accounts for the Federal dollars. It has opt-out provisions. 
It has secular alternative requirements.
  This bill builds on current law. The religious exemption that we are 
going to hear about so often today is current law. It has been law for 
years. This body has reinforced this law on bipartisan votes several 
times.
  In many ways, this bill is nothing new, because much of this is in 
current law; but in many ways, fundamental ways, it is new, because it 
opens up to new services, it opens up to new battles, it opens us up to 
new communities. With this bill, we can make a difference in lives, in 
neighborhoods, in

[[Page 13763]]

communities all across America. This is the right thing to do.
  Our President has pledged us as a Nation in his inaugural address 
that when we see that wounded traveler on the road to Jericho, we will 
not step to the other side. This legislation will ensure that that is 
the case.
  I am proud of this legislation. I think this rule makes sense. I look 
forward to the debate, and I look forward to passing this law and 
sending it on to the Senate and the President's desk.
  Mr. HALL of Ohio. Mr. Speaker, I yield 2 minutes to the gentleman 
from Mississippi (Mr. Shows).
  Mr. SHOWS. Mr. Speaker, I thank the gentleman from Ohio for yielding 
me time.
  Mr. Speaker, I appreciate the opportunity presented because of this 
bill being introduced. I rise today to express my strong support of 
H.R. 7, the Community Solutions Act of 2001. This bill is long overdue.
  I come from a small town in rural Mississippi called Bassfield, 
population 350, which is home to a few hundred families who work hard 
every day. I invite you and my colleagues to visit Bassfield and see 
what it is like in a real small town outside the Beltway. In my town, 
churches and other houses of worship and religious institutions are the 
bedrock of the community. This is true in small towns and big cities 
across the country.
  Where I come from, faith and family are common values; and, unlike 
Washington, when people in Bassfield need help, they do not look to the 
Government first, they look to the family and neighbors.
  We cannot put a fence around the churches in Bassfield or anywhere 
else. It is impossible, because religious institutions are and will 
always be central to the lives of our communities. They do it because 
it is the right thing to do, and they do it well.
  It does not make sense to reinvent the wheel to establish government 
programs to provide services in communities where services already 
exist in an overzealous effort to isolate religious from public policy.
  We must respect the foresight of our Founding Fathers, who knew that 
our new democracy could not permit one religion to prevail over others. 
But they also knew that our country was funded on the basic freedom to 
express one's religion, not to silence it. While we must respect the 
separation of church and State, we must also respect the rights of 
people of faith.
  Mr. Speaker, we always walk a fine line when we consider religion and 
public policy in the same breath; but in the Community Solutions Act, I 
believe we have crafted a bill that respects the separation of church 
and State, and, at the same time, tolerates the rights of all Americans 
to practice their religion.
  We have crafted a measure that affords people in big cities and small 
towns across the country the opportunity to receive essential services 
from the people who know them best, their faith-based institutions that 
already are the core of their communities. In a civil society in our 
democracy we tolerate the views and religions of others. In this 
spirit, I believe we can allow faith-based institutions to be our 
partners in communities. Indeed, they already are.
  Ms. PRYCE of Ohio. Mr. Speaker, I am pleased to yield 2 minutes to 
the distinguished gentleman from Florida (Mr. Stearns).
  Mr. STEARNS. Mr. Speaker, I thank the gentlewoman for yielding me 
time.
  Mr. Speaker, let me address two points. I do not know if my colleague 
from Massachusetts is still in the Chamber, but this Charitable Choice 
exists in Federal programs already. In addition, the House has provided 
passage of Charitable Choice in child support, the Home Ownership Act, 
Fathers Count Act of 11/10/99, and also the Juvenile Justice bill. So 
we have four cases where Charitable Choice is already in place.
  So for folks to come on the House floor and say vote against the rule 
because this is not fair, this is a great constitutional question, that 
is not true. However, President Clinton already signed into law four of 
these Charitable Choice pieces of legislation.
  Mr. Speaker, I am here because contained in the base bill, I have a 
bill that was incorporated, and I want to thank the gentleman from 
California (Chairman Thomas) and the gentleman from Oklahoma (Mr. 
Watts) for giving consideration to my bill, which repeals the excise 
tax on the net investment income for private foundations. I would also 
like to thank my colleagues who have cosponsored this legislation.
  Though, of course, full repeal of the 2 percent excise tax on private 
foundations would have been preferable, I want to thank my friends on 
the Committee on Ways and Means for eliminating the two-tier system and 
simplifying the tax to a flat 1 percent.
  The tax was originally enacted in 1969 as a way to offset the cost of 
government audit of these charitable organizations. In 1990, the excise 
tax raised $204 million, and they conducted 1,200 audits of private 
foundations. Then in 1999, the excise tax raised $500 million, and the 
IRS only did roughly about 200 audits.
  So private foundations generally must make annual distributions for 
charitable purposes equal to roughly 5 percent of their fair market 
value of the foundation's endowment assets. The excise tax acts as a 
credit in reducing this requirement.
  So I am glad my bill is part of the base bill. It is a tax cut. I 
want to again remind my colleagues to vote for the rule.
  Mr. Speaker, I first want to thank Chairman Thomas, along with 
Congressman Watts, for giving consideration to my bill H.R. 804--a bill 
to repeal the excise tax on the net investment income for private 
foundations. I would also like to thank my colleagues who have 
cosponsored this legislation.
  Though, of course, full repeal of the 2 percent excise tax on private 
foundations would have been preferable, I want to thank my friends on 
the Ways and Means Committee for eliminating the two-tiered system and 
simplifying the tax to a flat 1 percent.
  The tax was originally enacted in the Tax Reform Act of 1969 as a way 
to offset the cost of government audits of these organizations. In 
1990, the excise tax raised $204 million and the IRS conducted 1,200 
audits of private foundations. In 1999, the last year for which figures 
are available, the excise tax raised $499.6 million with the IRS 
conducting 191 audits.
  Private foundations generally must make annual distributions for 
charitable purposes equal to roughly 5 percent of the fair market value 
of the foundation's endowment assets. The excise tax paid acts as a 
credit in reducing the 5 percent requirement.
  By reducing the excise tax, we are placing needed money into the 
hands of our nation's charities. I thank Chairman Thomas and 
Congressman Watts for their leadership and support.
  Across this country, faith-based charitable organizations have 
brought healing to broken lives and suffering communities by providing 
emergency services, drug treatment, after school programs, as well as 
many other vital services. However, too often the Federal Government 
has valued process over performance and not welcomed faith-based 
charities as partners in fighting social ills.
  To address this bias Congress has repeatedly supported a program 
called Charitable Choice. This idea is not revolutionary. It has been 
adopted four separate times by bipartisan majorities and was signed 
into law by President Clinton each time, the first being the landmark 
welfare reform legislation in 1996. Charitable Choice is bipartisan, 
consensus law that expands options for needy Americans while 
safeguarding the character of faith-based charities and protects the 
rights of beneficiaries.
  In fact, it already exists in Federal law and applies to three 
domestic programs. It enjoys broad support because it is not a special 
fund for religious charities; it simply makes faith-based groups 
eligible to compete for Federal dollars.
  Charitable Choice corrects this prejudice that discriminates against 
charities on the sole basis of their belief system. This program 
because it is grounded in the Constitution, requires nondiscrimination. 
It includes all people of goodwill--whether Methodists, Muslim, Mormon, 
or good people of no faith at all.
  It preserves the first amendment because it insists on a separation 
between programs operating on the Federal dollar and those operating on 
the private dollar. Faith-based organizations may make federal programs 
available by advocating values but not engaging in religious worship.
  The question then becomes, why would any faith-based group want to 
participate with

[[Page 13764]]

these limitations. The answer is that the funding is always going to be 
there and therefore will we continue to discriminate or will we open 
the process and ferret out discrimination.
  Charitable Choice is about funding affective public services, not 
religious worship. It explicitly states that no direct funds ``may be 
expended for sectarian worship, instruction or proselytization.'' While 
securing this separation, it also allows ``conversion-centered'' groups 
to participate via vouchers. This is nothing new in Federal law. Since 
1990, low-income parents have used vouchers to enroll their children in 
thoroughly religious child-care services.
  This voucher option is critical for beneficiaries because when 
helping needy Americans one size does not fit all.
  Charitable Choice offers assistance in both the form of vouchers (to 
recipients) and grants (to organizations) to fund civic assistance 
programs. This variety expands service to needy Americans because it 
allows them to participate in a program that suits them without respect 
to religion.
  The President established the office of Faith-based and Community 
Initiatives, which is the first of its kind, to correct this glaring 
discreptency. The purpose of this office is to devise a constitutional 
means by which religious organizations are brought to the table and 
allowed to compete for Federal moneys regardless of their belief 
system.
  This is consistent with the President's objective to unleash private 
money for public good. It establishes charitable giving incentives for 
taxpayers to increase the level of money given directly to public 
service organizations.
  Charitable Choice allows faith-based and secular civic organizations 
to compete on the basis of the same criteria. Charitable Choice asks 
the question, ``What can you do?'' rather than ``Who are you?'' It 
holds both the religious and secular civic organizations to the same 
standard: Results.
  It is our responsibility to expand the range of care for people in 
crisis and Charitable Choice is an innovative way of achieving that 
goal. It is a way to empower that which is small and holistic.
  American's deserve a variety of alternatives; the goal is not to 
favor one group or belief system over another but to simply level the 
playing field such that any effective social service is made eligible 
for Federal moneys already designated for public services. It doesn't 
favor any religious organization; it only ends some of the burdens that 
often impede them. Surely this is something that every American can 
support.
  Mr. HALL of Ohio. Mr. Speaker, I yield 2 minutes to the gentleman 
from Virginia (Mr. Scott).
  Mr. SCOTT. Mr. Speaker, I rise in opposition to the rule. It is clear 
that the majority is avoiding the amendment process because they cannot 
defend the underlying bill. I offered an amendment that was rejected in 
Rules that would have required agencies when making funding decisions 
to consider objective merits when they consider the proposals.
  Now, I would like to ask, if you are not using objective merits, are 
the Federal officials supposed to just pick and choose between the 
religions based on the religion they like the best?
  In addition to discriminating in the grant process, it prevents 
amendments on the issue of whether we ought to roll back civil rights 
by 60 years. The Leadership Conference on Civil Rights, the NAACP, a 
host of other organizations, oppose this bill because of what it does 
to civil rights.
  We have heard we are not changing any present laws. Well, if you are 
not changing any present laws, you do not need a bill. This changes 
present laws, and that is the major controversy in the bill. We have 
not been able to discriminate in Federal contracts based on religion 
for decades. You can under this bill.
  In fact, this bill is not about small organizations, and it is not 
about faith organizations. Any program that can get funded under this 
bill can get funded today, except those sponsored by organizations who 
insist on discriminating based on religion.

                              {time}  1100

  We ought to have a process where we can debate the question of 
discrimination in this bill. We ought to have a rule that allows that; 
this rule does not, and therefore, this rule ought to be rejected.
  Ms. PRYCE of Ohio. Mr. Speaker, I yield 2 minutes to the gentleman 
from Indiana (Mr. Souder), my distinguished colleague.
  Mr. SOUDER. Mr. Speaker, I thank the gentlewoman for yielding me this 
time.
  First, I want to make a comment on the rule itself, which is this 
debate. The gentleman from Virginia just commented that he was 
frustrated that the rule does not allow for the ability to offer 
amendments. I cast a very difficult vote the other day. I do not favor 
campaign finance reform, but I believe that our leadership had been 
trying to work out a way for Shays-Meehan to have a straight up-or-down 
vote. In fact, this is what we need on charitable choice and this is 
what we need in health care.
  I believe this rule is fair. Most Members of this House, in effect, 
both on this side and on the other side, argued for a rule that gave 
people who are arguing a position the ability to have a vote on their 
bill, and I believe this bill falls into the same category as campaign 
finance reform, the Fletcher medical bill, and other bills. When we 
have these conflicts where there are two clear sides, we ought to have 
straight up-or-down votes on those bills.
  Secondly, while the gentleman from Virginia (Mr. Scott) is 
technically correct that this bill is different, it actually protects 
current religious exemptions. It does not change the religious freedom 
law. What we have done in this country is said that people who want to 
preserve their religious freedom are not eligible, even if they do not 
proselytize, even if they are just distributing soup to the hungry or 
if they are building a home for somebody who is homeless or if they are 
helping somebody who is dying of AIDS. Even if they do no 
evangelization, even if they do not pray with that individual, they are 
not allowed to build the house unless they change their entire religion 
or basic beliefs. That is what religious freedom is in this country, 
and that is what this bill is trying to uphold with current procedures 
as to how we do charitable work in this country so as to not step on 
religious freedom, and this bill attempts to rectify that.
  Mr. HALL of Ohio. Mr. Speaker I yield 2 minutes to the gentleman from 
Tennessee (Mr. Clement).
  Mr. CLEMENT. Mr. Speaker, I thank the gentleman for yielding me this 
time. I might say about the gentleman, he is a champion, not only in 
the United States but worldwide, when it comes to hunger and fighting 
hunger.
  I rise today in support of the rule, in support of H.R. 7, The 
Community Solutions Act of 2001. The heart of the so-called faith-based 
program would allow religious organizations to bid for Federal funds to 
feed the hungry, fight juvenile crime, assist older Americans, aid 
students, and help welfare recipients find work, among other charitable 
activities. I applaud the tremendous work that faith-based 
organizations have done to provide much-needed services to our 
communities.
  Organizations such as the Nashville Rescue Mission in my district 
offer a hand up to those in need without any influx of Federal dollars. 
This legislation would give the mission and other groups the 
opportunity to compete for such funds should they so desire. These 
important faith-based service programs no doubt play an extremely 
important role in transforming lives as they daily reach out to the 
less fortunate in Tennessee and across the Nation. The time has come to 
recognize these unique entities by passing charitable choice 
legislation.
  Charitable choice simply means equal access by faith-based 
organizations when they compete with other organizations for Federal 
social service contracts. Nothing is guaranteed. They must compete with 
everyone else and demonstrate their proven effectiveness in providing 
basic social services before they will be awarded Federal grants. 
Charitable choice is not a new idea. Existing charitable choice 
programs and national programs across the country have benefited 
thousands of people.
  Faith-based organizations have long been on the front lines of 
helping our communities' most needy and broken. They have taken on the 
challenges of society that others have left behind. It is time that the 
Federal Government

[[Page 13765]]

recognized the work they do and assist them in meeting these 
challenges. Let us improve our delivery system; let us support this 
bill and pass it.
  Ms. PRYCE of Ohio. Mr. Speaker, I yield 1\1/2\ minutes to the 
gentleman from Minnesota (Mr. Gutknecht).
  Mr. GUTKNECHT. Mr. Speaker, I thank the gentlewoman for yielding me 
this time.
  Mr. Speaker, I would like my colleagues to join me in a little 
visualization, the Members that are gathered here and perhaps others 
here in the Chamber. This story, I will give credit, came from John 
Fund who is an editorial writer, and I would like you all to close your 
eyes for a minute if it makes it easier. Imagine for a minute that you 
go home today and open your mail and there is a letter there from an 
attorney who is a long ways away, and as you read that letter you 
realize that you have been named an heir to an enormous fortune that 
you did not even know existed and, all of a sudden, you are wealthy 
beyond your wildest dreams. Think about that for just a minute. You 
think, this is a windfall. I would like to take a significant portion 
of this money that I did not know I was going to get and I would like 
to put it into something that will help the less fortunate. Think about 
that for a minute. What would you do with that windfall? How would you 
help the less fortunate?
  Now, be honest. How many of you, the first thing you thought of was, 
I know, I will give the money to the Federal Government.
  Now, you might have thought about giving the money to the Salvation 
Army, you might have thought about giving it to the Red Cross, to a 
church group, to some other organization, but I will guarantee very few 
people gathered here in this Chamber today, very few Americans, the 
very first thing they would have said is, I know, I will give the money 
to the Federal Government.
  That is what this bill is really all about. Let us give faith a 
chance. We all know deep down in our bones that we have wasted billions 
of dollars over the last 20 or 30 years in failed social programs run 
by the Federal bureaucracy. All this bill simply says is, give faith a 
chance.
  Mr. HALL of Ohio. Mr. Speaker, I yield 1 minute to the gentlewoman 
from California (Ms. Pelosi).
  Ms. PELOSI. Mr. Speaker, my husband, my children and I have among us 
100 years of Catholic education. That education has taught us our 
responsibilities to the poor and the mission of the Gospel of Matthew. 
Indeed, the gentleman from Ohio (Mr. Hall) is the living embodiment of 
the gospel of Matthew to minister to the needs of the hungry, the 
homeless, and others in need. That Catholic education has also taught 
us to oppose discrimination in every place in our country. That is why 
I have to oppose this legislation, H.R. 7, that is before us today.
  I am very proud that Catholic charities is the largest private 
network of social service agencies in the country, but in order to 
receive Federal funds, which they do now, Catholic charities and other 
religious affiliated nonprofits must agree to abide by all applicable 
antidiscrimination laws and to provide services without religious 
proselytizing. H.R. 7 would remove those important protections.
  So as a Catholic and one driven by the Gospel of Matthew and proud of 
the work that our nonprofits and all denominations do, what is the 
problem with this bill? The problem is that today, this House will vote 
to legalize discrimination as we minister to the needs of the poor. I 
hope that course of action will not be taken, and I urge my colleagues 
to oppose this unfair rule and to oppose H.R. 7.
  Ms. PRYCE of Ohio. Mr. Speaker, I yield 2 minutes to the gentleman 
from Texas (Mr. Smith), a member of the Committee on the Judiciary.
  Mr. SMITH of Texas. Mr. Speaker, I thank the gentlewoman from Ohio 
(Ms. Pryce), a member of the Committee on Rules, for yielding time to 
me.
  Mr. Speaker, I am happy to support our Nation's faith-based 
organizations. I want to mention some people back home who are doing 
this kind of work. In downtown San Antonio at the Little Church of La 
Villita, for almost 40 years, people like Cleo Edmonds and David Gross 
have given their time and resources to feed the hungry. They feed about 
100 people each day, primarily single mothers. Some people come in to 
get a meal; others to get groceries.
  In addition to meeting the nutritional needs of those who come 
seeking help, the Little Church of La Villita meets the spiritual needs 
in our community, offering prayer and counseling to those who request 
it.
  Some want to tell us that the faithful should leave their faith at 
the door. But, Mr. Speaker, everyone involved in serving the poor has 
faith; everyone has convictions. The only difference is that some 
believe in the power of God and some believe in the power of 
government.
  The Constitution does not envision a government devoid of all 
religion; rather, it envisions a rich menagerie of faiths, a patchwork 
of beliefs and convictions, all under the protection of one 
Constitution.
  Whether or not this bill becomes law, the Little Church of La Villita 
will continue its work. The question is not: Does the Little Church of 
La Villita need government money? The question is: Does the government 
need places like the Little Church of La Villita?
  Mr. HALL of Ohio. Mr. Speaker, I yield 2 minutes to the gentleman 
from Illinois (Mr. Davis).
  Mr. DAVIS of Illinois. Mr. Speaker, I feel like I am caught between a 
rock and a hard place. I say that because I support the concepts of 
faith-based initiatives. I support the elements of this legislation. I 
think it is going to go a long way towards finding solutions and 
helping address some of the many social ills and problems.
  On the other hand, I do not believe that we can allow any hint of 
discrimination or the opportunity to discriminate against any segment 
of our population, no matter whether we are dealing with race, color, 
national origin, sexual orientation, it matters not. Each and every 
human being in this country must feel that they have equal protection 
under the law, must know that they are not going to be discriminated 
against.
  While I hope that we will end up at the end of the day having passed 
this legislation, I hope we will end up at the end of the day sending a 
message to all of America that we will not allow discrimination in any 
shape, form, or fashion.
  Ms. PRYCE of Ohio. Mr. Speaker, I yield 4 minutes to the gentleman 
from Ohio (Mr. Boehner), the chairman of the Committee on Education and 
the Workforce.
  Mr. BOEHNER. Mr. Speaker, let me thank the gentlewoman from Ohio for 
yielding me this time.
  Mr. Speaker, I am pleased today to rise in support of President 
Bush's charitable choice initiative, the Community Solutions Act of 
2001. I wish to thank the gentleman from Wisconsin (Mr. Sensenbrenner) 
of the Committee on the Judiciary and the gentleman from California 
(Mr. Thomas), the chairman of the Committee on Ways and Means, for 
their diligent efforts in crafting this legislation which has taken 
into account many different points of view.
  As chairman of the Committee on Education and the Workforce, I am 
pleased that the legislation clearly indicates that faith-based 
organizations will be able to compete to provide services under several 
programs within our committee's jurisdiction. Every day throughout our 
Nation, community and faith-based organizations are playing a key role 
in meeting the needs of many Americans. Whether operating a soup 
kitchen, helping to build homes, providing child care, or providing 
training to welfare recipients, community and faith-based organizations 
are reaching out to others, and, in doing so, improving the quality of 
life for many Americans.
  President Bush has called them ``armies of compassion''; and, indeed, 
these organizations have demonstrated compassion on many fronts: caring 
for children after school, providing emergency food and shelter, 
offering mentoring and counseling, uplifting families of prisoners, and 
helping to rescue young

[[Page 13766]]

men and women from gangs and violence.
  While many of these organizations have had success, some faith-based 
organizations have faced barriers in accessing Federal funds. H.R. 7, 
the Community Solutions Act, addresses this problem by making Federal 
programs friendlier to faith-based organizations. It will enable these 
organizations to compete for Federal funds and grants on the same basis 
as other organizations; and, in short, it will ensure that they have a 
seat at the table with other nonprofit providers.
  Charitable choice is not a new idea, and over the past several years, 
Democrats and Republicans alike have voted for charitable choice in the 
Welfare Reform Act, the community services block grant law, and two 
substance abuse laws under the public health services act. The 
Community Solutions Act of 2001 represents a logical extension of these 
laws and would expand charitable choice to juvenile justice programs, 
housing programs, employment and training programs, child abuse, and 
violence prevention programs, hunger relief activities, high school 
equivalency and adult education programs, after-school programs and 
programs under the Older Americans Act, as well as many more.

                              {time}  1115

  For those who might be concerned about the excessive entanglement of 
religion in H.R. 7, it prohibits faith-based organizations from 
discriminating against participants on the basis of religion, a 
religious belief, or a refusal to hold a religious belief.
  Other safeguards include a prohibition on using government funds for 
religious worship, instruction or proselytizing, and a requirement for 
separate accounting for the government funds.
  Finally, if one objects to receiving services from a faith-based 
provider, alternative providers must be made available.
  I think another important part of this legislation is the expansion 
of charitable deductions to those who do not itemize on their tax 
returns. One organization in my home State that would benefit from this 
change in tax law, as well as the charitable choice provisions, is 
Reach Out Lakota, located in West Chester, Ohio. This group began 
nearly 8 years ago after a one-time Christmas charity event, and now 
has expanded into a year-round organization which provides food, 
clothing, and other social services to about 45 families each month.
  It is this kind of organization and this kind of involvement by 
community and faith-based organizations that I think is truly making a 
difference in the lives of many Americans. It is this kind of 
involvement that the Federal Government should be promoting and 
encouraging, the kind of involvement that H.R. 7 envisions.
  I urge my colleagues to support President Bush in his efforts to 
transform cities and neighborhoods all across the land. I will ask all 
of my colleagues to vote for the rule and to vote for this most 
important bill.
  Mr. HALL of Ohio. Mr. Speaker, I yield 2 minutes to the gentleman 
from New York (Mr. Nadler).
  Mr. NADLER. Mr. Speaker, I rise in opposition to this rule because it 
forces Members who have genuine concerns about some very troublesome 
elements of the bill to raise all those concerns in a single substitute 
motion.
  This rule permits not a single amendment to this bill to be heard on 
the floor. We will not be allowed to have clear votes on any of these 
questions, so the majority can shield from scrutiny the fiscal 
irresponsibility contained in this bill, the legislative green light in 
this bill for invidious discrimination, the nullification of State and 
local antidiscrimination laws contained in this bill.
  Their effort to allow the administration to completely rewrite the 
billions of dollars of social service programs into vouchers, without 
any legislative investigation into what we are talking about there, 
without congressional consideration, and allowing religious groups to 
subject the most vulnerable in our society to religious pressure and 
proselytizing using Federal dollars.
  Why are they so afraid of open and unstrained debate on this bill 
that makes such radical changes to our laws regarding religious freedom 
and the provision of social services? Why are they afraid to have clean 
up or down votes on these various issues? Does it have anything to do 
with the fear that those radical proposals considered one by one might 
not pass this body? Does it have anything to do with the fact that they 
are having trouble holding their own Members in line to vote for 
legalizing religious discrimination with taxpayer dollars?
  This is compassion? This is what the majority thinks of our first 
freedom? This is what the Republican leadership and the compassionate 
conservative in the White House think of the merits of this proposal, 
that they will not permit amendments to be introduced on the floor and 
considered and voted on?
  This House should have the chance to look carefully at each of these 
issues within this bill separately. We should have the chance to vote 
on these issues separately. We should have the chance to consider 
separately the several radical changes this bill would make in the very 
good and satisfactory way that religious organizations have been 
competing for and winning and using Federal funds for providing social 
services for the last 6 or 7 decades.
  Ms. PRYCE of Ohio. Mr. Speaker, I am pleased to yield 1\1/2\ minutes 
to my distinguished colleague, the gentleman from Ohio (Mr. Traficant).
  Mr. HALL of Ohio. Mr. Speaker, I also yield 1 minute to the gentleman 
from Ohio.
  The SPEAKER pro tempore (Mr. Bonilla). The gentleman from Ohio (Mr. 
Traficant) is recognized for 2\1/2\ minutes.
  Mr. TRAFICANT. Mr. Speaker, let us cut to the chase here. Opponents 
say that the Constitution separates church and State. Let us get down 
to business. But all legislative history clearly states and reflects 
the fact that the Founders' intent was only to prohibit the 
establishment of one state-sponsored religion.
  The Founders put God on our buildings, the Founders put God on our 
currency, and the Founders never intended to separate God and the 
American people.
  Think about what is happening in America. We have guns, drugs, murder 
in our schools, but prayer and God in our schools is actually 
prohibited by our government, we the people. Beam me up, Mr. Speaker. 
The Founders are rolling over in their graves.
  I say today on the House floor, a nation that denies God is a nation 
that invites the devil and welcomes massive social problems, and that 
is exactly what is happening in America. Look around.
  I stand here today in strong support of President Bush's initiative. 
I want to commend the gentleman from Oklahoma (Mr. Watts) and the 
gentleman from Ohio (Mr. Hall) for their great leadership in taking 
America back to the intended course that our Founders had planned for 
our great Nation, founded on religious liberty.
  We have let a few people in America decide what faith means. It is 
time to change that. This is the place to start. I commend those who 
are responsible for this great initiative.
  Mr. HALL of Ohio. Mr. Speaker, I yield 1 minute to the gentlewoman 
from California (Ms. Lee).
  Ms. LEE. Mr. Speaker, I thank the gentleman for yielding time to me.
  Today I rise in strong opposition to this rule and this bill. As one 
who attended a Catholic school for 8 years, and a person of very deep 
faith, I believe faith-based organizations do enormous good in our 
communities, our country, and across the world helping millions of 
people. They feed the hungry, heal the sick, house the homeless.
  Nonprofit religious organizations should be supported with increased 
funding and technical assistance. That is what charitable choice should 
do. There is not one cent in this bill to help these organizations in 
their noble work.
  However, providing Federal funding directly to churches, synagogues, 
and houses of worships, mosques, which this bill does, represents 
direct government intrusion into matters of faith.

[[Page 13767]]

Government cannot and government should not interfere with the practice 
of religion.
  This bill subjects houses of worship to government control. Mr. 
Speaker, the IRS will have a field day. This bill will allow 
government-sponsored discrimination. It tramples State and local civil 
rights laws, and allows the use of Federal taxpayer dollars to fund 
discrimination in employment.
  For example, it would allow organizations to refuse to hire Jews, 
Catholics, African American Baptists, depending on their religious 
policies and practices of their denomination. It would use taxpayer 
funds to fund that discrimination.
  That is intolerable. Our government cannot turn its back on decades 
of fighting against discrimination and start funding discrimination. I 
urge Members to oppose this rule.
  Ms. PRYCE of Ohio. Mr. Speaker, I am very pleased to yield 2 minutes 
to my friend and distinguished colleague, the gentleman from Georgia 
(Mr. Kingston).
  Mr. KINGSTON. Mr. Speaker, I thank the gentlewoman for yielding time 
to me.
  Mr. Speaker, I stand in strong support of this rule. I am a little 
confused. Those who are against it are saying they are against it 
because they cannot get their amendments in. Yet, that same group last 
week, when the Committee on Rules said, let us have a campaign finance 
reform bill with lots of amendments, they were totally against that 
rule. So the reality is here they are against H.R. 7.
  Let us review. In 1996, President Clinton, a liberal Democrat, signed 
into law welfare reform, welfare reform which said that faith-based 
organizations could participate in the delivery of some certain welfare 
services. The sky did not fall. For some reason, the sky is still up 
there.
  All this does, H.R. 7, is say, we are going to take the 1996 bedrock 
signed by President Clinton and expand it to say that faith-based 
organizations who participate in some form of social services can be 
eligible to compete for Federal grants that fund such services.
  Therefore, St. Paul's A.M.E. Church in Savannah, Georgia, run by 
Reverend Delaney, in all of his services of food and shelter and 
education and health care and family structure and family counseling, 
what they are saying to him is, ``Reverend Delaney, if you can divide 
the soup from the sermon, then what we will do is we will let you 
compete for a grant to feed the hungry. And what really matters is the 
full stomach here. That is the Federal Government's interest, not the 
conversion. You have to divide the soup in the sermon. But if you are 
doing a good job based on outcome, we are going to let you compete for 
that grant.'' That is what the Federal Government interest is, is the 
outcome.
  If the Federal Government and all our Federal agencies were doing 
such a darned good job of delivering these services, we should have 
wiped out poverty, because since 1964 we have spent more on the war on 
poverty than we did to fight World War II.
  It is not working. They need a helping hand. Let those who know the 
recipients, who live in the same ZIP Code and area code, let them 
compete for this money. They will do a good job.
  Mr. HALL of Ohio. Mr. Speaker, I yield 1 minute to the gentleman from 
North Carolina (Mr. Watt).
  Mr. WATT of North Carolina. Mr. Speaker, I find it very interesting 
to serve in a body where the Committee on Rules 1 week decides that 
democracy is all about debating every single amendment separately, and 
then the very next week decides that it will not allow a separate 
debate on an amendment that would eliminate the ability of religious 
institutions to discriminate in their employment practices and remove 
the offensive provision that everybody is concerned about from this 
bill.
  This is not a debate about government versus God. We made that choice 
when the Founding Fathers wrote into the Constitution ``one Nation, 
under God,'' and we have been living with that choice ever since.
  But we made a different choice in 1965 when we outlawed 
discrimination in this country. It was not a unanimous decision by the 
Nation at that time, but I am appalled 20 or 40 years later now to be 
debating the issue of whether we will allow religious discrimination to 
be engaged in in the delivery of services by church institutions, and 
we are doing it in the name of God.
  The gentleman from Pennsylvania (Mr. Traficant) said, ``Beam me up.'' 
I want to be beamed up on that false choice. We should have a rule that 
allows us to offer an amendment to strike this offensive provision from 
this bill, and then we would have almost unanimous support for the 
bill. But they would rather have the issue than the support.
  Mr. HALL of Ohio. Mr. Speaker, I yield 1 minute to the gentlewoman 
from Texas (Ms. Jackson-Lee).
  Ms. JACKSON-LEE of Texas. Mr. Speaker, I thank the gentleman from 
Ohio for yielding time to me. I thank the Speaker for the opportunity 
to characterize this date of history that we have today as a debate on 
a very crucial issue dealing with our view and commitment to the first 
amendment; that is, the idea of this government not establishing a 
specific religion for the nation.

                              {time}  1130

  I had hoped to offer the first amendment language as an amendment to 
this legislation, because I do not believe that we should be charged in 
this House with characterizing this debate as a question regarding our 
faith or our commitment in this Nation to our religious beliefs. I 
think it is important to understand that the Bill of Rights means 
something, that we cannot establish a religion through government. And 
certainly I think that as this legislation moves through this House 
today, giving direct funds to religious institutions makes this 
legislation as a violation of the Bill of Rights.
  I believe if we pass legislation that gives direct funds to religious 
institutions and then affirms the right of these religious institutions 
to discriminate as it relates to employment, we are doing the contrary 
to what the Founding Fathers determined in those early years. Might I 
say that in the story of the Good Samaritan it was a diverse individual 
that helped a different individual, used his religion, his commitment 
of faith and charity, but I do not believe he needed to have an 
established law of providing Federal funds to a certain religion to 
make him charitable.
  Mr. HALL of Ohio. Mr. Speaker, I yield 1 minute to the gentlewoman 
from Illinois (Ms. Schakowsky).
  Ms. SCHAKOWSKY. Mr. Speaker, faith-based organizations currently play 
an important and vital role in providing needed social welfare 
programs; and we, as a government, wholeheartedly support this work.
  In fiscal year 2000, faith-based organizations administered an 
estimated $1 billion in Housing and Urban Development assistance. 
Catholic Charities, Lutheran Services, Jewish Federation received 
substantial support from the Federal Government. But in order to get 
it, they agree not to discriminate. They simply comply with the 
structure established to comply with two of our Nations's most 
fundamental principles, equal protection of the law and separation of 
church and State.
  I have helped to establish many 501(c)(3)'s and wonderful 
organizations who do this work. A thousand religious leaders and 
organizations are opposed to H.R. 7, including American Baptist 
Churches USA, Office of Government Relations, Jewish Council on Public 
Affairs, Presbyterian Church USA, Episcopal Church, Unitarian 
Universalist Church, United Church of Christ, United Methodist Church. 
Join with them to oppose H.R. 7.
  Mr. HALL of Ohio. Mr. Speaker, I yield 1\1/4\ minutes to the 
gentleman from North Carolina (Mr. Price).
  Mr. PRICE of North Carolina. Mr. Speaker, many citizens, including 
Members of this House, first got into politics and stay involved in 
politics because of their moral and religious convictions. Religious 
congregations and organizations are working in communities daily to 
reach out to those in need, through Meals-on-Wheels, housing complexes 
for the elderly and the

[[Page 13768]]

disabled, after-school programs for at-risk youth; and they are often 
doing this with the help of public funds.
  This concept of faith-based initiatives is not new. My experience has 
been that religious groups are eager and effective in delivering 
greatly needed social services. But, Mr. Speaker, these groups have 
willingly organized their activities so as to honor the constitutional 
injunction against the establishment of religion when administering 
government funds. They have kept sectarian and social service 
activities institutionally separate. And they have understood that the 
use of public funds carries with it an obligation to refrain from 
discrimination, both among those served and among those hired to 
provide the service.
  While the Democratic substitute preserves these safeguards, the 
President's proposal threatens to break them down, and for that reason 
religious groups across the spectrum have raised red flags about the 
bill before us.
  The dual constitutional prohibitions against establishing religion 
and prohibiting its free exercise protect fairness and freedom in the 
public realm and also the autonomy and integrity of religious practice. 
We must maintain these safeguards, even as we encourage citizens to put 
their faith into action and thus to enrich our community life.
  My colleagues, support the carefully crafted Democratic substitute.
  Mr. HALL of Ohio. Mr. Speaker, I yield 1 minute to the gentlewoman 
from Ohio (Ms. Kaptur).
  Ms. KAPTUR. Mr. Speaker, I thank the gentleman for yielding me this 
time. Mr. Speaker, regarding the so-called faith-based initiative, if I 
were convinced that this initiative posed no threat to separation of 
church and State, I could support it. And if I were convinced it held 
no potential for the Government telling us what to believe, I could 
support it. But I am not convinced.
  I just want to point to one particular provision in the bill that 
asks those receiving funds to set up not a separate 501(c)(3) to 
receive the dollars and be audited, but only a separate account. It 
specifically states that in the legislation. Religious organizations or 
any organization that is not for-profit receiving government money 
should be required to set up a separate 501(c)(3) to give them tax 
exempt status and to keep the distinction between the religious side of 
the organization and its social service activities.
  In my district, the Lutheran Church already provides nursing home 
care, for example, through Wolf Creek Lutheran Home; but they have a 
separate 501(c)(3). Jewish Community Services, the same. Islamic Social 
Services, the same. The establishment of the 501(c)(3) principle in the 
base legislation is absolutely essential. I cannot support the faith-
based initiative as currently constituted.
  As a freedom lover who happens to be a Roman Catholic, I also know if 
our faith isn't deep enough, as sacrificing people, we don't need 
government money to subsidize us. We must give of our substance, not 
come to rely on a government subsidy.
  But partnership between government and faith-based groups has its 
place. If this initiative--or any faith-based initiative--had the 
proper safeguards, I could give it my support. On page 29 of the bill, 
any funds received by religious groups under this program shall be 
placed in a ``separate account,'' not a separately incorporated 
501(c)(3) legal entity. This means federal funds will be awarded 
directly to religious organizations. This simply defies our Bill of 
Rights and the separation of church and state so essential to the 
maintenance of our fundamental freedoms.
  This bill should require religious organizations to establish 
separate 501(c)(3) organizations and give them a separate legal 
standing from the religious mission of the faith-based group and a tax-
exempt status. Of course most involved in social services already do. 
In that way, they can take government money but maintain the separate 
legal structure that is necessary to protect religious freedom from 
government incursion.
  Of course, grantees should employ strict prohibitions against 
discrimination in hiring and the provision of services and abide by all 
applicable federal, state and local laws prohibiting discrimination.
  Of course, Mr. Speaker, religious organizations providing social 
services--augmented by taxpayer dollars--is hardly a new concept. And, 
we have learned an enormous amount from this rich and worthy 
experience. Let me give you some examples:
  The Sisters of Mercy, the Franciscans, the Grey Nuns, the Dominicans 
and members of other orders minister to the needy in hospitals and 
hospices and homeless shelters throughout America. But they do so 
through non-profit organizations that are separate and legally 
distinct.
  In my district, the Lutheran Church provides nursing home care and 
other service through Wolf Creek Lutheran Home. But they have a 
separate 501(c)(3).
  Jewish Community Services throughout the nation offer social 
services, including federally-subsidized independent housing for 
elderly and handicapped people. But they keep a separate accounting 
through a 501(c)(3) status.
  Islamic Social Services Association provides a wide range of social 
services to the growing Muslim population in North America--through its 
non-profit arm.
  Certainly we want to encourage religious organizations to provide 
social services to our fellow Americans. And certainly we want to do 
nothing that would discourage such compassionate activity.
  Priviate philantropy has its place, and we want to encourage our 
fellow citizens to give of their time and money to help the less 
fortunate. We know private philanthropy will never be a complete 
substitute for substantial social services funded by the U.S. 
Government. Our needs in America are so great, and many of the private 
groups boats are so small.
  I believe it is crucial--in order to protect taxpayer dollars and 
also to protect religious institutions from government interference--to 
keep not just two separate accounts, but separate and distinct 
organizations legally incorprated with their mission clearly defined.
  That is why the establishment of 501(c)(3) organizations is so 
crucial--not just for the integrity of government grant money but also 
for the independence of the religious organizations using it.
  I cannot support the faith-based initiative as currently proposed. 
Please vote ``no'' on the rule and on the bill, unless amended.
  Mr. HALL of Ohio. Mr. Speaker, I yield 1 minute to the gentleman from 
California (Mr. Schiff).
  Mr. SCHIFF. Mr. Speaker, I rise in opposition to the rule and to H.R. 
7. The Founding Fathers established a separation of church and State 
out of a solicitude for religion and for the State; and this initiative 
as drafted, I believe, is a threat to both. It is a threat to the State 
and the efficient operation of its services by preventing the State 
from ensuring that Federal funds are spent.
  Who among us in this body is prepared to ask for an audit of a Jewish 
synagogue or the Catholic Church or the Mormon Temple for its 
expenditures of Federal funds? I would say probably none of us. And so 
the effective delivery of services cannot be effectively audited.
  But more than that, the risk of excessive entanglement of religion, 
of having religious denominations compete with each other for Federal 
grants, becoming vendors of Federal services, of being told if they 
receive Federal money they cannot talk about faith being a necessary 
part of recovery, is this a position we want the Government to be in, 
saying if you take the Federal money, you cannot talk about faith, but 
if you do not, you can?
  This is not in the best interest of either State or church, and I 
urge a ``no'' vote.
  Mr. HALL of Ohio. Mr. Speaker, I yield 2 minutes to the gentleman 
from Texas (Mr. Edwards).
  Mr. EDWARDS. Mr. Speaker, as a person of faith, I believe in the 
power of faith to change lives, and I believe in the good work of 
faith-based groups. Yet today I join with over 1,000 religious leaders 
across America, and with civil rights groups, such as the NAACP, and 
educations groups, such as the National PTA and the National 
Association of School Administrators, who strongly oppose this bill.
  Mr. Speaker, when Members cast their vote on this bill today, I hope 
they will ask themselves two fundamental questions: one, should 
citizens' tax dollars be used to directly fund churches and houses of 
worship? And, two, is it right to discriminate in job hiring when using 
Federal dollars?
  I believe the answer to those two questions is no, and that is why I 
oppose this bill. Sending billions of tax dollars each year directly to 
churches

[[Page 13769]]

is unconstitutional under the first amendment. It will lead to 
government regulation of our churches, which is exactly why our 
Founding Fathers rejected the idea of using tax dollars to fund our 
churches when they wrote the Bill of Rights.
  It would be a huge step backwards in our Nation's march for civil 
rights to allow groups to fire employees from federally funded jobs 
solely because of their religious faith. Having a religious test for 
tax-supported jobs is wrong. No American citizen, not one, should have 
to pass someone else's religious test to qualify for a federally funded 
job.
  Mr. Speaker, this idea was a bad idea when Mr. Madison and Mr. 
Jefferson and our Founding Fathers rejected it in writing the 
Constitution two centuries ago. It is a bad idea today. This bill will 
harm religion, not help it. I urge my colleagues to vote ``no'' on this 
unfair rule and ``no'' on this bill.
  Ms. PRYCE of Ohio. Mr. Speaker, I yield 1 minute to the gentleman 
from California (Mr. Horn).
  Mr. HORN. Mr. Speaker, I thank the gentlewoman for yielding me this 
time, and I rise today in support of H.R. 7 and encourage my colleagues 
to vote for this important legislation.
  There is little doubt that faith-based organizations are often the 
most effective providers of social services in our communities. They 
are highly motivated, generous in spirit, and their motivation stems 
from a deep conviction about how one should live daily by giving to 
others in need. I have had a very strong record in this Chamber of 
separation of church and State, but I think we should give the 
President a chance on this. If something goes awry, then let us change 
it. But I think it will not, and I think thousands of people will be 
able to help hundreds of people.
  Through the welfare law passed in 1996, Congress provided 
opportunities for religious organizations, and I think there has been 
some very good language in H.R. 7. This program will work.
  Ms. PRYCE of Ohio. Mr. Speaker, I yield 2\1/2\ minutes to the 
gentleman from Mississippi (Mr. Pickering).
  Mr. PICKERING. Mr. Speaker, I rise today in proud support of both the 
rule and H.R. 7. I want to commend the gentleman from Ohio (Mr. Hall), 
who is an example to all of us, and the gentleman from Oklahoma (Mr. 
Watts). They are the best of this institution.
  I want to say that in my home State of Mississippi we have the proud 
distinction of being the most charitable State in the Nation, the most 
generous. And because of the faith-based initiative, we have had an 
effort that has brought our christian community together with the 
Jewish community, with Muslims, with black, with white, people of all 
ages to organize in support of this initiative, because we know in 
Mississippi, just as we know across this country, that for the addict, 
for the alcoholic, for the struggling family, for the hungry, for the 
prisoner, for those troubled, faith heals, faith renews, faith gives 
the hope that this country needs.
  Our President has called on us to remove the hindrances, to remove 
the hostility to the faith-based approaches so that there can be 
neutrality between the secular and the religious in healing our land. 
It is to remove the discrimination that we now have against the faith-
based solutions.
  I believe this approach can help heal our land, can bring our people 
together. It is happening in my own State of Mississippi; it is 
happening all across this land. I believe this is the right way at the 
right time to stand with organizations from the Salvation Army to 
Catholic Charities, to Evangelical Christians, to groups that represent 
the full breadth of this land and the greatest traditions of our faith.
  Our founders knew that faith needed to guide us to give us the 
political prosperity and the peace and the reconciliation and the 
renewal. May we rise to the occasion today and pass this great and good 
legislation.

                              {time}  1145

  Mr. HALL of Ohio. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, before I yield back the balance of my time, I would 
simply say that if I were to believe what has been said in the past few 
days, even the past couple weeks, even some of the stories I have read 
in the news, if I were to believe it without reading the bill, I would 
probably vote against this bill, too. But I have read the bill.
  I have lived and worked with some of these people that we are trying 
to help. It is time to reach out to them. It is time to encourage them, 
instead of beating them down. We beat them down. We turn them away from 
us when we have these kinds of discussions. It is time to reach out. 
That is what this bill does.
  Vote for the rule. Vote for the bill.
  Mr. Speaker, I yield back the balance of my time.
  Ms. PRYCE of Ohio. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, I ask my colleagues not to lose sight of our goal here 
to empower those organizations that can truly help in ways that the 
government could only wish, those organizations that are capable of 
really producing results in their own communities, neighbor to 
neighbor, one at a time. We need them far more than they need us.
  Mr. Speaker, I urge my colleagues to support this rule and the 
underlying legislation so that we can join our President and heroes 
like the gentleman from Ohio (Mr. Hall) and the gentleman from Oklahoma 
(Mr. Watts) and truly unleash the best of America.
  Mr. Speaker, I yield back the balance of my time, and I move the 
previous question on the resolution.
  The SPEAKER pro tempore (Mr. Bonilla). The question is on ordering 
the previous question.
  The question was taken; and the Speaker pro tempore announced that 
the noes appeared to have it.
  Ms. PRYCE of Ohio. Mr. Speaker, I object to the vote on the ground 
that a quorum is not present and make the point of order that a quorum 
is not present.
  The SPEAKER pro tempore. Evidently a quorum is not present.
  The Sergeant at Arms will notify absent Members.
  Pursuant to clause 9 of rule XX, the Chair will reduce to 5 minutes 
the minimum time for electronic voting, if ordered, on the question of 
agreeing to the resolution.
  The vote was taken by electronic device, and there were--yeas 228, 
nays 199, not voting 6, as follows:

                             [Roll No. 250]

                               YEAS--228

     Aderholt
     Akin
     Armey
     Bachus
     Baker
     Ballenger
     Barr
     Barton
     Bass
     Bereuter
     Biggert
     Bilirakis
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bono
     Brady (TX)
     Brown (SC)
     Bryant
     Burr
     Burton
     Buyer
     Callahan
     Calvert
     Camp
     Cannon
     Cantor
     Capito
     Castle
     Chabot
     Chambliss
     Coble
     Collins
     Combest
     Cooksey
     Cox
     Crane
     Crenshaw
     Cubin
     Culberson
     Davis, Jo Ann
     Davis, Tom
     Deal
     DeLay
     DeMint
     Diaz-Balart
     Doolittle
     Dreier
     Duncan
     Dunn
     Ehlers
     Ehrlich
     Emerson
     English
     Everett
     Ferguson
     Flake
     Fletcher
     Foley
     Forbes
     Fossella
     Frelinghuysen
     Gallegly
     Ganske
     Gekas
     Gibbons
     Gilchrest
     Gillmor
     Gilman
     Goode
     Goodlatte
     Goss
     Graham
     Granger
     Graves
     Green (WI)
     Greenwood
     Grucci
     Gutknecht
     Hall (OH)
     Hall (TX)
     Hansen
     Hart
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Herger
     Hilleary
     Hobson
     Hoekstra
     Horn
     Hostettler
     Houghton
     Hulshof
     Hunter
     Hutchinson
     Hyde
     Isakson
     Issa
     Istook
     Jenkins
     John
     Johnson (CT)
     Johnson (IL)
     Johnson, Sam
     Jones (NC)
     Keller
     Kelly
     Kennedy (MN)
     Kerns
     King (NY)
     Kingston
     Kirk
     Knollenberg
     Kolbe
     LaHood
     Largent
     Latham
     LaTourette
     Leach
     Lewis (CA)
     Lewis (KY)
     Linder
     Lipinski
     LoBiondo
     Lucas (OK)
     Manzullo
     Matheson
     McCrery
     McHugh
     McInnis
     McIntyre
     McKeon
     Mica
     Miller (FL)
     Miller, Gary
     Moran (KS)
     Morella
     Myrick
     Nethercutt
     Ney
     Northup
     Nussle
     Osborne
     Ose
     Otter
     Oxley
     Paul
     Pence
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Platts
     Pombo
     Portman
     Pryce (OH)
     Putnam
     Quinn
     Radanovich
     Ramstad
     Regula
     Rehberg
     Reynolds
     Riley
     Rogers (KY)

[[Page 13770]]


     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Roukema
     Royce
     Ryan (WI)
     Ryun (KS)
     Saxton
     Scarborough
     Schaffer
     Schrock
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Shays
     Sherwood
     Shimkus
     Shows
     Shuster
     Simmons
     Simpson
     Skeen
     Smith (MI)
     Smith (NJ)
     Smith (TX)
     Souder
     Stearns
     Stump
     Sununu
     Sweeney
     Tancredo
     Tauzin
     Taylor (MS)
     Taylor (NC)
     Terry
     Thomas
     Thornberry
     Thune
     Tiahrt
     Tiberi
     Toomey
     Traficant
     Upton
     Vitter
     Walden
     Walsh
     Wamp
     Watkins (OK)
     Watts (OK)
     Weldon (FL)
     Weldon (PA)
     Weller
     Whitfield
     Wicker
     Wilson
     Wolf
     Wu
     Young (AK)
     Young (FL)

                               NAYS--199

     Abercrombie
     Ackerman
     Allen
     Andrews
     Baca
     Baird
     Baldacci
     Baldwin
     Barcia
     Barrett
     Becerra
     Bentsen
     Berkley
     Berman
     Berry
     Bishop
     Blagojevich
     Blumenauer
     Bonior
     Borski
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brown (FL)
     Brown (OH)
     Capps
     Capuano
     Cardin
     Carson (IN)
     Carson (OK)
     Clay
     Clayton
     Clement
     Clyburn
     Condit
     Conyers
     Costello
     Coyne
     Cramer
     Crowley
     Cummings
     Cunningham
     Davis (CA)
     Davis (FL)
     Davis (IL)
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Deutsch
     Dicks
     Dingell
     Doggett
     Dooley
     Doyle
     Edwards
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Filner
     Ford
     Frank
     Frost
     Gephardt
     Gonzalez
     Gordon
     Green (TX)
     Gutierrez
     Harman
     Hastings (FL)
     Hill
     Hilliard
     Hinchey
     Hoeffel
     Holden
     Holt
     Honda
     Hooley
     Hoyer
     Inslee
     Israel
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Johnson, E. B.
     Jones (OH)
     Kanjorski
     Kaptur
     Kennedy (RI)
     Kildee
     Kilpatrick
     Kind (WI)
     Kleczka
     Kucinich
     LaFalce
     Lampson
     Langevin
     Lantos
     Larsen (WA)
     Larson (CT)
     Lee
     Levin
     Lewis (GA)
     Lofgren
     Lowey
     Lucas (KY)
     Luther
     Maloney (CT)
     Maloney (NY)
     Markey
     Mascara
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McDermott
     McGovern
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Millender-McDonald
     Miller, George
     Mink
     Mollohan
     Moore
     Moran (VA)
     Murtha
     Nadler
     Napolitano
     Neal
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Pelosi
     Peterson (MN)
     Phelps
     Pomeroy
     Price (NC)
     Rahall
     Rangel
     Reyes
     Rivers
     Rodriguez
     Roemer
     Ross
     Rothman
     Roybal-Allard
     Rush
     Sabo
     Sanchez
     Sanders
     Sandlin
     Sawyer
     Schakowsky
     Schiff
     Scott
     Serrano
     Sherman
     Skelton
     Slaughter
     Smith (WA)
     Snyder
     Solis
     Spratt
     Stark
     Stenholm
     Strickland
     Stupak
     Tanner
     Tauscher
     Thompson (CA)
     Thompson (MS)
     Thurman
     Tierney
     Towns
     Turner
     Udall (CO)
     Udall (NM)
     Velazquez
     Visclosky
     Waters
     Watson (CA)
     Watt (NC)
     Waxman
     Weiner
     Wexler
     Woolsey
     Wynn

                             NOT VOTING--6

     Bartlett
     Engel
     Hinojosa
     McKinney
     Norwood
     Spence

                              {time}  1207

  Ms. JACKSON-LEE of Texas, Mr. LUCAS of Kentucky, Mr. CLEMENT, Ms. 
PELOSI, and Mr. WEXLER changed their vote from ``yea'' to ``nay.''
  Mr. SHADEGG changed his vote from ``nay'' to ``yea.''
  So the previous question was ordered.
  The result of the vote was announced as above recorded.
  The SPEAKER pro tempore (Mr. Bonilla). The question is on the 
resolution.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.


                             Recorded Vote

  Mr. CONYERS. Mr. Speaker, I demand a recorded vote.
  A recorded vote was ordered.
  The SPEAKER pro tempore. This will be a 5-minute vote.
  The vote was taken by electronic device, and there were--ayes 233, 
noes 194, not voting 6, as follows:

                             [Roll No. 251]

                               AYES--233

     Aderholt
     Akin
     Armey
     Bachus
     Baker
     Ballenger
     Barr
     Bartlett
     Barton
     Bass
     Bereuter
     Biggert
     Bilirakis
     Bishop
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bono
     Brady (TX)
     Brown (SC)
     Bryant
     Burr
     Burton
     Buyer
     Callahan
     Calvert
     Camp
     Cannon
     Cantor
     Capito
     Castle
     Chabot
     Chambliss
     Clement
     Coble
     Collins
     Combest
     Cooksey
     Cox
     Crane
     Crenshaw
     Cubin
     Culberson
     Cunningham
     Davis, Jo Ann
     Davis, Tom
     Deal
     DeLay
     DeMint
     Diaz-Balart
     Doolittle
     Dreier
     Duncan
     Dunn
     Ehlers
     Ehrlich
     Emerson
     English
     Everett
     Ferguson
     Flake
     Fletcher
     Foley
     Forbes
     Ford
     Fossella
     Frelinghuysen
     Gallegly
     Ganske
     Gekas
     Gibbons
     Gilchrest
     Gillmor
     Gilman
     Goode
     Goodlatte
     Gordon
     Goss
     Graham
     Granger
     Graves
     Green (WI)
     Greenwood
     Grucci
     Gutknecht
     Hall (OH)
     Hall (TX)
     Hansen
     Hart
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Herger
     Hilleary
     Hobson
     Hoekstra
     Horn
     Hostettler
     Houghton
     Hulshof
     Hunter
     Hutchinson
     Hyde
     Isakson
     Issa
     Istook
     Jackson-Lee (TX)
     Jenkins
     Johnson (IL)
     Johnson, Sam
     Jones (NC)
     Keller
     Kelly
     Kennedy (MN)
     Kerns
     King (NY)
     Kingston
     Kirk
     Knollenberg
     Kolbe
     LaHood
     Largent
     Latham
     LaTourette
     Leach
     Lewis (CA)
     Lewis (KY)
     Linder
     Lipinski
     LoBiondo
     Lucas (KY)
     Lucas (OK)
     Manzullo
     Matheson
     McCrery
     McHugh
     McInnis
     McIntyre
     McKeon
     Mica
     Miller (FL)
     Miller, Gary
     Moran (KS)
     Morella
     Myrick
     Nethercutt
     Ney
     Northup
     Nussle
     Osborne
     Ose
     Otter
     Oxley
     Paul
     Pence
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Platts
     Pombo
     Portman
     Pryce (OH)
     Putnam
     Quinn
     Radanovich
     Ramstad
     Regula
     Rehberg
     Reynolds
     Riley
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Roukema
     Royce
     Ryan (WI)
     Ryun (KS)
     Saxton
     Scarborough
     Schaffer
     Schrock
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Shays
     Sherwood
     Shimkus
     Shows
     Shuster
     Simmons
     Simpson
     Skeen
     Skelton
     Smith (MI)
     Smith (NJ)
     Smith (TX)
     Souder
     Stearns
     Stump
     Sununu
     Sweeney
     Tancredo
     Tauzin
     Taylor (NC)
     Terry
     Thomas
     Thornberry
     Thune
     Tiahrt
     Tiberi
     Toomey
     Traficant
     Upton
     Vitter
     Walden
     Walsh
     Wamp
     Watkins (OK)
     Watts (OK)
     Weldon (FL)
     Weldon (PA)
     Weller
     Whitfield
     Wicker
     Wilson
     Wolf
     Young (AK)
     Young (FL)

                               NOES--194

     Abercrombie
     Ackerman
     Allen
     Andrews
     Baca
     Baird
     Baldacci
     Baldwin
     Barcia
     Barrett
     Becerra
     Bentsen
     Berkley
     Berman
     Berry
     Blagojevich
     Blumenauer
     Bonior
     Borski
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brown (FL)
     Brown (OH)
     Capps
     Capuano
     Cardin
     Carson (IN)
     Carson (OK)
     Clay
     Clayton
     Clyburn
     Condit
     Conyers
     Costello
     Coyne
     Cramer
     Crowley
     Cummings
     Davis (CA)
     Davis (FL)
     Davis (IL)
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Deutsch
     Dicks
     Dingell
     Doggett
     Dooley
     Doyle
     Edwards
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Filner
     Frank
     Frost
     Gephardt
     Gonzalez
     Green (TX)
     Gutierrez
     Harman
     Hastings (FL)
     Hill
     Hilliard
     Hinchey
     Hoeffel
     Holden
     Holt
     Honda
     Hooley
     Hoyer
     Inslee
     Israel
     Jackson (IL)
     Jefferson
     John
     Johnson, E. B.
     Jones (OH)
     Kanjorski
     Kaptur
     Kennedy (RI)
     Kildee
     Kilpatrick
     Kind (WI)
     Kleczka
     Kucinich
     LaFalce
     Lampson
     Langevin
     Lantos
     Larsen (WA)
     Larson (CT)
     Lee
     Levin
     Lewis (GA)
     Lofgren
     Lowey
     Luther
     Maloney (CT)
     Maloney (NY)
     Markey
     Mascara
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McDermott
     McGovern
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Millender-McDonald
     Miller, George
     Mink
     Mollohan
     Moore
     Moran (VA)
     Murtha
     Nadler
     Napolitano
     Neal
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Pelosi
     Peterson (MN)
     Phelps
     Pomeroy
     Price (NC)
     Rahall
     Rangel
     Reyes
     Rivers
     Rodriguez
     Roemer
     Ross
     Rothman
     Roybal-Allard
     Rush
     Sabo
     Sanchez
     Sanders
     Sandlin
     Sawyer
     Schakowsky
     Schiff
     Scott
     Serrano
     Sherman
     Slaughter
     Smith (WA)
     Snyder
     Solis
     Spratt
     Stark
     Stenholm
     Strickland
     Stupak
     Tanner
     Tauscher
     Taylor (MS)
     Thompson (CA)
     Thompson (MS)
     Thurman
     Tierney
     Towns
     Turner
     Udall (CO)
     Udall (NM)
     Velazquez
     Visclosky
     Waters
     Watson (CA)
     Watt (NC)
     Waxman
     Weiner
     Wexler
     Woolsey
     Wu
     Wynn

                             NOT VOTING--6

     Engel
     Hinojosa
     Johnson (CT)
     McKinney
     Norwood
     Spence

                              {time}  1219

  So the resolution was agreed to.

[[Page 13771]]

  The result of the vote was announced as above recorded.
  A motion to reconsider was laid on the table.


                          personal explanation

  Mr. HINOJOSA. Mr. Speaker, I regret that I was unavoidably detained 
this last evening and this morning. Had I been present, I would have 
voted ``yes'' on rollcall 243, ``yes'' on rollcall 244, ``no'' on 
rollcall 245, ``no'' on rollcall 246, ``yes'' on rollcall 247, ``yes'' 
on rollcall 248, ``yes'' on rollcall 249, ``no'' on rollcall 250, and 
``no'' on rollcall 251.
  Mr. THOMAS. Mr. Speaker, pursuant to House Resolution 196, I call up 
the bill (H.R. 7) to provide incentives for charitable contributions by 
individuals and businesses, to improve the effectiveness and efficiency 
of government program delivery to individuals and families in need, and 
to enhance the ability of low-income Americans to gain financial 
security by building assets, and ask for its immediate consideration.
  The Clerk read the title of the bill.
  The SPEAKER pro tempore (Mr. LaHood). Pursuant to House Resolution 
196, the bill is considered read for amendment.
  The text of H.R. 7 is as follows:

                                 H.R. 7

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Community 
     Solutions Act of 2001''.
       (b) Table of Contents.--The table of contents is as 
     follows:

Sec. 1. Short title; table of contents.

             TITLE I--CHARITABLE GIVING INCENTIVES PACKAGE

Sec. 101. Deduction for portion of charitable contributions to be 
              allowed to individuals who do not itemize deductions.
Sec. 102. Tax-free distributions from individual retirement accounts 
              for charitable purposes.
Sec. 103. Charitable deduction for contributions of food inventory.
Sec. 104. Charitable donations liability reform for in-kind corporate 
              contributions.

                TITLE II--EXPANSION OF CHARITABLE CHOICE

Sec. 201. Provision of assistance under government programs by 
              religious and community organizations.

               TITLE III--INDIVIDUAL DEVELOPMENT ACCOUNTS

Sec. 301. Purposes.
Sec. 302. Definitions.
Sec. 303. Structure and administration of qualified individual 
              development account programs.
Sec. 304. Procedures for opening and maintaining an individual 
              development account and qualifying for matching funds.
Sec. 305. Deposits by qualified individual development account 
              programs.
Sec. 306. Withdrawal procedures.
Sec. 307. Certification and termination of qualified individual 
              development account programs.
Sec. 308. Reporting, monitoring, and evaluation.
Sec. 309. Authorization of appropriations.
Sec. 310. Account funds disregarded for purposes of certain means-
              tested Federal programs.
Sec. 311. Matching funds for individual development accounts provided 
              through a tax credit for qualified financial 
              institutions.

             TITLE I--CHARITABLE GIVING INCENTIVES PACKAGE

     SEC. 101. DEDUCTION FOR PORTION OF CHARITABLE CONTRIBUTIONS 
                   TO BE ALLOWED TO INDIVIDUALS WHO DO NOT ITEMIZE 
                   DEDUCTIONS.

       (a) In General.--Section 170 of the Internal Revenue Code 
     of 1986 (relating to charitable, etc., contributions and 
     gifts) is amended by redesignating subsection (m) as 
     subsection (n) and by inserting after subsection (l) the 
     following new subsection:
       ``(m) Deduction for Individuals Not Itemizing Deductions.--
     In the case of an individual who does not itemize his 
     deductions for the taxable year, there shall be taken into 
     account as a direct charitable deduction under section 63 an 
     amount equal to the lesser of--
       ``(1) the amount allowable under subsection (a) for the 
     taxable year, or
       ``(2) the amount of the standard deduction.''
       (b) Direct Charitable Deduction.--
       (1) In general.--Subsection (b) of section 63 of such Code 
     is amended by striking ``and'' at the end of paragraph (1), 
     by striking the period at the end of paragraph (2) and 
     inserting ``, and'', and by adding at the end thereof the 
     following new paragraph:
       ``(3) the direct charitable deduction.''
       (2) Definition.--Section 63 of such Code is amended by 
     redesignating subsection (g) as subsection (h) and by 
     inserting after subsection (f) the following new subsection:
       ``(g) Direct Charitable Deduction.--For purposes of this 
     section, the term `direct charitable deduction' means that 
     portion of the amount allowable under section 170(a) which is 
     taken as a direct charitable deduction for the taxable year 
     under section 170(m).''
       (3) Conforming amendment.--Subsection (d) of section 63 of 
     such Code is amended by striking ``and'' at the end of 
     paragraph (1), by striking the period at the end of paragraph 
     (2) and inserting ``, and'', and by adding at the end thereof 
     the following new paragraph:
       ``(3) the direct charitable deduction.''
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after the date of the 
     enactment of this Act.

     SEC. 102. TAX-FREE DISTRIBUTIONS FROM INDIVIDUAL RETIREMENT 
                   ACCOUNTS FOR CHARITABLE PURPOSES.

       (a) In General.--Subsection (d) of section 408 of the 
     Internal Revenue Code of 1986 (relating to individual 
     retirement accounts) is amended by adding at the end the 
     following new paragraph:
       ``(8) Distributions for charitable purposes.--
       ``(A) In general.--No amount shall be includible in gross 
     income by reason of a qualified charitable distribution from 
     an individual retirement account to an organization described 
     in section 170(c).
       ``(B) Special rules relating to charitable remainder 
     trusts, pooled income funds, and charitable gift annuities.--
       ``(i) In general.--No amount shall be includible in gross 
     income by reason of a qualified charitable distribution from 
     an individual retirement account--

       ``(I) to a charitable remainder annuity trust or a 
     charitable remainder unitrust (as such terms are defined in 
     section 664(d)),
       ``(II) to a pooled income fund (as defined in section 
     642(c)(5)), or
       ``(III) for the issuance of a charitable gift annuity (as 
     defined in section 501(m)(5)).

     The preceding sentence shall apply only if no person holds an 
     income interest in the amounts in the trust, fund, or annuity 
     attributable to such distribution other than one or more of 
     the following: the individual for whose benefit such account 
     is maintained, the spouse of such individual, or any 
     organization described in section 170(c).
       ``(ii) Determination of inclusion of amounts distributed.--
     In determining the amount includible in the gross income of 
     any person by reason of a payment or distribution from a 
     trust referred to in clause (i)(I) or a charitable gift 
     annuity (as so defined), the portion of any qualified 
     charitable distribution to such trust or for such annuity 
     which would (but for this subparagraph) have been includible 
     in gross income--

       ``(I) shall be treated as income described in section 
     664(b)(1), and
       ``(II) shall not be treated as an investment in the 
     contract.

       ``(iii) No inclusion for distribution to pooled income 
     fund.--No amount shall be includible in the gross income of a 
     pooled income fund (as so defined) by reason of a qualified 
     charitable distribution to such fund.
       ``(C) Qualified charitable distribution.--For purposes of 
     this paragraph, the term `qualified charitable distribution' 
     means any distribution from an individual retirement 
     account--
       ``(i) which is made on or after the date that the 
     individual for whose benefit the account is maintained has 
     attained age 59\1/2\, and
       ``(ii) which is made directly from the account to--

       ``(I) an organization described in section 170(c), or
       ``(II) a trust, fund, or annuity referred to in 
     subparagraph (B).

       ``(D) Denial of deduction.--The amount allowable as a 
     deduction under section 170 to the taxpayer for the taxable 
     year shall be reduced (but not below zero) by the sum of the 
     amounts of the qualified charitable distributions during such 
     year which would be includible in the gross income of the 
     taxpayer for such year but for this paragraph.''
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to taxable years beginning after the date of the 
     enactment of this Act.

     SEC. 103. CHARITABLE DEDUCTION FOR CONTRIBUTIONS OF FOOD 
                   INVENTORY.

       (a) In General.--Subsection (e) of section 170 of the 
     Internal Revenue Code of 1986 (relating to certain 
     contributions of ordinary income and capital gain property) 
     is amended by adding at the end the following new paragraph:
       ``(7) Special rule for contributions of food inventory.--
     For purposes of this section--
       ``(A) Contributions by non-corporate taxpayers.--In the 
     case of a charitable contribution of food by a taxpayer, 
     paragraph (3)(A) shall be applied without regard to whether 
     or not the contribution is made by a corporation.
       ``(B) Limit on reduction.--In the case of a charitable 
     contribution of food which is a qualified contribution 
     (within the meaning of paragraph (3)(A), as modified by 
     subparagraph (A) of this paragraph)--
       ``(i) paragraph (3)(B) shall not apply, and

[[Page 13772]]

       ``(ii) the reduction under paragraph (1)(A) for such 
     contribution shall be no greater than the amount (if any) by 
     which the amount of such contribution exceeds twice the basis 
     of such food.
       ``(C) Determination of basis.--For purposes of this 
     paragraph, if a taxpayer uses the cash method of accounting, 
     the basis of any qualified contribution of such taxpayer 
     shall be deemed to be 50 percent of the fair market value of 
     such contribution.
       ``(D) Determination of fair market value.--In the case of a 
     charitable contribution of food which is a qualified 
     contribution (within the meaning of paragraph (3), as 
     modified by subparagraphs (A) and (B) of this paragraph) and 
     which, solely by reason of internal standards of the 
     taxpayer, lack of market, or similar circumstances, or which 
     is produced by the taxpayer exclusively for the purposes of 
     transferring the food to an organization described in 
     paragraph (3)(A), cannot or will not be sold, the fair market 
     value of such contribution shall be determined--
       ``(i) without regard to such internal standards, such lack 
     of market, such circumstances, or such exclusive purpose, and
       ``(ii) if applicable, by taking into account the price at 
     which the same or similar food items are sold by the taxpayer 
     at the time of the contribution (or, if not so sold at such 
     time, in the recent past).''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to taxable years beginning after December 31, 
     2001.

     SEC. 104. CHARITABLE DONATIONS LIABILITY REFORM FOR IN-KIND 
                   CORPORATE CONTRIBUTIONS.

       (a) Definitions.--For purposes of this section:
       (1) Aircraft.--The term ``aircraft'' has the meaning 
     provided that term in section 40102(6) of title 49, United 
     States Code.
       (2) Business entity.--The term ``business entity'' means a 
     firm, corporation, association, partnership, consortium, 
     joint venture, or other form of enterprise.
       (3) Equipment.--The term ``equipment'' includes mechanical 
     equipment, electronic equipment, and office equipment.
       (4) Facility.--The term ``facility'' means any real 
     property, including any building, improvement, or 
     appurtenance.
       (5) Gross negligence.--The term ``gross negligence'' means 
     voluntary and conscious conduct by a person with knowledge 
     (at the time of the conduct) that the conduct is likely to be 
     harmful to the health or well-being of another person.
       (6) Intentional misconduct.--The term ``intentional 
     misconduct'' means conduct by a person with knowledge (at the 
     time of the conduct) that the conduct is harmful to the 
     health or well-being of another person.
       (7) Motor vehicle.--The term ``motor vehicle'' has the 
     meaning provided that term in section 30102(6) of title 49, 
     United States Code.
       (8) Nonprofit organization.--The term ``nonprofit 
     organization'' means--
       (A) any organization described in section 501(c)(3) of the 
     Internal Revenue Code of 1986 and exempt from tax under 
     section 501(a) of such Code; or
       (B) any not-for-profit organization organized and conducted 
     for public benefit and operated primarily for charitable, 
     civic, educational, religious, welfare, or health purposes.
       (9) State.--The term ``State'' means each of the several 
     States, the District of Columbia, the Commonwealth of Puerto 
     Rico, the Virgin Islands, Guam, American Samoa, the Northern 
     Mariana Islands, any other territory or possession of the 
     United States, or any political subdivision of any such 
     State, territory, or possession.
       (b) Liability.--
       (1) Liability of business entities that donate equipment to 
     nonprofit organizations.--
       (A) In general.--Subject to subsection (c), a business 
     entity shall not be subject to civil liability relating to 
     any injury or death that results from the use of equipment 
     donated by a business entity to a nonprofit organization.
       (B) Application.--This paragraph shall apply with respect 
     to civil liability under Federal and State law.
       (2) Liability of business entities providing use of 
     facilities to nonprofit organizations.--
       (A) In general.--Subject to subsection (c), a business 
     entity shall not be subject to civil liability relating to 
     any injury or death occurring at a facility of the business 
     entity in connection with a use of such facility by a 
     nonprofit organization, if--
       (i) the use occurs outside of the scope of business of the 
     business entity;
       (ii) such injury or death occurs during a period that such 
     facility is used by the nonprofit organization; and
       (iii) the business entity authorized the use of such 
     facility by the nonprofit organization.
       (B) Application.--This paragraph shall apply--
       (i) with respect to civil liability under Federal and State 
     law; and
       (ii) regardless of whether a nonprofit organization pays 
     for the use of a facility.
       (3) Liability of business entities providing use of a motor 
     vehicle or aircraft.--
       (A) In general.--Subject to subsection (c), a business 
     entity shall not be subject to civil liability relating to 
     any injury or death occurring as a result of the operation of 
     aircraft or a motor vehicle of a business entity loaned to a 
     nonprofit organization for use outside of the scope of 
     business of the business entity, if--
       (i) such injury or death occurs during a period that such 
     motor vehicle or aircraft is used by a nonprofit 
     organization; and
       (ii) the business entity authorized the use by the 
     nonprofit organization of motor vehicle or aircraft that 
     resulted in the injury or death.
       (B) Application.--This paragraph shall apply--
       (i) with respect to civil liability under Federal and State 
     law; and
       (ii) regardless of whether a nonprofit organization pays 
     for the use of the aircraft or motor vehicle.
       (4) Liability of business entities providing tours of 
     facilities.--
       (A) In general.--Subject to subsection (c), a business 
     entity shall not be subject to civil liability relating to 
     any injury to, or death of an individual occurring at a 
     facility of the business entity, if--
       (i) such injury or death occurs during a tour of the 
     facility in an area of the facility that is not otherwise 
     accessible to the general public; and
       (ii) the business entity authorized the tour.
       (B) Application.--This paragraph shall apply--
       (i) with respect to civil liability under Federal and State 
     law; and
       (ii) regardless of whether an individual pays for the tour.
       (c) Exceptions.--Subsection (b) shall not apply to an 
     injury or death that results from an act or omission of a 
     business entity that constitutes gross negligence or 
     intentional misconduct, including any misconduct that--
       (1) constitutes a crime of violence (as that term is 
     defined in section 16 of title 18, United States Code) or act 
     of international terrorism (as that term is defined in 
     section 2331 of title 18, United States Code) for which the 
     defendant has been convicted in any court;
       (2) constitutes a hate crime (as that term is used in the 
     Hate Crime Statistics Act (28 U.S.C. 534 note));
       (3) involves a sexual offense, as defined by applicable 
     State law, for which the defendant has been convicted in any 
     court; or
       (4) involves misconduct for which the defendant has been 
     found to have violated a Federal or State civil rights law.
       (d) Superseding Provision.--
       (1) In general.--Subject to paragraph (2) and subsection 
     (e), this title preempts the laws of any State to the extent 
     that such laws are inconsistent with this title, except that 
     this title shall not preempt any State law that provides 
     additional protection for a business entity for an injury or 
     death described in a paragraph of subsection (b) with respect 
     to which the conditions specified in such paragraph apply.
       (2) Limitation.--Nothing in this title shall be construed 
     to supersede any Federal or State health or safety law.
       (e) Election of State Regarding Nonapplicability.--A 
     provision of this title shall not apply to any civil action 
     in a State court against a business entity in which all 
     parties are citizens of the State if such State enacts a 
     statute--
       (1) citing the authority of this section;
       (2) declaring the election of such State that such 
     provision shall not apply to such civil action in the State; 
     and
       (3) containing no other provisions.
       (f) Effective Date.--This section shall apply to injuries 
     (and deaths resulting therefrom) occurring on or after the 
     date of the enactment of this Act.

                TITLE II--EXPANSION OF CHARITABLE CHOICE

     SEC. 201. PROVISION OF ASSISTANCE UNDER GOVERNMENT PROGRAMS 
                   BY RELIGIOUS AND COMMUNITY ORGANIZATIONS.

       Title XXIV of the Revised Statutes is amended by inserting 
     after section 1990 (42 U.S.C. 1994) the following:

     ``SEC. 1994A. CHARITABLE CHOICE.

       ``(a) Short Title.--This section may be cited as the 
     `Charitable Choice Act of 2001'.
       ``(b) Purposes.--The purposes of this section are--
       ``(1) to provide assistance to individuals and families in 
     need in the most effective and efficient manner;
       ``(2) to prohibit discrimination against religious 
     organizations on the basis of religion in the administration 
     and distribution of government assistance under the 
     government programs described in subsection (c)(4);
       ``(3) to allow religious organizations to assist in the 
     administration and distribution of such assistance without 
     impairing the religious character of such organizations; and
       ``(4) to protect the religious freedom of individuals and 
     families in need who are eligible for government assistance, 
     including expanding the possibility of choosing to receive 
     services from a religious organization providing such 
     assistance.
       ``(c) Religious Organizations Included as Nongovernmental 
     Providers.--
       ``(1) In general.--

[[Page 13773]]

       ``(A) Inclusion.--For any program described in paragraph 
     (4) that is carried out by the Federal Government, or by a 
     State or local government with Federal funds, the government 
     shall consider, on the same basis as other nongovernmental 
     organizations, religious organizations to provide the 
     assistance under the program, if the program is implemented 
     in a manner that is consistent with the Establishment Clause 
     and the Free Exercise Clause of the first amendment to the 
     Constitution.
       ``(B) Discrimination prohibited.--Neither the Federal 
     Government nor a State or local government receiving funds 
     under a program described in paragraph (4) shall discriminate 
     against an organization that provides assistance under, or 
     applies to provide assistance under, such program, on the 
     basis that the organization has a religious character.
       ``(2) Funds not aid to religion.--Federal, State, or local 
     government funds or other assistance that is received by a 
     religious organization for the provision of services under 
     this section constitutes aid to individuals and families in 
     need, the ultimate beneficiaries of such services, and not 
     aid to the religious organization.
       ``(3) Funds not endorsement of religion.--The receipt by a 
     religious organization of Federal, State, or local government 
     funds or other assistance under this section is not and 
     should not be perceived as an endorsement by the government 
     of religion or the organization's religious beliefs or 
     practices.
       ``(4) Programs.--For purposes of this section, a program is 
     described in this paragraph--
       ``(A) if it involves activities carried out using Federal 
     funds--
       ``(i) related to the prevention and treatment of juvenile 
     delinquency and the improvement of the juvenile justice 
     system, including programs funded under the Juvenile Justice 
     and Delinquency Prevention Act of 1974 (42 U.S.C. 5601 et 
     seq.);
       ``(ii) related to the prevention of crime, including 
     programs funded under title I of the Omnibus Crime Control 
     and Safe Streets Act of 1968 (42 U.S.C. 3701 et seq.);
       ``(iii) under the Federal housing laws;
       ``(iv) under title I of the Workforce Investment Act of 
     1998 (29 U.S.C. 2801 et seq.)
       ``(v) under the Older Americans Act of 1965 (42 U.S.C. 3001 
     et seq.);
       ``(vi) under the Child Care Development Block Grant Act of 
     1990 (42 U.S.C. 9858 et seq.);
       ``(vii) under the Community Development Block Grant Program 
     established under title I of the Housing and Community 
     Development Act of 1974 (42 U.S.C. 5301 et seq.);
       ``(viii) related to the intervention in and prevention of 
     domestic violence;
       ``(ix) related to hunger relief activities; or
       ``(x) under the Job Access and Reverse Commute grant 
     program established under section 3037 of the Federal Transit 
     Act of 1998 (49 U.S.C. 5309 note); or
       ``(B)(i) if it involves activities to assist students in 
     obtaining the recognized equivalents of secondary school 
     diplomas and activities relating to non-school-hours 
     programs; and
       ``(ii) except as provided in subparagraph (A) and clause 
     (i), does not include activities carried out under Federal 
     programs providing education to children eligible to attend 
     elementary schools or secondary schools, as defined in 
     section 14101 of the Elementary and Secondary Education Act 
     of 1965 (20 U.S.C. 8801).
       ``(d) Organizational Character and Autonomy.--
       ``(1) In general.--A religious organization that provides 
     assistance under a program described in subsection (c)(4) 
     shall retain its autonomy from Federal, State, and local 
     governments, including such organization's control over the 
     definition, development, practice, and expression of its 
     religious beliefs.
       ``(2) Additional safeguards.--Neither the Federal 
     Government nor a State or local government shall require a 
     religious organization in order to be eligible to provide 
     assistance under a program described in subsection (c)(4)--
       ``(A) to alter its form of internal governance; or
       ``(B) to remove religious art, icons, scripture, or other 
     symbols because they are religious.
       ``(e) Employment Practices.--
       ``(1) In general.--In order to aid in the preservation of 
     its religious character, a religious organization that 
     provides assistance under a program described in subsection 
     (c)(4) may, notwithstanding any other provision of law, 
     require that its employees adhere to the religious practices 
     of the organization.
       ``(2) Title vii exemption.--The exemption of a religious 
     organization provided under section 702 or 703(e)(2) of the 
     Civil Rights Act of 1964 (42 U.S.C. 2000e-1, 2000e-2(e)(2)) 
     regarding employment practices shall not be affected by the 
     religious organization's provision of assistance under, or 
     receipt of funds from, a program described in subsection 
     (c)(4).
       ``(3) Effect on other laws.--Nothing in this section alters 
     the duty of a religious organization to comply with the 
     nondiscrimination provisions in title VI of the Civil Rights 
     Act of 1964 (42 U.S.C. 2000d et seq.) (prohibiting 
     discrimination on the basis of race, color, and national 
     origin), title IX of the Education Amendments of 1972 (20 
     U.S.C. 1681-1686) (prohibiting discrimination in educational 
     institutions on the basis of sex and visual impairment), 
     section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 794) 
     (prohibiting discrimination against otherwise qualified 
     disabled individuals), and the Age Discrimination Act of 1975 
     (42 U.S.C. 6101-6107) (prohibiting discrimination on the 
     basis of age).
       ``(f) Rights of Beneficiaries of Assistance.--
       ``(1) In general.--If an individual described in paragraph 
     (3) has an objection to the religious character of the 
     organization from which the individual receives, or would 
     receive, assistance funded under any program described in 
     subsection (c)(4), the appropriate Federal, State, or local 
     governmental entity shall provide to such individual (if 
     otherwise eligible for such assistance) within a reasonable 
     period of time after the date of such objection, assistance 
     that--
       ``(A) is an alternative, including a nonreligious 
     alternative, that is accessible to the individual; and
       ``(B) has a value that is not less than the value of the 
     assistance that the individual would have received from such 
     organization.
       ``(2) Notice.--The appropriate Federal, State, or local 
     governmental entity shall guarantee that notice is provided 
     to the individuals described in paragraph (3) of the rights 
     of such individuals under this section.
       ``(3) Individual described.--An individual described in 
     this paragraph is an individual who receives or applies for 
     assistance under a program described in subsection (c)(4).
       ``(g) Nondiscrimination Against Beneficiaries.--
       ``(1) Grants and contracts.--A religious organization 
     providing assistance through a grant or contract under a 
     program described in subsection (c)(4) shall not 
     discriminate, in carrying out the program, against an 
     individual described in subsection (f)(3) on the basis of 
     religion, a religious belief, or a refusal to hold a 
     religious belief.
       ``(2) Indirect forms of disbursement.--A religious 
     organization providing assistance through a voucher, 
     certificate, or other form of indirect disbursement under a 
     program described in subsection (c)(4) shall not 
     discriminate, in carrying out the program, against an 
     individual described in subsection (f)(3) on the basis of 
     religion, a religious belief, or a refusal to hold a 
     religious belief.
       ``(h) Accountability.--
       ``(1) In general.--Except as provided in paragraph (2), a 
     religious organization providing assistance under any program 
     described in subsection (c)(4) shall be subject to the same 
     regulations as other nongovernmental organizations to account 
     in accord with generally accepted accounting principles for 
     the use of such funds provided under such program.
       ``(2) Limited audit.--Such organization shall segregate 
     government funds provided under such program into a separate 
     account or accounts. Only the government funds shall be 
     subject to audit by the government.
       ``(i) Limitations on Use of Funds for Certain Purposes.--No 
     funds provided through a grant or contract to a religious 
     organization to provide assistance under any program 
     described in subsection (c)(4) shall be expended for 
     sectarian worship, instruction, or proselytization. A 
     certificate shall be signed by such organizations and filed 
     with the government agency that disbursed the funds that 
     gives assurance the organization will comply with this 
     subsection.
       ``(j) Effect on State and Local Funds.--If a State or local 
     government contributes State or local funds to carry out a 
     program described in subsection (c)(4), the State or local 
     government may segregate the State or local funds from the 
     Federal funds provided to carry out the program or may 
     commingle the State or local funds with the Federal funds. If 
     the State or local government commingles the State or local 
     funds, the provisions of this section shall apply to the 
     commingled funds in the same manner, and to the same extent, 
     as the provisions apply to the Federal funds.
       ``(k) Treatment of Intermediate Contractors.--If a 
     nongovernmental organization (referred to in this subsection 
     as an `intermediate contractor'), acting under a contract or 
     other agreement with the Federal Government or a State or 
     local government, is given the authority under the contract 
     or agreement to select nongovernmental organizations to 
     provide assistance under the programs described in subsection 
     (c)(4), the intermediate contractor shall have the same 
     duties under this section as the government when selecting or 
     otherwise dealing with subcontractors, but the intermediate 
     contractor, if it is a religious organization, shall retain 
     all other rights of a religious organization under this 
     section.
       ``(l) Compliance.--A party alleging that the rights of the 
     party under this section have been violated by a State or 
     local government may bring a civil action pursuant to section 
     1979 against the official or government agency that has 
     allegedly committed such violation. A party alleging that the 
     rights of the party under this section have been violated by 
     the Federal Government

[[Page 13774]]

     may bring a civil action for appropriate relief in Federal 
     district court against the official or government agency that 
     has allegedly committed such violation.''.

               TITLE III--INDIVIDUAL DEVELOPMENT ACCOUNTS

     SEC. 301. PURPOSES.

       The purposes of this title are to provide for the 
     establishment of individual development account programs that 
     will--
       (1) provide individuals and families with limited means an 
     opportunity to accumulate assets and to enter the financial 
     mainstream;
       (2) promote education, homeownership, and the development 
     of small businesses;
       (3) stabilize families and build communities; and
       (4) support United States economic expansion.

     SEC. 302. DEFINITIONS.

       As used in this title:
       (1) Eligible individual.--
       (A) In general.--The term ``eligible individual'' means an 
     individual who--
       (i) has attained the age of 18 years but not the age of 61;
       (ii) is a citizen or legal resident of the United States;
       (iii) is not a student (as defined in section 151(c)(4)); 
     and
       (iv) is a taxpayer the adjusted gross income of whom for 
     the preceding taxable year does not exceed--

       (I) $20,000, in the case of a taxpayer described in section 
     1(c) or 1(d) of the Internal Revenue Code of 1986;
       (II) $25,000, in the case of a taxpayer described in 
     section 1(b) of such Code; and
       (III) $40,000, in the case of a taxpayer described in 
     section 1(a) of such Code.

       (B) Inflation adjustment.--
       (i) In general.--In the case of any taxable year beginning 
     after 2002, each dollar amount referred to in subparagraph 
     (A)(iv) shall be increased by an amount equal to--

       (I) such dollar amount, multiplied by
       (II) the cost-of-living adjustment determined under section 
     (1)(f)(3) of the Internal Revenue Code of 1986 for the 
     calendar year in which the taxable year begins, by 
     substituting ``2001'' for ``1992''.

       (ii) Rounding.--If any amount as adjusted under clause (i) 
     is not a multiple of $50, such amount shall be rounded to the 
     nearest multiple of $50.
       (2) Individual development account.--The term ``Individual 
     Development Account'' means an account established for an 
     eligible individual as part of a qualified individual 
     development account program, but only if the written 
     governing instrument creating the account meets the following 
     requirements:
       (A) The sole owner of the account is the individual for 
     whom the account was established.
       (B) No contribution will be accepted unless it is in cash.
       (C) The holder of the account is a qualified financial 
     institution.
       (D) The assets of the account will not be commingled with 
     other property except in a common trust fund or common 
     investment fund.
       (E) Except as provided in section 306(b), any amount in the 
     account may be paid out only for the purpose of paying the 
     qualified expenses of the account owner.
       (3) Parallel account.--The term ``parallel account'' means 
     a separate, parallel individual or pooled account for all 
     matching funds and earnings dedicated to an Individual 
     Development Account owner as part of a qualified individual 
     development account program, the sole owner of which is a 
     qualified financial institution, a qualified nonprofit 
     organization, or an Indian tribe.
       (4) Qualified financial institution.--
       (A) In general.--The term ``qualified financial 
     institution'' means any person authorized to be a trustee of 
     any individual retirement account under section 408(a)(2).
       (B) Rule of construction.--Nothing in this paragraph shall 
     be construed as preventing a person described in subparagraph 
     (A) from collaborating with 1 or more contractual affiliates, 
     qualified nonprofit organizations, or Indian tribes to carry 
     out an individual development account program established 
     under section 303.
       (5) Qualified nonprofit organization.--The term ``qualified 
     nonprofit organization'' means--
       (A) any organization described in section 501(c)(3) of the 
     Internal Revenue Code of 1986 and exempt from taxation under 
     section 501(a) of such Code;
       (B) any community development financial institution 
     certified by the Community Development Financial Institution 
     Fund; or
       (C) any credit union chartered under Federal or State law.
       (6) Indian tribe.--The term ``Indian tribe'' means any 
     Indian tribe as defined in section 4(12) of the Native 
     American Housing Assistance and Self-Determination Act of 
     1996 (25 U.S.C. 4103(12), and includes any tribal subsidiary, 
     subdivision, or other wholly owned tribal entity.
       (7) Qualified individual development account program.--The 
     term ``qualified individual development account program'' 
     means a program established under section 303 under which--
       (A) Individual Development Accounts and parallel accounts 
     are held by a qualified financial institution; and
       (B) additional activities determined by the Secretary as 
     necessary to responsibly develop and administer accounts, 
     including recruiting, providing financial education and other 
     training to account owners, and regular program monitoring, 
     are carried out by the qualified financial institution, a 
     qualified nonprofit organization, or an Indian tribe.
       (8) Qualified expense distribution.--
       (A) In general.--The term ``qualified expense 
     distribution'' means any amount paid (including through 
     electronic payments) or distributed out of an Individual 
     Development Account and a parallel account established for an 
     eligible individual if such amount--
       (i) is used exclusively to pay the qualified expenses of 
     the Individual Development Account owner or such owner's 
     spouse or dependents, as approved by the qualified financial 
     institution, qualified nonprofit organization, or Indian 
     tribe;
       (ii) is paid by the qualified financial institution, 
     qualified nonprofit organization, or Indian tribe--

       (I) except as otherwise provided in this clause, directly 
     to the unrelated third party to whom the amount is due;
       (II) in the case of distributions for working capital under 
     a qualified business plan (as defined in subparagraph 
     (B)(iv)(IV)), directly to the account owner;
       (III) in the case of any qualified rollover, directly to 
     another Individual Development Account and parallel account; 
     or
       (IV) in the case of a qualified final distribution, 
     directly to the spouse, dependent, or other named beneficiary 
     of the deceased account owner; and

       (iii) is paid after the account owner has completed a 
     financial education course as required under section 304(b).
       (B) Qualified expenses.--
       (i) In general.--The term ``qualified expenses'' means any 
     of the following:

       (I) Qualified higher education expenses.
       (II) Qualified first-time homebuyer costs.
       (III) Qualified business capitalization or expansion costs.
       (IV) Qualified rollovers.
       (V) Qualified final distribution.

       (ii) Qualified higher education expenses.--

       (I) In general.--The term ``qualified higher education 
     expenses'' has the meaning given such term by section 
     72(t)(7) of the Internal Revenue Code of 1986, determined by 
     treating postsecondary vocational educational schools as 
     eligible educational institutions.
       (II) Postsecondary vocational education school.--The term 
     ``postsecondary vocational educational school'' means an area 
     vocational education school (as defined in subparagraph (C) 
     or (D) of section 521(4) of the Carl D. Perkins Vocational 
     and Applied Technology Education Act (20 U.S.C. 2471(4))) 
     which is in any State (as defined in section 521(33) of such 
     Act), as such sections are in effect on the date of the 
     enactment of this Act.
       (III) Coordination with other benefits.--The amount of 
     qualified higher education expenses for any taxable year 
     shall be reduced as provided in section 25A(g)(2) of such 
     Code and may not be taken into account for purposes of 
     determining qualified higher education expenses under section 
     135 or 530 of the Internal Revenue Code of 1986.

       (iii) Qualified first-time homebuyer costs.--The term 
     ``qualified first-time homebuyer costs'' means qualified 
     acquisition costs (as defined in section 72(t)(8) of such 
     Code without regard to subparagraph (B) thereof) with respect 
     to a principal residence (within the meaning of section 121 
     of such Code) for a qualified first-time homebuyer (as 
     defined in section 72(t)(8) of such Code).
       (iv) Qualified business capitalization or expansion 
     costs.--

       (I) In general.--The term ``qualified business 
     capitalization or expansion costs'' means qualified 
     expenditures for the capitalization or expansion of a 
     qualified business pursuant to a qualified business plan.
       (II) Qualified expenditures.--The term ``qualified 
     expenditures'' means expenditures included in a qualified 
     business plan, including capital, plant, equipment, working 
     capital, inventory expenses, attorney and accounting fees, 
     and other costs normally associated with starting or 
     expanding a business.
       (III) Qualified business.--The term ``qualified business'' 
     means any business that does not contravene any law.
       (IV) Qualified business plan.--The term ``qualified 
     business plan'' means a business plan which has been approved 
     by the qualified financial institution, qualified nonprofit 
     organization, or Indian tribe and which meets such 
     requirements as the Secretary may specify.

       (v) Qualified rollovers.--The term ``qualified rollover'' 
     means the complete distribution of the amounts in an 
     Individual Development Account and parallel account to 
     another Individual Development Account and parallel account 
     established in another qualified financial institution, 
     qualified nonprofit organization, or Indian tribe for the 
     benefit of the account owner.
       (vi) Qualified final distribution.--The term ``qualified 
     final distribution'' means, in

[[Page 13775]]

     the case of a deceased account owner, the complete 
     distribution of the amounts in an Individual Development 
     Account and parallel account directly to the spouse, any 
     dependent, or other named beneficiary of the deceased.
       (9) Secretary.--The term ``Secretary'' means the Secretary 
     of the Treasury.

     SEC. 303. STRUCTURE AND ADMINISTRATION OF QUALIFIED 
                   INDIVIDUAL DEVELOPMENT ACCOUNT PROGRAMS.

       (a) Establishment of Qualified Individual Development 
     Account Programs.--Any qualified financial institution, 
     qualified nonprofit organization, or Indian tribe may 
     establish 1 or more qualified individual development account 
     programs which meet the requirements of this title.
       (b) Basic Program Structure.--
       (1) In general.--All qualified individual development 
     account programs shall consist of the following 2 components:
       (A) An Individual Development Account to which an eligible 
     individual may contribute cash in accordance with section 
     304.
       (B) A parallel account to which all matching funds shall be 
     deposited in accordance with section 305.
       (2) Tailored ida programs.--A qualified financial 
     institution, a qualified nonprofit organization, or an Indian 
     tribe may tailor its qualified individual development account 
     program to allow matching funds to be spent on 1 or more of 
     the categories of qualified expenses.
       (c) Tax Treatment of Parallel Accounts.--Any account 
     described in subparagraph (B) of subsection (b)(1) is exempt 
     from taxation under the Internal Revenue Code of 1986.

     SEC. 304. PROCEDURES FOR OPENING AND MAINTAINING AN 
                   INDIVIDUAL DEVELOPMENT ACCOUNT AND QUALIFYING 
                   FOR MATCHING FUNDS.

       (a) Opening an Account.--An eligible individual may open an 
     Individual Development Account with a qualified financial 
     institution, a qualified nonprofit organization, or an Indian 
     tribe upon certification that such individual maintains no 
     other Individual Development Account (other than an 
     Individual Development Account to be terminated by a 
     qualified rollover).
       (b) Required Completion of Financial Education Course.--
       (1) In general.--Before becoming eligible to withdraw 
     matching funds to pay for qualified expenses, owners of 
     Individual Development Accounts must complete a financial 
     education course offered by a qualified financial 
     institution, a qualified nonprofit organization, an Indian 
     tribe, or a government entity.
       (2) Standard and applicability of course.--The Secretary, 
     in consultation with representatives of qualified individual 
     development account programs and financial educators, shall 
     establish minimum quality standards for the contents of 
     financial education courses and providers of such courses 
     offered under paragraph (1) and a protocol to exempt 
     individuals from the requirement under paragraph (1) because 
     of hardship or lack of need.
       (c) Status as an Eligible Individual.--Federal income tax 
     forms from the preceding taxable year (or in the absence of 
     such forms, such documentation as specified by the Secretary 
     proving the eligible individual's adjusted gross income and 
     the status of the individual as an eligible individual) shall 
     be presented to the qualified financial institution, 
     qualified nonprofit organization, or Indian tribe at the time 
     of the establishment of the Individual Development Account 
     and in any taxable year in which contributions are made to 
     the Account to qualify for matching funds under section 
     305(b)(1)(A).
       (d) Direct Deposits.--The Secretary may, under regulations, 
     provide for the direct deposit of any portion (not less than 
     $1) of any overpayment of Federal tax of an individual as a 
     contribution to the Individual Development Account of such 
     individual.

     SEC. 305. DEPOSITS BY QUALIFIED INDIVIDUAL DEVELOPMENT 
                   ACCOUNT PROGRAMS.

       (a) Parallel Accounts.--The qualified financial 
     institution, qualified nonprofit organization, or Indian 
     tribe shall deposit all matching funds for each Individual 
     Development Account into a parallel account at a qualified 
     financial institution, a qualified nonprofit organization, or 
     an Indian tribe.
       (b) Regular Deposits of Matching Funds.--
       (1) In general.--Subject to paragraph (2), the qualified 
     financial institution, qualified nonprofit organization, or 
     Indian tribe shall not less than quarterly (or upon a proper 
     withdrawal request under section 306, if necessary) deposit 
     into the parallel account with respect to each eligible 
     individual the following:
       (A) A dollar-for-dollar match for the first $500 
     contributed by the eligible individual into an Individual 
     Development Account with respect to any taxable year.
       (B) Any matching funds provided by State, local, or private 
     sources in accordance to the matching ratio set by those 
     sources.
       (2) Inflation adjustment.--
       (A) In general.--In the case of any taxable year beginning 
     after 2002, the dollar amount referred to in paragraph (1)(A) 
     shall be increased by an amount equal to--
       (i) such dollar amount, multiplied by
       (ii) the cost-of-living adjustment determined under section 
     (1)(f)(3) of the Internal Revenue Code of 1986 for the 
     calendar year in which the taxable year begins, by 
     substituting ``2001'' for ``1992''.
       (B) Rounding.--If any amount as adjusted under subparagraph 
     (A) is not a multiple of $20, such amount shall be rounded to 
     the nearest multiple of $20.
       (3) Cross reference.--

  For allowance of tax credit for Individual Development Account 
subsidies, including matching funds, see section 30B of the Internal 
Revenue Code of 1986.

       (c) Deposit of Matching Funds Into Individual Development 
     Account of Individual Who Has Attained Age 61.--In the case 
     of an Individual Development Account owner who attains the 
     age of 61, the qualified financial institution, qualified 
     nonprofit organization, or Indian tribe which holds the 
     parallel account for such individual shall deposit the funds 
     in such parallel account into the Individual Development 
     Account of such individual on the first day of the succeeding 
     taxable year of such individual.
       (d) Uniform Accounting Regulations.--To ensure proper 
     recordkeeping and determination of the tax credit under 
     section 30B of the Internal Revenue Code of 1986, the 
     Secretary shall prescribe regulations with respect to 
     accounting for matching funds in the parallel accounts.
       (e) Regular Reporting of Accounts.--Any qualified financial 
     institution, qualified nonprofit organization, or Indian 
     tribe shall report the balances in any Individual Development 
     Account and parallel account of an individual on not less 
     than an annual basis to such individual.

     SEC. 306. WITHDRAWAL PROCEDURES.

       (a) Withdrawals for Qualified Expenses.--To withdraw money 
     from an individual's Individual Development Account to pay 
     qualified expenses of such individual or such individual's 
     spouse or dependents, the qualified financial institution, 
     qualified nonprofit organization, or Indian tribe shall 
     directly transfer such funds from the Individual Development 
     Account, and, if applicable, from the parallel account 
     electronically to the distributees described in section 
     302(8)(A)(ii). If the distributee is not equipped to receive 
     funds electronically, the qualified financial institution, 
     qualified nonprofit organization, or Indian tribe may issue 
     such funds by paper check to the distributee.
       (b) Withdrawals for Nonqualified Expenses.--An Individual 
     Development Account owner may unilaterally withdraw any 
     amount of funds from the Individual Development Account for 
     purposes other than to pay qualified expenses, but shall 
     forfeit a proportionate amount of matching funds from the 
     individual's parallel account by doing so, unless such 
     withdrawn funds are recontributed to such Account by 
     September 30 following the withdrawal.
       (c) Withdrawals From Accounts of Noneligible Individuals.--
     If the individual for whose benefit an Individual Development 
     Account is established ceases to be an eligible individual, 
     such account shall remain an Individual Development Account, 
     but such individual shall not be eligible for any further 
     matching funds under section 305(b)(1)(A) during the period--
       (1) beginning on the first day of the taxable year of such 
     individual following the beginning of such ineligibility, and
       (2) ending on the last day of the taxable year of such 
     individual in which such ineligibility ceases.
       (d) Tax Treatment of Matching Funds.--Any amount withdrawn 
     from a parallel account shall not be includible in an 
     eligible individual's gross income.
       (e) Withdrawal Liability Rests Only With Eligible 
     Individuals.--Nothing in this title may be construed to 
     impose liability on a qualified financial institution, a 
     qualified nonprofit organization, or an Indian tribe for non-
     compliance with the requirements of this title related to 
     withdrawals from Individual Development Accounts.

     SEC. 307. CERTIFICATION AND TERMINATION OF QUALIFIED 
                   INDIVIDUAL DEVELOPMENT ACCOUNT PROGRAMS.

       (a) Certification Procedures.--Upon establishing a 
     qualified individual development account program under 
     section 303, a qualified financial institution, a qualified 
     nonprofit organization, or an Indian tribe shall certify to 
     the Secretary on forms prescribed by the Secretary and 
     accompanied by any documentation required by the Secretary, 
     that--
       (1) the accounts described in subparagraphs (A) and (B) of 
     section 303(b)(1) are operating pursuant to all the 
     provisions of this title; and
       (2) the qualified financial institution, qualified 
     nonprofit organization, or Indian tribe agrees to implement 
     an information system necessary to monitor the cost and 
     outcomes of the qualified individual development account 
     program.
       (b) Authority To Terminate Qualified IDA Program.--If the 
     Secretary determines that a qualified financial institution, 
     a qualified nonprofit organization, or an Indian tribe under 
     this title is not operating a qualified individual 
     development account program in accordance with the 
     requirements of this title (and has not implemented any 
     corrective recommendations directed by

[[Page 13776]]

     the Secretary), the Secretary shall terminate such 
     institution's nonprofit organization's, or Indian tribe's 
     authority to conduct the program. If the Secretary is unable 
     to identify a qualified financial institution, a qualified 
     nonprofit organization, or an Indian tribe to assume the 
     authority to conduct such program, then any funds in a 
     parallel account established for the benefit of any 
     individual under such program shall be deposited into the 
     Individual Development Account of such individual as of the 
     first day of such termination.

     SEC. 308. REPORTING, MONITORING, AND EVALUATION.

       (a) Responsibilities of Qualified Financial Institutions, 
     Qualified Nonprofit Organizations, and Indian Tribes.--Each 
     qualified financial institution, qualified nonprofit 
     organization, or Indian tribe that operates a qualified 
     individual development account program under section 303 
     shall report annually to the Secretary within 90 days after 
     the end of each calendar year on--
       (1) the number of eligible individuals making contributions 
     into Individual Development Accounts;
       (2) the amounts contributed into Individual Development 
     Accounts and deposited into parallel accounts for matching 
     funds;
       (3) the amounts withdrawn from Individual Development 
     Accounts and parallel accounts, and the purposes for which 
     such amounts were withdrawn;
       (4) the balances remaining in Individual Development 
     Accounts and parallel accounts; and
       (5) such other information needed to help the Secretary 
     monitor the cost and outcomes of the qualified individual 
     development account program (provided in a non-individually-
     identifiable manner).
       (b) Responsibilities of the Secretary.--
       (1) Monitoring protocol.--Not later than 12 months after 
     the date of the enactment of this Act, the Secretary shall 
     develop and implement a protocol and process to monitor the 
     cost and outcomes of the qualified individual development 
     account programs established under section 303.
       (2) Annual reports.--In each year after the date of the 
     enactment of this Act, the Secretary shall submit a progress 
     report to Congress on the status of such qualified individual 
     development account programs. Such report shall include from 
     a representative sample of qualified individual development 
     account programs information on--
       (A) the characteristics of participants, including age, 
     gender, race or ethnicity, marital status, number of 
     children, employment status, and monthly income;
       (B) deposits, withdrawals, balances, uses of Individual 
     Development Accounts, and participant characteristics;
       (C) the characteristics of qualified individual development 
     account programs, including match rate, economic education 
     requirements, permissible uses of accounts, staffing of 
     programs in full time employees, and the total costs of 
     programs; and
       (D) information on program implementation and 
     administration, especially on problems encountered and how 
     problems were solved.

     SEC. 309. AUTHORIZATION OF APPROPRIATIONS.

       There is authorized to be appropriated to the Secretary 
     $1,000,000 for fiscal year 2002 and for each fiscal year 
     through 2008, for the purposes of implementing this title, 
     including the reporting, monitoring, and evaluation required 
     under section 308, to remain available until expended.

     SEC. 310. ACCOUNT FUNDS DISREGARDED FOR PURPOSES OF CERTAIN 
                   MEANS-TESTED FEDERAL PROGRAMS.

       Notwithstanding any other provision of Federal law that 
     requires consideration of 1 or more financial circumstances 
     of an individual, for the purposes of determining eligibility 
     to receive, or the amount of, any assistance or benefit 
     authorized by such provision to be provided to or for the 
     benefit of such individual, an amount equal to the sum of--
       (1) all amounts (including earnings thereon) in any 
     Individual Development Account; plus
       (2) the matching deposits made on behalf of such individual 
     (including earnings thereon) in any parallel account,
     shall be disregarded for such purposes.

     SEC. 311. MATCHING FUNDS FOR INDIVIDUAL DEVELOPMENT ACCOUNTS 
                   PROVIDED THROUGH A TAX CREDIT FOR QUALIFIED 
                   FINANCIAL INSTITUTIONS.

       (a) In General.--Subpart B of part IV of subchapter A of 
     chapter 1 of the Internal Revenue Code of 1986 (relating to 
     other credits) is amended by inserting after section 30A the 
     following new section:

     ``SEC. 30B. INDIVIDUAL DEVELOPMENT ACCOUNT INVESTMENT CREDIT 
                   FOR QUALIFIED FINANCIAL INSTITUTIONS.

       ``(a) Determination of Amount.--There shall be allowed as a 
     credit against the applicable tax for the taxable year an 
     amount equal to the individual development account investment 
     provided by an eligible entity during the taxable year under 
     an individual development account program established under 
     section 303 of the Community Solutions Act of 2001.
       ``(b) Applicable Tax.--For the purposes of this section, 
     the term `applicable tax' means the excess (if any) of--
       ``(1) the tax imposed under this chapter (other than the 
     taxes imposed under the provisions described in subparagraphs 
     (C) through (Q) of section 26(b)(2)), over
       ``(2) the credits allowable under subpart B (other than 
     this section) and subpart D of this part.
       ``(c) Individual Development Account Investment.--
       ``(1) In general.--For purposes of this section, the term 
     `individual development account investment' means, with 
     respect to an individual development account program of a 
     qualified financial institution in any taxable year, an 
     amount equal to the sum of--
       ``(A) the aggregate amount of dollar-for-dollar matches 
     under such program under section 305(b)(1)(A) of the 
     Community Solutions Act of 2001 for such taxable year, plus
       ``(B) an amount equal to the sum of--
       ``(i) with respect to each Individual Development Account 
     opened during such taxable year, $100, plus
       ``(ii) with respect to each Individual Development Account 
     maintained during such taxable year, $30.
       ``(2) Inflation adjustment.--
       ``(A) In general.--In the case of any taxable year 
     beginning after 2002, each dollar amount referred to in 
     paragraph (1)(B) shall be increased by an amount equal to--
       ``(i) such dollar amount, multiplied by
       ``(ii) the cost-of-living adjustment determined under 
     section (1)(f)(3) for the calendar year in which the taxable 
     year begins, by substituting `2001' for `1992'.
       ``(B) Rounding.--If any amount as adjusted under 
     subparagraph (A) is not a multiple of $5, such amount shall 
     be rounded to the nearest multiple of $5.
       ``(d) Eligible Entity.--For purposes of this section, the 
     term `eligible entity' means a qualified financial 
     institution, or 1 or more contractual affiliates of such an 
     institution as defined by the Secretary in regulations.
       ``(e) Other Definitions.--For purposes of this section, any 
     term used in this section and also in the Community Solutions 
     Act shall have the meaning given such term by such Act.
       ``(f) Denial of Double Benefit.--No deduction or credit 
     (other than under this section) shall be allowed under this 
     chapter with respect to any expense which is taken into 
     account under subsection (c)(1)(A) in determining the credit 
     under this section.
       ``(g) Regulations.--The Secretary may prescribe such 
     regulations as may be necessary or appropriate to carry out 
     this section, including regulations providing for a recapture 
     of the credit allowed under this section (notwithstanding any 
     termination date described in subsection (h)) in cases where 
     there is a forfeiture under section 306(b) of the Community 
     Solutions Act of 2001 in a subsequent taxable year of any 
     amount which was taken into account in determining the amount 
     of such credit.
       ``(h) Application of Section.--This section shall apply to 
     any expenditure made in any taxable year beginning after 
     December 31, 2001, and before January 1, 2009, with respect 
     to any Individual Development Account opened before January 
     1, 2007.''.
       (b) Conforming Amendment.--The table of sections for 
     subpart B of part IV of subchapter A of chapter 1 is amended 
     by inserting after the item relating to section 30A the 
     following new item:

``Sec. 30B. Individual development account investment credit for 
              qualified financial institutions.''.

       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2001.

  The SPEAKER pro tempore. In lieu of the amendments recommended by the 
Committee on Ways and Means and the Committee on the Judiciary printed 
in the bill, the amendment in the nature of a substitute printed in the 
Congressional Record and numbered 1 is adopted.
  The text of the bill as amended by the amendment in the nature of a 
substitute printed in the Congressional Record and numbered 1 is as 
follows:

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Community 
     Solutions Act of 2001''.
       (b) Table of Contents.--The table of contents is as 
     follows:

Sec. 1. Short title; table of contents.

             TITLE I--CHARITABLE GIVING INCENTIVES PACKAGE

Sec. 101. Deduction for portion of charitable contributions to be 
              allowed to individuals who do not itemize deductions.
Sec. 102. Tax-free distributions from individual retirement accounts 
              for charitable purposes.
Sec. 103. Increase in cap on corporate charitable contributions.
Sec. 104. Charitable deduction for contributions of food inventory.
Sec. 105. Reform of excise tax on net investment income of private 
              foundations.
Sec. 106. Excise tax on unrelated business taxable income of charitable 
              remainder trusts.

[[Page 13777]]

Sec. 107. Expansion of charitable contribution allowed for scientific 
              property used for research and for computer technology 
              and equipment used for educational purposes.
Sec. 108. Adjustment to basis of S corporation stock for certain 
              charitable contributions.

                TITLE II--EXPANSION OF CHARITABLE CHOICE

Sec. 201. Provision of assistance under government programs by 
              religious and community organizations.

               TITLE III--INDIVIDUAL DEVELOPMENT ACCOUNTS

Sec. 301. Additional qualified entities eligible to conduct projects 
              under the Assets for Independence Act.
Sec. 302. Increase in limitation on net worth.
Sec. 303. Change in limitation on deposits for an individual.
Sec. 304. Elimination of limitation on deposits for a household.
Sec. 305. Extension of program.
Sec. 306. Conforming amendments.
Sec. 307. Applicability.

 TITLE IV--CHARITABLE DONATIONS LIABILITY REFORM FOR IN-KIND CORPORATE 
                             CONTRIBUTIONS

Sec. 401. Charitable donations liability reform for in-kind corporate 
              contributions.

             TITLE I--CHARITABLE GIVING INCENTIVES PACKAGE

     SEC. 101. DEDUCTION FOR PORTION OF CHARITABLE CONTRIBUTIONS 
                   TO BE ALLOWED TO INDIVIDUALS WHO DO NOT ITEMIZE 
                   DEDUCTIONS.

       (a) In General.--Section 170 of the Internal Revenue Code 
     of 1986 (relating to charitable, etc., contributions and 
     gifts) is amended by redesignating subsection (m) as 
     subsection (n) and by inserting after subsection (l) the 
     following new subsection:
       ``(m) Deduction for Individuals Not Itemizing Deductions.--
       ``(1) In general.--In the case of an individual who does 
     not itemize his deductions for the taxable year, there shall 
     be taken into account as a direct charitable deduction under 
     section 63 an amount equal to the lesser of--
       ``(A) the amount allowable under subsection (a) for the 
     taxable year for cash contributions, or
       ``(B) the applicable amount.
       ``(2) Applicable amount.--For purposes of paragraph (1), 
     the applicable amount shall be determined as follows:

``For taxable years beginning in:           The applicable amount is:  
      2002 and 2003............................................$25 .

      2004, 2005, 2006.........................................$50 .

      2007, 2008, 2009.........................................$75 .

      2010 and thereafter.....................................$100..

     In the case of a joint return, the applicable amount is twice 
     the applicable amount determined under the preceding 
     table.''.
       (b) Direct Charitable Deduction.--
       (1) In general.--Subsection (b) of section 63 of such Code 
     is amended by striking ``and'' at the end of paragraph (1), 
     by striking the period at the end of paragraph (2) and 
     inserting ``, and'', and by adding at the end thereof the 
     following new paragraph:
       ``(3) the direct charitable deduction.''.
       (2) Definition.--Section 63 of such Code is amended by 
     redesignating subsection (g) as subsection (h) and by 
     inserting after subsection (f) the following new subsection:
       ``(g) Direct Charitable Deduction.--For purposes of this 
     section, the term `direct charitable deduction' means that 
     portion of the amount allowable under section 170(a) which is 
     taken as a direct charitable deduction for the taxable year 
     under section 170(m).''.
       (3) Conforming amendment.--Subsection (d) of section 63 of 
     such Code is amended by striking ``and'' at the end of 
     paragraph (1), by striking the period at the end of paragraph 
     (2) and inserting ``, and'', and by adding at the end thereof 
     the following new paragraph:
       ``(3) the direct charitable deduction.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2001.

     SEC. 102. TAX-FREE DISTRIBUTIONS FROM INDIVIDUAL RETIREMENT 
                   ACCOUNTS FOR CHARITABLE PURPOSES.

       (a) In General.--Subsection (d) of section 408 of the 
     Internal Revenue Code of 1986 (relating to individual 
     retirement accounts) is amended by adding at the end the 
     following new paragraph:
       ``(8) Distributions for charitable purposes.--
       ``(A) In general.--No amount shall be includible in gross 
     income by reason of a qualified charitable distribution.
       ``(B) Qualified charitable distribution.--For purposes of 
     this paragraph, the term `qualified charitable distribution' 
     means any distribution from an individual retirement 
     account--
       ``(i) which is made on or after the date that the 
     individual for whose benefit the account is maintained has 
     attained age 70\1/2\, and
       ``(ii) which is made directly by the trustee--

       ``(I) to an organization described in section 170(c), or
       ``(II) to a split-interest entity.

     A distribution shall be treated as a qualified charitable 
     distribution only to the extent that the distribution would 
     be includible in gross income without regard to subparagraph 
     (A) and, in the case of a distribution to a split-interest 
     entity, only if no person holds an income interest in the 
     amounts in the split-interest entity attributable to such 
     distribution other than one or more of the following: the 
     individual for whose benefit such account is maintained, the 
     spouse of such individual, or any organization described in 
     section 170(c).
       ``(C) Contributions must be otherwise deductible.--For 
     purposes of this paragraph--
       ``(i) Direct contributions.--A distribution to an 
     organization described in section 170(c) shall be treated as 
     a qualified charitable distribution only if a deduction for 
     the entire distribution would be allowable under section 170 
     (determined without regard to subsection (b) thereof and this 
     paragraph).
       ``(ii) Split-interest gifts.--A distribution to a split-
     interest entity shall be treated as a qualified charitable 
     distribution only if a deduction for the entire value of the 
     interest in the distribution for the use of an organization 
     described in section 170(c) would be allowable under section 
     170 (determined without regard to subsection (b) thereof and 
     this paragraph).
       ``(D) Application of section 72.--Notwithstanding section 
     72, in determining the extent to which a distribution is a 
     qualified charitable distribution, the entire amount of the 
     distribution shall be treated as includible in gross income 
     without regard to subparagraph (A) to the extent that such 
     amount does not exceed the aggregate amount which would be so 
     includible if all amounts were distributed from all 
     individual retirement accounts otherwise taken into account 
     in determining the inclusion on such distribution under 
     section 72. Proper adjustments shall be made in applying 
     section 72 to other distributions in such taxable year and 
     subsequent taxable years.
       ``(E) Special rules for split-interest entities.--
       ``(i) Charitable remainder trusts.--Distributions made from 
     an individual retirement account to a trust described in 
     subparagraph (G)(ii)(I) shall be treated as income described 
     in section 664(b)(1) except to the extent that the 
     beneficiary of the individual retirement account notifies the 
     trustee of the trust of the amount which is not allocable to 
     income under subparagraph (D).
       ``(ii) Pooled income funds.--No amount shall be includible 
     in the gross income of a pooled income fund (as defined in 
     subparagraph (G)(ii)(II)) by reason of a qualified charitable 
     distribution to such fund.
       ``(iii) Charitable gift annuities.--Qualified charitable 
     distributions made for a charitable gift annuity shall not be 
     treated as an investment in the contract.
       ``(F) Denial of deduction.--Qualified charitable 
     distributions shall not be taken into account in determining 
     the deduction under section 170.
       ``(G) Split-interest entity defined.--For purposes of this 
     paragraph, the term `split-interest entity' means--
       ``(i) a charitable remainder annuity trust or a charitable 
     remainder unitrust (as such terms are defined in section 
     664(d)),
       ``(ii) a pooled income fund (as defined in section 
     642(c)(5)), and
       ``(iii) a charitable gift annuity (as defined in section 
     501(m)(5)).''.
       (b) Modifications Relating to Information Returns by 
     Certain Trusts.--
       (1) Returns.--Section 6034 of such Code (relating to 
     returns by trusts described in section 4947(a)(2) or claiming 
     charitable deductions under section 642(c)) is amended to 
     read as follows:

     ``SEC. 6034. RETURNS BY TRUSTS DESCRIBED IN SECTION 
                   4947(A)(2) OR CLAIMING CHARITABLE DEDUCTIONS 
                   UNDER SECTION 642(C).

       ``(a) Trusts Described in Section 4947(a)(2).--Every trust 
     described in section 4947(a)(2) shall furnish such 
     information with respect to the taxable year as the Secretary 
     may by forms or regulations require.
       ``(b) Trusts Claiming a Charitable Deduction Under Section 
     642(c).--
       ``(1) In general.--Every trust not required to file a 
     return under subsection (a) but claiming a charitable, etc., 
     deduction under section 642(c) for the taxable year shall 
     furnish such information with respect to such taxable year as 
     the Secretary may by forms or regulations prescribe, 
     including:
       ``(A) the amount of the charitable, etc., deduction taken 
     under section 642(c) within such year,
       ``(B) the amount paid out within such year which represents 
     amounts for which charitable, etc., deductions under section 
     642(c) have been taken in prior years,
       ``(C) the amount for which charitable, etc., deductions 
     have been taken in prior years but which has not been paid 
     out at the beginning of such year,
       ``(D) the amount paid out of principal in the current and 
     prior years for charitable, etc., purposes,
       ``(E) the total income of the trust within such year and 
     the expenses attributable thereto, and

[[Page 13778]]

       ``(F) a balance sheet showing the assets, liabilities, and 
     net worth of the trust as of the beginning of such year.
       ``(2) Exceptions.--Paragraph (1) shall not apply in the 
     case of a taxable year if all the net income for such year, 
     determined under the applicable principles of the law of 
     trusts, is required to be distributed currently to the 
     beneficiaries. Paragraph (1) shall not apply in the case of a 
     trust described in section 4947(a)(1).''.
       (2) Increase in penalty relating to filing of information 
     return by split-interest trusts.--Paragraph (2) of section 
     6652(c) of such Code (relating to returns by exempt 
     organizations and by certain trusts) is amended by adding at 
     the end the following new subparagraph:
       ``(C) Split-interest trusts.--In the case of a trust which 
     is required to file a return under section 6034(a), 
     subparagraphs (A) and (B) of this paragraph shall not apply 
     and paragraph (1) shall apply in the same manner as if such 
     return were required under section 6033, except that--
       ``(i) the 5 percent limitation in the second sentence of 
     paragraph (1)(A) shall not apply,
       ``(ii) in the case of any trust with gross income in excess 
     of $250,000, the first sentence of paragraph (1)(A) shall be 
     applied by substituting `$100' for `$20', and the second 
     sentence thereof shall be applied by substituting `$50,000' 
     for `$10,000', and
       ``(iii) the third sentence of paragraph (1)(A) shall be 
     disregarded.

     If the person required to file such return knowingly fails to 
     file the return, such person shall be personally liable for 
     the penalty imposed pursuant to this subparagraph.''.
       (3) Confidentiality of noncharitable beneficiaries.--
     Subsection (b) of section 6104 of such Code (relating to 
     inspection of annual information returns) is amended by 
     adding at the end the following new sentence: ``In the case 
     of a trust which is required to file a return under section 
     6034(a), this subsection shall not apply to information 
     regarding beneficiaries which are not organizations described 
     in section 170(c).''.
       (c) Effective Dates.--
       (1) Subsection (a).--The amendment made by subsection (a) 
     shall apply to taxable years beginning after December 31, 
     2001.
       (2) Subsection (b).--The amendments made by subsection (b) 
     shall apply to returns for taxable years beginning after 
     December 31, 2001.

     SEC. 103. INCREASE IN CAP ON CORPORATE CHARITABLE 
                   CONTRIBUTIONS.

       (a) In General.--Paragraph (2) of section 170(b) of the 
     Internal Revenue Code of 1986 (relating to corporations) is 
     amended by striking ``10 percent'' and inserting ``the 
     applicable percentage''.
       (b) Applicable Percentage.--Subsection (b) of section 170 
     of such Code is amended by adding at the end the following 
     new paragraph:
       ``(3) Applicable percentage defined.--For purposes of 
     paragraph (2), the applicable percentage shall be determined 
     in accordance with the following table:

``For taxable years beginning in:           The applicable amount is:  
      2002 and 2003............................................$25 .

      2004, 2005, 2006.........................................$50 .

      2007, 2008, 2009.........................................$75 .

      2010 and thereafter...........................................
``For taxable years beginning in         The applicable percentage is--
      calendar year--
      2002 through 2007.............................................11 
      2008..........................................................12 
      2009..........................................................13 
      2010 and thereafter.........................................15''.
       (c) Conforming Amendments.--
       (1) Sections 512(b)(10) and 805(b)(2)(A) of such Code are 
     each amended by striking ``10 percent'' each place it occurs 
     and inserting ``the applicable percentage (determined under 
     section 170(b)(3))''.
       (2) Sections 545(b)(2) and 556(b)(2) of such Code are each 
     amended by striking ``10-percent limitation'' and inserting 
     ``applicable percentage limitation''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2001.

     SEC. 104. CHARITABLE DEDUCTION FOR CONTRIBUTIONS OF FOOD 
                   INVENTORY.

       (a) In General.--Paragraph (3) of section 170(e) of the 
     Internal Revenue Code of 1986 (relating to special rule for 
     certain contributions of inventory and other property) is 
     amended by redesignating subparagraph (C) as subparagraph (D) 
     and by inserting after subparagraph (B) the following new 
     subparagraph:
       ``(C) Special rule for contributions of food inventory.--
       ``(i) General rule.--In the case of a charitable 
     contribution of food, this paragraph shall be applied--

       ``(I) without regard to whether the contribution is made by 
     a C corporation, and
       ``(II) only for food that is apparently wholesome food.

       ``(ii) Determination of fair market value.--In the case of 
     a qualified contribution of apparently wholesome food to 
     which this paragraph applies and which, solely by reason of 
     internal standards of the taxpayer or lack of market, cannot 
     or will not be sold, the fair market value of such food shall 
     be determined by taking into account the price at which the 
     same or similar food items are sold by the taxpayer at the 
     time of the contribution (or, if not so sold at such time, in 
     the recent past).
       ``(iii) Apparently wholesome food.--For purposes of this 
     subparagraph, the term `apparently wholesome food' shall have 
     the meaning given to such term by section 22(b)(2) of the 
     Bill Emerson Good Samaritan Food Donation Act (42 U.S.C. 
     1791(b)(2)), as in effect on the date of the enactment of 
     this subparagraph.''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to taxable years beginning after December 31, 
     2001.

     SEC. 105. REFORM OF EXCISE TAX ON NET INVESTMENT INCOME OF 
                   PRIVATE FOUNDATIONS.

       (a) In General.--Subsection (a) of section 4940 of the 
     Internal Revenue Code of 1986 (relating to excise tax based 
     on investment income) is amended by striking ``2 percent'' 
     and inserting ``1 percent''.
       (b) Repeal of Reduction In Tax Where Private Foundation 
     Meets Certain Distribution Requirements.--Section 4940 of 
     such Code is amended by striking subsection (e).
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2001.

     SEC. 106. EXCISE TAX ON UNRELATED BUSINESS TAXABLE INCOME OF 
                   CHARITABLE REMAINDER TRUSTS.

       (a) In General.--Subsection (c) of section 664 of the 
     Internal Revenue Code of 1986 (relating to exemption from 
     income taxes) is amended to read as follows:
       ``(c) Taxation of Trusts.--
       ``(1) Income tax.--A charitable remainder annuity trust and 
     a charitable remainder unitrust shall, for any taxable year, 
     not be subject to any tax imposed by this subtitle.
       ``(2) Excise tax.--
       ``(A) In general.--In the case of a charitable remainder 
     annuity trust or a charitable remainder unitrust that has 
     unrelated business taxable income (within the meaning of 
     section 512, determined as if part III of subchapter F 
     applied to such trust) for a taxable year, there is hereby 
     imposed on such trust or unitrust an excise tax equal to the 
     amount of such unrelated business taxable income.
       ``(B) Certain rules to apply.--The tax imposed by 
     subparagraph (A) shall be treated as imposed by chapter 42 
     for purposes of this title other than subchapter E of chapter 
     42.
       ``(C) Character of distributions and coordination with 
     distribution requirements.--The amounts taken into account in 
     determining unrelated business taxable income (as defined in 
     subparagraph (A)) shall not be taken into account for 
     purposes of--
       ``(i) subsection (b),
       ``(ii) determining the value of trust assets under 
     subsection (d)(2), and
       ``(iii) determining income under subsection (d)(3).
       ``(D) Tax court proceedings.--For purposes of this 
     paragraph, the references in section 6212(c)(1) to section 
     4940 shall be deemed to include references to this 
     paragraph.''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to taxable years beginning after December 31, 
     2001.

     SEC. 107. EXPANSION OF CHARITABLE CONTRIBUTION ALLOWED FOR 
                   SCIENTIFIC PROPERTY USED FOR RESEARCH AND FOR 
                   COMPUTER TECHNOLOGY AND EQUIPMENT USED FOR 
                   EDUCATIONAL PURPOSES.

       (a) Scientific Property Used for Research.--Clause (ii) of 
     section 170(e)(4)(B) of the Internal Revenue Code of 1986 
     (defining qualified research contributions) is amended by 
     inserting ``or assembled'' after ``constructed''.
       (b) Computer Technology and Equipment for Educational 
     Purposes.--Clause (ii) of section 170(e)(6)(B) of such Code 
     is amended by inserting ``or assembled'' after 
     ``constructed'' and ``or assembling'' after ``construction''.
       (c) Conforming Amendment.--Subparagraph (D) of section 
     170(e)(6) of such Code is amended by inserting ``or 
     assembled'' after ``constructed'' and ``or assembling'' after 
     ``construction''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2001.

     SEC. 108. ADJUSTMENT TO BASIS OF S CORPORATION STOCK FOR 
                   CERTAIN CHARITABLE CONTRIBUTIONS.

       (a) In General.--Paragraph (1) of section 1367(a) of such 
     Code (relating to adjustments to basis of stock of 
     shareholders, etc.) is amended by striking ``and'' at the end 
     of subparagraph (B), by striking the period at the end of 
     subparagraph (C) and inserting ``, and'', and by adding at 
     the end the following new subparagraph:
       ``(D) the excess of the amount of the shareholder's 
     deduction for any charitable contribution made by the S 
     corporation over the shareholder's proportionate share of the 
     adjusted basis of the property contributed.''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to taxable years beginning after December 31, 
     2001.

[[Page 13779]]



                TITLE II--EXPANSION OF CHARITABLE CHOICE

     SEC. 201. PROVISION OF ASSISTANCE UNDER GOVERNMENT PROGRAMS 
                   BY RELIGIOUS AND COMMUNITY ORGANIZATIONS.

       Title XXIV of the Revised Statutes of the United States is 
     amended by inserting after section 1990 (42 U.S.C. 1994) the 
     following:

     ``SEC. 1991. CHARITABLE CHOICE.

       ``(a) Short Title.--This section may be cited as the 
     `Charitable Choice Act of 2001'.
       ``(b) Purposes.--The purposes of this section are--
       ``(1) to enable assistance to be provided to individuals 
     and families in need in the most effective and efficient 
     manner;
       ``(2) to supplement the Nation's social service capacity by 
     facilitating the entry of new, and the expansion of existing, 
     efforts by religious and other community organizations in the 
     administration and distribution of government assistance 
     under the government programs described in subsection (c)(4);
       ``(3) to prohibit discrimination against religious 
     organizations on the basis of religion in the administration 
     and distribution of government assistance under such 
     programs;
       ``(4) to allow religious organizations to participate in 
     the administration and distribution of such assistance 
     without impairing the religious character and autonomy of 
     such organizations; and
       ``(5) to protect the religious freedom of individuals and 
     families in need who are eligible for government assistance, 
     including expanding the possibility of their being able to 
     choose to receive services from a religious organization 
     providing such assistance.
       ``(c) Religious Organizations Included as Providers; 
     Disclaimers.--
       ``(1) In general.--
       ``(A) Inclusion.--For any program described in paragraph 
     (4) that is carried out by the Federal Government, or by a 
     State or local government with Federal funds, the government 
     shall consider, on the same basis as other nongovernmental 
     organizations, religious organizations to provide the 
     assistance under the program, and the program shall be 
     implemented in a manner that is consistent with the 
     establishment clause and the free exercise clause of the 
     first amendment to the Constitution.
       ``(B) Discrimination prohibited.--Neither the Federal 
     Government, nor a State or local government receiving funds 
     under a program described in paragraph (4), shall 
     discriminate against an organization that provides assistance 
     under, or applies to provide assistance under, such program 
     on the basis that the organization is religious or has a 
     religious character.
       ``(2) Funds not aid to religion.--Federal, State, or local 
     government funds or other assistance that is received by a 
     religious organization for the provision of services under 
     this section constitutes aid to individuals and families in 
     need, the ultimate beneficiaries of such services, and not 
     support for religion or the organization's religious beliefs 
     or practices. Notwithstanding the provisions in this 
     paragraph, title VI of the Civil Rights Act of 1964 (42 USC 
     2000d et seq.) shall apply to organizations receiving 
     assistance funded under any program described in subsection 
     (c)(4).
       ``(3) Funds not endorsement of religion.--The receipt by a 
     religious organization of Federal, State, or local government 
     funds or other assistance under this section is not an 
     endorsement by the government of religion or of the 
     organization's religious beliefs or practices.
       ``(4) Programs.--For purposes of this section, a program is 
     described in this paragraph--
       ``(A) if it involves activities carried out using Federal 
     funds--
       ``(i) related to the prevention and treatment of juvenile 
     delinquency and the improvement of the juvenile justice 
     system, including programs funded under the Juvenile Justice 
     and Delinquency Prevention Act of 1974 (42 U.S.C. 5601 et 
     seq.);
       ``(ii) related to the prevention of crime and assistance to 
     crime victims and offenders' families, including programs 
     funded under title I of the Omnibus Crime Control and Safe 
     Streets Act of 1968 (42 U.S.C. 3701 et seq.);
       ``(iii) related to the provision of assistance under 
     Federal housing statutes, including the Community Development 
     Block Grant Program established under title I of the Housing 
     and Community Development Act of 1974 (42 U.S.C. 5301 et 
     seq.);
       ``(iv) under subtitle B or D of title I of the Workforce 
     Investment Act of 1998 (29 U.S.C. 2801 et seq.);
       ``(v) under the Older Americans Act of 1965 (42 U.S.C. 3001 
     et seq.);
       ``(vi) related to the intervention in and prevention of 
     domestic violence, including programs under the Child Abuse 
     Prevention and Treatment Act (42 U.S.C. 5101 et seq.) or the 
     Family Violence Prevention and Services Act (42 U.S.C. 10401 
     et seq.);
       ``(vii) related to hunger relief activities; or
       ``(viii) under the Job Access and Reverse Commute grant 
     program established under section 3037 of the Federal Transit 
     Act of 1998 (49 U.S.C. 5309 note); or
       ``(B)(i) if it involves activities to assist students in 
     obtaining the recognized equivalents of secondary school 
     diplomas and activities relating to nonschool hours programs, 
     including programs under--
       ``(I) chapter 3 of subtitle A of title II of the Workforce 
     Investment Act of 1998 (Public Law 105-220); or
       ``(II) part I of title X of the Elementary and Secondary 
     Education Act (20 U.S.C. 6301 et seq.); and
       ``(ii) except as provided in subparagraph (A) and clause 
     (i), does not include activities carried out under Federal 
     programs providing education to children eligible to attend 
     elementary schools or secondary schools, as defined in 
     section 14101 of the Elementary and Secondary Education Act 
     of 1965 (20 U.S.C. 8801).
       ``(d) Organizational Character and Autonomy.--
       ``(1) In general.--A religious organization that provides 
     assistance under a program described in subsection (c)(4) 
     shall have the right to retain its autonomy from Federal, 
     State, and local governments, including such organization's 
     control over the definition, development, practice, and 
     expression of its religious beliefs.
       ``(2) Additional safeguards.--Neither the Federal 
     Government, nor a State or local government with Federal 
     funds, shall require a religious organization, in order to be 
     eligible to provide assistance under a program described in 
     subsection (c)(4), to--
       ``(A) alter its form of internal governance or provisions 
     in its charter documents; or
       ``(B) remove religious art, icons, scripture, or other 
     symbols, or to change its name, because such symbols or names 
     are of a religious character.
       ``(e) Employment Practices.--A religious organization's 
     exemption provided under section 702 of the Civil Rights Act 
     of 1964 (42 U.S.C. 2000e-1) regarding employment practices 
     shall not be affected by its participation in, or receipt of 
     funds from, programs described in subsection (c)(4), and any 
     provision in such programs that is inconsistent with or would 
     diminish the exercise of an organization's autonomy 
     recognized in section 702 or in this section shall have no 
     effect. Nothing in this section alters the duty of a 
     religious organization to comply with the nondiscrimination 
     provisions of title VII of the Civil Rights Act of 1964 in 
     the use of funds from programs described in subsection 
     (c)(4).
       ``(f) Effect on Other Laws.--Nothing in this section shall 
     alter the duty of a religious organization receiving 
     assistance or providing services under any program described 
     in subsection (c)(4) to comply with the nondiscrimination 
     provisions in title VI of the Civil Rights Act of 1964 (42 
     U.S.C. 2000d et seq.) (prohibiting discrimination on the 
     basis of race, color, and national origin), title IX of the 
     Education Amendments of 1972 (20 U.S.C. 1681-1688) 
     (prohibiting discrimination in education programs or 
     activities on the basis of sex and visual impairment), 
     section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 794) 
     (prohibiting discrimination against otherwise qualified 
     disabled individuals), and the Age Discrimination Act of 1975 
     (42 U.S.C. 6101-6107) (prohibiting discrimination on the 
     basis of age).
       ``(g) Rights of Beneficiaries of Assistance.--
       ``(1) In general.--If an individual described in paragraph 
     (3) has an objection to the religious character of the 
     organization from which the individual receives, or would 
     receive, assistance funded under any program described in 
     subsection (c)(4), the appropriate Federal, State, or local 
     governmental entity shall provide to such individual (if 
     otherwise eligible for such assistance) within a reasonable 
     period of time after the date of such objection, assistance 
     that--
       ``(A) is an alternative that is accessible to the 
     individual and unobjectionable to the individual on religious 
     grounds; and
       ``(B) has a value that is not less than the value of the 
     assistance that the individual would have received from such 
     organization.
       ``(2) Notice.--The appropriate Federal, State, or local 
     governmental entity shall guarantee that notice is provided 
     to the individuals described in paragraph (3) of the rights 
     of such individuals under this section.
       ``(3) Individual described.--An individual described in 
     this paragraph is an individual who receives or applies for 
     assistance under a program described in subsection (c)(4).
       ``(h) Nondiscrimination Against Beneficiaries.--
       ``(1) Grants and cooperative agreements.--A religious 
     organization providing assistance through a grant or 
     cooperative agreement under a program described in subsection 
     (c)(4) shall not discriminate in carrying out the program 
     against an individual described in subsection (g)(3) on the 
     basis of religion, a religious belief, or a refusal to hold a 
     religious belief.
       ``(2) Indirect forms of assistance.--A religious 
     organization providing assistance through a voucher, 
     certificate, or other form of indirect assistance under a 
     program described in subsection (c)(4) shall not deny an 
     individual described in subsection (g)(3) admission into such 
     program on the basis of religion, a religious belief, or a 
     refusal to hold a religious belief.
       ``(i) Accountability.--
       ``(1) In general.--Except as provided in paragraphs (2) and 
     (3), a religious organization providing assistance under any 
     program

[[Page 13780]]

     described in subsection (c)(4) shall be subject to the same 
     regulations as other nongovernmental organizations to account 
     in accord with generally accepted accounting principles for 
     the use of such funds and its performance of such programs.
       ``(2) Limited audit.--
       ``(A) Grants and cooperative agreements.--A religious 
     organization providing assistance through a grant or 
     cooperative agreement under a program described in subsection 
     (c)(4) shall segregate government funds provided under such 
     program into a separate account or accounts. Only the 
     separate accounts consisting of funds from the government 
     shall be subject to audit by the government.
       ``(B) Indirect forms of assistance.--A religious 
     organization providing assistance through a voucher, 
     certificate, or other form of indirect assistance under a 
     program described in subsection (c)(4) may segregate 
     government funds provided under such program into a separate 
     account or accounts. If such funds are so segregated, then 
     only the separate accounts consisting of funds from the 
     government shall be subject to audit by the government.
       ``(3) Self audit.--A religious organization providing 
     services under any program described in subsection (c)(4) 
     shall conduct annually a self audit for compliance with its 
     duties under this section and submit a copy of the self audit 
     to the appropriate Federal, State, or local government 
     agency, along with a plan to timely correct variances, if 
     any, identified in the self audit.
       ``(j) Limitations on Use of Funds; Voluntariness.--No funds 
     provided through a grant or cooperative agreement to a 
     religious organization to provide assistance under any 
     program described in subsection (c)(4) shall be expended for 
     sectarian instruction, worship, or proselytization. If the 
     religious organization offers such an activity, it shall be 
     voluntary for the individuals receiving services and offered 
     separate from the program funded under subsection (c)(4). A 
     certificate shall be separately signed by religious 
     organizations, and filed with the government agency that 
     disburses the funds, certifying that the organization is 
     aware of and will comply with this subsection.
       ``(k) Effect on State and Local Funds.--If a State or local 
     government contributes State or local funds to carry out a 
     program described in subsection (c)(4), the State or local 
     government may segregate the State or local funds from the 
     Federal funds provided to carry out the program or may 
     commingle the State or local funds with the Federal funds. If 
     the State or local government commingles the State or local 
     funds, the provisions of this section shall apply to the 
     commingled funds in the same manner, and to the same extent, 
     as the provisions apply to the Federal funds.
       ``(l) Indirect Assistance.--When consistent with the 
     purpose of a program described in subsection (c)(4), the 
     Secretary of the department administering the program may 
     direct the disbursement of some or all of the funds, if 
     determined by the Secretary to be feasible and efficient, in 
     the form of indirect assistance. For purposes of this 
     section, `indirect assistance' constitutes assistance in 
     which an organization receiving funds through a voucher, 
     certificate, or other form of disbursement under this section 
     receives such funding only as a result of the private choices 
     of individual beneficiaries and no government endorsement of 
     any particular religion, or of religion generally, occurs.
       ``(m) Treatment of Intermediate Grantors.--If a 
     nongovernmental organization (referred to in this subsection 
     as an `intermediate grantor'), acting under a grant or other 
     agreement with the Federal Government, or a State or local 
     government with Federal funds, is given the authority under 
     the agreement to select nongovernmental organizations to 
     provide assistance under the programs described in subsection 
     (c)(4), the intermediate grantor shall have the same duties 
     under this section as the government when selecting or 
     otherwise dealing with subgrantors, but the intermediate 
     grantor, if it is a religious organization, shall retain all 
     other rights of a religious organization under this section.
       ``(n) Compliance.--A party alleging that the rights of the 
     party under this section have been violated by a State or 
     local government may bring a civil action for injunctive 
     relief pursuant to section 1979 against the State official or 
     local government agency that has allegedly committed such 
     violation. A party alleging that the rights of the party 
     under this section have been violated by the Federal 
     Government may bring a civil action for injunctive relief in 
     Federal district court against the official or government 
     agency that has allegedly committed such violation.
       ``(o) Training and Technical Assistance for Small 
     Nongovernmental Organizations.--
       ``(1) In general.--From amounts made available to carry out 
     the purposes of the Office of Justice Programs (including any 
     component or unit thereof, including the Office of Community 
     Oriented Policing Services), funds are authorized to provide 
     training and technical assistance, directly or through grants 
     or other arrangements, in procedures relating to potential 
     application and participation in programs identified in 
     subsection (c)(4) to small nongovernmental organizations, as 
     determined by the Attorney General, including religious 
     organizations, in an amount not to exceed $50 million 
     annually.
       ``(2) Types of assistance.--Such assistance may include--
       ``(A) assistance and information relative to creating an 
     organization described in section 501(c)(3) of the Internal 
     Revenue Code of 1986 to operate identified programs;
       ``(B) granting writing assistance which may include 
     workshops and reasonable guidance;
       ``(C) information and referrals to other nongovernmental 
     organizations that provide expertise in accounting, legal 
     issues, tax issues, program development, and a variety of 
     other organizational areas; and
       ``(D) information and guidance on how to comply with 
     Federal nondiscrimination provisions including, but not 
     limited to, title VI of the Civil Rights Act of 1964 (42 
     U.S.C. 2000d et seq.), title VII of the Civil Rights Act of 
     1964 (42 U.S.C. 2000e et seq.), the Fair Housing Act, as 
     amended (42 U.S.C. 3601 et seq.), title IX of the Education 
     Amendments of 1972 (20 U.S.C. 1681-1688), section 504 of the 
     Rehabilitation Act of 1973 (29 U.S.C. 694), and the Age 
     Discrimination Act of 1975 (42 U.S.C. 6101-6107).
       ``(3) Reservation of funds.--An amount of no less than 
     $5,000,000 shall be reserved under this section. Small 
     nongovernmental organizations may apply for these funds to be 
     used for assistance in providing full and equal integrated 
     access to individuals with disabilities in programs under 
     this title.
       ``(4) Priority.--In giving out the assistance described in 
     this subsection, priority shall be given to small 
     nongovernmental organizations serving urban and rural 
     communities.''.

               TITLE III--INDIVIDUAL DEVELOPMENT ACCOUNTS

     SEC. 301. ADDITIONAL QUALIFIED ENTITIES ELIGIBLE TO CONDUCT 
                   PROJECTS UNDER THE ASSETS FOR INDEPENDENCE ACT.

       Section 404(7)(A)(iii)(I)(aa) of the Assets for 
     Independence Act (42 U.S.C. 604 note) is amended to read as 
     follows:
       ``(aa) a federally insured credit union; or''.

     SEC. 302. INCREASE IN LIMITATION ON NET WORTH.

       Section 408(a)(2)(A) of the Assets for Independence Act (42 
     U.S.C. 604 note) is amended by striking ``$10,000'' and 
     inserting ``$20,000''.

     SEC. 303. CHANGE IN LIMITATION ON DEPOSITS FOR AN INDIVIDUAL.

       Section 410(b) of the Assets for Independence Act (42 
     U.S.C. 604 note) is amended to read as follows:
       ``(b) Limitation on Deposits for an Individual.--Not more 
     than $500 from a grant made under section 406(b) shall be 
     provided per year to any one individual during the 
     project.''.

     SEC. 304. ELIMINATION OF LIMITATION ON DEPOSITS FOR A 
                   HOUSEHOLD.

       Section 410 of the Assets for Independence Act (42 U.S.C. 
     604 note) is amended by striking subsection (c) and 
     redesignating subsections (d) and (e) as subsections (c) and 
     (d), respectively.

     SEC. 305. EXTENSION OF PROGRAM.

       Section 416 of the Assets for Independence Act (42 U.S.C. 
     604 note) is amended by striking ``2001, 2002, and 2003'' and 
     inserting ``and 2001, and $50,000,000 for each of fiscal 
     years 2002 through 2008''.

     SEC. 306. CONFORMING AMENDMENTS.

       (a) Amendments to Text.--The text of each of the following 
     provisions of the Assets for Independence Act (42 U.S.C. 604 
     note) is amended by striking ``demonstration'' each place it 
     appears:
       (1) Section 403.
       (2) Section 404(2).
       (3) Section 405(a).
       (4) Section 405(b).
       (5) Section 405(c).
       (6) Section 405(d).
       (7) Section 405(e).
       (8) Section 405(g).
       (9) Section 406(a).
       (10) Section 406(b).
       (11) Section 407(b)(1)(A).
       (12) Section 407(c)(1)(A).
       (13) Section 407(c)(1)(B).
       (14) Section 407(c)(1)(C).
       (15) Section 407(c)(1)(D).
       (16) Section 407(d).
       (17) Section 408(a).
       (18) Section 408(b).
       (19) Section 409.
       (20) Section 410(e).
       (21) Section 411.
       (22) Section 412(a).
       (23) Section 412(b)(2).
       (24) Section 412(c).
       (25) Section 413(a).
       (26) Section 413(b).
       (27) Section 414(a).
       (28) Section 414(b).
       (29) Section 414(c).
       (30) Section 414(d)(1).
       (31) Section 414(d)(2).
       (b) Amendments to Subsection Headings.--The heading of each 
     of the following provisions of the Assets for Independence 
     Act (42 U.S.C. 604 note) is amended by striking 
     ``Demonstration'':
       (1) Section 405(a).

[[Page 13781]]

       (2) Section 406(a).
       (3) Section 413(a).
       (c) Amendments to Section Headings.--The headings of 
     sections 406 and 411 of the Assets for Independence Act (42 
     U.S.C. 604 note) are amended by striking ``DEMONSTRATION''.

     SEC. 307. APPLICABILITY.

       (a) In General.--The amendments made by this title shall 
     apply to funds provided before, on or after the date of the 
     enactment of this Act.
       (b) Prior Amendments.--The amendments made by title VI of 
     the Departments of Labor, Health and Human Services, and 
     Education, and Related Agencies Appropriations Act, 2001 (as 
     enacted into law by Public Law 106-554) shall apply to funds 
     provided before, on or after the date of the enactment of 
     such Act.

 TITLE IV--CHARITABLE DONATIONS LIABILITY REFORM FOR IN-KIND CORPORATE 
                             CONTRIBUTIONS

     SEC. 401. CHARITABLE DONATIONS LIABILITY REFORM FOR IN-KIND 
                   CORPORATE CONTRIBUTIONS.

       (a) Definitions.--For purposes of this section:
       (1) Aircraft.--The term ``aircraft'' has the meaning 
     provided that term in section 40102(6) of title 49, United 
     States Code.
       (2) Business entity.--The term ``business entity'' means a 
     firm, corporation, association, partnership, consortium, 
     joint venture, or other form of enterprise.
       (3) Equipment.--The term ``equipment'' includes mechanical 
     equipment, electronic equipment, and office equipment.
       (4) Facility.--The term ``facility'' means any real 
     property, including any building, improvement, or 
     appurtenance.
       (5) Gross negligence.--The term ``gross negligence'' means 
     voluntary and conscious conduct by a person with knowledge 
     (at the time of the conduct) that the conduct is likely to be 
     harmful to the health or well-being of another person.
       (6) Intentional misconduct.--The term ``intentional 
     misconduct'' means conduct by a person with knowledge (at the 
     time of the conduct) that the conduct is harmful to the 
     health or well-being of another person.
       (7) Motor vehicle.--The term ``motor vehicle'' has the 
     meaning provided that term in section 30102(6) of title 49, 
     United States Code.
       (8) Nonprofit organization.--The term ``nonprofit 
     organization'' means--
       (A) any organization described in section 501(c)(3) of the 
     Internal Revenue Code of 1986 and exempt from tax under 
     section 501(a) of such Code; or
       (B) any not-for-profit organization organized and conducted 
     for public benefit and operated primarily for charitable, 
     civic, educational, religious, welfare, or health purposes.
       (9) State.--The term ``State'' means each of the several 
     States, the District of Columbia, the Commonwealth of Puerto 
     Rico, the Virgin Islands, Guam, American Samoa, the Northern 
     Mariana Islands, any other territory or possession of the 
     United States, or any political subdivision of any such 
     State, territory, or possession.
       (b) Liability.--
       (1) Liability of business entities that donate equipment to 
     nonprofit organizations.--
       (A) In general.--Subject to subsection (c), a business 
     entity shall not be subject to civil liability relating to 
     any injury or death that results from the use of equipment 
     donated by a business entity to a nonprofit organization.
       (B) Application.--This paragraph shall apply with respect 
     to civil liability under Federal and State law.
       (2) Liability of business entities providing use of 
     facilities to nonprofit organizations.--
       (A) In general.--Subject to subsection (c), a business 
     entity shall not be subject to civil liability relating to 
     any injury or death occurring at a facility of the business 
     entity in connection with a use of such facility by a 
     nonprofit organization, if--
       (i) the use occurs outside of the scope of business of the 
     business entity;
       (ii) such injury or death occurs during a period that such 
     facility is used by the nonprofit organization; and
       (iii) the business entity authorized the use of such 
     facility by the nonprofit organization.
       (B) Application.--This paragraph shall apply--
       (i) with respect to civil liability under Federal and State 
     law; and
       (ii) regardless of whether a nonprofit organization pays 
     for the use of a facility.
       (3) Liability of business entities providing use of a motor 
     vehicle or aircraft.--
       (A) In general.--Subject to subsection (c), a business 
     entity shall not be subject to civil liability relating to 
     any injury or death occurring as a result of the operation of 
     aircraft or a motor vehicle of a business entity loaned to a 
     nonprofit organization for use outside of the scope of 
     business of the business entity, if--
       (i) such injury or death occurs during a period that such 
     motor vehicle or aircraft is used by a nonprofit 
     organization; and
       (ii) the business entity authorized the use by the 
     nonprofit organization of motor vehicle or aircraft that 
     resulted in the injury or death.
       (B) Application.--This paragraph shall apply--
       (i) with respect to civil liability under Federal and State 
     law; and
       (ii) regardless of whether a nonprofit organization pays 
     for the use of the aircraft or motor vehicle.
       (c) Exceptions.--Subsection (b) shall not apply to an 
     injury or death that results from an act or omission of a 
     business entity that constitutes gross negligence or 
     intentional misconduct.
       (d) Superseding Provision.--
       (1) In general.--Subject to paragraph (2) and subsection 
     (e), this title preempts the laws of any State to the extent 
     that such laws are inconsistent with this title, except that 
     this title shall not preempt any State law that provides 
     additional protection for a business entity for an injury or 
     death described in a paragraph of subsection (b) with respect 
     to which the conditions specified in such paragraph apply.
       (2) Limitation.--Nothing in this title shall be construed 
     to supersede any Federal or State health or safety law.
       (e) Election of State Regarding Nonapplicability.--A 
     provision of this title shall not apply to any civil action 
     in a State court against a business entity in which all 
     parties are citizens of the State if such State enacts a 
     statute--
       (1) citing the authority of this section;
       (2) declaring the election of such State that such 
     provision shall not apply to such civil action in the State; 
     and
       (3) containing no other provisions.
       (f) Effective Date.--This section shall apply to injuries 
     (and deaths resulting therefrom) occurring on or after the 
     date of the enactment of this Act.

  The SPEAKER pro tempore. After 1 hour of debate on the bill, as 
amended, it shall be in order to consider a further amendment printed 
in House Report 107-144, if offered by the gentleman from New York (Mr. 
Rangel), or the gentleman from Michigan (Mr. Conyers), or a designee, 
which shall be considered read, and shall be debatable for 60 minutes, 
equally divided and controlled by the proponent and an opponent.
  The gentleman from California (Mr. Thomas) and the gentleman from New 
York (Mr. Rangel) each will control 30 minutes of debate on the bill.
  The Chair recognizes the gentleman from California (Mr. Thomas).
  Mr. THOMAS. Mr. Speaker, I yield 15 minutes of my time to the 
gentleman from Wisconsin (Mr. Sensenbrenner), and ask unanimous consent 
that he may control that time.
  Prior to doing that, I ask unanimous consent that the gentleman from 
New York (Mr. Rangel) be recognized.
  The SPEAKER pro tempore. Without objection, the gentleman from New 
York (Mr. Rangel) is recognized.
  There was no objection.
  Mr. RANGEL. Mr. Speaker, I ask unanimous consent that the first 15 
minutes of my time be controlled by the gentleman from Michigan (Mr. 
Conyers), the ranking member of the Committee on the Judiciary, and the 
remainder of my time be controlled by the gentleman from Georgia (Mr.  
Lewis), a member of the Committee on Ways and Means.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from New York?
  There was no objection.
  The SPEAKER pro tempore. The Chair recognizes the gentleman from 
Wisconsin (Mr. Sensenbrenner).
  Mr. SENSENBRENNER. Mr. Speaker, I ask unanimous consent that I may be 
allowed to yield parts of my time to others.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Wisconsin?
  There was no objection.
  Mr. SENSENBRENNER. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, I rise in strong support of H.R. 7. Quite simply, the 
aim of this legislation is to encourage more community-based solutions 
to social problems in America. When implemented, it will provide some 
truly life-changing opportunities to many individuals struggling in our 
communities across the country.
  It says that faith-based organizations should no longer be 
discriminated against when competing for Federal social service funds 
because of a misconstrued interpretation of current law by some, and 
that we welcome even the smallest faith-based organizations into the 
war against desperation and hopelessness.

[[Page 13782]]

  As a result, new doors will be opened to the neediest in our 
communities to receive help and assistance that they seek. This is a 
wonderful and compassionate goal that most, if not all, should be able 
to embrace. In fact, H.R. 7 could very well improve our culture in ways 
that we have not seen in decades.
  The concept of Charitable Choice is not new. Federal welfare reform 
in 1996 authorized collaboration between government and faith-based 
organizations to provide services to the poor. Charitable Choice has 
allowed religious organizations, rather than just secular or 
secularized groups, to compete for public funding. Many faith-based 
organizations have been providing services to their community, but with 
government funding they are able to create new programs and expand 
existing ones.
  For example, the Cookman United Methodist Church in Philadelphia has 
created a program of ``education, life-skills, job placement, job 
development and computer literacy, and children and youth services'' 
with their Federal funding. By testing new solutions to the problem of 
poverty, the Cookman Church has used Charitable Choice funds to expand 
their program of needed services into a much larger and more meaningful 
one for their community. They have done this under existing Charitable 
Choice law in the 1996 Welfare Reform Act, which allows them to help 
those in need without having to hire lawyers to create a separate 
secularized organization and without having to rent expensive office 
space outside their neighborhood church.
  There are literally hundreds of other programs like that of the 
Cookman United Methodist Church that have benefited thousands of 
persons in need without raising constitutional concerns in their 
implementation. These organizations are striving to make a difference 
in communities all across America.
  It is a tragedy that those who move to help others by the strength of 
faith face added barriers to Federal social service funds based upon 
misguided understandings of the Constitution's religion clauses. Often 
it is those whose earthly compassion has the deep root of faith who 
stand strongest against the whims of despair. Different rules should 
not apply to them when they seek to cooperate with the Federal 
Government in helping meet basic human needs.
  Some of our colleagues have raised constitutional objections to this 
legislation. I believe that those objections, while sincere, are 
misguided. Charitable Choice neither inhibits free exercise of 
religion, nor does it involve the government establishment of religion. 
It simply allows all organizations, religious or non-religious, to be 
considered equally by the Government for what they can do to help 
alleviate our Nation's social ills.
  Unfortunately, it has become all too common for faith-based 
organizations to be subject to blanket exclusionary rules applied by 
the government grant and contract distributors based upon the notion 
that no Federal funds can go to pervasively sectarian institutions. 
However, the Congressional Research Service concluded in its December 
27, 2000, report to Congress on Charitable Choice: ``In its most recent 
decisions, the Supreme Court appears to have abandoned the presumption 
that some religious institutions are so pervasive sectarian that they 
are constitutionally ineligible to participate in direct public aid 
programs. The question of whether a recipient institution is 
pervasively sectarian is no longer a constitutionally determinative 
factor.''
  The pervasively sectarian test under which the patronizing assumption 
was made that religious people could be too religious to be trusted to 
follow rules against the use of Federal funds for proselytizing 
activity is, thankfully, dead. However, its ghost continues to linger 
in many of the implementing regulations of the programs covered by H.R. 
7, and, unfortunately, in the rhetoric of many of H.R. 7's opponents.
  For those with constitutional concerns, I also ask them to consider 
the changes to H.R. 7 that were adopted by the Committee on the 
Judiciary and just amended in this bill with the self-executing rule. 
These changes firm up the constitutionality of the bill and expand the 
options of individuals to receive government services from the type of 
organization they are most comfortable with.
  To begin with, the bill now makes clear that when a beneficiary has 
objection to the religious nature of a provider, an alternative 
provider is required that is objectionable to the beneficiary on 
religious grounds, but that the alternative provider need not be non-
religious. This same requirement appears in the Charitable Choice 
provisions of the 1996 Welfare Reform Act. If, of course, a beneficiary 
objects to being served by any faith-based organization, such a 
beneficiary is granted a secular alternative.
  Existing Charitable Choice law contains an explicit protection of a 
beneficiary's right to refuse to actively participate in a religious 
practice, thereby ensuring a beneficiary's right to avoid any unwanted 
sectarian practices. Such a provision makes clear that participation, 
if any, in a sectarian practice, is voluntary and non-compulsory.
  Further, Justices O'Connor and Breyer require that no government 
funds be diverted to religious indoctrination. Therefore, religious 
organizations receiving direct funding will have to separate their 
social service program from their sectarian practices. If any part of 
the faith-based organization's activities involve religious 
indoctrination, such activities must be set apart from the government-
funded program, and, hence, privately funded.
  The bill as reported out of the Committee on the Judiciary now 
contains a clear statement that if any sectarian worship instruction or 
proselytization occurs, that shall be voluntary for individuals 
receiving services and offered separate from the program funded.
  Also the bill now includes a requirement that a certificate shall be 
separately signed by the religious organization and filed with the 
government agency that disperses the funds certifying that the 
organization is aware of and will take care to comply with this 
provision.

                              {time}  1230

  The amendment also makes clear that volunteers cannot come into a 
federally funded program and proselytize or otherwise engage in 
sectarian activity.
  The Committee on the Judiciary also changed the bill to include a 
subsection to permit review of the performance of the program itself, 
not just its fiscal aspects. This amendment is needed to prevent an 
unconstitutional preference for faith-based organizations, as secular 
programs are subject to both types of review.
  One of the most important guarantees of institutional autonomy is a 
faith-based organization's ability to select its own staff in the 
manner that takes into account its faith. It was for that reason that 
Congress wrote an exemption from the religious discrimination provision 
of Title VII of the Civil Rights Act of 1964 for religious employers. 
All other current charitable choice laws specifically provide that 
faith-based organizations retain this limited exemption from Federal 
employment nondiscrimination laws.
  An amendment adopted by the Committee on the Judiciary replaced 
existing language in H.R. 7 with the same language used in the 1996 
Welfare Reform Act, which was signed into law by President Clinton, 
with an additional clause making clear that contrary provisions in the 
Federal programs covered by H.R. 7 have no force and effect. This 
additional clause was not necessary in the 1996 Welfare Reform Act 
because it codified charitable choice rules for a new program, whereas 
H.R. 7 covers already existing programs that may have conflicting 
provisions.
  This amendment is offered to avoid any confusion. The language of the 
1996 Welfare Reform Act did nothing to ``roll back'' existing civil 
rights laws, and that same language is used in this amendment.
  It is important for all to understand that this bill does not change 
the antidiscrimination laws one bit, either with respect to employees 
or beneficiaries. Faith-based organizations

[[Page 13783]]

must comply with civil rights laws prohibiting discrimination on the 
basis of race, color, national origin, gender, age and disability.
  Since 1964, faith-based organizations have been entitled to the Title 
VII exemption to hire staff that share religious beliefs; and courts, 
including the Supreme Court, have upheld this exemption. Do the critics 
of those laws really want to revoke current public funding from the 
thousands of child care centers, colleges and universities that receive 
Federal funds in the form of Pell grants, veterans benefits, vocational 
training, et cetera, because these institutions hire faculty and staff 
that share religious beliefs?
  Remember, one of the primary goals of this legislation is to try to 
open opportunities for small entities that take part in Federal social 
service programs. It is particularly important to maintain this 
exemption for small faith-based entities, because they are the types of 
community organizations we hope will be encouraged by this bill to seek 
involvement in delivering social services. These small entities are not 
going to go out and create new organizations and staff that provide 
these services. So we do not want to force them to advertise, hire new 
people and possibly be sued in Federal court for a job they would like 
to be filled by people already on staff, namely, people who share their 
religious beliefs.
  One of the most revered liberal justices in the history of the 
Supreme Court, William Brennan, recognized that preserving the Title 
VII exemption where religious organizations engage in social services 
is a necessary element of religious freedom.
  In his opinion in the Amos case upholding the current Title VII 
exemption, Justice Brennan recognized that many religious organizations 
and associations engage in extensive social welfare and charitable 
activities such as operating soup kitchens and day care centers or 
providing aid to the poor and the homeless. Even where such activity 
does not contain any sectarian instruction, worship or proselytizing, 
he recognized that the religious organization's performance of such 
functions was likely to be ``infused with a religious purpose.'' He 
also recognized that churches and other entities ``often regard the 
provision of social services as a means of fulfilling religious duty 
and providing an example of the way of life a church seeks to foster.''
  Charitable choice principles recognize that people in need should 
have the benefit of the best social services available, whether the 
providers of those services are faith-based or otherwise. That is the 
goal: helping tens of thousands of Americans in need.
  We are considering today whether the legions of faith-based 
organizations in the inner cities, small towns and other communities of 
America can compete for Federal funds to help pay the heating bills in 
shelters for victims of domestic violence, to help them pay for 
training materials teaching basic work skills, to help them feed the 
hungry, and to provide other social services to help the most desperate 
among us.
  Mr. Speaker, I urge my colleagues, even those initially opposed to 
H.R. 7, to join me today in voting for this bill and the expansion of 
charitable choice.
  Mr. Speaker, I reserve the balance of my time.
  Mr. CONYERS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I commend the gentleman from Wisconsin (Mr. 
Sensenbrenner), the chairman of the committee, for his sterling 
statement. Except for the conclusion, of course, it was very well 
presented.
  Now, to the heart of the matter. The Conservative Family Research 
Council announced yesterday that they would abandon support for H.R. 7 
if it were changed one iota to defer to existing State or local civil 
rights laws. Therein lays the rub. Namely, to put it another way, more 
colloquially, can a brother make as good a pot of soup as a Southern 
Baptist? Can too much diversity spoil the soup? That is the problem 
here, and it is why we are having so much trouble with faith-based 
which, incidentally, already exists, I say to my colleagues. Is there 
anyone not aware that we already have faith-based organizations 
dispensing charity by the billions of dollars? So what is the problem 
here?
  Well, during our discussion in the Committee on the Judiciary, no one 
caught this sense of the issue more sensitively than our distinguished 
colleague from Florida (Mr. Scarborough), and I quote him at this point 
from page 191: ``For instance,'' he says, ``delivering soup. Let's say, 
for instance, in an area that is heavily served, let's say a synagogue, 
in an urban part of the area, listen, they want to get their soup. They 
do not want to hear somebody with views that are completely different 
from their own views. And I understand. I understand what the bill 
says, that they are not allowed to do that. But, again, if you compel 
these organizations, whose culture many Americans believe allow faith-
based organizations to deliver services more effectively,'' and so on 
and so forth.
  So I thank our departing colleague for that very important 
contribution to what we are about here.
  Now, why do so many people feel uncomfortable about using this 
legislation as a vehicle to override our civil rights laws, our Federal 
civil rights laws, our State civil rights laws, our local civil rights 
laws? Why?
  Many of us are still recovering from the revelation that the 
Salvation Army negotiated a secret deal with the White House to 
override parts of civil rights laws, including those protecting 
domestic partner benefits. Most do not think it is right to trade off 
our civil rights laws to get legislative support from a private 
organization.
  Had the administration really wanted to do something to help 
religion, they might have tried to include the proposed charitable tax 
deductions in the $2 trillion tax deal. If they wanted to do something 
to improve social services, they would increase funding for drug 
treatment, housing and for seniors, instead of cutting these programs 
by billions of dollars. If they wanted to help our kids in our inner 
cities, of which I have heard so much today it is staggering, they 
would help us try to rebuild the crumbling schools all around them.
  Mr. Speaker, I yield 2\1/4\ minutes to the gentleman from New York 
(Mr. Nadler), the ranking member of the subcommittee from which this 
bill came.
  Mr. NADLER. Mr. Speaker, this bill is a threat to religious liberty, 
a threat to the very effective way the Federal, State and local 
governments have long worked with religious charities, and a threat to 
this Nation's long commitment to equal rights, nondiscrimination and 
human dignity.
  I would like to dispense with a few myths that have been propagated 
during this debate.
  First, contrary to what we may have heard, religious charities are 
not the victims of discrimination; far from it. Religious charities now 
administer billions of dollars in public funds every year. Catholic 
Charities, the Federation of Protestant Welfare Agencies, the United 
Jewish Communities and many other church groups have been providing 
social services partially funded with taxpayer dollars for many, many 
decades.
  Myth two: Religious charities must be allowed to discriminate in 
employment and services using public money in order to do their jobs 
properly. Why? Why does a Jewish lunch program need to hire only Jews 
to serve the soup? Why does a Baptist homeless shelter need to hire 
only Baptists to provide the blankets? I thought that this was a 
settled issue in our society, but apparently it is not.
  Let me ask my colleagues, on the road to Jericho, did the good 
Samaritan ask the wounded traveler whether he was of a certain faith or 
whether he was gay or whether he was of the proper race? If the answer 
is no, then why would we think it necessary for churches to do this 
now, with public funds?
  We are told that current law already allows such discrimination. Yes, 
it does, but only with church funds. But this bill is different. This 
bill allows that discrimination not just with

[[Page 13784]]

church money but with public money in purely secular activities or what 
we are told are purely secular activities. That is very new and very, 
very wrong.
  Myth three: This bill preserves State laws. Not true. The gentleman 
from Wisconsin (Mr. Sensenbrenner) made clear in the markup in the 
committee that it does not. The bill allows broad religious 
discrimination and nullifies the laws of 12 States and more than 100 
localities to the contrary. Do not be fooled by the argument that this 
applies only to lesbian and gay rights, important though they are. This 
applies to all local antidiscrimination laws, whether they protect 
women or minorities or single mothers or whatever local communities may 
have committed to take a stand on. That is an important difference from 
past charitable choice legislation, which specifically said that State 
and local laws would be preserved. This is different.


                Announcement by the Speaker Pro Tempore

  The SPEAKER pro tempore (Mr. LaHood). The Chair would remind Members 
to abide by the time limitations.
  Mr. CONYERS. Mr. Speaker, I yield 2 minutes to the gentleman from 
Virginia (Mr. Scott).
  Mr. SCOTT. Mr. Speaker, I rise in strong opposition to H.R. 7. While 
it has been described as a plan to help religious organizations to 
receive and administer government funds, charitable choice in reality 
is a fundamental assault on our civil rights laws.
  In this debate, let us be clear. The major impact of H.R. 7 will be 
to allow religious sponsors who want to receive Federal funds to 
discriminate in hiring based on religion. Any program that can get 
funded under H.R. 7 can get funding today, except those run by 
organizations that insist on the right to discriminate in hiring.

                              {time}  1245

  So when we hear about all the programs that can get funded, let us 
tell the truth, all of them can be funded today if the sponsors are 
willing to follow civil rights laws, just like all other Federal 
contractors. Just do not discriminate in hiring.
  So this bill is not about new programs which can get funded. There is 
no new money in the program. Any program funded under H.R. 7 can be 
funded now. This bill provides no new funding, just new discrimination.
  Whatever excuse there is to discriminate based on religion in these 
programs should apply to all Federal programs. In fact, it would apply 
to all private contractors or all private employers.
  Why should a manufacturer be required to hire people of different 
faiths? The answer is it is the law. Because of our sorry history of 
discrimination and bigotry in the past, we have had to pass laws to 
establish protected classes.
  So someone can choose their employees any way they want, except they 
cannot discriminate in hiring based on the protective classes of race, 
color, creed, national origin, or sex. This principle was established 
in Federal defense contracts when President Roosevelt signed Executive 
Order 8802 on June 25, 1941. Now, 60 years later, here we are allowing 
sponsors of federally funded programs to discriminate in hiring.
  There are a lot of other problems with this bill, but we ought to 
defeat this bill strictly because of the fact that it allows new 
discrimination in hiring.
  Mr. CONYERS. Mr. Speaker, in consultation with the chairman of the 
committee, I ask unanimous consent that each side be given 10 
additional minutes.
  The SPEAKER pro tempore (Mr. LaHood). Is there objection to the 
request of the gentleman from Michigan?
  Mr. SENSENBRENNER. Mr. Speaker, reserving the right to object, I 
would point out to the gentleman from Michigan that while I personally 
have no objection, the general debate time is controlled by the 
Committee on Ways and Means. I would suggest that he request that of 
the chairman of the Committee on Ways and Means when he comes back to 
the Chamber. I am afraid that I would be trodding on their turf, so I 
would ask him to withdraw his unanimous consent request.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Michigan?
  Mr. SENSENBRENNER. I object, Mr. Speaker.
  The SPEAKER pro tempore. Objection is heard.
  Mr. CONYERS. Mr. Speaker, I yield 2 minutes and 5 seconds to the 
gentlewoman from California (Ms. Lofgren).
  Ms. LOFGREN. Mr. Speaker, if we take time to review the details of 
this bill, we will see it is bad for America. The premise that 
religious people cannot help solve America's social problems is simply 
wrong. I spent 14 years in local government. We worked with Catholic 
Charities and many others. We do not need this radical departure from 
the Bill of Rights to work with Catholics, Protestants, Buddhists, 
Hindus, Sikhs, or Jains to solve America's problems.
  Consider the plain language of the first amendment: ``Congress shall 
make no law respecting an establishment of religion.'' I think that is 
clear. But this bill would take tax money and give it directly to 
churches. How can that not run afoul of the constitutional prohibition 
against the establishment of religion?
  Our country was started by people seeking religious freedom to 
worship, and this fundamental American value was put in the very first 
amendment to our Constitution.
  When government becomes involved in establishing or preferring 
religions, trouble follows. Will the Sikhs or Hindus receive the day 
care contract? Will the Muslims or Jews run the nursing home where your 
mother will live? Pity the local government who must decide.
  With government money comes interference and perhaps improper 
conduct. Do these funds go to friends of the President? Does the 
Salvation Army get a financial benefit for political work? Thomas 
Jefferson is famous for the observation that ``. . . intermingling of 
church and State corrupts both.''
  Finally and incredibly, there are special interest provisions in this 
bill that do not even relate to religion. Look at section 104.
  Astonishingly, the bill creates a special class of victims without 
rights, nonprofit and religious groups who rent vehicles from 
businesses. An example: Corporation A leases a van with bald tires to 
the Baptist Youth Choir. The van overturns. With section 104, 
Corporation A cannot be held liable to help with the funeral and 
medical expenses. But if the same van is rented for the same price to a 
for-profit satanic rock group, corporation A can be held liable. Why 
should religious and nonprofit groups be victimized with impunity?



  This bill will result in outcomes not desired by the American people. 
It will end up undercutting religion as well as religious freedom. It 
will enrage Americans by using their tax dollars to subsidize religious 
beliefs they disagree with. It undercuts our Constitution, provides not 
one additional cent of tax money to help the poor, and will end up 
stimulating religious conflict and racial and religious discrimination. 
Please have the good sense to vote no.
  Mr. CONYERS. Mr. Speaker, I ask unanimous consent for each side to 
have 10 additional minutes, having consulted with my leader on the 
Committee on Ways and Means, the gentleman from New York (Mr. Rangel).
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Michigan?
  Mr. THOMAS. Reserving the right to object, Mr. Speaker, I yield to 
the gentleman from New York (Mr. Rangel) in terms of the statement of 
the gentleman from Michigan.
  Mr. RANGEL. Mr. Speaker, I thank the gentleman for yielding to me.
  Mr. Speaker, it seems as though, on this very controversial but 
important subject matter, there are so many Members who would like to 
share their views before we have time to vote on this, and in view of 
the fact that the Committee on the Judiciary has had jurisdiction over 
the substance of this and the time was split and they need additional 
time, if there is any technicality because the Committee on Ways and 
Means would follow them that

[[Page 13785]]

interferes with them getting unanimous consent, I would like to yield 
to them on this issue.
  Mr. THOMAS. Continuing to reserve my right to object, Mr. Speaker, I 
would tell the gentleman that actually we have 2 hours of debate on 
this question. As the Speaker indicated in announcing the rule, there 
is an hour of general debate and an hour on the substitute.
  That means the Committee on the Judiciary, if the time is divided on 
the substitute, the same as was divided on general debate, would have 1 
hour. That is the normal debate time. The Committee on Ways and Means 
would have 1 hour. The Committee on the Judiciary would have an hour.
  The debate is not necessarily narrowly directed to the subject at 
hand; i.e., if the gentleman from Michigan (Chairman Conyers) has some 
of his members of the Committee on the Judiciary who wish to make 
general statements about the underlying legislation, they certainly are 
able to, and indeed, we often do that during the debate on the 
substitute.
  It seems to me that an extra 1 hour on this subject matter for a full 
2 hours of discussion is more than ample.
  Therefore, Mr. Speaker, I object.
  The SPEAKER pro tempore. Objection is heard.
  Mr. CONYERS. Mr. Speaker, I yield 1\1/2\ minutes to the gentlewoman 
from Texas (Ms. Jackson-Lee), a distinguished member of the Committee.
  Ms. JACKSON-LEE of Texas. Mr. Speaker, I thank the distinguished 
gentleman from Michigan for yielding time to me, and I thank the 
leaders for this very important debate.
  Mr. Speaker, I rise today to reinforce the importance of this debate 
and the importance of characterizing this debate for what it is: the 
desire for those of us who believe in the first amendment and the Bill 
of Rights to emphasize that this should not be a referendum on our 
faith, for this country was founded on the ability to be able to 
practice one's faith without intrusion.
  But rather, I would hope that this particular debate will focus 
around the intent and the understanding of James Madison, the father of 
the first amendment, that indicated that he believed that the 
commingling of church and State was something that should not exist, 
and that he apprehended the meaning of the establishment clause to be 
that ``Congress shall not establish a religion and enforce the legal 
observation of it by law, nor compel men or women to worship God in any 
manner contrary to their conscience.''
  It means that if I am of a different belief and I want to fight 
against child abuse, and a particular religious institution is running 
a child abuse prevention charitable organization in my community, I 
should be able to be hired. Under this bill, although it has good 
intentions, it forces direct monies into religious institutions, not 
requiring them to comply with any means of preventing discrimination.
  Martin Luther King said ``Injustice anywhere is injustice 
everywhere.'' Discrimination on the basis of religion somewhere is 
discrimination everywhere.
  What we want here is an understanding that we embrace faith, but we 
do not embrace discrimination. Change this legislation, eliminate the 
discriminatory aspects, eliminate the voucher program, eliminate the 
direct funding of religion, and James Madison's voice and spirit will 
live and the Bill of Rights will live, and we can all support this 
legislation.
  Mr. CONYERS. Mr. Speaker, I yield 1\1/2\ minutes to the gentlewoman 
from Wisconsin (Ms. Baldwin).
  Ms. BALDWIN. Mr. Speaker, I thank the gentleman for yielding time to 
me.
  Mr. Speaker, this debate is about the fundamental relationship 
between a democratic government and religious institutions.
  The first amendment has two purposes. First, it is designed to 
prevent the government from using its power to promote a particular 
religion. Second, it is designed to protect religious institutions from 
unwarranted intrusions of government.
  I believe H.R. 7 endangers both of these purposes. This bill expands 
the religious exemption under Title VII to clearly nonreligious 
activities, and it preempts State and all other local nondiscrimination 
laws. For the first time, Federal dollars, public funds, will be used 
to discriminate; or put another way, Americans can be barred from 
taxpayer-funded employment on the basis of their religion or other 
factors.
  Civil rights and religious freedom go hand-in-hand. Undermine one and 
we undermine the other.
  Mr. Speaker, it is a mistake for government and religion to become 
entangled. I urge my colleagues to reaffirm our commitment to 
separation of church and State by defeating H.R. 7.
  Mr. Speaker, I rise today in opposition to H.R. 7.
  Let me begin by saying that I very much value the traditional role of 
religions institutions in providing social services. Our country has 
been made stronger through the good works of people of faith in helping 
those in need. Religious institutions have long fed the hungry, clothed 
the poor, given shelter to the homeless, and helped heal the sick. 
These contributions have been absolutely essential for millions of 
Americans throughout the history of our great nation.
  But this debate is not whether or not religious institutions should 
do good works. We all agree that they do and they should. This debate 
is about the fundamental relationship between a democratic government 
and religious institutions.
  The Bill of Rights to the United States Constitution sets forth the 
fundamental principles upon which our democracy is based--freedom of 
speech, freedom of expression, right to trial by jury, limitations on 
searches an seizures, the right to bear arms. One of the most 
fundamental protections in our Constitution is freedom of religion.
  The First Amendment states: ``Congress shall make no law respecting 
an establishment of religion or prohibiting the free exercise 
thereof.'' This Constitutional principle has two purposes. First, it is 
designed to prevent the government from using its power to promote a 
particular religion. Our Founding Fathers rightly saw that true freedom 
of worship was impossible if the state advantaged one religion over 
others.
  The second purpose is to protect religious institutions from the 
unwarranted intrusion of government. The independence of religious 
institutions from the hand of government is fundamental to the free 
exercise of religion.
  I believe H.R. 7 endangers both of these purposes and therefore 
undermines our nation's commitment to the free exercise of religion. 
This bill will allow religious institutions to accept direct government 
funding of social service programs. While it purports to ban 
proselytizing using tax dollars, it still permits the mingling of 
religion and government as never before seen in our country. It extends 
the reach of government into the private religious sphere. And I 
believe it is unconstitutional.
  It is not in the best interest of our religious institutions to have 
government agencies pick and choose which church or synagogue or mosque 
should get taxpayer dollars. As my colleague Mr. Schiff of California 
said in the Judiciary Committee, ``would it be appropriate for Members 
of Congress to write letters in support of one church's grant 
application or against another?'' Would it? Is that a good idea? What 
future rules will we apply to these funds? Will the Bishop or the Rabbi 
come by to lobby for funding? If a church violates the rules or is 
suspected of fraud, do we really want the government digging into their 
books?
  Our Founding Fathers created the Establishment Clause as an answer to 
this dilemma. Their answer was no. In a letter written in 1832, James 
Madison wrote, ``it may not be easy, in every possible case, to trace 
the line of separation between the rights of religion and the civil 
authority with such distinctness as to avoid collisions and doubts on 
unessential points. The tendency of a usurpation on one side or the 
other, or a corrupting coalition or alliance between them, will be best 
guarded by an entire abstinence of the government from interference in 
any way whatsoever?''
  We have recently seen the impact of entangling government and 
religion in the case of the White House and the Salvation Army. The 
Salvation Army, a religious charity, has lobbied and been lobbied by 
the White House to promote this legislation. According to newspaper 
accounts, the Salvation Army was prepared to spend hundreds of 
thousands of dollars to advance this bill in exchange for the right to 
discriminate in hiring. The White House now says they've backed off.
  But the very right to discriminate in hiring that the Salvation Army 
wanted is contained in this bill! This bill expands the religious 
exemption under Title VII to clearly non-religious activities and 
preempts all other state and local

[[Page 13786]]

non-discrimination laws. For the first time, public funds will be used 
to discriminate in employment. Or put another way, Americans can be 
barred from taxpayer funded employment on the basis of their religion.
  Under this bill, a Protestant church could refuse to hire a person 
who is Jewish to work in their day care or a Muslim soup kitchen could 
refuse to hire a Catholic to serve meals to the hungry. But not only 
that, a church could refuse to hire a person who is divorced if divorce 
is against that church's tenets and teachings, even though the position 
is involved only in a secular activity.
  Expanding a religious institution's ability to discriminate in 
employment to include secular enterprises is just the start of the 
discrimination in this bill. The bill also preempts all state and local 
laws against discrimination. Thus, if a state protects its citizens 
from discrimination on the basis of sexual orientation, real or 
perceived gender, marital status, student status, or other bases the 
moment federal funds are commingled, religious institutions are allowed 
to discriminate. We hear a great deal about local control, but this 
bill eviscerates these state and local non-discrimination laws.
  That is why the Gentleman from Massachusetts, Mr. Frank, and I 
proposed an amendment in the Rules Committee. It is very simple, just 
one line. ``Notwithstanding anything to the contrary in this section, 
nothing in this section shall preempt or supersede State or local civil 
rights laws.'' Unfortunately, the Rules Committee refused to make our 
amendment in order, denying the House the opportunity to have an up or 
down vote on this critical issue.
  The House still has an opportunity to correct this major problem with 
the bill. The Democratic Substitute maintains non-discrimination 
protections in current Federal, State and local law. I urge all of my 
colleagues to support the substitute.
  It is very distressing that the proponents of this bill desire to 
chip away at our civil rights and non-discrimination laws. And it is 
even more distressing that they are using religion as a cover. Civil 
rights and religious freedom go hand in hand. Undermine one and you 
undermine the other. In the Federalist Papers Number 51, James Madison 
noted this interrelationship: ``In a free government, the security for 
civil rights must be the same as that for religious rights. It consists 
in the one case in the multiplicity of interests, and in the other in 
the multiplicity of sects.''
  Mr. Speaker, it is a mistake for government and religion to become 
entangled. I urge my colleagues to reaffirm our commitment to the 
separation of church and state by defeating this misguided legislation.
  Mr. CONYERS. Mr. Speaker, I am pleased to yield the balance of our 
time to my distinguished leader, the gentlewoman from California (Ms. 
Waters).
  The SPEAKER pro tempore. The gentlewoman from California (Ms. Waters) 
is recognized for 2 minutes and 10 seconds.
  Ms. WATERS. Mr. Speaker, I think it is important for some of us to 
say that we were raised in church, and that we are religious people. We 
went to Sunday school every Sunday when I was a little girl coming up. 
We went back to the 11 a.m. service with our parents, and then we went 
back at 6 o'clock in the evening to BYPU for the young people.
  I do not want anybody to think that because we are against this bill, 
somehow we are not religious, or we do not believe in religion. We 
certainly do. What we do not believe in is discrimination. We cannot, 
as public policymakers who understand the Constitution and appreciate 
it, and understand the struggle of those people who came to this 
country fleeing religious oppression, sit here and allow something 
called a faith-based program to reinstitute discrimination. It is 
wrong, and we cannot stand for that.
  Religious organizations in this country participate in this 
government in many ways. For those people who say we have to have this 
bill in order to have participation, they are wrong.
  Let me just tell the Members, last year Lutheran Services, the 
largest faith-based organization to receive government aid, received 
about $2.7 billion, Jewish organizations received about $2 billion in 
government aid, Catholic Charities received $1.4 billion, and the 
Salvation Army received $400 million.
  So what are we talking about? They have separate 501(c)3s that they 
apply under because they separate from the collection plate the money 
that comes from the government in order to carry out these programs, 
and that is the way it should be. We should never allow commingling of 
the government and taxpayers' dollars in the collection plate. It is 
wrong, it violates separation of church and State, and we should stop 
it on this floor right now, and not support the so-called faith-based 
organization initiative.
  I would say to my friends and colleagues here today, we have the 
opportunity to uphold civil rights, to say we are against 
discrimination, to say we are not going to allow taxpayer dollars to 
turn people away who are applying for jobs, and most importantly, we 
are going to uphold the Constitution of the United States of America. I 
ask for a no vote on the faith-based organization initiative.
  Mr. SENSENBRENNER. Mr. Speaker, I yield the balance of my time to the 
gentleman from Ohio (Mr. Chabot), the chairman of the Subcommittee on 
the Constitution.

                              {time}  1300

  Mr. CHABOT. Mr. Speaker, as we debate this bill today, I would ask my 
colleagues not to let partisanship cloud their judgment on this 
proposal. The purpose of this bill is to help people. This is not some 
great scheme to funnel tax dollars to religious organizations or to 
force people to seek social services from religious providers. This 
bill will provide new hope and new opportunities to thousands of 
Americans. It will help the homeless, the hungry, and the downtrodden, 
and it will help those in need.
  Over the past several months, the House Subcommittee on the 
Constitution held several hearings that looked at charitable choice 
programs and the role that faith-based organizations can play in the 
delivery of social services. We heard compelling testimony about the 
work of faith-based organizations that have received Federal funding 
under current law. It is the current law now.
  And we discussed and debated the constitutional issues surrounding 
this legislative proposal. And at the conclusion of these hearings, two 
points were very clear. First, the charitable choice provisions of H.R. 
7 are completely consistent with the Constitution. And second, faith-
based organizations play a vital role in providing social services to 
the most desperate among us.
  I would like to quote from a speech that was made a while back to the 
Salvation Army: ``The men and women who work in faith-based 
organizations are driven by their spiritual commitment. They have 
sustained the drug addicted, the mentally ill, the homeless, they have 
trained them, they have educated them, they have cared for them. Most 
of all, they have done what government can never do: they have loved 
them.''
  Do my colleagues know who said that? Al Gore. Now I do not always 
agree with Al Gore, but I certainly agree with him in that particular 
instance.
  This is legislation which is very important to the President. I want 
to thank the chairman, the gentleman from Wisconsin (Mr. 
Sensenbrenner), for getting us to this point today. We want to make 
sure that this withstands any constitutional challenge that might be 
made against it. This is excellent legislation which will literally 
help thousands and thousands of the most desperately needy people in 
this country.
  I want to thank the chairman for his leadership again on this. Let us 
pass this legislation today. It is important to an awful lot of people.

 Responses to False Democratic Claims in Their Dissenting Views in the 
                            Committee Report

     Claimed comparison of H.R. 7 with language of 1996 Welfare 
         Reform Act
       Footnote 7 of the Dissenting Views states that H.R. 7 does 
     not contain language from the 1996 Welfare Reform Act that 
     indicated its provisions were not intended to supercede State 
     law, and therefore the absence of that provision from H.R. 7 
     means it somehow preempts State law. That is a 
     mischaracterization of the provision in the 1996 Welfare 
     Reform Act. The provision referred to in the 1996 Act was 
     simply a ``savings clause'' that recognized that some states 
     have provisions in their constitutions and state laws that 
     don't allow them to spend state funds on faith-based 
     organizations. The savings clause simply recognized

[[Page 13787]]

     that in those states with such laws, they could continue to 
     segregate state funds as required by state law, but that they 
     could also use federal funds in accordance with the 
     charitable choice provisions of the 1996 Welfare Reform Act. 
     Conference Report 104-430, accompanying H.R. 4, 104th 
     Congress, 1st Session (December 20, 1995), at 361--the 
     previously adopted welfare reform bill with the identical 
     subsection (k) as that found in the Welfare Reform Act of 
     1996--provides the following explanation for the subsection: 
     ``Subsection (k) states that nothing in this section shall be 
     construed to preempt State constitutions or statutes which 
     restrict the expenditure of State funds in or by religious 
     organizations. In some States, provisions of the State 
     constitution or a State statute prohibit the expenditure of 
     public funds in or by sectarian institutions. It is the 
     intent of Congress, however, to encourage States to involve 
     religious organizations in the delivery of welfare services 
     to the greatest extent possible. The conferees do not intend 
     that this language be construed to required that funds 
     provided by the Federal government referred to in subsection 
     (a) be segregated and expended under rules different than 
     funds provided by the State for the same purposes; however, 
     States may revise such laws, or segregate State and Federal 
     funds, as necessary to allow full participation in these 
     programs by religious organizations.'' H.R. 7 gives states 
     the same option. Subsection (j) provides that insofar as 
     states use federal funds, or mingle state and federal funds, 
     and uses them for covered programs, the federal rules in H.R. 
     7 apply. If states separate out their state funds, then they 
     can of course use them without any federal conditions 
     attaching.
     Claim that millions of dollars already go to groups like 
         Catholic Charities, so there is no problem to fix
       The Dissenting Views point out that millions of dollars go 
     to large organizations such as Catholic Charities every year, 
     but fails to mention these are large, separately incorporated 
     and secularized organizations, not churches. The purpose of 
     H.R. 7 is to allow small religious organizations to be able 
     to compete for social service funds by removing barriers to 
     entry and allowing them to serve as churches, and to provide 
     social services in their churches without having to rent out 
     separate, expensive office space, or having to hire lawyers 
     to create separate corporations.
     Claim that H.R. 7 preempts general state and local 
         nondiscrimination in employment laws
       The Dissenting Views states that under H.R. 7 a national 
     religious organization could choose to accept a single 
     federal grant and attempt to use that as a shield against 
     laws protecting gay and lesbian employment rights in all 50 
     states. This is wrong. Subsections (d) and (e) in H.R. 7 do 
     not constitute a general preemption clause, but a narrow 
     statutory right afforded faith-based organizations to help 
     them preserve their religious liberty when they are using 
     federal funds during the course of a federally funded program 
     and encourage their participation in the delivery of social 
     services for the poor and the needy. When a religious 
     organization is not using federal funds during the hours of a 
     federally funded program, which will be most of the time, the 
     protections of H.R. 7 do not apply, and all State and local 
     nondiscrimination in employment laws that are not tied to 
     government funding, including those that prohibit 
     discrimination based on sexual orientation, remain in effect. 
     For example, in 16 states, employers with a single employee 
     are covered by their state's civil rights law. Others set the 
     minimum number of employees between 4 and 10. Ohio's 
     employment discrimination law covers employers with 4 or more 
     employees; Oh.St. Sec. 4112.01(A)(2); Wisconsin's covers 
     employers with 1 or more employees; Wi.St. 111.32(6)(a); 
     Massachusetts' covers employers with 6 or more employees; 
     Ma.St. 151B Sec. 1(5); New York's covers employers with 4 or 
     more employees; N.Y.Exec. Sec. 292(5); Michigan's covers 
     employers with 1 or more employees; Mi.St. Sec. 37.2201(a); 
     California's covers employers with 5 or more employees; 
     Ca.Civil Sec. 51.5(a). Also, the provisions of H.R. 7 will 
     not apply whenever a State or local government chooses to 
     separate its federal funds from its non-federal funds. 
     Experience from existing charitable choice laws that contain 
     the very same provisions as H.R. 7--and which have been on 
     the books for five years--has shown that this narrow 
     statutory right will not need to be invoked very often, if 
     ever.
     Claim that the House has never previously considered the 
         details of charitable choice provisions
       Contrary to the assertion in the Dissenting Views, the 
     House has voted several times on amendments offered by Mr. 
     Scott to strip away charitable choice provisions that would 
     allow religious organizations to continue to be able to hire 
     based on religion while taking part on federal programs.
       The Fathers Count Act of 1999 contained the charitable 
     choice provisions of the Welfare Reform Act of 1996. Mr. 
     Scott offered a motion to recommit the bill with instructions 
     to remove the charitable choice provision allowing religious 
     organizations receiving funds under the designated programs 
     to make employment decisions on religious grounds. This 
     motion was defeated 176-246, by a 70 vote margin including 34 
     Democrats. The bill was then adopted by the House by a vote 
     of 328-93, by a 235 vote margin. Constitution subcommittee 
     Ranking Member Nadler voted for the bill, as did four other 
     Democratic Members of the House Judiciary Committee. Those 
     other Members were Sheila Jackson-Lee, Boucher, Delahunt, and 
     Meehan.
       The Child Support Distribution Act of 2000 also contained 
     the charitable choice provisions of the Welfare Reform Act of 
     1996. Mr. Scott's motion to recommit with instructions would 
     have removed the charitable choice provision allowing 
     participating religious organizations to make employment 
     decisions on religious grounds. The motion was defeated 175-
     249, by a 74 vote margin including 30 Decmocrats. The bill 
     was then adopted by a vote of 405-18, by a 387 vote margin. 
     Constitution Subcommittee Ranking Member Nadler voted for the 
     bill, as did eight other Democratic Members of the House 
     Judiciary Committee. Those other Members were Conyers, Watt 
     Jackson-Lee, Lofgren, Berman, Boucher, Meehan, Delahunt, 
     Wexler, Baldwin, and Weiner.
     Claims regarding statements made by President Clinton when he 
         signed previous charitable chioce laws
       The Dissenting Views incorrectly state that prior 
     charitable choice laws were enacted without the support of 
     President Clinton, and they cite President Clinton's 
     statement when he signed the re-authorization measure for the 
     Community Services Block Grants Program (``CSBG'') into law 
     that its charitable choice provisions should not be used to 
     fund `` `pervasively sectarian' organizations, as tha term 
     has been defined by the courts.'' 134 Weekly Compilation of 
     Presidential Documents 2148 (Nov. 2, 1998) (Statement on 
     Signing the Community Opportunities, Accountability, and 
     Training and Educational Services Act of 1998). However, the 
     courts have since abandoned the ``pervasively sectarian'' 
     test, and President Clinton's later statements on charitable 
     choice provisions in October and December 2000, do not rely 
     on the pervasively sectarian test, and those statements in 
     fact support H.R. 7. The Congressional Research Service 
     concluded in the December 27, 2000, Report to Congress on 
     Charitable Choice, that ``In its most recent decisions[,] the 
     [Supreme] Court appears to have abandoned the presumption 
     that some religious institutions, such as sectarian 
     elementary and secondary schools, are so pervasively 
     sectarian that they are constitutionally ineligible to 
     participate in direct public aid programs.'' CRS Report, at 
     29.
       Indeed, on October 17, 2000, President Clinton stated his 
     constitutional concerns regarding the implementation of the 
     charitable choice provisions in Substsance Abuse and Mental 
     Health Services Administration (``SAMHSA'') programs as 
     follows: ``This bill includes a provision making clear that 
     religious organizations may qualify for SAMHSA's substance 
     abuse prevention and treatment grants on the same basis as 
     other nonprofit organizations. The Department of Justice 
     advises, however, that this provision would be 
     unconstitutional to the extent that it were construed to 
     permit governmental funding of organizations that do not or 
     cannot separate their religious activities from their 
     substance abuse treatment and prevention activities that are 
     supported by SAMHSA aid. Accordingly, I construe the act as 
     forbidding the funding of such organizations and as 
     permitting Federal, State, and local governments involved in 
     disbursing SAMHSA funds to take into account the structure 
     and operations of a religious organization in determining 
     whether such an organization is constitutionally and 
     statutorily eligible to receive funding.'' Weekly Compilation 
     of Presidential Documents (Oct. 23, 2000) (Statement on 
     Signing the Children's Health Act of 2000), p. 2504. He made 
     an identical statement regarding the charitable choice 
     provisions in the Community Renewal Tax Relief Act when he 
     signed that measure into law on December 15, 2000. See White 
     House Office of the Press Secretary, ``Statement of the 
     President Upon Signing H.R. 4577, the Consolidated 
     Appropriations Act, FY 2001'' (December 22, 2000), at 8. 
     These concerns are the same as those addressed by the 
     provision in subsection (j) of the Charitable Choice Act of 
     2001, which provides that, ``No funds provided through a 
     grant or cooperative agreement to a religious organization to 
     provide assistance under any [covered] program . . . shall be 
     expended for sectarian instruction, worship, or 
     proselytization. If the religious organization offers such an 
     activity, it shall be voluntary for the individuals receiving 
     services and offered separate from the program funded under 
     subsection (c)(4).'' The required separation would not be met 
     where the government-funded program entails worship, 
     sectarian instruction, or proselytizing. Under subsection 
     (j), there are to be no practices constituting ``religious 
     indoctrination'' performed by an employee while working in a 
     Government-funded program. The same is true for volunteers.

[[Page 13788]]


     Claim that current charitable choice laws have been barely 
         implemented
       The Dissenting Views states that current charitable choice 
     laws have barely been implemented. This is untrue. Existing 
     charitable choice programs have had a significant impact on 
     social welfare. Dr. Amy Sherman of the Hudson Institute has 
     conducted the most extensive survey of existing charitable 
     choice programs. Dr. Sherman concluded that, currently, ``All 
     together, thousands of welfare recipients are benefiting from 
     services now offered through FBOs [faith-based organizations] 
     and congregations working in tandem with local and state 
     welfare agencies.'' Dr. Amy S. Sherman, ``The Growing Impact 
     of Charitable Choice: A Catalogue of New Collaborations 
     Between Government and Faith-Based Organizations in Nine 
     States'' (``Growing Impact''), The Center for Public Justice 
     Charitable Choice Tracking Project (March 2000) at 8. Dr. 
     Sherman also found that fears of aggressive evangelism by 
     publicly funded faith-based organizations have little basis 
     in fact. According to Dr. Sherman: ``[O]ut of the thousands 
     of beneficiaries engaged in programs offered by FBOs [faith-
     based organizations] collaborating with government, 
     interviewees reported only two complaints by clients who felt 
     uncomfortable with the religious organization from which they 
     received help. In both cases--in accordance with Charitable 
     Choice guidelines--the client simply opted out of the faith-
     based program and enrolled in a similar program operated by a 
     secular provider. In summary, in nearly all the examples of 
     collaboration studied, what Charitable Choice seeks to 
     accomplish is in fact being accomplished: the religious 
     integrity of the FBOs working with government is being 
     protected and the civil liberties of program beneficiaries 
     enrolled in faith-based programs are being respected. Id. at 
     11 (emphasis added). Religious groups in the nine states Dr. 
     Sherman surveyed also registered few complaints about their 
     government partners. According to Dr. Sherman, ``The vast 
     majority reported that the church-state question was a `non-
     issue,' and that they enjoyed the trust of their government 
     partners and that they had been straightforward about their 
     religious identify.'' Id.
       The success of existing charitable choice programs had led 
     the National Conference of State Legislatures (``NCSL'') to 
     support their expansion. According to Sheri Steisel, director 
     of NCSL's Human Services Committee, ``In many communities, 
     the only institutions that are in a position to provide human 
     services are faith-based organizations. Providing grants to 
     or entering into cooperative agreements with faith-based and 
     other community organizations to provide government services 
     is something that has proven effective in the states over the 
     past five years. As welfare reform continues to evolve, it is 
     important that government at all levels continues to explore 
     innovative ways to provide services to its constituents. We 
     are extremely pleased that the President is joining the 
     states in exploring these new opportunities.'' News Release, 
     ``Faith Based Initiatives Nothing New to Nation's State 
     Lawmakers'' (January 30, 2001). Some states have embraced 
     charitable choice to the tune of spending hundreds of 
     thousands of dollars or, in some cases, millions in contracts 
     with congregations and other organizations that would not 
     otherwise have been eligible. See Associated Press, Survey 
     Highlights Charitable Choice (March 19, 2001).
     Claim regarding the number of ``charitable choice'' lawsuits 
         filed
       The Dissenting Views states that there have been five 
     lawsuits filed challenging existing charitable choice laws. 
     That is not true. The Dissenting Views mention three lawsuits 
     that do not involve the terms of federal charitable choice 
     programs, and another has already been dismissed as moot:
       American Jewish Congress v. Bernick, (San Francisco County 
     Superior Court, filed January 31, 2001) (challenging a 
     program announced in August 2000 by the California Department 
     of Employment Development to fund job training offered by 
     groups that had never before contracted with government; 
     charging that only religious organizations were eligible to 
     compete). The State of California filed an affidavit in the 
     case stating no TANF funds were used in the program.
       Pedreira v. Kentucky Baptist Home for Children, Case No. -- 
     (E.D. Ky., filed April 17, 2000) (charging that the dismissal 
     of an employee, who was employed to help the Kentucky Baptist 
     Home for Children distribute state funds for the provision of 
     child care, on the grounds that her sexual orientation was 
     contrary to the employer's religious tenets violates the 
     establishment of religion clause). No federal funds were used 
     in this case, so the lawsuit does not involve a federal 
     charitable choice program.
       In Lara v. Tarrant County, 2001 WL 721076 (Tex.), the court 
     stated that ``This case involves a dispute over a religious-
     education program in a Tarrant County jail facility. Our 
     inquiry focuses on the Chaplain's Education Unit, a separate 
     unit within the Tarrant County Corrections Center, where 
     inmates can volunteer for instruction in a curriculum 
     approved by the sheriff and director of chaplaincy at the 
     jail as consistent with the sheriff's and chaplain's views of 
     Christianity.''
       American Jewish Congress and Texas Civil Rights Project v. 
     Bost, No. -- (Travis County, Texas, filed July 24, 2000) was 
     dismissed as moot on January 29, 2001.
     Claim that H.R. 7 requirement that an alternative 
         unobjectionable on religious grounds is available is an 
         ``unfunded mandate''
       The Dissenting Views state that H.R. 7's requirement that 
     an alternative be available that is unobjectionable to a 
     beneficiary on religious grounds is an ``unfunded mandate.'' 
     This is not true. As the Congressional Budget Office points 
     out in its statement on H.R. 7, ``All of [the charitable 
     choice] requirements are conditions of federal assistance, 
     and therefore, are not mandates under UMRA [the Unfunded 
     Mandates Reform Act].''
     Claim that children could be subject to ``peer pressure'' to 
         engage in proselytizing activity
       The Dissenting Views worry about children being subject to 
     ``peer pressure'' that leads them to take part in sectarian 
     activities outside a federal program.
       H.R. 7 excludes from covered programs those that include 
     ``activities carried out under Federal programs providing 
     education to children eligible to attend elementary schools 
     or secondary schools, as defined in section 14101 of the 
     Elementary and Secondary Education Act of 1965 (20 U.S.C. 
     8801),'' except it does not exclude activities ``related to 
     the prevention and treatment of juvenile delinquency and the 
     improvement of the juvenile justice system, including 
     programs funded under the Juvenile Justice and Delinquency 
     Prevention Act of 1974 (42 U.S.C. 5601 et seq.).'' Children 
     eligible to attend elementary schools or secondary schools is 
     defined in Elementary and Secondary Education Act of 1965, 20 
     U.S.C. Sec. 8801(3), as follows: ``The term `child' means any 
     person within the age limits for which the State provides 
     free public education.''
       Also, H.R. 7 makes clear that any sectarian instruction, 
     worship, or proselytizing activities must be conducted 
     separate and apart from the federally-funded program, and any 
     children taking part in any such activities would be doing so 
     under the normal doctrines of guardianship law.
     Claim that H.R. 7 allows discrimination against beneficiaries
       The Dissenting Views incorrectly states that H.R. 7 allows 
     discrimination against beneficiaries because its terms only 
     refer to a prohibition on discrimination against 
     beneficiaries on the basis of religion. First, courts will 
     interpret ``on the basis of religion'' in the same way they 
     do when interpreting the Title VII exemption, which is to 
     also include within ``religion'' an organization's beliefs 
     regarding lifestyle. Courts have held that the Sec. 702 
     exemption to Title VII applies not just when religious 
     organizations favor persons of their own denomination. 
     Rather, the cases permit them to staff on the basis of their 
     faith or doctrine. See Little v. Wuerl, 929 F.2d 944 (3d Cir. 
     1991) (Catholic school declines to renew contract of teacher 
     upon her second marriage); Hill v. Baptist Memorial Health 
     Care Corporation, 215 F.2d 618 (6th Cir. 2000) (dismissing 
     woman when she became associated with church supportive of 
     homosexual lifestyle and announced she was lesbian). H.R. 7's 
     provisions in subsection (h)(1) prevent religious 
     organizations taking part in covered programs from 
     discriminating against beneficiaries of grant programs on the 
     basis of a refusal to hold a religious belief. Therefore, a 
     religious organization could not discriminate against 
     homosexual beneficiaries of grant programs because they do 
     not adhere to a religious belief that homosexuality is a sin.
       Also, Title VII does not exempt a religious organization 
     from a discrimination claim based on sex, and Title VII 
     treats discrimination against a woman because of her 
     pregnancy as discrimination based on sex, and prohibits it. 
     The answer is the same whether the woman is married or 
     unmarried.
       Further, H.R. 7 does not preempt State or local laws 
     protecting beneficiaries from discrimination, including State 
     or local laws that prohibit discrimination against 
     homosexuals in the receipt of social services.
     Claim that beneficiaries don't have a right under H.R. 7 to 
         enforce discrimination claims in court
       The Dissenting Views state that beneficiaries facing 
     discrimination do not have a right to enforce their rights in 
     court. This is patently untrue. Any beneficiary who is 
     discriminated against may sue, in federal court, a State or 
     locality under subsection (n) and get them to stop any 
     discrimination going on in a covered program that denies a 
     beneficiary access to a service on the basis of religion, a 
     religious belief, or a refusal to hold a religious belief. A 
     beneficiary who is protected by any other State or local law 
     protecting beneficiaries in the receipt of services can 
     enforce their rights in court under those laws as well. 
     Beneficiaries are also protected against discrimination based 
     on race under Title VI.
     Claim that subsection (l) regarding indirect funding was 
         ``hidden in the fine print''
       The Dissenting Views claim that subsection (l) was hidden 
     ``in the fine print'' of the manager's amendment and ``added 
     in the

[[Page 13789]]

     middle of the night.'' Well, subsection (l) was typed on the 
     page in the same font and font size as any other provision in 
     the amendment, and the amendment was distributed the 
     afternoon before the markup, at about 3 o'clock. Subsection 
     (l) was not buried in a footnote. Indeed, the entire 
     charitable choice sections of the amendment consisted of a 
     mere 13 pages, double spaced, in standard legislative counsel 
     format. Of course, we had been working on changes, but we 
     didn't have the final draft until that afternoon and 
     therefore couldn't distribute it to our Republican Members 
     until the day before the markup too.
     Claims on indirect funding that are internally inconsistent
       The Dissenting Views are internally inconsistent on the 
     significance of indirect funding. On the one hand, on page 
     305, they state that indirect funding of religious 
     organizations is objectionable because when a religious 
     organization engages in sectarian instruction, worship, or 
     proselytizing with indirect funds, it is still doing so 
     ``with Federal funds.'' But on page 298, the Democrats say 
     it's all right for religious organizations to hire staff 
     based on religion when they receive Federal funds indirectly. 
     Apparently there is dissent even within the Dissenting Views.
     Claim that ``you can't have it both ways'' on non-
         proselytization and hiring on a religious basis
       The Dissenting Views state that the Majority ``cannot have 
     it both ways--either the Federal funds will be used for 
     religious purposes, in which case there may be a 
     justification for tolerating religious discrimination [in 
     hiring]; or the funds will be used in a non-sectarian manner, 
     in which case there is no reason to discriminate [in hiring] 
     on the basis of religion.'' This totally misses the point 
     that faith-based organizations perform secular social 
     services motivated by religious conviction. They want to 
     provide social services as a church. While the task of 
     serving the poor and the needy is ``secular'' from the 
     perspective of the government, from the viewpoint of the 
     faith-based organization and its workers it is a ministry of 
     mercy driven by faith and guided by faith. As the Reverend 
     Donna Jones of North Philadelphia stated in her testimony 
     before the House Subcommittee on the Constitution, she and 
     her fellow church members did not want to set up a separate 
     secular organization to perform good works because they were 
     motivated to perform those good works together as a church, 
     and they wanted to retain their identity as a church when 
     they provided the services.
       Justice Brennan makes this same point in his concurring 
     opinion in the Amos case, which upheld the current Title VII 
     exemption for religious organizations seeking to preserve the 
     religious character of their organization. Justice Brennan 
     recognized that many religious organizations and associations 
     engage in extensive social welfare and charitable activities, 
     such as operating soup kitchens and day care centers or 
     providing aid to the poor and the homeless. Even where the 
     content of such activities is secular--in the sense that it 
     does not include religious teaching, proselytizing, prayer or 
     ritual--he recognized that the religious organization's 
     performance of such functions is likely to be ``infused with 
     a religious purpose.'' Amos, 483 U.S. at 342 (Brennan, J., 
     concurring). He also recognized that churches and other 
     religious entities ``often regard the provision of such 
     services as a means of fulfilling religious duty and 
     providing an example of the way of life a church seeks to 
     foster.'' Id. at 344. Perhaps one of the greatest liberal 
     Justices, then, recognized that preserving the Title VII 
     exemption when religious organizations engage in social 
     services is a necessary element of religious freedom.
       Mostly importantly, faith-based organization employees and 
     volunteers can do their good works out of religious motive. 
     While the task of helping the poor and needy is ``secular'' 
     from the perspective of the Government, from the viewpoint of 
     the faith-based organization and its workers it is a ministry 
     of mercy driven by faith and guided by faith.
     Claim that H.R. 7 allows a faith-based organization to 
         discriminate based on interracial dating or marriage
       The Dissenting Views claim that H.R. 7 will permit 
     employment discrimination on the basis of interracial 
     marriage. The cited source, an NAACP memo, plays off Bob 
     Jones University v. United States, 461 U.S. 574 (1983). The 
     claim in false. Title VII prohibits racial discrimination in 
     employment by faith-based organizations. It is an act of 
     facial discrimination to fire a while person because he or 
     she marries a black person. There are no reported cases of 
     anyone ever being allowed to be discriminated against by an 
     organization due to interracial dating or marriage under 
     Title VII.
       Finally, in no way does H.R. 7 overrule the Bob Jones case. 
     The case involved a challenge to a 1971 IRS Ruling which 
     denied tax exempt status, under 501(c)(3), to any school 
     which engaged in racial discrimination, and the Bob Jones 
     University prohibited interracial dating by its students. The 
     IRS Ruling has nothing to do with federal funding. H.R. 7 
     does not affect the Supreme Court's decision in any way. The 
     IRS Ruling #71-447 continues in full force and effect.
     Claim that Justice O'Connor disapproves of direct funding of 
         religious organizations
       In Justice O'Connor's view, monetary payments are just a 
     factor to consider, not controlling. Also, please note that 
     Justice O'Connor concurred in the opinion in Bowen v. 
     Kendrick, where she joined in approving direct cash grants to 
     religious organizations, even in the particularly 
     ``sensitive'' area of teenage sexual behavior, as long as 
     there is no actual ``use of public funds to promote religious 
     doctrines.'' Bowen v. Kendrick, 487 U.S. 589, 623 (1988) 
     (O'Connor, J., concurring).

  Mr. THOMAS. Mr. Speaker, I yield myself such time as I may consume.
  This particular bill is shared in its jurisdiction between the 
Committee on the Judiciary and the Committee on Ways and Means. The 
discussion that we have been hearing is over the second title of the 
bill. There are three titles. The first title deals with charitable 
contributions by individuals and businesses. The second title is that 
which has been under discussion. The third title deals with individual 
or independence accounts, which is a demonstration program that the 
Committee on Ways and Means addressed.
  I believe, and I hope it is true, that the debate about the 
constitutionality of this bill, which I do not believe to be 
meritorious, does not apply in any way to title I and title III 
discussions. It is well-established in terms of the charitable 
contribution aspect of the Tax Code. The committee examined these 
issues through subcommittee hearings, analyzed other Members' pieces of 
legislation and of course listened to groups who are involved in 
charitable activities, and then suggested a number of proposed tax 
changes that could create a more positive environment for giving.
  The cost of the bill, over 10 years, as determined by the Joint 
Committee on Taxation, is a little over $13 billion over a ten year 
period. About half of that is directed toward creating a greater 
opportunity for those income tax payers who do not itemize their income 
taxes. These individuals are then recognized for additional tax 
contributions to charitable organizations beyond that amount already 
incorporated into the determination of the standard deduction.
  It also addresses the fact that more and more seniors, through very 
prudent decisions, have individual retirement accounts that they put 
away for their senior years, and that some individuals, while in those 
senior years, have decided that they would be able to make additional 
charitable contributions. There now is a taxable consequence for 
directing those charitable contributions, and we eliminate that for 
seniors if they choose to use a portion of their individual retirement 
account for charitable giving.
  In addition to that, there are a number of industries who are 
involved in the food services business who contribute excess food to 
charity but who certainly would be induced to do so even more if there 
was a modest recognition in the Tax Code for the contribution of those 
foodstuffs. And we will hear more about that provision as we discuss 
the rest of the provisions.
  In addition to that, there are two rather arcane sections of the bill 
in which, based upon the structure of a corporation, that corporation 
either may be able to claim the full value of appreciable property or 
it cannot. The committee decided, listening to testimony, that it did 
not make any sense to differentiate between a so-called Subchapter S 
corporation or a C corporation; that a C corporation could donate 
property and get a deduction for the full appreciated asset and 
Subchapter S corporations could not.
  These are the kinds of changes that constitute title I. As I said, 
over 10 years, there are about $13 billion. Some may say that these are 
very modest. But if we examine especially the corporate provisions on 
foodstuffs and the manner in which appreciable property could be 
donated, I believe that we will have a significant impact, far more 
than the $13 billion over the 10 years; and it could amount to as much 
as several billion dollars the first year.
  So it may be called modest, but it is a step in the right direction; 
and I do hope Members, as they assess their

[[Page 13790]]

vote on this bill, would look at the consequences of voting no, 
especially in regard to title I and to title III. These are sections of 
the bill that should be passed into law. And from my reading of the 
Constitution, section II should be as well.
  Mr. Speaker, I reserve the balance of my time.
  Mr. LEWIS of Georgia. Mr. Speaker, I yield myself such time as I may 
consume, and I want to thank the gentleman from New York (Mr. Rangel), 
the ranking member, my friend and colleague, for allowing me to control 
this part of the debate on this bill.
  Mr. Speaker, H.R. 7 is wrong for America. Allowing religious 
organizations to provide much-needed social services to disadvantaged 
people or people in need sounds like an innocent way to solve many of 
our problems. But the truth is that it allows these organizations to 
use Federal dollars, the taxpayers' dollars, to discriminate in their 
hiring. This is not right. It is not fair. It is not just.
  I have spent more than 40 years of my life fighting against 
discrimination. We have worked too long and too hard, and we cannot sit 
back and watch the work of so many people who sacrificed so much be 
undone by this bill. We have come too far in this country to go back 
now. The House should not support a bill that allows the Government to 
promote discrimination, or return to the days when religious 
intolerance was permitted. It is not the right thing to do. It is not 
the right way to go. It is not the way to use the Tax Code.
  Furthermore, this bill is an assault on the separation of church and 
State. This concept underlies our democracy. Yet H.R. 7 compels a 
citizen, through his tax dollars, to fund religious organizations. Tax 
dollars will go directly to churches, synagogues, and mosques. The wall 
between church and State must be solid. It must be strong. It has 
guided us for more than 200 years. It must not be breached for any 
reason.
  There is no doubt, Mr. Speaker, that there are many religious 
organizations and institutions providing much-needed services to our 
citizens. But as a government and as a Nation, we should not sanction 
religious discrimination or violate the separation of church and State. 
I urge my colleagues to vote against H.R. 7.
  Mr. Speaker, I reserve the balance of my time.
  Mr. THOMAS. Mr. Speaker, I yield 2 minutes to the gentleman from 
Illinois (Mr. Crane), a member of the Committee on Ways and Means.
  Prior to that, however, I ask unanimous consent that the gentleman 
from Michigan (Mr. Camp) be allowed to manage the remainder of my time.
  The SPEAKER pro tempore (Mr. LaHood). Is there objection to the 
request of the gentleman from California?
  There was no objection.
  The SPEAKER pro tempore. The gentleman from Illinois (Mr. Crane) is 
recognized for 2 minutes.
  Mr. CRANE. Mr. Speaker, I thank the gentleman for yielding me this 
time.
  We now have an excellent opportunity to advance sound tax policy and 
sound fiscal policy and sound social policy by returning to our 
Nation's historical emphasis on private activities and personal 
involvement in the well-being of our communities. Because the 
legislation we are considering contains a number of worthwhile 
provisions that I believe will help encourage people to give to 
charity, I rise today to express my support.
  Mr. Speaker, I have long been an advocate in making changes in the 
Tax Code to encourage charitable giving. For many years, I have 
championed and sponsored some of the proposals contained in the 
legislation we have before us today, including the charitable IRA 
rollover and the deduction for nonitemizers. In fact, I do not believe 
there is a Member in Congress who has fought longer and harder for 
restoring a charitable deduction for nonitemizers than me. I have 
introduced the nonitemizer deduction legislation in every Congress 
since the 99th, and it is gratifying to finally see its inclusion in 
this legislation.
  I would like to thank the gentleman from Oklahoma (Mr. Watts) for 
including my provisions in H.R. 7, and the chairman, the gentleman from 
California (Mr. Thomas), for including it in the mark. While I am 
pleased that the nonitemizer deduction was included in H.R. 7, I am 
disappointed that the limitations on the amount of the deduction were 
set so low. I hope to be able to work with the chairman in the future 
to raise the limit up to the standard deduction.
  Mr. LEWIS of Georgia. Mr. Speaker, I yield 2 minutes to the gentleman 
from New York (Mr. Rangel), the Committee on Ways and Means ranking 
member.
  Mr. RANGEL. And now, my colleagues, we get to act two of this bill. 
And as was indicated by the chairman of the committee, while the tax 
provisions may not be unconstitutional, in my view they are 
unrealistic.
  The President has seen fit to provide some $84 billion to taxpayers 
in order to encourage them to do the right thing, to make charitable 
contributions. But there was no money to do that. So the leadership in 
the Committee on Ways and Means reduced the $84 billion down to $13 
billion. Well, we cannot do much with that if we want to give 
incentives to those people who do not itemize. But in order to make 
certain that this size 12 foot fits into a size 6 shoe, they had to put 
a cap on the amount that a person could deduct.
  Now, listen to this, because if you are a charity, you are in 
trouble. The cap on the amount of money that a taxpayer who does not 
itemize can give is $25. Of course, if it is a married couple, it 
increases dramatically to $50. If an individual is in the 15 percent 
bracket, they will be able to get a return up to $3.75. So much for a 
realistic incentive.
  What we are trying to do with the $13 billion is at least to pay for 
it, and we believe that the highest income people in this country can 
afford to pay for at least the $13 billion that hopefully will be given 
to those people in our great society that are least able to take care 
of themselves. It should not be that we should have to give incentives. 
But if we have to do it, let us give those that can really work.
  Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from Ohio 
(Mr. Portman), a distinguished member of the Committee on Ways and 
Means.
  Mr. PORTMAN. I thank my colleague and rise in strong support of this 
bill because it will help Americans who are most in need.
  Over the past decade, Mr. Speaker, our Nation has enjoyed great 
prosperity, but it has not reached everybody. And the idea of this 
legislation is to try to reach people who have been left behind and to 
try to get at our very toughest social problems.
  Some, including some I have heard earlier today, think the Government 
is the answer; that the Government is going to solve these problems. 
The Government can solve some of these problems; but we know from 
experience that when it comes to helping those most in need, there is 
no questioning the great success of community groups, of faith-based 
groups, of our churches, our synagogues, our temples reaching out to 
people. And not just helping them in their immediate need, but helping 
people help themselves by transforming lives. That is what this is all 
about.
  Currently, government regulations often prohibit Federal assistance 
to support these institutions.

                              {time}  1315

  That is a fact. That is what we are trying to break down. We have 
heard a lot of discussion today about how this raises concerns.
  Opponents today have said it violates the separation of church and 
State. Not true. This bill strictly follows the boundaries that have 
been established over time by the Constitution and by numerous court 
decisions. These funds will not be used for religious purposes. These 
funds will be used to fund the good work that these groups are doing in 
our communities.
  We have heard opponents say this bill threatens the independence of 
religious organizations. That is not true. First of all, it is entirely 
voluntary. No religious organization must partner with government to 
get these funds. Second,

[[Page 13791]]

the legislation contains specific protections to prohibit the Federal 
government from interfering with the internal governance of the 
religious organizations.
  We have heard opponents say this bill discriminates in employment. 
Not true. This legislation strictly protects the exception for 
religious organizations that were first established in the Civil Rights 
Act of 1964. This exemption allows religious organizations to maintain 
their character and mission by hiring staff that share their beliefs. 
That is all. That exemption continues. Organizations still must comply 
with all Federal laws regarding discrimination.
  I would say Congress has passed four bills during my tenure here that 
President Clinton signed that have similar charitable choice 
provisions.
  Mr. LEWIS of Georgia. Mr. Speaker, I yield 5 seconds to the gentleman 
from Virginia (Mr. Scott) on intervention.
  Mr. SCOTT. Mr. Speaker, I wanted to point out that any program that 
can get funded under H.R. 7 can be funded today. There is no 
discrimination against religious organizations. Many religious 
organizations get money today.
  Mr. LEWIS of Georgia. Mr. Speaker, I yield 3 minutes to the gentleman 
from Maryland (Mr. Cardin).
  Mr. CARDIN. Mr. Speaker, President Bush has said we should fund the 
good work of the faithful but not the faith itself. I agree. 
Unfortunately, somewhere along the line the administration's proposal 
as reflected in the bill before us lost track of the goal of providing 
additional funds for faith and community groups to help needy families. 
Instead, the bill promotes government-funded religious discrimination, 
turning the President's campaign proposal on its head.
  President Bush and the authors of H.R. 7 have continually failed to 
acknowledge that religious charities can and already do receive 
government funding to address poverty and other social problems. For 
example, Catholic Charities receives two-thirds of its budget from 
Federal, State and local government. The armies of compassion are 
already marching with the Federal government's thanks, blessing and 
money.
  The bill before us does not provide a single dime in new money for 
these programs, no new resources for child care, social services, 
substance abuse treatment, housing or any other pressing need that the 
community and faith-based organizations are working to meet.
  I asked the Committee on Rules to make an amendment in order that 
would have backed up our bold talk with badly-need funds. My amendment 
would have increased resources for the child care and the social 
services block grant, two programs that are underfunded and have a long 
and successful record of supporting faith-based organizations. 
Unfortunately, the Committee on Rules rejected my amendment along with 
a number of other amendments that would strengthen this bill.
  Rather than providing real assistance to religious charities to serve 
needy families, the President's initiative focuses on allowing groups 
receiving government money to discriminate in their hiring practices. 
In fact, the proposal goes so far as to preempt State and local laws on 
prohibiting employment discrimination.
  Proponents of the H.R. 7 have said they are simply continuing a 
current exemption to the Civil Rights Act, as the gentleman from 
Cincinnati (Mr. Portman) just said, for the hiring practices of 
religious organizations.
  This exemption is a common sense provision that ensures a synagogue 
is not required to hire a Catholic as a rabbi and a Christian church is 
not required to hire a Jew as a priest. However, the bill before us 
today is talking about something very different, allowing 
discrimination in secular jobs which are directly supported with 
government dollars. Such discrimination is not only wrong, it is 
unconstitutional.
  In its decision on this specific issue, Dodge v. Salvation Army, a 
U.S. District Court ruled, and I quote, ``The effect of government 
substantially, if not exclusively, funding a position and then allowing 
an organization to choose the person to fill or maintain that position 
based on religious preference clearly has the effect of advancing 
religion and is unconstitutional.''
  Mr. Speaker, there is no disagreement in this Chamber about the 
important role that religious charities play in addressing our Nation's 
problems. However, many of us are concerned about the proposal that it 
attempts to bypass constitutional protections while simultaneously 
failing to provide the necessary resources to achieve its stated 
purpose.
  Mr. Speaker, I urge my colleagues to support the substitute that 
provides the protections and to reject the underlying bill.
  Mr. CAMP. Mr. Speaker, I yield 1\1/2\ minutes to the gentlewoman from 
Washington (Ms. Dunn).
  Ms. DUNN. Mr. Speaker, Americans in communities across the country 
give their time, their talents and their money to help worthy causes. 
We have always been a generous people. DeTocqueville noted this in the 
mid-1800s when he spoke of the unique American tradition of 
volunteerism. No matter the social or economic burdens, the average 
American takes extraordinary actions to make a difference and to help 
those in need, not because they must but because they care.
  H.R. 7 is a reflection of President Bush's vision to tap into the 
generosity of average Americans by expanding tax relief for charitable 
donations and by encouraging all organizations to participate in caring 
for those in need.
  Currently, taxpayers who itemize their returns get to take a 
charitable deduction. Unfortunately, the Tax Code leaves out the nearly 
70 percent of taxpayers who do not itemize. H.R. 7 eliminates that 
restriction. It puts a toe in the door. It rewards the taxpayer's 
charitable choice and will lead to a corresponding boost in donations.
  The bill also allows wealthy retired individuals to donate more money 
from their IRA without a tax penalty. Older people with means who want 
to help the community by donating to charity should be encouraged and 
not punished by the Tax Code.
  Lastly, we should continue developing public-private partnerships 
between the government and charitable organizations.
  Some critics claim that this is a dangerous blurring of politics and 
religion. With great respect, I disagree. I believe that by supporting 
this bill we honor our common commitment and belief in helping our 
fellow human beings.
  Mr. LEWIS of Georgia. Mr. Speaker, I yield such time as he may 
consume to the gentleman from Illinois (Mr. Davis).
  Mr. DAVIS of Illinois. Mr. Speaker, I rise in favor of the Democratic 
substitute.
  Mr. Speaker, I rise in support of the Community Solutions Act, 
Democratic Substitute, as there are thousands of communities and 
millions of people in our country who have serious problems and are in 
need of real solutions.
  I rise in support of this legislation, not because I believe that it 
is a panacea, I don't believe in one-stop cure-alls for the 
overwhelming magnitude of social, emotional, spiritual and economic 
ills which plague our society and are in need of every rational, 
logical, and proven approach that we can muster.
  And yes, Mr. Speaker, I support this legislation because I have 
faith, faith in the ability of religious institutions to provide human 
services without proselytizing. I have faith in these institutions to 
organize themselves into corporate business entities to develop 
programs, to keep records, and to manage their affairs in compliance 
with legal requirements. I also have confidence in the ability of these 
institutions to magnify the Golden Rule, ``Do unto others as you would 
have them do unto you.''
  I have listened intently to the issues raised by my colleagues who 
have expressed serious concerns about this legislation and I commend 
them for their diligence. I appreciate their concerns about charitable 
choice, ranging from discrimination to infringement on individual 
liberties.
  However, charitable choice is already a part of three federal social 
programs: (1) The Personal Responsibility and Work Opportunity 
Reconciliation Act of 1996, (2) The Community Services Block Grant Act 
of 1998, and is part

[[Page 13792]]

of the 2000 Reauthorization of funding for the Substance Abuse and 
Mental Health Services Administration. Each of these programs possess 
the overarching goal of helping those in poverty, or treating those 
suffering from chemical dependency, and the programs seem to achieve 
their purpose by providing resources in the most effective and 
efficient manner. The opponents of this legislation have expressed 
concern about the possible erosion of rights and protections of program 
participants and beneficiaries. (And rightly so, nothing could be more 
important). Therefore, I am pleased that after serious scrutiny and 
debate we have language which protects our citizens and repudiates 
employment discrimination on the basis of race, color, religion, 
national origin or sexual preference.
  The overall purpose and impact of this legislation can be good. It 
reinforces for us the fact that many people in poverty, suffer from 
some form of drug dependency. Alcohol, narcotics, and in some 
instances, even legalized prescription or over-the-counter-drugs. Many 
of these individuals have been beaten down, have virtually given up, 
and have lost the will to overcome their difficulties. It is in these 
instances and situations, Mr. Speaker, that I believe the Community 
Solutions Act can and will help the most.
  It reminds us, Mr. Speaker, that poverty, deprivation and the 
inability to cope with anxiety, frustration, homelessness, are still 
rampant in our country. Let's look, if you will, at an exoffender, 
unable to get a job, illiterate, semi-illiterate, disavowed by the 
ambiguities and contradictions of a sometimes cold, misunderstanding, 
uncaring or unwilling-to-help society. These situations create the need 
for something different; new theories, old theories reinforced, new 
approaches, new treatment modalities.
  A preacher friend of mine was fond of saying that new occasions call 
for new truths, new situations make ancient remedies uncouth. Well, I 
can tell you Mr. Speaker, the drug problem in this country is so 
overwhelming, so difficult to deal with, so pervasive . . . the Mental 
health challenges require so much, the abused, neglected and abandoned 
problems require psychiatrists, counselors, psychologists, well 
developed pharmaceuticals and all of the social health, physical health 
and professional treatment that we can muster, but I also believe that 
we could use a little Balm of Gilead to have and hold, I do believe 
that we could use a little Balm of Gilead to help heal our sin sick 
souls.
  Mr. Speaker, I am told that the cost of drug abuse to society is 
estimated at $16 billion annually, in less time than it takes to debate 
this bill, another 14 infants will be born into poverty in America, 
another 10 will be born without health insurance, and one more child 
will be neglected or abused. In fact, the number of persons in our 
country below the poverty level in 1999 was 32.3 million.
  This legislation recognizes the fact that we must commandeer and 
enlist every weapon in our arsenal to fight the war against poverty, 
crime, mental illness, drug use, and abuse as well as all of the 
maladies that are associated with these debilitating conditions. H.R. 
7, the Community Solutions Act of 2001, can lend a helping hand.
  But it cannot be allowed to help expand discrimination; therefore, I 
urge that we vote for the democratic substitute and the motion to 
recommit.
  Mr. LEWIS of Georgia. Mr. Speaker, I yield 2 minutes to the gentleman 
from Washington (Mr. McDermott).
  Mr. McDERMOTT. Mr. Speaker, whenever we pass this legislation, we 
have to ask ourselves, what is broke? What are we trying to fix?
  The gentleman from Virginia (Mr. Scott) has very clearly said any 
religious organization can accept money. In the present situation, this 
bill is not needed. Catholic Charities gets 62 percent. That equates to 
$1.4 billion a year from the Federal Government. The Salvation Army 
gets $400 million a year. United Jewish Communities, their nursing 
homes get 76 percent of their money from the Federal Government. 
Lutheran Services gets 30 percent of their $6.9 billion from the 
Federal Government. That is $2.6 billion.
  Mr. Speaker, my colleagues tell me that faith-based organizations 
need this bill to get this money. That is clearly not what we are doing 
here. We are skirting around the court case we heard about. We want to 
give the ability of religious organizations to break laws that are here 
today and mix church and State.
  The other thing that we are doing, and everybody forgets the past, 
the other side of the aisle took money from the Community Development 
Block Grant for social services 2 years ago and put it into the 
transportation budget. Now these agencies are coming and saying, we do 
not have enough money. So the other side of the aisle's answer is, 
well, we will just ask people to contribute more. We will put this 
really good incentive out there.
  Mr. Speaker, everybody who has filed the short form in this country 
now has the opportunity to give $25. If they keep records, and they 
have to keep records where they gave that $25, they then will get $3.75 
back. Now, I do not know how stupid the other side of the aisle thinks 
75 percent of the American people are. If they care, they are already 
giving $25. They will give $25 or $50, or whatever they have, but they 
are not going to do it for $3.75 that they have to wait a year to get. 
This is simply a nonsense bill.
  Mr. CAMP. Mr. Speaker, I yield 1 minute to the gentleman from 
Pennsylvania (Mr. English).
  Mr. ENGLISH. Mr. Speaker, the real issue today is, will blind 
ideology and partisan politics stand in the way of our investing in 
successful faith-based programs, in communities and families, and in 
individuals truly in need? The naysayers today are the same people who 
told us that welfare reform would not work; and look at the results.
  For years, faith-based charities have reached out, making it their 
mission to serve our communities. They work to support those who are 
struggling and have broken lives. These groups provide emergency food 
and shelter, after school care, drug treatment, welfare-to-work 
assistance, and many other services. They do it with little support 
from the Federal Government, but they get the job done.
  Because of all of that, what these groups do for our communities, I 
urge my colleagues to step back from partisan politics, step back from 
blind ideology and support the Community Solutions Act.
  Mr. Speaker, this bill will stimulate an outpouring of private giving 
to nonprofits, faith-based programs and community groups by expanding 
tax deductions and other initiatives.
  Mr. LEWIS of Georgia. Mr. Speaker, I yield 1 minute to the 
gentlewoman from Florida (Mrs. Meek).
  Mrs. MEEK of Florida. Mr. Speaker, this is an outrage. I got religion 
in a lean-to many years ago, so there is very little my colleagues can 
tell me about faith based. But they can say to me that they want to 
discriminate, and I can hear that in whatever language they speak it 
in.
  Mr. Speaker, the other side of the aisle is giving a set-aside. That 
is what my colleagues are doing. It is a set-aside with Federal funds 
for religious organizations, and it is a subterfuge. It is a set-aside 
on civil rights.
  It is well-intended. There are some good people behind this bill, and 
there were some good people behind slavery. We do not want that to 
happen again. We have to watch this.
  There is no one in this Congress that is more faith based than I am, 
so I should have every reason to support H.R. 7. But, Mr. Speaker, I am 
afraid of this bill. Some of the little churches in my community are 
going to be misguided and misrepresented; and, before we know it, they 
will be in Federal court because of some of my colleagues' foolishness 
trying to spread out and do something.
  Mr. Speaker, why are my colleagues doing this bill? There is only one 
reason. It is a subterfuge.
  Mr. CAMP. Mr. Speaker, I yield 1 minute to the gentleman from Texas 
(Mr. Sam Johnson), a distinguished member of the Committee on Ways and 
Means.
  Mr. SAM JOHNSON of Texas. Mr. Speaker, this act will actually 
increase charitable giving. I want to focus on the value of individuals 
donating funds from their IRAs to charities once they reach the age of 
70\1/2\. Permitting older Americans to roll over funds from a 
retirement account without the government getting a piece of the action 
is a major help for charities. When this bill becomes law, a $100 YMCA 
contribution will be a $100 contribution, not $85 because the IRS is 
not going to take their chunk out.

[[Page 13793]]

  Mr. Speaker, charities do remarkable things for our country. They 
change the lives and hearts of so many for the better. They feed the 
hungry, clothe the homeless, and assist the needy. Now is the time to 
help charities help those most in need. Let us help the charities keep 
more of their well-deserved dollars. It is the right thing to do.
  Mr. LEWIS of Georgia. Mr. Speaker, I yield 2 minutes to the gentleman 
from Texas (Mr. Edwards).
  Mr. EDWARDS. Mr. Speaker, the question before this House is not 
whether faith is a powerful force; it is. The question is not whether 
faith-based groups do good works; they do. The question is not even 
whether government can assist faith-based groups in their social work; 
the government does, and has so for years without this bill.
  Mr. Speaker, rather, the vote on this bill boils down to two 
fundamental questions: First, do we want citizens' tax dollars funding 
directly our churches and houses of worship? Second, is it right to 
discriminate in job hiring when using tax dollars?
  By directly funding churches and houses of worship with tax dollars, 
this bill obliterates the Bill of Rights' wall of separation between 
church and State. As all of human history has proven, entanglement 
between government and religion will lead to less religious freedom and 
more religious strife. Government funding of our churches will 
absolutely lead to government regulation of our churches, and it will 
cause religious strife as thousands of churches compete for billions of 
dollars annually.
  Mr. Speaker, to my conservative colleagues I would say this: No one 
should be more concerned than true political conservatives about the 
idea of the long arm of the Federal Government and its regulations 
extending into our sacred houses of worship.
  I would challenge any Member of this House to show me one nation 
anywhere in the world that funds its churches and has more religious 
liberty, more religious vitality or tolerance than right here in the 
United States.
  Regarding the religious discrimination subsidized by this bill, I 
would say this: No American citizen, not one, should ever have to pass 
someone else's religious test in order to qualify for a federally 
funded job. Sadly, under this bill, a church or group associated with 
Bob Jones University could put out a sign that says, ``No Catholics 
Need Apply Here'' for a federally funded job. That is wrong. This bill 
is wrong for religion, it is wrong for our churches, and it is wrong 
for our Nation.

                              {time}  1330

  Mr. CAMP. Mr. Speaker, I yield 1 minute to the gentleman from New 
York (Mr. Houghton), a distinguished member of the Committee on Ways 
and Means.
  Mr. HOUGHTON. Mr. Speaker, there are many parts of this bill. The 
part I would like to concentrate on is something which the gentleman 
from Ohio (Mr. Hall) and I have been working on for a long time. The 
basis is this: there are 31 million Americans, according to a 
Department of Agriculture report, who go to bed hungry every night; and 
12 million of those are children. One of the things this bill does is 
to encourage and gives a tax incentive to restaurants and hotels and 
people like that who have excess food, throw it away, to give it to 
these organizations, to help these people that are hungry.
  That is all it is. It is a very simple part of this bill. I think it 
is needed, and I think it is the right area.
  Mr. LEWIS of Georgia. Mr. Speaker, I am pleased to yield 1 minute to 
the gentleman from Florida (Mr. Deutsch).
  Mr. DEUTSCH. Mr. Speaker, I would take second place to no one in this 
Chamber in my faith and my belief in God. I would take second place to 
no one in this Chamber in terms of my personal commitment to supporting 
faith-based organizations. But I cannot support the bill as presently 
drafted and specifically focusing on the discrimination aspect of the 
bill.
  No one in this Chamber would ask that a Jew serve as a Catholic 
priest or a Muslim serve as a Christian minister. But what this bill 
specifically does, and we should face it and we should talk about it 
and think about the implication, is that the person serving the soup 
literally with the ladle would be allowed to be only of a certain 
faith, whatever that faith may be, with Federal funds. That is a very 
scary concept, I think, for many Americans. I ask my colleagues to 
sensitize themselves about that. We could talk around that issue. We 
could talk any way that we want. If that money is coming from my 
donation as a free will offering, and that institution chooses to do 
that, they have the ability, but not with Federal funds, not with 
taxpayer dollars.
  Mr. CAMP. Mr. Speaker, I yield 2 minutes to the gentleman from 
Wisconsin (Mr. Ryan), a distinguished member of the Committee on Ways 
and Means.
  Mr. RYAN of Wisconsin. Mr. Speaker, I think it is important as we 
listen to this debate to hear what the opponents are saying. They are 
not attacking this bill head-on. They are chewing around the edges. 
They are trying to set up roadblocks. They are trying to put new 
provisions in law with respect to the civil rights acts. What they are 
trying to do is make this program unworkable.
  We hear this comment repeated over and over: Catholic social 
services, Lutheran social services is getting all this government 
money. That is true. The large, high-financed, well-established 
churches do get Federal funding. They can afford the attorneys, they 
can afford the accountants, they can afford the largesse to afford 
these complicated tax structures to get this money.
  That is not what this bill is about. This bill is about the little 
guy. This bill is about the people who have those small, faith-based 
organizations in our inner cities, in our rural areas, who know the 
names, who know the faces, of those who are in need.
  The problem that we have had with this Federal Government, with the 
welfare state, with our approach to poverty, is that we have treated 
the superficial wounds that have plagued our population but we have not 
treated the soul. We have not treated the heart of the problem. The 
goal here is to let those small institutions of civil society 
throughout America, those faith-based organizations, who know the name 
of the person in need, who are there in the ghettos, in the streets, to 
help them, to sight their problems and to help them and to get 
assistance.
  This bill is about discrimination. We are discriminating against 
those groups from getting equal treatment of our laws to help these 
people in need. It maintains every point of our current civil rights 
laws today. There is no civil rights law that is degraded in this act 
as we move forward. We are simply removing discrimination against these 
groups.
  I urge passage of this bill. I think this bill has the potential of 
changing our culture more so than any other measure we may be 
considering here in this Congress. I think those who are on the other 
side are well-intended, but I think it is the right time that we pass 
this legislation. I urge its passage.
  Mr. LEWIS of Georgia. Mr. Speaker, I yield 1 minute to the gentleman 
from Massachusetts (Mr. Frank).
  Mr. FRANK. Mr. Speaker, if what the previous gentleman said was in 
the bill, it would be much less controversial. It does change civil 
rights laws. It preempts, as the chairman of the committee acknowledged 
in the debate, all State and local laws that many of these 
organizations do now have to abide by in their purely secular activity, 
and it allows discrimination with Federal funds for purely secular 
activities. It says, ``No, you can't discriminate based on race, but 
you can based on religion.''
  But, sadly, all too often in America, religion becomes a proxy for 
race. When Orthodox Jews get this money in Brooklyn, no blacks will be 
hired. When the Nation of Islam gets this money in Baltimore to deal 
with public housing, no whites will be hired. In fact, religion is all 
too often correlated with race. And when you say to religious groups, 
provide a purely secular activity with Federal tax dollars but in

[[Page 13794]]

employing people to serve the soup or build the homes or clean up or 
give drug treatment, hire only your own co-religionists, you are 
empowering people de facto to engage in racial segregation. That is not 
worthy of the purposes of this bill.
  Mr. LEWIS of Georgia. Mr. Speaker, I yield the balance of my time to 
the gentleman from Virginia (Mr. Scott).
  Mr. SCOTT. Mr. Speaker, I would just point out that no one is going 
to make a $25 donation because they can get $3.75 back from their taxes 
a year from now. If we want to help these organizations, we ought to 
increase the appropriations that have been cut over the past few years.
  And we are not going around the edges. The basic core part of the 
bill does not help little churches. They still have to do a grant-
writing proposal. They still have to run a program pursuant to Federal 
regulations. They still have to withstand an audit. But they cannot 
discriminate now, and this bill will allow them to discriminate in 
hiring. That is wrong. That is why the bill ought to be defeated.
  Mr. CAMP. Mr. Speaker, I yield myself the balance of my time.
  Just briefly on the tax provisions in this bill, this bill is about 
fairness. It allows those 70 percent of taxpayers who do not itemize 
ability to give charitable contributions regardless of their itemizing 
on their tax returns. IRS data shows that if they do, they will 
increase their charitable giving significantly.
  It also allows for tax-free withdrawals from IRAs and Roth IRAs. It 
also gives incentives for increased charitable contributions by 
businesses and employers in terms of food from restaurants or computer 
equipment from other businesses.
  This will be a real benefit to our communities. I urge support and 
passage of this bill.
  Mrs. MINK of Hawaii. Mr. Speaker, I rise today in very strong 
opposition to H.R. 7, the Charitable Choice Act of 2001.
  This legislation sanctions government-funded discrimination. Passage 
of this bill would allow religious organizations who receive government 
funds to hire only those individuals who prescribe to the 
organization's religious tenets. The bill would also override state and 
local civil rights laws that prohibit discrimination based on race, 
sex, national origin and sexual orientation.
  This bill proposes a major change to the basic American principle of 
separating church and state. Federal agencies would be given the 
opportunity to take all of the funding for a program and convert it 
into vouchers to religious organizations. Religious groups receiving 
this money would be able to use it for any number of purposes, 
including proselytizing.
  Supporters of this bill claim that more individuals will be helped 
because more organizations will have access to federal funds. This is 
simply not the case. H.R. 7 does not provide one additional dollar in 
federal funding for social programs. In fact, the President's budget 
actually cuts funding for the very programs that are being touted in 
this bill.
  The tax provisions of this bill are a joke. On the campaign trail, 
the President wanted to encourage greater charitable giving by 
providing $91.7 billion in tax breaks for those who donate. H.R. 7 
provides only $13.3 billion in tax incentives for charitable giving. 
Why the discrepancy? In their haste to pass a massive tax cut, the 
President and Republicans abandoned the charitable donation proposals.
  I urge all members to vote against this harmful legislation.
  Mr. ETHERIDGE. Mr. Speaker, I rise in strong opposition to H.R. 7. As 
an active member of my local church, I strongly support the good work 
performed by faith-based charities across this country. But there is a 
right way and a wrong way to provide government support for those 
efforts. Unfortunately, this bill represents the wrong way.
  H.R. 7 will allow religious organizations to discriminate in hiring 
on the basis of race, color, sex, national origin and sexual 
orientation while using federal tax dollars collected from all 
Americans. This would be a giant step backwards for civil rights. This 
legislation also subverts First Amendment safeguards by allowing 
individuals to use vouchers in faith-based programs. Finally, sending 
federal tax dollars directly to our houses of worship is 
unconstitutional, and will inevitably lead to government regulation of 
religion.
  Mr. Speaker, I am proud to support the Democratic Alternative to H.R. 
7. The Democratic Substitute will prevent the charitable choice 
provisions in H.R. 7 from preempting or superseding state or local 
civil rights laws. The Substitute will also prohibit the use of 
vouchers and other indirect aid by religious organizations. Mr. 
Speaker, the Democratic Alternative represents the right way to 
establish partnerships between faith-based organizations and 
government. We must never use the American people's money to condone 
discrimination.
  Faith- and community-based organizations have always taken the lead 
in combating the hardships facing families and communities, and I 
strongly support the work they have done and will continue to do. But 
H.R. 7 is the wrong way to show our support for these important 
organizations. I urge my colleagues to oppose H.R. 7 and to support the 
Rangel Substitute.
  In addition, Mr. Speaker, I want to submit for the Record a list of 
some of the distinguished organizations that have contacted me to 
express opposition to H.R. 7. This list is large and broad-based and 
demonstrates the divisive nature of this bill in its present form. I am 
hopeful Congress will come together across party lines to pass a common 
sense compromise to support faith-based charities.
  Here is a partial list of organizations that oppose H.R. 7:

       The Baptist Joint Committee
       The United Methodist Church, General Board of Church and 
     Society
       The Presbyterian Church, USA
       American Baptist Churches, USA
       The Episcopal Church, USA
       The American Jewish Committee
       The Anti-Defamation League
       The American Association of School Administrators
       Hadassah, The Women's Zionist Organization of America
       The American Association of University Women
       The American Federation of Government Employees, AFL-CIO 
     (AFGE)
       The American Federation of State, County and Municipal 
     Employees (AFSCME)
       The American Federation of Teachers
       The National Coalition for Public Education
       The Jewish Council on Public Affairs
       The National Association for the Advancement of Colored 
     People (NAACP)
       The National Council of Jewish Women
       The National Education Association (NEA)
       The National Parent Teacher Association (PTA)
       Service Employees International Union, AFL-CIO (SEIU)
       The Interfaith Alliance
  Mr. KLECZKA. Mr. Speaker, the issue before the House of 
Representatives today is not whether faith is a positive force or 
whether churches and synagogues do good work. I think it's safe to 
assume we all agree that religious organizations play a significant 
role in providing needed social-welfare programs in every community 
across the United States.
  Religious groups have been doing charity work for years, and they 
have been doing so without the necessity of the legislation before us 
today. What is of issue, however, is whether Congress should sanction 
government-funded discrimination and remove the wall between the church 
and state.
  By permitting religious groups to discriminate in hiring on the basis 
of religion, the bill before us today violates the principle of equal 
protection and endorses taxpayer-funded discrimination. Under the bill, 
for instance, a religious group can refuse to hire a single mother, a 
woman using birth control for family planning, or even a person of a 
different race, if their ``status'' violates the doctrine of that 
religion. I can support religious institutions using their private 
funds to hire a rabbi or a priest to lead their congregations in 
worship, but I do not condone allowing religious groups to discriminate 
in hiring when receiving public funds. No American should have to pass 
a religious test to qualify for a federally-funded job.
  Equally disturbing, this legislation does not provide adequate 
safeguards and essentially obliterates the wall separating church and 
state, a core principle of our nation for over 200 years. H.R. 7 
introduces a new feature into our social-welfare system that allows 
federal agencies to convert more than $47 billion in federal funds into 
vouchers to religious organizations. These vouchers could be used for 
religious purposes, including the funding of sectarian worship, 
instruction, and proselytization.
  As a strong supporter of faith-based organizations, I cannot support 
this flawed legislation. The Rangel/Conyers Substitute, which includes 
anti-discrimination protections and safeguards between church and state 
received my strong endorsement and vote. This Substitute removed from 
the base bill the provision that permits indirect aid that could be 
used for religious purposes and clearly stated that religious programs 
could not engage in sectarian worship, instruction, or proselytization 
at the same time and place as the government-funded program.

[[Page 13795]]

  It is my hope the senate makes wiser choices during its consideration 
of this legislation, and the bill's shortcomings are addressed during 
conference committee. Hopefully, by that point, the measure will be 
corrected so that I may lend it my support.
  Mr. BENTSEN. Mr. Speaker, I rise in opposition to H.R. 7, the 
community Solutions Act, well-intentioned legislation that would 
undermine two of our nation's most fundamental constitutional 
principles--equal protection and the separation of church and state. 
Mr. Speaker, I agree that the federal government should encourage non-
profits including religious organizations to help in meeting our 
nation's social welfare needs, but not at the expense of the 
constitutional principals that have served this nation so well.
  H.R. 7 would broaden the use of federal funds made available to 
religious groups than is currently permitted and allow such groups to 
make their religious tenets central in the provision of those services. 
Specifically, the bill prohibits the federal government, or state and 
local governments using covered federal funds, from denying religious 
organizations in the awarding of grants on the basis of the 
organizations' religious character. The bill expands previously enacted 
``charitable choice'' laws to include eight new programs that relate 
to: juvenile justice, crime, housing, job training, domestic violence, 
hunger relief, senior services and education.
  The bill also contains $13 billion in tax reductions over the next 
decade designed to encourage charitable giving. Given the new budgetary 
constraints after the passage of the President's $1.35 trillion tax cut 
package, the Ways and Means Committee approved just 15% of charitable 
giving tax incentives provided under the President's plan. H.R. 7 would 
permit taxpayers who do not itemize their taxes to deduct up to $25 in 
charitable contributions a year, rising to $100 in 2010. Under this 
bill, non-itemizers in the 15 percent tax bracket would get anemic tax 
benefit of $3.75 a year if they contributed the maximum, rising to $15 
a year. I would also note that the bill does not provide one additional 
dollar in federal funding for charitable-choice programs. In fact, the 
President's budget, in fact, slashes funding for some of the very 
programs promoted in the bill.
  Mr. Speaker, I supported the ``charitable choice'' provisions of the 
1996 Welfare Reform Act which allowed religious organizations to 
qualify for federal funds for social service programs, without being 
forced to eliminate or soften their religious content. Such previously-
enacted charitable choice laws strictly prohibited these faith-based 
social-service providers from proselytizing in their federally-funded 
programs. Today, we have before us legislation to give effect to the 
President's ``faith-based initiative'' by allowing religious 
organizations to proselytize or undertake other religious activity with 
federal funds when such activities are funded indirectly through 
vouchers.
  This approach, while well-meaning, runs afoul of the First Amendment 
requirement of separation of church and state and would open the door 
to employment discrimination in federally-funded programs. Under H.R. 
7, groups would be permitted to make hiring decisions based on 
religion, without regard to state or local laws on the subject. Under 
the bill, for instance, an organization could discriminate against 
someone involved in an interracial relationship or second marriage, if 
that status violated the doctrine of the religion. I can see no 
legitimate justification for permitting providers of government-funded 
secular services to discriminate in this manner. The content of a 
person's heart and a desire to serve the community should be the only 
requisites for undertaking good works. Taxpayers should not be required 
to support discrimination.
  The fact that some of the most vocal opponents of this bill are 
members of the clergy must not be overlooked. The bill does not provide 
adequate safeguards regarding the separation of church and state and 
may pave the way for excessive entanglement between government and 
religion. Churches and religious organizations that embrace this 
program should consider that with taxpayer dollars comes a fiduciary 
responsible in the form of oversight and what can be deemed intrusions 
into the affairs of such churches and other faith-based groups. Just 
this week, I heard from a constituent, a political science professor 
from Rice University who is active in his church, who urged me to vote 
against H.R. 7 and said it would ``strike a blow to religious autonomy 
in America, allowing government auditors and other bureaucrats into the 
inner sanctum of religious organizations--including, ironically, many 
of the churches who favor the bill.'' I couldn't have said it better 
myself.
  Mr. Speaker, I also oppose the substitute, offered by Reps. Rangel 
and Conyers, because I believe that the passage of new legislation is 
not necessary. For decades, government-funded partnerships with 
religiously-affiliated organizations such as Catholic Charities, Jewish 
Community Federations, and Lutheran Social Services have helped to 
combat poverty and have provided housing, education, and health care 
services for those in need. These successful partnerships have provided 
excellent service to communities largely unburdened by concerns over 
bureaucratic entanglements between government and religion. In fact, 
many smaller churches in my district provide a multitude of social 
services to the community with federal grant money and tax deductible 
contributions. The existing prohibition on proselytizing has not 
curtailed their desire to serve and fulfill their missions.
  Under the present system, any church or religious institution can 
establish a 501(C)(3) and apply for federal funds. Under Sec. 501(c)(3) 
of the Internal Revenue Code, ``charitable organizations'' set up by 
organizations such as the Red Cross, Catholic Charities USA or small 
churches and religious organizations greatly benefit from the ability 
to receive tax-deductible charitable contributions and are generally 
exempted from being taxed. Today, religiously-affiliated private 
entities receive hundreds of millions of dollars for their social 
service works. Mr. Speaker, we must all remember that religious 
institutions are out there, every day, making a difference in the lives 
of their communities and, with or without passage of this measure, will 
continue to contribute to the social fabric of this nation.
  Mr. Speaker, while I strongly believe that religious organizations 
play an important role in providing needed social-welfare programs, I 
cannot sanction this bill which would put the federal government in the 
position of funding discrimination picking and choosing among the right 
religions and breaking down the separation of church and state.
  Mr. STARK. Mr. Speaker, I rise today in opposition of H.R. 7, the 
Community Solutions Act. With 12 million children living in poverty, it 
is clear that Congress needs to do more to lift them out of their 
desperate situation. However, H.R. 7 does nothing to achieve this goal. 
It provides only a minimal tax deduction to encourage people to 
contribute to charitable organizations that provide social services to 
the poor. The bill does not provide any new government funding for 
faith-based organizations to carry out their missions to provide social 
services and reduce poverty.
  If the Republicans truly cared about lifting children and families 
out of poverty, their budget would reflect significant increases in 
funding for social service programs. Instead, the Bush budget increases 
spending for the Administration for Children and Families by only 
2.9%--far less than even inflation.
  This bill is purported to be necessary to allow religious 
organizations to receive federal funds to provide services for those in 
need. In fact, many religious organizations qualify for such funds 
today. The only requirement is that they separate their duties as 
religious entities from their social service programs. For example, 
Catholic Charities received $1.4 billion in 1999 in government 
funding--totaling two-thirds of their annual budget.
  Let's be real. This bill has nothing to do with increasing social 
services funding.
  The most significant achievement of H.R. 7 is to allow federally 
funded faith-based organizations to circumvent state and local anti-
discrimination laws.
  Last week, the Bush administration announced that they would not 
pursue an administrative rule that would allow faith-based 
organizations to pre-exempt state laws prohibiting discrimination based 
on sexual orientation. Although some may believe that action resolved 
the issue, it did not. H.R. 7 explicitly allows faith-based 
organizations to pre-empt state law and state law and discriminate in 
their hiring practices.
  This provision is worse than the Administration's proposed regulation 
because it allows faith-based organizations to not only discriminate 
against someone based on their sexual orientation, but for many other 
reasons such as being unmarried or pregnant to name a couple. However, 
this is only the tip of the iceberg.
  Religious organizations have an exemption under the Civil rights Act 
that allows them to discriminate in the hiring of individuals that 
perform their religious work. However, that exemption does not 
currently allow them to discriminate in the hiring of individuals that 
carry out their federally funded social service programs. H.R. 7 
extends the Civil Rights exemption to allow faith-based organizations 
to discriminate in the hiring of individuals that deliver their 
federally funded social service programs.
  Again, the only real change in this bill from current law is to allow 
faith-based organizations to discriminate and to proselytize while

[[Page 13796]]

receiving government funds. This bill is strong on promoting 
discrimination and weak on lifting families out of poverty.
  By passing H.R. 7, the United States House of Representatives is 
sending the message that Congress endorses government-sponsored 
discrimination. I believe that this message desecrates the memory of 
the men, women and children who lost and risked their lives to bring 
equal rights to all who live in this country. Instead of undermining 
the memory of these courageous civil rights advocates, Congress should 
be using their effort as a source of inspiration to continue and move 
forward the battle to ensure that all who live in this nation obtain 
true equal rights.
  It is time that our nations' leaders stood together to protect the 
advancements made in civil rights and create a nation that cherishes 
tolerance for all groups. To truly help the poor, Congress should 
ensure that they have access to health care, child care and other 
social services. None of these measures require undermining this 
nation's civil rights laws.
  Finally, I hope this bill is no indication that Bush Administration 
wants to dismantle our existing social safety net and turn it over to 
religious organizations and other private charities. A recent Ewing 
Marion Kauffman Foundation study indicates that charities--even with 
the benefits of the tax cuts in this bill--would not be able to replace 
the federal government's commitment to providing social services. 
According to their study, adding up the current assets of all the 
foundations in America would only replace federal government funding 
for social services for 74 days. The Bush Administration may want to 
shift responsibility to religious organizations and private charities, 
but they can't do the job alone.
  Moreover, if Congress decides to allocate more government funds to 
increase faith-based organizations role in providing social services, 
we should make sure that we are getting our taxpayers' money worth. At 
a recent Brookings Institute conference recently on child care, Mary 
Bogle, a child care expert, cited several studies that reported that 
child care provided by churches was among the lowest quality in the 
country. These child care centers had higher staff-to-child ratios, 
lower levels of trained and educated teachers and less educated 
administrators than other non profit child care centers.
  I for one do not want to be telling my constituents several years 
down the road that Congress spent money on social services based on 
whether they are religious rather than on their ability to provide 
quality services.
  Please join me in opposing H.R. 7 and lets work together to seriously 
tackle the problem of poverty without legalizing government-sponsored 
discrimination.
  Mr. BLUMENAUER. Mr. Speaker, I rise to oppose H.R. 7, the Charitable 
Choice Act of 2001. I support the work that many religious charities do 
on behalf of those in the need in my community and across the nations. 
Currently, any church or religious organization can establish a charity 
and apply for federal funds. This legislation provides no additional 
money for those organizations. It simply would allow religious 
organizations that wish to discriminate to apply or federal funds. It 
would allow the rollback of many of the basic civil rights protections 
for all Americans currently enjoy. Allowing religious organization to 
discriminate in hiring on the basis of religion, sexual preference, and 
race is wrong.
  Short-circuiting the current system also opens the door to federal 
interference in religious activities, which has prompted the opposition 
of many religious organizations and leaders. The litany of groups 
opposing this bill is long and contains the names of some of the most 
distinguished charitable and religious groups in the country.
  Another unfortunate aspect is the failure to meaningfully assist the 
charitable contributions of low income Americans unable to itemize on 
income tax returns. As a result of other tax relief for people who need 
help the least, we are unable to assist those who are unduly penalized.
  Given the flaws in this legislation, I oppose it, and urge my 
colleagues to do likewise.
  Mr. WEXLER. Mr. Speaker, I rise today in opposition to the Community 
Solutions Act of 2001.
  In a 1780 letter, Benjamin Franklin wrote, ``When religion is good, I 
conceive that it will support itself; and, when it cannot support 
itself, and G-d does not take care to support, so that its professors 
are obliged to call for the help of the civil power, it is a sign, I 
apprehend, of its being a bad one.''
  Forty-three years later, James Madison wrote in a letter, ``Religion 
is essentially distinct from civil government and exempt from its 
cognizance . . . a connection between them is injurious to both.''
  Franklin and Madison's observations are still poignant, and relevant 
to today's debate on President Bush's social services plan. I join with 
many Americans who have great concerns about the provisions of his plan 
which punch holes in the firewall between places of worship and the 
government.
  A number of religious organizations already run very valuable social 
service programs, and Americans appreciate the significant 
contributions that these religious groups make to the well being of our 
communities. However, this proposed faith-based legislation 
unnecessarily entwines church and state in a financial relationship 
under the mantra of improving social services.
  The Founding Fathers understood that both church and state play 
important roles in the lives of Americans, but neither may function 
appropriately under our Constitution if they are heavily intertwined. 
The separation of church and state actually protects each from the 
other. Many Americans express concern over the potential for a 
disproportionate level of influence of religious doctrine upon the 
making of public policy. However, places of worship should also be 
concerned about interference from government. It would be a travesty if 
a financial relationship between the two became so significant that 
religious decisions are affected by concerns over public funding.
  Let us be straight-forward about the crux of this debate: The 
question is not whether churches, synagogues or mosques should provide 
social services. Of course they should. The question is whether 
religious organizations should abide by federal civil rights laws if 
they take federal money. The answer again is of course they should.
  Proponents of the President's plan call for the removal of 
``barriers'' which religious charities face when attempting to secure 
public funding for their social service programs. These so-called 
``barriers'' are America's civil rights laws, and we must not 
compromise them. If a privately-funded place of worship directs its 
employees to follow its religious dictates, then it is within its 
rights to do so. However, if it uses public funds, then it should not 
be allowed to discriminate against anyone.
  While we should always look for better ways to provide social 
services, I do not believe that the separation between church and state 
need to be dismantled to do so. I ask that you vote against the bill.
  Ms. McCOLLUM. Mr. Speaker, today I will vote against H.R. 7, the 
Community Solutions Act, because I strongly support the constitutional 
separation of church and state, and I believe this bill infringes on 
that separation. The bill would threaten religious autonomy, as 
religious organizations would be subject to government regulations in 
exchange for federal funds. The truth is that the federal government 
can already fund faith-based charities if they meet the following three 
conditions: they establish a 501(c)(3) tax-exempt charitable 
organization, they agree not to proselytize using tax dollars, and they 
cannot discriminate in job hiring. H.R. 7 would remove these important 
protections. I also believe this bill allows federal intrusion on state 
and local jurisdiction, as faith-based groups would not have to adhere 
to Minnesota's comprehensive state and local nondiscrimination laws.
  I recognize the very important contributions of faith-based 
organizations to our communities and families. Some successful faith-
based organizations in Minnesota such as Church Charities, Lutheran 
Social Services, and Jewish Family and Children's Services have 
developed a reputation for providing quality services without religious 
discrimination. These organizations certainly complement many 
governmental social services and I would not want to see their roles 
diminished in the lives of so many Minnesotans. This bill has the 
potential to interfere in the historic working relationships between 
faith-based organizations, the government, and the people they so 
generously serve.
  Mrs. CHRISTENSEN. Mr. Speaker, I must join my colleagues who have 
spoken in opposition to H.R. 7.
  Never can I or will I ever support a piece of legislation which would 
allow and therefore support discrimination in any way shape or form.
  I am proud to be a member of the Congressional Black Caucus which 
does not oppose, but strongly supports, making funding available to 
support our religious organization's work in the world, but voted 
unanimously to oppose the egregious parts of the bill which allow the 
provisions of the hard fought for civil rights laws to be sidestepped.
  As an African-American and a Christian, I must also say that I am 
insulted and deeply resent the way the administration has specifically 
courted the Black Church with this initiative because H.R. 7 falsely 
advertises the initiative as new, and also as funded, and it most 
agregiously, allows discrimination.
  Mr. Speaker, I am and have always been a strong supporter of the work 
that religious

[[Page 13797]]

groups such as Lutheran Social Services, Catholic Social Services, the 
Inter-Faith Coalition, the Moravian conference, The Seventh Day 
Adventist Church and others have been doing.
  In addition to these concerns, I am also very troubled by the fact 
that H.R. 7 contains a provision that allows any federal agency to 
convert their entire services programs into a voucher in order to 
circumvent protections against discrimination that are provided for 
under federal law.
  This most uncharitable bill goes beyond the question of violating the 
principle of separation of Church and State, first by allowing 
discrimination and then by purporting to provide funds for religious 
and other organizations when it doesn't actually provide any new 
dollars in the bill at all. Neither should they now, that the lack of 
funding is uncovered, be allowed to raid the Medicare Trust Fund.
  As an African-American and a Christian, I must also say that I am 
insulted and deeply resent the way the administration has specifically 
courted the Black Church with this initiative because of the 
aforementioned aspects of H.R. 7 to which I have objected.
  Mr. Speaker, I am and have always been a strong supporter of the work 
that religious groups in my and other communities do. Federal support 
of Faith based organizations is not new. In my district, groups such as 
Lutheran Social Services, Catholic Social Services, the Inter-Faith 
Coalition, the Moravian conference, The Seventh Day Adventist Church 
and others have been doing a tremendous job serving the needy in Virgin 
Islanders for many years now and will continue to do so with or without 
this bill.
  Where there efforts are hampered is through the recent tax cut which 
will drastically cut funding from the programs that help those in our 
communities who need an extra hand up--in education, in health care 
services, in housing, in economic opportunity, and in programs that 
would promote an improved quality of life.
  And it just astounds me that while the Administration is pushing this 
initiative ``as'' one of its highest priorities, in the case of the CBC 
Minority AIDS Initiative, the Department has decided that Faith Based 
Organizations can no longer be targeted for funding.
  I support the Democratic Substitute and urge my colleagues to do the 
same. This better bill would prohibit employment discrimination and the 
setting aside of state and local civil right laws and delete the 
sweeping new language in the bill which would permit federal agencies 
to convert more than $47 billion in current government programs into 
private vouchers.
  Mr. GILMAN. Mr. Speaker, faith-based organizations play a vital role 
in our communities and work tirelessly towards effectively meeting the 
needs of our communities. These organizations cover all religions and 
range from family counseling, to community development, to homeless and 
battered woman's shelters, to drug-treatment and rehabilitation 
programs and to saving our ``at-risk'' children. In many cases, they 
are the only organizations that have taken the initiative to provide a 
much needed community service.
  In principle, I support what H.R. 7, the Community Solutions Act 
seeks to accomplish. However, during exhaustive conversations with my 
constituents, and a variety of organizations, we must address the 
following issues before the bill is viable and fair:
  H.R. 7 gives the executive branch broad discretion to fundamentally 
change the structure of a plethora of federal social service programs 
totaling some 47 billion dollars through the use of vouchers.This 
voucher program allows any Cabinet Secretary to convert any of the 
covered programs currently funded through grants or direct funding to a 
voucher program, without Congressional approval. The risk of these 
voucher programs is that once a program becomes a voucher program, the 
funds become indirect funds, which could require participants in 
voucher funded programs to engage in worship or to conform to the 
religious beliefs of the religious organizations providing the service.
  H.R. 7, would permit a variety of organizations, including for-profit 
entities, to receive program vouchers. Our concern is that this could 
jeopardize the financial stability of non-profit agencies by replacing 
the more reliable grant and contracts funding they currently receive 
with unpredictable voucher funding.
  Mr. speaker, Charitable Choice fails to protect the beneficiaries of 
funded programs from proselytization, in that H.R. 7 fails to include 
meaningful safeguards for the beneficiaries while they are participants 
in publicly funded programs. H.R. 7, places the burden of objecting to 
the religious nature of the program up to the client, after he or she 
has sought assistance. Only after the injury suffered through unwanted 
proselyting, that the government is required to provide an alternative 
program. We should fund secular alternatives in advance, not when a 
lawsuit is brought challenging the religious nature of the program.
  Mr. Speaker, H.R. 7, mandates that those faith based entities 
utilizing federal funds are to be held to the federal civil rights 
standard that allows religious organizations to discriminate against 
those on the basis of religion. In many cases state law provides 
additional civil rights protections regarding sexual orientation, 
physical and mental disabilities, genetics, and a host of other 
protections. To allow federal law to supersede state law on this 
important issue, not only creates the potential for constitutional 
states rights challenges, but does nothing to advance civil rights 
protections in our nation.
  While no one can dispute the great work and the important services 
that faith-based organizations provide to our communities, the issues 
that I set forth and those raised by my colleagues must be addressed 
before this bill is fair, balanced and provides the necessary 
safeguards for all.
  Accordingly, I look forward to working with our Conferees in the 
conference on this bill in order to more clearly address these issues.
  Mr. PAUL. Mr. Speaker, no one familiar with the history of the past 
century can doubt that private charities, particularly those maintained 
by persons motivated by their faith to perform charitable acts, are 
more effective in addressing social needs than federal programs. 
Therefore, the sponsors of HR 7, the Community Solutions Act, are 
correct to believe that expanding the role of voluntary, religious-
based organizations will benefit society. However, this noble goal will 
not be accomplished by providing federal taxpayer funds to these 
organizations. Instead, federal funding will transform these 
organizations into adjuncts of the federal government and reduce 
voluntary giving on the part of the people. In so doing, HR 7 will 
transform the majority of private charities into carbon copies of 
failed federal welfare programs.
  Providing federal funds to religious organizations gives the 
organizations an incentive to make obedience to federal bureaucrats 
their number-one priority. Religious entities may even change the 
religious character of their programs in order to please their new 
federal paymaster. Faith-based organizations may find federal funding 
diminishes their private support as people who currently voluntarily 
support religious organizations assume they ``gave at the (tax) 
office'' and will thus reduce their levels of private giving. Thus, 
religious organizations will become increasingly dependent on federal 
funds for support. Since ``he who pays the piper calls the tune'' 
federal bureaucrats and Congress will then control the content of 
``faith-based'' programs.
  Those who dismiss these concerns should consider that HR 7 explicitly 
forbids proselytizing in ``faith-based' programs receiving funds 
directly from the federal government. Religious organizations will not 
have to remove religious income from their premises in order to receive 
federal funds. However, I fail to see the point in allowing a Catholic 
soup kitchen to hang a crucifix on its wall or a Jewish day care center 
to hang a Star of David on its door if federal law forbids believers 
from explaining the meaning of those symbols to persons receiving 
assistance. Furthermore, proselytizing is what is at the very heart of 
the effectiveness of many of these programs!
  H.R. 7 also imposes new paperwork and audit requirements on religious 
organizations, thus diverting resources away from fulfilling the 
charitable mission. Supporters of HR 7 point out that any organization 
that finds the conditions imposed by the federal government too onerous 
does not have to accept federal grants. It is true no charity has to 
accept federal grants. It is true no charity has to accept federal 
funds, but a significant number will accept federal funds in exchange 
for federal restrictions on their programs, especially since the 
restrictions will appear ``reasonable'' during the program's first few 
years. Of course, history shows that Congress and the federal 
bureaucracy cannot resist imposing new mandates on recipients of 
federal money. For example, since the passage of the Higher Education 
Act the federal government has gradually assumed control over almost 
every aspect of campus life.
  Just as bad money drives out good, government-funded charities will 
overshadow government charities that remain independent of federal 
funding. After all, a federally-funded charity has the government's 
stamp of approval and also does not have to devote resources to 
appealing to the consciences of parishioners for donations. Instead, 
government-funded charities can rely on forced contributions from the 
taxpayers. Those who dismiss this as unlikely to occur should remember 
that there are only three institutions of higher education today that 
do not accept federal funds and thus do not have to obey federal 
regulations.

[[Page 13798]]

  We have seen how federal funding corrupts charity in our time. Since 
the Great Society, many organizations which once were devoted to 
helping the poor have instead become lobbyists for ever-expanding 
government, since a bigger welfare state means more power for their 
organizations. Furthermore, many charitable organizations have devoted 
resources to partisan politics as part of coalitions dedicated to 
expanding federal control over the American people.
  Federally-funded social welfare organizations are inevitably less 
effective than their counterparts because federal funding changes the 
incentives of participants in these organizations. Voluntary charities 
promote self-reliance, while government welfare programs foster 
dependency. In fact, it is in the self-interests of the bureaucrats and 
politicians who control the welfare state to encourage dependency. 
After all, when a private organization moves a person off welfare, the 
organization has fulfilled its mission and proved its worth to donors. 
In contrast, when people leave government welfare programs, they have 
deprived federal bureaucrats of power and of a justification for a 
larger amount of taxpayer funding.
  Accepting federal funds will corrupt religious institutions in a 
fundamental manner. Religious institutions provide charity services 
because they are commanded to by their faith. However, when religious 
organizations accept federal funding promoting the faith may take a 
back seat to fulfilling the secular goals of politicians and 
bureaucrats.
  Some supporters of this measure have attempted to invoke the legacy 
of the founding fathers in support of this legislation. Of course, the 
founders recognized the importance of religion in a free society, but 
not as an adjunct of the state. Instead, the founders hoped a religious 
people would resist any attempts by the state to encroach on the proper 
social authority of the church. The Founding Fathers would have been 
horrified by any proposal to put churches on the federal dole, as this 
threatens liberty by subordinating churches to the state.
  Obviously, making religious institutions dependent on federal funds 
(and subject to federal regulations) violates the spirit, if not the 
letter, of the first amendment. Critics of this legislation are also 
correct to point out that this bill violates the first amendment by 
forcing taxpayers to subsidize religious organizations whose principles 
they do not believe. However, many of these critics are inconsistent in 
that they support using the taxing power to force religious citizens to 
subsidize secular organizations.
  The primary issue both sides of this debate are avoiding is the 
constitutionality of the welfare state. Nowhere in the Constitution is 
the federal government given the power to level excessive taxes on one 
group of citizens for the benefit of another group of citizens. Many of 
the founders would have been horrified to see modern politicians define 
compassion as giving away other people's money stolen through 
confiscatory taxation. After all, the words of the famous essay by 
former Congressman Davy Crockett, that money is ``Not Yours to Give.''
  Instead of expanding the unconstitutional welfare state, Congress 
should focus on returning control over welfare to the American people. 
As Marvin Olaksy, the ``godfather of compassionate conservatism,'' and 
others have amply documented, before they were crowded out by federal 
programs, private charities did an exemplary job at providing necessary 
assistance to those in need. These charities not only met the material 
needs of those in poverty but helped break many of the bad habits, such 
as alcoholism, taught them ``marketable'' skills or otherwise engaged 
them in productive activity, and helped them move up the economic 
ladder.
  Therefore, it is clear that instead of expanding the unconstitutional 
welfare state, Congress should return control over charitable giving to 
the American people by reducing the tax burden. This is why I strongly 
support the tax cut provisions of H.R. 7, and would enthusiastically 
support them if they were brought before the House as a stand alone 
bill. I also proposed a substitute amendment which would have given 
every taxpayer in America a $5,000 tax credit for contributions to 
social services organizations which serve lower-income people. Allowing 
people to use more of their own money promotes effective charity by 
ensuring that charities remain true to their core mission. After all, 
individual donors will likely limit their support to those groups with 
a proven track record of helping the poor, whereas government agencies 
may support organizations more effective at complying with federal 
regulations or acquiring political influence than actually serving the 
needy.
  Many prominent defenders of the free society and advocates of 
increasing the role of faith-based institutions in providing services 
to the needy have also expressed skepticism regarding giving federal 
money to religious organizations, including the Reverend Pat Robinson, 
the Reverend Jerry Falwell, Star Parker, Founder and President of the 
Coalition for Urban Renewal (CURE), Father Robert Sirico, President of 
the Action Institute for Religious Liberty, Michael Tanner, Director of 
Health and Welfare studies at the CATO Institute, and Lew Rockwell, 
founder and president of the Ludwig Von Misses Institute. Even Marvin 
Olaksy, the above-referenced ``godfather of compassionate 
conservatism,'' has expressed skepticism regarding this proposal.
  In conclusion, Mr. Speaker, because H.R. 7 extends the reach of the 
immoral, unconstitutional welfare state and thus threatens the autonomy 
and the effectiveness of the very faith-based charities it claims to 
help, I urge my colleagues to reject it. Instead, I hope my colleagues 
will join me in supporting a constitutional and compassionate agenda of 
returning control over charity to the American people through large tax 
cuts and tax credits.
  Ms. KILPATRICK. Mr. Speaker, today I rise in opposition to the 
underlying bill and in support of the Conyers Substitute. First, and 
foremost I must make known my profound belief in the healing ability of 
faith. The Church has always played an important role in my life and in 
many ways was a catalyst to my choice to pursue a political career. 
However, this is not a debate about government versus religion. 
Religious organizations play an important role in our society and no 
matter what we do on the floor today they will continue to do so. I 
assure you I will continue to support them.


                  Already have the ability to compete

  There are many who have taken the floor and allege that Faith Based 
organizations are discriminated against when competing for federal 
funds. I question this statement. I have come to believe that under 
current law, Faith Based organizations can in fact compete if they take 
certain steps under the law. They must create a separate 501(C)(3) 
organization to prevent the mixing of church and secular activities. In 
my mind this insulates Faith Based organizations from the sometimes 
intrusive hand of the government.


                             Discrimination

  Again I state my support for the healing role of faith based 
organizations. However, as an avid student of this country's history 
and, for that matter, the world's history, I cannot ignore some of the 
heinous things that have been done in the name of religion. In fact, 
current history is full of the horrors attendant to state sponsored 
religion. For decades, this country has struggled to bring peace to the 
hot box that is the Middle East, where religion is the sub-text used 
for the oppression of women, the oppression of other faiths and state 
sponsored terrorism. While I realize that this country has many 
protections against many of these horrors, and I do not mean to suggest 
that the enactment of this bill will rise to the level of these 
horrors, I do mean to suggest that more subtle forms of these problems 
such as discrimination will result from this measure.
  This bill would allow Faith Based organizations to discriminate as to 
who they will hire. This is wrong. The faith of a helping hand is of no 
consequence to the person in need. All of humanity has the potential to 
accomplish charitable deeds and should not be told that there is no 
role for their charity because of the faith they hold dear. I will not 
stand idly by as the Civil Rights laws in place to prevent workplace 
discrimination are flouted in the name of religion


                 No Additional Funding for the Program

  Finally, this measure is indicative of the Republican efforts to 
dismantle social programs. I say this because they have not provided a 
red cent for the implementation of this initiative or the programs that 
it involves. This bill will expand the pool of competitors already 
competing for diminished funds due to a bloated tax-cut. For example 
the Bush budget cuts local crime prevention funds by $1 billion. The 
Bush budget also cuts the needs of public housing by $1 billion by 
cutting $309 million from Public Housing Drug Elimination Grants, and 
cutting the Public Housing Capital Fund by $700 million. Even Job 
Training is cut by $500 million under the Administration's budget.
  Mr. CRANE. Mr. Speaker, I have long advocated making changes to the 
tax code designed to encourage charitable giving. Indeed, I have 
promoted some of the proposals contained in the legislation we have 
before us today, including the charitable IRA rollover and the 
deduction for non-itemizers, for many years. Because the legislation we 
are considering, the Community Solutions Act, contains a number of 
worthwhile provisions that I believe will help encourage people to give 
to charity, I rise today to express my support.
  However, while I believe this legislation is a step in the right 
direction, H.R. 7 is but a first

[[Page 13799]]

step. Frankly, we need to do more, and in my remarks today I would like 
to highlight a number of items that I believe need to receive further 
consideration by the Ways and Means Committee and the Congress in the 
near future.
  My first comments relate to the largest provision in this legislation 
in terms of revenue impact--the charitable deduction for non-itemizers. 
I do not believe there is a member in Congress who has fought longer or 
harder for restoring the charitable deduction for non-itemizers than I. 
The non-itemizer charitable deduction actually existed in the tax code 
from 1981-1986. It was created in the 1981 Reagan tax bill, but the 
language in the 1981 bill sunset the provision after 1986. In January 
1985, at the start of the 99th Congress, I introduced legislation, H.R. 
94, to make the non-itemizer deduction permanent. The year after the 
provision expired in 1986, I introduced legislation, H.R. 113, to 
restore the deduction. In every Congress since that time up to the 
present, I have introduced legislation to restore this deduction. For 
the record, I would like to insert the following table identifying the 
Congress, date and bill number of the legislation that I have 
introduced on this subject: 99th Congress--1/3/85--H.R. 94; 100th 
Congress--1/6/87--H.R. 113; 101st Congress--1/4/89--H.R. 459; 102nd 
Congress--1/3/91--H.R. 310; 103rd Congress--1/5/93--H.R. 152; 104th 
Congress--4/7/95--H.R. 1493; 105th Congress--9/18/97--H.R. 2499; 106th 
Congress--3/25/99--H.R. 1310; and 107th Congress--2/28/01--H.R. 777.
  While I am gratified that Congressman Watts included that the non-
itemizer deduction in H.R. 7, I am disappointed that the limitations on 
the amount of the deduction were set so low. Indeed, I am concerned 
that the deduction limits have been set so low as to have a very 
minimal impact toward the goal of increasing charitable giving. 
Frankly, the deduction allowance ought to be set substantially higher. 
I applaud President Bush for his proposal to allow the deduction up to 
the amount of the standard deduction. However, despite my concerns with 
the limitations contained in H.R. 7, I still believe that this 
provision represents a positive first step--a step on which the Ways 
and Means Committee can build a more substantial deduction. Moreover, I 
hope that the other body takes up similar legislation this year and 
that it considered the concerns I am raising today.
  With regard to those individuals who do itemize their deductions, I 
want to mention two proposals that were not contained in H.R. 7 but 
hopefully will be considered at a later date. The first of these 
proposals relates to Section 170 of the tax code. Under current law, 
individuals who contribute appreciated property (such as stocks and 
real estate) to charity are subject to complex deduction limits. While 
donors can generally deduct charitable contributions up to 50 percent 
of their income, deductions for gifts of appreciated property are 
limited to 30 percent of income. For gifts of appreciated property to 
charities that are private foundations, deductions are limited to 20 
percent of income. In my view, these limits under present law 
discourage charitable giving from the very people who are in the best 
position to make large gifts. Someone who has done well in the stock 
market should be encouraged to share the benefits. In order to fix this 
problem we should consider allowing contributions of appreciated 
property to be deductible within the same percentage limits as for 
other charitable gifts.
  The proposal I have in mind would increase the percentage limitation 
applicable to charitable contributions of capital gain property to 
public charities by individuals from 30 percent to 50 percent of 
income. Thus, both cash and non-cash contributions to such entities 
would be subject to a 50 percent deductibility limit. In addition, I 
would propose increasing the percentage limitation for contributions of 
capital gain property to private foundations from 20 percent to 30 
percent of income. While these proposals were not included in H.R. 7, I 
want to thank Ways and Means Chairman Thomas for publicly acknowledging 
that these issues are worthy of consideration. As a follow-up to his 
comments in the Ways and Means Committee, Chairman Thomas has written a 
letter to the Staff Director of the Joint Committee on Taxation asking 
for a revenue estimate and additional information with respect to this 
proposal.
  In addition, I would like to thank the Chairman for making a similar 
request with regard to the other proposal I believe needs to be 
addressed--removal of charitable contributions from the cutback of 
itemized deductions commonly referred to as the ``Pease'' limitations. 
Even though the cutback of itemized deductions is being phased out 
under current law, its impact on charitable giving will remain in 
effect for several years. It is my strong belief that extracting 
charitable contributions from the Pease limitation will do much to 
encourage further generosity from those in a position to give the most.
  Mr. Speaker, I am pleased to have this opportunity to express my 
support for H.R. 7 and I hope that I will return to the floor one day 
soon to address the other important issues I have raised in my remarks.
  Mr. FORBES. Mr. Speaker, I rise in strong support of the Community 
Solutions Act, which will provide more opportunities for the strong 
wills and good hearts of Americans everywhere to rally to the aid of 
their neighbors.
  All across America, there are people in need of a helping hand. Some 
of them are just a little down on their luck and need temporary shelter 
or a hot meal or the comfort of a confidant. Others are in more dire 
straits. The government can provide some assistance to these 
individuals and families, but it cannot do it all. And, frankly, it 
should not. In every pocket of America, there are groups and 
individuals--some of faith and some not--who are rallying to the aid of 
their neighbors. We in Washington should be in the business of 
encouraging this kind of community involvement and outreach.
  In fact, the public places far more trust in faith-based institutions 
and community organizations than in government to solve the social woes 
of our nation. Earlier this year, the Pew Partnership for Civic Change 
asked Americans to rank 15 organizations, including governments, 
businesses, and community groups, for their role in solving social 
problems in our communities. More than half named local churches, 
synagogues, and religious institutions; nonprofit groups, like the 
Salvation Army and Habitat for Humanity; and friends and neighbors--
putting them at the top of the list behind only the local police. In 
contrast, the federal government was ranked 14th out of 15, with only 
about 1 in 4 respondents naming it as a social problem-solver.
  The bipartisan Community Solutions Act builds on the faith-based 
initiative proposed earlier this year by the President to answer this 
call. But, to call it a faith-based initiative is really a misnomer. 
While faith-based groups clearly have a role to play in this plan, it 
is really all about neighbors helping neighbors.
  Mr. Speaker, the bill will increase charitable giving by allowing 
non-itemizers to deduct their charitable contributions. It will also 
expand individual development accounts to encourage low-income families 
to save money for home ownership, college education, or other needs. 
And, the Community Solutions Act will expand charitable choice 
provisions already in law to give faith-based groups a greater 
opportunity to provide assistance to those in need through programs 
that Congress has created.
  This bill embodies many good ideas, and it is long past the time when 
we should be returning these principles to our civil society. I thank 
the President for making this a priority for his Administration, and 
thank Congressmen Watts and Hall introducing it in the House.
  It is time for Congress to step aside and let the armies of 
compassion do what they do best--help neighbors in need. I urge my 
colleagues to support this bill and to oppose the substitute and the 
motion to recommit.
  Ms. MILLENDER-McDONALD. Mr. Speaker, currently, under Title VII, 
religious organizations can discriminate in hiring practices. If the 
Charitable Choice Act (H.R. 7) is enacted, this discriminatory practice 
will extend to programs on the Federal level. It is alarming that the 
Charitable Choice Act (H.R. 7) would pre-empt state and local anti-
discrimination laws. This bill would open women to all kinds of 
employment discrimination that is currently prohibited by Federal law.
  Under H.R. 7, religious employers would be allowed to include 
questions in hiring interviews on marital status and childcare 
provisions. Women would also be subject to discrimination in the 
delivery of services. For example, this bill offers no protection for 
the unwed mother being denied benefits because of the tenets of the 
religious organization responsible for delivering services. Women's 
basic employment and civil rights should be a fundamental guarantee and 
not conditioned on whether or not the entity hiring or providing 
services has been offered special protections under the law.
  Currently, under Title VII, there are cases where women lost their 
job because they became pregnant but wasn't married and due to their 
views on abortion. If the Charitable Choice Act is passed, then this 
can include many more forms of discrimination.
  This is no ordinary piece of legislation. It raises serious questions 
about church-state relations in this country. These are grave issues. 
Congress needs to proceed with caution.

[[Page 13800]]


  Mr. HALL of Texas. Mr. Speaker, as a long-time supporter of local 
solutions for local problems, I want to thank my colleagues, 
Representative J.C. Watts and Representative Tony Hall, for their work 
to bring H.R. 7, the Community Solutions Act, to the Floor. I am 
pleased to be a cosponsor of this initiative, which recognizes the 
important role that faith-based groups are performing in every 
community in America. I commend President Bush for making this a 
priority of his Administration.
  Government has long provided public funding for social service 
programs through its ``charitable choice'' provisions. This Act builds 
on this success by expanding the services that may be provided by 
faith-based groups. Most of us would agree that local citizens have a 
far better understanding of local problems and have better solutions 
for those problems than some ``one-size-fits-all'' Federal program. 
We've spent billions of dollars fighting the war against drugs, for 
example--and are still losing it because we are fighting it from the 
top.
  The bill's sponsors have worked to address the constitutional 
concerns that have been raised, and they have provided some important 
safeguards. As this bill moves forward, we need to continue our efforts 
to fully examine the implications of this Act as it affects State laws.
  The Community Solutions Act holds great promise in our efforts to 
combat drugs, juvenile delinquency, teenage pregnancy, hunger, school 
violence, illiteracy and other ills. It recognizes that faith-based 
organizations often are succeeding where government-run programs are 
failing. It makes sense to include these worthy programs in our efforts 
to serve those in need in our communities.
  I urge my colleagues to recognize the contributions and potential of 
faith-based organizations to improve the quality of life for our 
citizens by voting for H.R. 7 and giving this initiative a chance to 
work.
  Mr. BROWN of South Carolina. Mr. Speaker, I rise today in strong 
support of President Bush's faith-based initiative, as reflected in 
H.R. 7. Both the Judiciary Committee and the Ways and Means Committee 
has worked hard to craft legislation we should all be able to support.
  I would like to take a minute, though, to concentrate on the 
charitable choice provision of this bill, because the tax provisions 
should not keep anyone from voting for H.R. 7. According to Chairman 
Nussle of the House Budget Committee, the $13.3 billion in estimated 
revenue reduction does not threaten the Medicare trust fund. No, if 
this bill fails, the failure will be due to the charitable choice 
provision.
  Many have expressed concerns about ``separation of church and state'' 
and about ``government funded discrimination'' in conjunction with 
President Bush's faith-based initiative. However, when the Welfare 
Reform Act was passed in 1996, the charitable choice provision allowed 
faith-based groups to apply for federal money the same way that secular 
groups do. The charitable choice provision is also included in the 1998 
Community Services Block Grant Act and in the 2000 Public Health 
Service Act. The charitable choice provision has a history of success.
  Rather than promoting a radical restructuring of current law, H.R. 7 
will simply ensure that faith-based organizations can compete on more 
equal footing than in the past. The government will not be encouraging 
any kind of discrimination but, instead, will be able to partner with 
faith-based organizations in a wider variety of social services, 
including juvenile justice, crime prevention, housing assistance, job 
training, elder care, hunger relief, domestic violence prevention, and 
others.
  In summary, we should all support H.R. 7 because it provides a proven 
method for the federal government to participate in the provision of 
social services to Americans who still need help. This bill allows the 
federal government to partner with faith-based and other community 
service organizations that already have a history of success in 
providing these social services. H.R. 7 puts faith-based organizations 
on a level playing field in the competition for federal funds, without 
jeopardizing their autonomy, and without undermining religious freedom 
for either the service providers or for the service beneficiaries. I 
urge all of my colleagues to vote for H.R. 7.
  Mr. HYDE. Mr. Speaker, I have been listening to this debate with 
great attention all afternoon, and--at the risk of oversimplifying, I 
would like to cut to the chase. What we are talking about is an army of 
people out there motivated by spiritual impulses who want to do good, 
who want to help solve poverty, disease, violence in the community, 
homelessness, hunger, and some of them are clergy, some of them are 
not. They are religiously motivated, and we have spent all afternoon 
finding ways to keep them out. We have enough help. We don't need 
them--there is too much God out there. We suffer from an excess of God, 
for some crazy reason.
  Discrimination--if the First Baptist Church wants to do something as 
the First Baptist Church, take care of some homeless people, the fact 
that they want to retain their identify and not become another local 
United Fund operation, there is nothing wrong with that. There is 
nothing wrong with saying if you want to join us, you have to be 
Baptist.
  There is discrimination, and there is invidious discrimination. I do 
not think it is discrimination for Baptists to want to hire Baptists to 
do something as the Baptist Church. I think that is fine. That is not 
invidious discrimination. So far as I am concerned, we ought to figure 
out ways to facilitate the exploitation, the benign exploitation of 
these wonderful people who want to help us with our very human 
problems, instead of finding ways to say on because, for fear, God 
might sneak in under the door.
  Mr. KIND. Mr. Speaker, as with many of the colleagues from both sides 
of the aisle, I strongly support the community services provided by 
religious organizations throughout the Nation. We are all proud of the 
faith we hold and believe in the principles of selfless service 
encouraged by religious organizations. As I have personally witnessed 
in western Wisconsin, the effective and invaluable efforts put forth by 
religious organizations to combat such traumas as drug-addiction, and 
child and domestic abuse, are worthy of our continual appreciation and 
praise.
  I am, however, concerned that this legislation would undermine the 
successes and integrity of such programs through the introduction of 
more government. I am therefore unable to support this flawed 
legislation which, while it may be well intentioned, seeks to provide 
funds to religious organizations by violating our constitution and 
without regard to State's rights.
  The establishment of religion clause in the first amendment to the 
constitution was drafted in the recognition that state activity must be 
separate from church activity if people are to be free from Government 
interference. The Founders did not intend this provision as anti-
religious, but instead realized this is the way to protect religion 
while simultaneously protecting the people's rights to worship freely.
  America was founded by people seeking freedom from religious 
persecution by fleeing lands that contained religious strife and even 
warfare. To infringe on the separation of church and state is to 
infringe on the miracle and fundamental principles of American 
democracy. It is this principle that not only allows our government to 
operate by the will of the people, but also allows religious entities 
to conduct themselves without Government regulation and intrusion. When 
the line between church and state is an issue in policy, the highest 
scrutiny must be applied to ensure that principle prevails. I do not 
believe this legislation would pass such constitutional scrutiny.
  The Founders also recognized the dangers of State sponsored 
favoritism toward any religion. This bill will not only pit secular 
agencies against religious organizations, it will pit religion against 
religion for the competition of limited public funds.
  Under current law, there are Federal tax incentives for individuals 
to donate to charitable organizations, including the religious 
organizations of their choice. In addition, religious groups have 
always had the ability to apply and receive federal funding for the 
purpose of providing welfare related programs and services after they 
form 501(c)(3) organizations. Entities including Catholic Charities and 
Lutheran Social Service have a long history of participation in 
publicly funded social service programs.
  The conditions associated with the provision of these services, 
however, require the religious organizations to be secular in nature--
in accordance with the establishment of religion clause in the first 
amendment to the Constitution, as well as adhere to federal, state or 
local civil rights laws. H.R. 7 would remove these preconditions, 
allowing for public funding to go toward discriminatory and 
exclusionary practices that violate the intentions of hard fought civil 
rights.
  In addition to the constitutionality of the legislation, we must also 
question how the provisions contained in the bill would be implemented 
and enforced. Supporters of H.R. 7 claim the bill contains safeguards 
that would prohibit public funding from going to proselytization and 
other strictly religious activities. Even if these safeguards existed, 
which they do not, how do we police these organizations to ensure 
compliance? If we find violations do we then fine the churches or 
prosecute Catholic priests, Methodist ministers or Lutheran pastors?
  The road we are taking with this legislation leads to these serious 
questions about regulations imposed on organizations that receive

[[Page 13801]]

Federal funds. The strings attached to entities receiving federal funds 
are there to ensure applicable laws are obeyed and accountability 
exists. It is precisely these types of provisions that will inhibit 
religious organizations from maintaining their character, and it would 
be negligent of us as public servants to waive these provisions. This 
situation serves to illustrate why this bill should be opposed.
  The substitute to this bill, offered by Mr. Rangel, guards against 
the possibility of publicly funded discrimination by not overriding 
State and local civil rights laws, as well as offsetting the costs 
associated with this legislation. In addition to being unconditional, 
H.R. 7 is indeed expensive. While it is not as expensive as the 
President had originally envisioned, it will cost over $13 billion with 
no offsets. With passage of the President's tax cut, there is simply no 
money to pay for this bill without taking from the Medicare and Social 
Security Trust funds. A problem that will not go away as we mark up the 
rest of next year's budget.
  With all the problems associated with this bill, I ask my colleagues 
to vote against H.R. 7, and support the Rangel substitute.
  Mr. GREEN of Texas. Mr. Speaker, I rise in opposition to H.R. 7, the 
Community Solutions Act. While the goals of this bill are noble, there 
are fundamental concerns with this legislation.
  One of the central tenets of most faith based organizations, whether 
they are Catholic, Protestant, Jewish or Muslim, is to reach out to 
those in need.
  I know that in churches in which I've been a member and churches in 
my district have several programs to serve the needy, such as food 
drives, senior nutrition programs, housing assistance, substance abuse 
counseling, after school programs and many other needed community 
services.
  These are services that most churches perform because they are 
consistent with that church's mission.
  A component of H.R. 7, the Community Solutions Act would expand 
Charitable Choice to allow faith based organizations to compete for 
federal funding for many of these services. The religious groups today 
compete and receive federal funding.
  But they cannot only serve their particular faith or beliefs.
  In fact, there are organizations such as the Baptist Joint Committee, 
the United Methodist Church, the Presbyterian Church, and the United 
Jewish Communities Federation all fear that this legislation would 
interfere with their missions, rather than help them.
  We know that the first amendment prevents Congress from establishing 
a religion or prohibiting the free exercise thereof. This wall of 
separation has been a fundamental principle since the founding of our 
great nation.
  As a Christian I believe it is my duty to serve and my service is a 
reflection of my faith. Many Christians, Jewish and Muslims, do this 
everyday if we are practicing our beliefs.
  We do not need Federal tax dollars to practice and live our faith.
  Mr. CUMMINGS. Mr. Speaker, I stand with you today to raise my grave 
concerns regarding H.R. 7.
  Faith-based and community-based organizations have always been at the 
forefront of combating the hardships facing families and communities. 
As a federal legislator, I do not have a problem with government 
finding ways to harness the power of faith-based organizations and 
their vital services.
  Although I support faith-based entities, I cannot endorse H.R. 7 
because I believe that: (1) taxpayer money should not be used to 
proselytize; (2) taxpayer money should not be used to discriminate on 
the basis of race, gender, religion, or sexual orientation; and (3) the 
independence and autonomy of our religious institutions should not be 
threatened.
  Unfortunately, H.R. 7 in its current form does not prevent the 
problems I have outlined. Most significantly, while it may state that 
government funds should not be used for worship or proselytization, 
meaningful safeguards to prevent such action are not included in the 
provisions. Further, religious institutions are currently exempted from 
the ban on religious discrimination in employment provided under Title 
VII of the Civil Rights Act of 1964. As such, because the bill does not 
include a repeal of this exemption, these institutions can engage in 
government-funded employment discrimination.
  I am committed to our U.S. Constitution and civil rights statutes. 
Unfortunately, H.R. 7 threatens these very principles and I believe it 
is unnecessary and unconstitutional. It is important to note that under 
current law, religious entities can seek government funding by 
establishing 501(c)(3) affiliate organizations.
  I look forward to working with faith-based entities in their good 
works, but will also remain a strong advocate of civil rights, 
religious tolerance and the independence of our religious institutions. 
Join me in opposing H.R. 7 and supporting the Democratic substitute 
that will address these serious issues.
  Mr. DeMINT. Mr. Speaker, I rise today in strong support of H.R. 7, 
the Community Solutions Act, which is also known as the Faith-Based 
Initiative.
  America has long been a country made up of generous people who want 
to help a neighbor in need. Long before government programs came along 
to act as an extra safety net, individuals worked together with their 
churches and other community groups to ensure those in need were 
housed, clothed, and fed.
  While government programs were created to provide specific services 
to needy populations, these programs have less incentive to go above 
and beyond the call of duty.
  For many people of faith who run social service programs, their faith 
is what inspires them to go the extra mile for the poor, the 
downtrodden, the hopeless.
  Why, then, would the government exclude faith-based providers in its 
attempt to tackle difficult social problems such as drug addiction, 
gang violence, domestic violence, mental illness, and homelessness?
  Faith-based organizations with effective programs to combat societal 
ills should be able to compete equally with their non-faith based 
counterparts for government grants.
  And in some cases under current ``charitable choice'' laws, they can. 
When Welfare Reform passed in 1996, charitable choice language was 
included so faith-based groups providing welfare-to-work programs such 
as job training and child care can compete equally.
  I'm sure most of us know a church day care program which could care 
for children with just as much love and ability and professionalism as 
a non-faith based program.
  The legislation before us today allows ``charitable choice'' to apply 
to more government programs, such as juvenile delinquency, housing, 
domestic violence, job training, and community development programs.
  Let me make one thing clear: no faith-based group is compelled to 
apply. Those who are not interested in government funding can carry on 
with their ministry and keep doing the good work of serving our nation.
  Those groups which have an effective program and would like to 
compete for a grant may do so and keep their faith-based component 
largely intact. They would have to abide by some common sense 
requirements such as keeping the government funds in a separate 
account, but the requirements should not interfere with the religious 
nature of their program.
  The religious organization sponsoring the program would remain 
completely autonomous from federal, state, and local government 
control.
  The Faith-Based Initiative is a long-overdue, much-needed reform to 
recognize the importance of the faith community in caring for the most 
vulnerable of our nation.
  I want to take a minute to highlight a couple of wonderful community 
initiatives in my District which are inspirational to me. The Downtown 
Rescue Mission in Spartanburg has a myriad of exciting initiatives to 
provide housing, meals, health services, job training, and other help 
to give a helping hand up and empower folks in the downtown area.
  And in Greenville, since 1937--during the Great Depression--Miracle 
Hill Ministries has provided leadership in our community by providing 
food, clothing, shelter, and compassion to hurting and needy people, as 
well as serving as a model for other homeless outreach efforts in South 
Carolina.
  I am proud of these folks and the good work that they do and hope 
that the Faith-Based Initiative would be helpful to them. There are 
countless other good people and good organizations--big and small--
which could benefit from this attempt to provide a level playing field 
for the faith community.
  This bill also contains some great provisions to encourage charitable 
giving by individuals and corporations, as well as incentives for low-
income individuals to save money that can be used to buy a home, a 
college education, or start a small business.
  We want everyone in America to be able to live the American Dream.
  The armies of compassion in our nation should be able to serve the 
needy and provide them hope, so that they too--through hard work and 
perseverance--can make the American Dream a reality.
  Mr. GARY G. MILLER of California. Mr. Speaker, I rise in support of 
H.R. 7 the ``Community Solutions Act.''
  Although a lot of speakers have focused their remarks on the 
charitable choice provisions of this bill, I feel that Title III, the 
Individual Development Account or IDAs offers a

[[Page 13802]]

fundamental policy shift which merits the attention of this House.
  Many communities are facing an affordable housing crisis. Until now, 
our solution to this problem has been to increase the number of 
available Section 8 vouchers. However, this ``solution'' has only 
widened the gap between those who dream of owning a home, and those who 
are able to accumulate the financial resources needed to become a 
first-time home buyer. Under the Section 8 voucher program, if you 
demonstrate ambition and work hard to improve your situation, you are 
no longer eligible for the voucher. But at the same time, you do not 
have the down payment to own a home.
  IDAs will begin to reverse this trend. By encouraging individuals to 
save for a home through tax exemption IDAs and matching that 
investment, we finally have policy which makes sense.
  I urge my colleagues to support this bill and to turn the American 
dream of owning a home into a reality.
  The SPEAKER pro tempore (Mr. LaHood). All time for debate on the bill 
has expired.


     Amendment in the Nature of a Substitute Offered by Mr. Rangel

  Mr. RANGEL. Mr. Speaker, I offer an amendment in the nature of a 
substitute.
  The SPEAKER pro tempore. The Clerk will designate the amendment in 
the nature of a substitute.
  The text of the amendment in the nature of a substitute is as 
follows:

       Amendment in the nature of a substitute printed in House 
     Report 107-144 offered by Mr. Rangel:
       Strike all after the enacting clause and insert the 
     following:

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Community 
     Solutions Act of 2001''.
       (b) Table of Contents.--The table of contents is as 
     follows:

Sec. 1. Short title; table of contents.

             TITLE I--CHARITABLE GIVING INCENTIVES PACKAGE

Sec. 101. Deduction for portion of charitable contributions to be 
              allowed to individuals who do not itemize deductions.
Sec. 102. Tax-free distributions from individual retirement accounts 
              for charitable purposes.
Sec. 103. Increase in cap on corporate charitable contributions.
Sec. 104. Charitable deduction for contributions of food inventory.
Sec. 105. Reform of excise tax on net investment income of private 
              foundations.
Sec. 106. Excise tax on unrelated business taxable income of charitable 
              remainder trusts.
Sec. 107. Expansion of charitable contribution allowed for scientific 
              property used for research and for computer technology 
              and equipment used for educational purposes.
Sec. 108. Adjustment to basis of S corporation stock for certain 
              charitable contributions.
Sec. 109. Revenue offset.

                TITLE II--EXPANSION OF CHARITABLE CHOICE

Sec. 201. Provision of assistance under government programs by 
              religious and community organizations.

               TITLE III--INDIVIDUAL DEVELOPMENT ACCOUNTS

Sec. 301. Additional qualified entities eligible to conduct projects 
              under the Assets for Independence Act.
Sec. 302. Increase in limitation on net worth.
Sec. 303. Change in limitation on deposits for an individual.
Sec. 304. Elimination of limitation on deposits for a household.
Sec. 305. Extension of program.
Sec. 306. Conforming amendments.
Sec. 307. Applicability.

             TITLE I--CHARITABLE GIVING INCENTIVES PACKAGE

     SEC. 101. DEDUCTION FOR PORTION OF CHARITABLE CONTRIBUTIONS 
                   TO BE ALLOWED TO INDIVIDUALS WHO DO NOT ITEMIZE 
                   DEDUCTIONS.

       (a) In General.--Section 170 of the Internal Revenue Code 
     of 1986 (relating to charitable, etc., contributions and 
     gifts) is amended by redesignating subsection (m) as 
     subsection (n) and by inserting after subsection (l) the 
     following new subsection:
       ``(m) Deduction for Individuals Not Itemizing Deductions.--
       ``(1) In general.--In the case of an individual who does 
     not itemize his deductions for the taxable year, there shall 
     be taken into account as a direct charitable deduction under 
     section 63 an amount equal to the lesser of--
       ``(A) the amount allowable under subsection (a) for the 
     taxable year for cash contributions, or
       ``(B) the applicable amount.
       ``(2) Applicable amount.--For purposes of paragraph (1), 
     the applicable amount shall be determined as follows:

``For taxable years beginning in:           The applicable amount is:  
      2002 and 2003............................................$25 .

      2004, 2005, 2006.........................................$50 .

      2007, 2008, 2009.........................................$75 .

      2010 and thereafter.....................................$100..

     In the case of a joint return, the applicable amount is twice 
     the applicable amount determined under the preceding 
     table.''.
       (b) Direct Charitable Deduction.--
       (1) In general.--Subsection (b) of section 63 of such Code 
     is amended by striking ``and'' at the end of paragraph (1), 
     by striking the period at the end of paragraph (2) and 
     inserting ``, and'', and by adding at the end thereof the 
     following new paragraph:
       ``(3) the direct charitable deduction.''.
       (2) Definition.--Section 63 of such Code is amended by 
     redesignating subsection (g) as subsection (h) and by 
     inserting after subsection (f) the following new subsection:
       ``(g) Direct Charitable Deduction.--For purposes of this 
     section, the term `direct charitable deduction' means that 
     portion of the amount allowable under section 170(a) which is 
     taken as a direct charitable deduction for the taxable year 
     under section 170(m).''.
       (3) Conforming amendment.--Subsection (d) of section 63 of 
     such Code is amended by striking ``and'' at the end of 
     paragraph (1), by striking the period at the end of paragraph 
     (2) and inserting ``, and'', and by adding at the end thereof 
     the following new paragraph:
       ``(3) the direct charitable deduction.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2001.

     SEC. 102. TAX-FREE DISTRIBUTIONS FROM INDIVIDUAL RETIREMENT 
                   ACCOUNTS FOR CHARITABLE PURPOSES.

       (a) In General.--Subsection (d) of section 408 of the 
     Internal Revenue Code of 1986 (relating to individual 
     retirement accounts) is amended by adding at the end the 
     following new paragraph:
       ``(8) Distributions for charitable purposes.--
       ``(A) In general.--No amount shall be includible in gross 
     income by reason of a qualified charitable distribution.
       ``(B) Qualified charitable distribution.--For purposes of 
     this paragraph, the term `qualified charitable distribution' 
     means any distribution from an individual retirement 
     account--
       ``(i) which is made on or after the date that the 
     individual for whose benefit the account is maintained has 
     attained age 70\1/2\, and
       ``(ii) which is made directly by the trustee--

       ``(I) to an organization described in section 170(c), or
       ``(II) to a split-interest entity.

     A distribution shall be treated as a qualified charitable 
     distribution only to the extent that the distribution would 
     be includible in gross income without regard to subparagraph 
     (A) and, in the case of a distribution to a split-interest 
     entity, only if no person holds an income interest in the 
     amounts in the split-interest entity attributable to such 
     distribution other than one or more of the following: the 
     individual for whose benefit such account is maintained, the 
     spouse of such individual, or any organization described in 
     section 170(c).
       ``(C) Contributions must be otherwise deductible.--For 
     purposes of this paragraph--
       ``(i) Direct contributions.--A distribution to an 
     organization described in section 170(c) shall be treated as 
     a qualified charitable distribution only if a deduction for 
     the entire distribution would be allowable under section 170 
     (determined without regard to subsection (b) thereof and this 
     paragraph).
       ``(ii) Split-interest gifts.--A distribution to a split-
     interest entity shall be treated as a qualified charitable 
     distribution only if a deduction for the entire value of the 
     interest in the distribution for the use of an organization 
     described in section 170(c) would be allowable under section 
     170 (determined without regard to subsection (b) thereof and 
     this paragraph).
       ``(D) Application of section 72.--Notwithstanding section 
     72, in determining the extent to which a distribution is a 
     qualified charitable distribution, the entire amount of the 
     distribution shall be treated as includible in gross income 
     without regard to subparagraph (A) to the extent that such 
     amount does not exceed the aggregate amount which would be so 
     includible if all amounts were distributed from all 
     individual retirement accounts otherwise taken into account 
     in determining the inclusion on such distribution under 
     section 72. Proper adjustments shall be made in applying 
     section 72 to other distributions in such taxable year and 
     subsequent taxable years.
       ``(E) Special rules for split-interest entities.--
       ``(i) Charitable remainder trusts.--Distributions made from 
     an individual retirement account to a trust described in 
     subparagraph (G)(ii)(I) shall be treated as income described 
     in section 664(b)(1) except to

[[Page 13803]]

     the extent that the beneficiary of the individual retirement 
     account notifies the trustee of the trust of the amount which 
     is not allocable to income under subparagraph (D).
       ``(ii) Pooled income funds.--No amount shall be includible 
     in the gross income of a pooled income fund (as defined in 
     subparagraph (G)(ii)(II)) by reason of a qualified charitable 
     distribution to such fund.
       ``(iii) Charitable gift annuities.--Qualified charitable 
     distributions made for a charitable gift annuity shall not be 
     treated as an investment in the contract.
       ``(F) Denial of deduction.--Qualified charitable 
     distributions shall not be taken into account in determining 
     the deduction under section 170.
       ``(G) Split-interest entity defined.--For purposes of this 
     paragraph, the term `split-interest entity' means--
       ``(i) a charitable remainder annuity trust or a charitable 
     remainder unitrust (as such terms are defined in section 
     664(d)),
       ``(ii) a pooled income fund (as defined in section 
     642(c)(5)), and
       ``(iii) a charitable gift annuity (as defined in section 
     501(m)(5)).''.
       (b) Modifications Relating to Information Returns by 
     Certain Trusts.--
       (1) Returns.--Section 6034 of such Code (relating to 
     returns by trusts described in section 4947(a)(2) or claiming 
     charitable deductions under section 642(c)) is amended to 
     read as follows:

     ``SEC. 6034. RETURNS BY TRUSTS DESCRIBED IN SECTION 
                   4947(A)(2) OR CLAIMING CHARITABLE DEDUCTIONS 
                   UNDER SECTION 642(C).

       ``(a) Trusts Described in Section 4947(a)(2).--Every trust 
     described in section 4947(a)(2) shall furnish such 
     information with respect to the taxable year as the Secretary 
     may by forms or regulations require.
       ``(b) Trusts Claiming a Charitable Deduction Under Section 
     642(c).--
       ``(1) In general.--Every trust not required to file a 
     return under subsection (a) but claiming a charitable, etc., 
     deduction under section 642(c) for the taxable year shall 
     furnish such information with respect to such taxable year as 
     the Secretary may by forms or regulations prescribe, 
     including:
       ``(A) the amount of the charitable, etc., deduction taken 
     under section 642(c) within such year,
       ``(B) the amount paid out within such year which represents 
     amounts for which charitable, etc., deductions under section 
     642(c) have been taken in prior years,
       ``(C) the amount for which charitable, etc., deductions 
     have been taken in prior years but which has not been paid 
     out at the beginning of such year,
       ``(D) the amount paid out of principal in the current and 
     prior years for charitable, etc., purposes,
       ``(E) the total income of the trust within such year and 
     the expenses attributable thereto, and
       ``(F) a balance sheet showing the assets, liabilities, and 
     net worth of the trust as of the beginning of such year.
       ``(2) Exceptions.--Paragraph (1) shall not apply in the 
     case of a taxable year if all the net income for such year, 
     determined under the applicable principles of the law of 
     trusts, is required to be distributed currently to the 
     beneficiaries. Paragraph (1) shall not apply in the case of a 
     trust described in section 4947(a)(1).''.
       (2) Increase in penalty relating to filing of information 
     return by split-interest trusts.--Paragraph (2) of section 
     6652(c) of such Code (relating to returns by exempt 
     organizations and by certain trusts) is amended by adding at 
     the end the following new subparagraph:
       ``(C) Split-interest trusts.--In the case of a trust which 
     is required to file a return under section 6034(a), 
     subparagraphs (A) and (B) of this paragraph shall not apply 
     and paragraph (1) shall apply in the same manner as if such 
     return were required under section 6033, except that--
       ``(i) the 5 percent limitation in the second sentence of 
     paragraph (1)(A) shall not apply,
       ``(ii) in the case of any trust with gross income in excess 
     of $250,000, the first sentence of paragraph (1)(A) shall be 
     applied by substituting `$100' for `$20', and the second 
     sentence thereof shall be applied by substituting `$50,000' 
     for `$10,000', and
       ``(iii) the third sentence of paragraph (1)(A) shall be 
     disregarded.
     If the person required to file such return knowingly fails to 
     file the return, such person shall be personally liable for 
     the penalty imposed pursuant to this subparagraph.''.
       (3) Confidentiality of noncharitable beneficiaries.--
     Subsection (b) of section 6104 of such Code (relating to 
     inspection of annual information returns) is amended by 
     adding at the end the following new sentence: ``In the case 
     of a trust which is required to file a return under section 
     6034(a), this subsection shall not apply to information 
     regarding beneficiaries which are not organizations described 
     in section 170(c).''.
       (c) Effective Dates.--
       (1) Subsection (a).--The amendment made by subsection (a) 
     shall apply to taxable years beginning after December 31, 
     2001.
       (2) Subsection (b).--The amendments made by subsection (b) 
     shall apply to returns for taxable years beginning after 
     December 31, 2001.

     SEC. 103. INCREASE IN CAP ON CORPORATE CHARITABLE 
                   CONTRIBUTIONS.

       (a) In General.--Paragraph (2) of section 170(b) of the 
     Internal Revenue Code of 1986 (relating to corporations) is 
     amended by striking ``10 percent'' and inserting ``the 
     applicable percentage''.
       (b) Applicable Percentage.--Subsection (b) of section 170 
     of such Code is amended by adding at the end the following 
     new paragraph:
       ``(3) Applicable percentage defined.--For purposes of 
     paragraph (2), the applicable percentage shall be determined 
     in accordance with the following table:

``For taxable years beginning in calendarThe applicable percentage is--
      2002 through 2007.............................................11 
      2008..........................................................12 
      2009..........................................................13 
      2010 and thereafter........................................15.''.
       (c) Conforming Amendments.--
       (1) Sections 512(b)(10) and 805(b)(2)(A) of such Code are 
     each amended by striking ``10 percent'' each place it occurs 
     and inserting ``the applicable percentage (determined under 
     section 170(b)(3))''.
       (2) Sections 545(b)(2) and 556(b)(2) of such Code are each 
     amended by striking ``10-percent limitation'' and inserting 
     ``applicable percentage limitation''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2001.

     SEC. 104. CHARITABLE DEDUCTION FOR CONTRIBUTIONS OF FOOD 
                   INVENTORY.

       (a) In General.--Paragraph (3) of section 170(e) of the 
     Internal Revenue Code of 1986 (relating to special rule for 
     certain contributions of inventory and other property) is 
     amended by redesignating subparagraph (C) as subparagraph (D) 
     and by inserting after subparagraph (B) the following new 
     subparagraph:
       ``(C) Special rule for contributions of food inventory.--
       ``(i) General rule.--In the case of a charitable 
     contribution of food, this paragraph shall be applied--

       ``(I) without regard to whether the contribution is made by 
     a C corporation, and
       ``(II) only for food that is apparently wholesome food.

       ``(ii) Determination of fair market value.--In the case of 
     a qualified contribution of apparently wholesome food to 
     which this paragraph applies and which, solely by reason of 
     internal standards of the taxpayer or lack of market, cannot 
     or will not be sold, the fair market value of such food shall 
     be determined by taking into account the price at which the 
     same or similar food items are sold by the taxpayer at the 
     time of the contribution (or, if not so sold at such time, in 
     the recent past).
       ``(iii) Apparently wholesome food.--For purposes of this 
     subparagraph, the term `apparently wholesome food' shall have 
     the meaning given to such term by section 22(b)(2) of the 
     Bill Emerson Good Samaritan Food Donation Act (42 U.S.C. 
     1791(b)(2)), as in effect on the date of the enactment of 
     this subparagraph.''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to taxable years beginning after December 31, 
     2001.

     SEC. 105. REFORM OF EXCISE TAX ON NET INVESTMENT INCOME OF 
                   PRIVATE FOUNDATIONS.

       (a) In General.--Subsection (a) of section 4940 of the 
     Internal Revenue Code of 1986 (relating to excise tax based 
     on investment income) is amended by striking ``2 percent'' 
     and inserting ``1 percent''.
       (b) Repeal of Reduction In Tax Where Private Foundation 
     Meets Certain Distribution Requirements.--Section 4940 of 
     such Code is amended by striking subsection (e).
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2001.

     SEC. 106. EXCISE TAX ON UNRELATED BUSINESS TAXABLE INCOME OF 
                   CHARITABLE REMAINDER TRUSTS.

       (a) In General.--Subsection (c) of section 664 of the 
     Internal Revenue Code of 1986 (relating to exemption from 
     income taxes) is amended to read as follows:
       ``(c) Taxation of Trusts.--
       ``(1) Income tax.--A charitable remainder annuity trust and 
     a charitable remainder unitrust shall, for any taxable year, 
     not be subject to any tax imposed by this subtitle.
       ``(2) Excise tax.--
       ``(A) In general.--In the case of a charitable remainder 
     annuity trust or a charitable remainder unitrust that has 
     unrelated business taxable income (within the meaning of 
     section 512, determined as if part III of subchapter F 
     applied to such trust) for a taxable year, there is hereby 
     imposed on such trust or unitrust an excise tax equal to the 
     amount of such unrelated business taxable income.
       ``(B) Certain rules to apply.--The tax imposed by 
     subparagraph (A) shall be treated as imposed by chapter 42 
     for purposes of this title other than subchapter E of chapter 
     42.
       ``(C) Character of distributions and coordination with 
     distribution requirements.--The amounts taken into account in 
     determining unrelated business taxable income (as defined in 
     subparagraph (A)) shall not be taken into account for 
     purposes of--
       ``(i) subsection (b),

[[Page 13804]]

       ``(ii) determining the value of trust assets under 
     subsection (d)(2), and
       ``(iii) determining income under subsection (d)(3).
       ``(D) Tax court proceedings.--For purposes of this 
     paragraph, the references in section 6212(c)(1) to section 
     4940 shall be deemed to include references to this 
     paragraph.''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to taxable years beginning after December 31, 
     2001.

     SEC. 107. EXPANSION OF CHARITABLE CONTRIBUTION ALLOWED FOR 
                   SCIENTIFIC PROPERTY USED FOR RESEARCH AND FOR 
                   COMPUTER TECHNOLOGY AND EQUIPMENT USED FOR 
                   EDUCATIONAL PURPOSES.

       (a) Scientific Property Used for Research.--Clause (ii) of 
     section 170(e)(4)(B) of the Internal Revenue Code of 1986 
     (defining qualified research contributions) is amended by 
     inserting ``or assembled'' after ``constructed''.
       (b) Computer Technology and Equipment for Educational 
     Purposes.--Clause (ii) of section 170(e)(6)(B) of such Code 
     is amended by inserting ``or assembled'' after 
     ``constructed'' and ``or assembling'' after ``construction''.
       (c) Conforming Amendment.--Subparagraph (D) of section 
     170(e)(6) of such Code is amended by inserting ``or 
     assembled'' after ``constructed'' and ``or assembling'' after 
     ``construction''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2001.

     SEC. 108. ADJUSTMENT TO BASIS OF S CORPORATION STOCK FOR 
                   CERTAIN CHARITABLE CONTRIBUTIONS.

       (a) In General.--Paragraph (1) of section 1367(a) of such 
     Code (relating to adjustments to basis of stock of 
     shareholders, etc.) is amended by striking ``and'' at the end 
     of subparagraph (B), by striking the period at the end of 
     subparagraph (C) and inserting ``, and'', and by adding at 
     the end the following new subparagraph:
       ``(D) the excess of the amount of the shareholder's 
     deduction for any charitable contribution made by the S 
     corporation over the shareholder's proportionate share of the 
     adjusted basis of the property contributed.''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to taxable years beginning after December 31, 
     2001.

     SEC. 109. REVENUE OFFSET.

       (a) In General.--Paragraph (2) of section 1(i) of the 
     Internal Revenue Code of 1986 (relating to reductions in 
     rates after June 30, 2001) is amended--
       (1) by striking ``38.6'' and inserting ``38.8'',
       (2) by striking ``37.6'' and inserting ``37.8'', and
       (3) by striking ``35'' and inserting ``35.5''.
       (b) Effective Date.--The amendments made by subsection (a) 
     shall apply to taxable years beginning after December 31, 
     2001.

                TITLE II--EXPANSION OF CHARITABLE CHOICE

     SEC. 201. PROVISION OF ASSISTANCE UNDER GOVERNMENT PROGRAMS 
                   BY RELIGIOUS AND COMMUNITY ORGANIZATIONS.

       Title XXIV of the Revised Statutes of the United States is 
     amended by inserting after section 1990 (42 U.S.C. 1994) the 
     following:

     ``SEC. 1991. CHARITABLE CHOICE.

       ``(a) Short Title.--This section may be cited as the 
     `Charitable Choice Act of 2001'.
       ``(b) Purposes.--The purposes of this section are--
       ``(1) to enable assistance to be provided to individuals 
     and families in need in the most effective and efficient 
     manner;
       ``(2) to supplement the Nation's social service capacity by 
     facilitating the entry of new, and the expansion of existing, 
     efforts by religious and other community organizations in the 
     administration and distribution of government assistance 
     under the government programs described in subsection (c)(4);
       ``(3) to prohibit discrimination against religious 
     organizations on the basis of religion in the administration 
     and distribution of government assistance under such 
     programs;
       ``(4) to allow religious organizations to participate in 
     the administration and distribution of such assistance 
     without impairing the religious character and autonomy of 
     such organizations; and
       ``(5) to protect the religious freedom of individuals and 
     families in need who are eligible for government assistance, 
     including expanding the possibility of their being able to 
     choose to receive services from a religious organization 
     providing such assistance.
       ``(c) Religious Organizations Included as Providers; 
     Disclaimers.--
       ``(1) In general.--
       ``(A) Inclusion.--For any program described in paragraph 
     (4) that is carried out by the Federal Government, or by a 
     State or local government with Federal funds, the government 
     shall consider, on the same basis as other nongovernmental 
     organizations, religious organizations to provide the 
     assistance under the program, and the program shall be 
     implemented in a manner that is consistent with the 
     establishment clause and the free exercise clause of the 
     first amendment to the Constitution.
       ``(B) Discrimination prohibited.--Neither the Federal 
     Government, nor a State or local government receiving funds 
     under a program described in paragraph (4), shall 
     discriminate against an organization that provides assistance 
     under, or applies to provide assistance under, such program 
     on the basis that the organization is religious or has a 
     religious character.
       ``(2) Funds not aid to religion.--Federal, State, or local 
     government funds or other assistance that is received by a 
     religious organization for the provision of services under 
     this section constitutes aid to individuals and families in 
     need, the ultimate beneficiaries of such services, and not 
     support for religion or the organization's religious beliefs 
     or practices. Notwithstanding the provisions in this 
     paragraph, title VI of the Civil Rights Act of 1964 (42 USC 
     2000d et seq.) shall apply to organizations receiving 
     assistance funded under any program described in subsection 
     (c)(4).
       ``(3) Funds not endorsement of religion.--The receipt by a 
     religious organization of Federal, State, or local government 
     funds or other assistance under this section is not an 
     endorsement by the government of religion or of the 
     organization's religious beliefs or practices.
       ``(4) Programs.--For purposes of this section, a program is 
     described in this paragraph--
       ``(A) if it involves activities carried out using Federal 
     funds--
       ``(i) related to the prevention and treatment of juvenile 
     delinquency and the improvement of the juvenile justice 
     system, including programs funded under the Juvenile Justice 
     and Delinquency Prevention Act of 1974 (42 U.S.C. 5601 et 
     seq.);
       ``(ii) related to the prevention of crime and assistance to 
     crime victims and offenders' families, including programs 
     funded under title I of the Omnibus Crime Control and Safe 
     Streets Act of 1968 (42 U.S.C. 3701 et seq.);
       ``(iii) related to the provision of assistance under 
     Federal housing statutes, including the Community Development 
     Block Grant Program established under title I of the Housing 
     and Community Development Act of 1974 (42 U.S.C. 5301 et 
     seq.);
       ``(iv) under subtitle B or D of title I of the Workforce 
     Investment Act of 1998 (29 U.S.C. 2801 et seq.);
       ``(v) under the Older Americans Act of 1965 (42 U.S.C. 3001 
     et seq.);
       ``(vi) related to the intervention in and prevention of 
     domestic violence, including programs under the Child Abuse 
     Prevention and Treatment Act (42 U.S.C. 5101 et seq.) or the 
     Family Violence Prevention and Services Act (42 U.S.C. 10401 
     et seq.);
       ``(vii) related to hunger relief activities; or
       ``(viii) under the Job Access and Reverse Commute grant 
     program established under section 3037 of the Federal Transit 
     Act of 1998 (49 U.S.C. 5309 note); or
       ``(B)(i) if it involves activities to assist students in 
     obtaining the recognized equivalents of secondary school 
     diplomas and activities relating to nonschool hours programs, 
     including programs under--
       ``(I) chapter 3 of subtitle A of title II of the Workforce 
     Investment Act of 1998 (Public Law 105-220); or
       ``(II) part I of title X of the Elementary and Secondary 
     Education Act (20 U.S.C. 6301 et seq.); and
       ``(ii) except as provided in subparagraph (A) and clause 
     (i), does not include activities carried out under Federal 
     programs providing education to children eligible to attend 
     elementary schools or secondary schools, as defined in 
     section 14101 of the Elementary and Secondary Education Act 
     of 1965 (20 U.S.C. 8801).
       ``(d) Organizational Character and Autonomy.--
       ``(1) In general.--A religious organization that provides 
     assistance under a program described in subsection (c)(4) 
     shall have the right to retain its autonomy from Federal, 
     State, and local governments, including such organization's 
     control over the definition, development, practice, and 
     expression of its religious beliefs.
       ``(2) Additional safeguards.--Neither the Federal 
     Government, nor a State or local government with Federal 
     funds, shall require a religious organization, in order to be 
     eligible to provide assistance under a program described in 
     subsection (c)(4), to--
       ``(A) alter its form of internal governance or provisions 
     in its charter documents; or
       ``(B) remove religious art, icons, scripture, or other 
     symbols, or to change its name, because such symbols or names 
     are of a religious character.
       ``(e) Employment Practices.--A religious organization's 
     exemption provided under section 702 of the Civil Rights Act 
     of 1964 (42 U.S.C. 2000e-1) regarding employment practices 
     shall not be affected by its participation in, or receipt of 
     funds from, programs described in subsection (c)(4), and any 
     provision in such programs that is inconsistent with or would 
     diminish the exercise of an organization's autonomy 
     recognized in section 702 or in this section shall have no 
     effect, except that no religious organization receiving funds 
     through a grant or cooperative agreement for programs 
     described in subsection (c)(4) shall, in expending such funds 
     allocated under such program, discriminate in employment on 
     the basis of an employee's religion, religious belief, or a 
     refusal to hold a religious belief. Nothing in this section 
     alters the duty of a religious organization to comply with 
     the nondiscrimination provisions of title VII of the Civil 
     Rights Act of

[[Page 13805]]

     1964 in the use of funds from programs described in 
     subsection (c)(4).
       ``(f) Effect on Other Laws.--Nothing in this section shall 
     alter the duty of a religious organization receiving 
     assistance or providing services under any program described 
     in subsection (c)(4) to comply with the nondiscrimination 
     provisions in title VI of the Civil Rights Act of 1964 (42 
     U.S.C. 2000d et seq.) (prohibiting discrimination on the 
     basis of race, color, and national origin), title IX of the 
     Education Amendments of 1972 (20 U.S.C. 1681-1688) 
     (prohibiting discrimination in education programs or 
     activities on the basis of sex and visual impairment), 
     section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 794) 
     (prohibiting discrimination against otherwise qualified 
     disabled individuals), and the Age Discrimination Act of 1975 
     (42 U.S.C. 6101-6107) (prohibiting discrimination on the 
     basis of age).
       ``(g) Rights of Beneficiaries of Assistance.--
       ``(1) In general.--If an individual described in paragraph 
     (3) has an objection to the religious character of the 
     organization from which the individual receives, or would 
     receive, assistance funded under any program described in 
     subsection (c)(4), the appropriate Federal, State, or local 
     governmental entity shall provide to such individual (if 
     otherwise eligible for such assistance) within a reasonable 
     period of time after the date of such objection, assistance 
     that--
       ``(A) is an alternative that is accessible to the 
     individual and unobjectionable to the individual on religious 
     grounds; and
       ``(B) has a value that is not less than the value of the 
     assistance that the individual would have received from such 
     organization.
       ``(2) Notice.--The appropriate Federal, State, or local 
     governmental entity shall guarantee that notice is provided 
     to the individuals described in paragraph (3) of the rights 
     of such individuals under this section.
       ``(3) Individual described.--An individual described in 
     this paragraph is an individual who receives or applies for 
     assistance under a program described in subsection (c)(4).
       ``(h) Nondiscrimination Against Beneficiaries.--
       ``(1) Grants and cooperative agreements.--A religious 
     organization providing assistance through a grant or 
     cooperative agreement under a program described in subsection 
     (c)(4) shall not discriminate in carrying out the program 
     against an individual described in subsection (g)(3) on the 
     basis of religion, a religious belief, or a refusal to hold a 
     religious belief.
       ``(2) Indirect forms of assistance.--A religious 
     organization providing assistance through a voucher, 
     certificate, or other form of indirect assistance under a 
     program described in subsection (c)(4) shall not deny an 
     individual described in subsection (g)(3) admission into such 
     program on the basis of religion, a religious belief, or a 
     refusal to hold a religious belief.
       ``(i) Local Civil Rights Laws.--Nothwithstanding anything 
     to the contrary in this section, nothing in this section 
     preempts or supercedes State or local civil rights laws.
       ``(j) Accountability.--
       ``(1) In general.--Except as provided in paragraphs (2) and 
     (3), a religious organization providing assistance under any 
     program described in subsection (c)(4) shall be subject to 
     the same regulations as other nongovernmental organizations 
     to account in accord with generally accepted accounting 
     principles for the use of such funds and its performance of 
     such programs.
       ``(2) Limited audit.--
       ``(A) Grants and cooperative agreements.--A religious 
     organization providing assistance through a grant or 
     cooperative agreement under a program described in subsection 
     (c)(4) shall segregate government funds provided under such 
     program into a separate account or accounts. Only the 
     separate accounts consisting of funds from the government 
     shall be subject to audit by the government.
       ``(B) Indirect forms of assistance.--A religious 
     organization providing assistance through a voucher, 
     certificate, or other form of indirect assistance under a 
     program described in subsection (c)(4) may segregate 
     government funds provided under such program into a separate 
     account or accounts. If such funds are so segregated, then 
     only the separate accounts consisting of funds from the 
     government shall be subject to audit by the government.
       ``(3) Self audit.--A religious organization providing 
     services under any program described in subsection (c)(4) 
     shall conduct annually a self audit for compliance with its 
     duties under this section and submit a copy of the self audit 
     to the appropriate Federal, State, or local government 
     agency, along with a plan to timely correct variances, if 
     any, identified in the self audit.
       ``(k) Limitations on Use of Funds; Voluntariness.--No funds 
     provided through a grant or cooperative agreement to a 
     religious organization to provide assistance under any 
     program described in subsection (c)(4) shall be expended for 
     sectarian instruction, worship, or proselytization. If the 
     religious organization offers such an activity, it shall be 
     voluntary for the individuals receiving services and offered 
     separate from the program funded under subsection (c)(4). A 
     certificate shall be separately signed by religious 
     organizations, and filed with the government agency that 
     disburses the funds, certifying that the organization is 
     aware of and will comply with this subsection. No direct 
     funds shall be provided under subsection (c)(4) to a 
     religious organization that engages in sectarian instruction, 
     worship, or proselytization at the same time and place as the 
     government funded program.
       ``(l) Effect on State and Local Funds.--If a State or local 
     government contributes State or local funds to carry out a 
     program described in subsection (c)(4), the State or local 
     government may segregate the State or local funds from the 
     Federal funds provided to carry out the program or may 
     commingle the State or local funds with the Federal funds. If 
     the State or local government commingles the State or local 
     funds, the provisions of this section shall apply to the 
     commingled funds in the same manner, and to the same extent, 
     as the provisions apply to the Federal funds.
       ``(m) Treatment of Intermediate Grantors.--If a 
     nongovernmental organization (referred to in this subsection 
     as an `intermediate grantor'), acting under a grant or other 
     agreement with the Federal Government, or a State or local 
     government with Federal funds, is given the authority under 
     the agreement to select nongovernmental organizations to 
     provide assistance under the programs described in subsection 
     (c)(4), the intermediate grantor shall have the same duties 
     under this section as the government when selecting or 
     otherwise dealing with subgrantors, but the intermediate 
     grantor, if it is a religious organization, shall retain all 
     other rights of a religious organization under this section.
       ``(n) Compliance.--A party alleging that the rights of the 
     party under this section have been violated by a State or 
     local government may bring a civil action for injunctive 
     relief pursuant to section 1979 against the State official or 
     local government agency that has allegedly committed such 
     violation. A party alleging that the rights of the party 
     under this section have been violated by the Federal 
     Government may bring a civil action for injunctive relief in 
     Federal district court against the official or government 
     agency that has allegedly committed such violation.
       ``(o) Training and Technical Assistance for Small 
     Nongovernmental Organizations.--
       ``(1) In general.--From amounts made available to carry out 
     the purposes of the Office of Justice Programs (including any 
     component or unit thereof, including the Office of Community 
     Oriented Policing Services), funds are authorized to provide 
     training and technical assistance, directly or through grants 
     or other arrangements, in procedures relating to potential 
     application and participation in programs identified in 
     subsection (c)(4) to small nongovernmental organizations, as 
     determined by the Attorney General, including religious 
     organizations, in an amount not to exceed $50 million 
     annually.
       ``(2) Types of assistance.--Such assistance may include--
       ``(A) assistance and information relative to creating an 
     organization described in section 501(c)(3) of the Internal 
     Revenue Code of 1986 to operate identified programs;
       ``(B) granting writing assistance which may include 
     workshops and reasonable guidance;
       ``(C) information and referrals to other nongovernmental 
     organizations that provide expertise in accounting, legal 
     issues, tax issues, program development, and a variety of 
     other organizational areas; and
       ``(D) information and guidance on how to comply with 
     Federal nondiscrimination provisions including, but not 
     limited to, title VI of the Civil Rights Act of 1964 (42 
     U.S.C. 2000d et seq.), title VII of the Civil Rights Act of 
     1964 (42 U.S.C. 2000e et seq.), the Fair Housing Act, as 
     amended (42 U.S.C. 3601 et seq.), title IX of the Education 
     Amendments of 1972 (20 U.S.C. 1681-1688), section 504 of the 
     Rehabilitation Act of 1973 (29 U.S.C. 694), and the Age 
     Discrimination Act of 1975 (42 U.S.C. 6101-6107).
       ``(3) Reservation of funds.--An amount of no less than 
     $5,000,000 shall be reserved under this section. Small 
     nongovernmental organizations may apply for these funds to be 
     used for assistance in providing full and equal integrated 
     access to individuals with disabilities in programs under 
     this title.
       ``(4) Priority.--In giving out the assistance described in 
     this subsection, priority shall be given to small 
     nongovernmental organizations serving urban and rural 
     communities.''.

               TITLE III--INDIVIDUAL DEVELOPMENT ACCOUNTS

     SEC. 301. ADDITIONAL QUALIFIED ENTITIES ELIGIBLE TO CONDUCT 
                   PROJECTS UNDER THE ASSETS FOR INDEPENDENCE ACT.

       Section 404(7)(A)(iii)(I)(aa) of the Assets for 
     Independence Act (42 U.S.C. 604 note) is amended to read as 
     follows:
       ``(aa) a federally insured credit union; or''.

     SEC. 302. INCREASE IN LIMITATION ON NET WORTH.

       Section 408(a)(2)(A) of the Assets for Independence Act (42 
     U.S.C. 604 note) is amended by striking ``$10,000'' and 
     inserting ``$20,000''.

[[Page 13806]]



     SEC. 303. CHANGE IN LIMITATION ON DEPOSITS FOR AN INDIVIDUAL.

       Section 410(b) of the Assets for Independence Act (42 
     U.S.C. 604 note) is amended to read as follows:
       ``(b) Limitation on Deposits for an Individual.--Not more 
     than $500 from a grant made under section 406(b) shall be 
     provided per year to any one individual during the 
     project.''.

     SEC. 304. ELIMINATION OF LIMITATION ON DEPOSITS FOR A 
                   HOUSEHOLD.

       Section 410 of the Assets for Independence Act (42 U.S.C. 
     604 note) is amended by striking subsection (c) and 
     redesignating subsections (d) and (e) as subsections (c) and 
     (d), respectively.

     SEC. 305. EXTENSION OF PROGRAM.

       Section 416 of the Assets for Independence Act (42 U.S.C. 
     604 note) is amended by striking ``2001, 2002, and 2003'' and 
     inserting ``and 2001, and $50,000,000 for each of fiscal 
     years 2002 through 2008''.

     SEC. 306. CONFORMING AMENDMENTS.

       (a) Amendments to Text.--The text of each of the following 
     provisions of the Assets for Independence Act (42 U.S.C. 604 
     note) is amended by striking ``demonstration'' each place it 
     appears:
       (1) Section 403.
       (2) Section 404(2).
       (3) Section 405(a).
       (4) Section 405(b).
       (5) Section 405(c).
       (6) Section 405(d).
       (7) Section 405(e).
       (8) Section 405(g).
       (9) Section 406(a).
       (10) Section 406(b).
       (11) Section 407(b)(1)(A).
       (12) Section 407(c)(1)(A).
       (13) Section 407(c)(1)(B).
       (14) Section 407(c)(1)(C).
       (15) Section 407(c)(1)(D).
       (16) Section 407(d).
       (17) Section 408(a).
       (18) Section 408(b).
       (19) Section 409.
       (20) Section 410(e).
       (21) Section 411.
       (22) Section 412(a).
       (23) Section 412(b)(2).
       (24) Section 412(c).
       (25) Section 413(a).
       (26) Section 413(b).
       (27) Section 414(a).
       (28) Section 414(b).
       (29) Section 414(c).
       (30) Section 414(d)(1).
       (31) Section 414(d)(2).
       (b) Amendments to Subsection Headings.--The heading of each 
     of the following provisions of the Assets for Independence 
     Act (42 U.S.C. 604 note) is amended by striking 
     ``Demonstration'':
       (1) Section 405(a).
       (2) Section 406(a).
       (3) Section 413(a).
       (c) Amendments to Section Headings.--The headings of 
     sections 406 and 411 of the Assets for Independence Act (42 
     U.S.C. 604 note) are amended by striking ``DEMONSTRATION''.

     SEC. 307. APPLICABILITY.

       (a) In General.--The amendments made by this title shall 
     apply to funds provided before, on or after the date of the 
     enactment of this Act.
       (b) Prior Amendments.--The amendments made by title VI of 
     the Departments of Labor, Health and Human Services, and 
     Education, and Related Agencies Appropriations Act, 2001 (as 
     enacted into law by Public Law 106-554) shall apply to funds 
     provided before, on or after the date of the enactment of 
     such Act.

  The SPEAKER pro tempore. Pursuant to House Resolution 196, the 
gentleman from New York (Mr. Rangel) and the gentleman from California 
(Mr. Thomas) each will control 30 minutes.
  The Chair recognizes the gentleman from New York (Mr. Rangel).
  Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, we have an opportunity here to review a very important 
piece of legislation. As relates to the tax portion of this bill, I do 
not think anybody would believe that allowing a taxpayer to deduct $25 
cap or $50 for a couple is enough incentive, or that incentive is 
necessary. But this is politics as usual, and so we are prepared not to 
fight that. But the least we should do is to pay for these things. $13 
billion, in the majority's point of view, is not a lot of money. After 
all, they have just passed a $1.3 trillion tax cut. But it would seem 
to me, Mr. Speaker, that if we are going to have a budget and we are 
going to try to stay within the four corners of that budget, the least 
we could do is to try to pay for those things.
  Mr. Speaker, I yield 15 minutes to the gentleman from Michigan (Mr. 
Conyers), the ranking member of the Committee on the Judiciary, and I 
ask unanimous consent that he be allowed to further allocate the time.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from New York?
  There was no objection.
  Mr. RANGEL. Mr. Speaker, I yield the balance of my time to the 
gentleman from Washington (Mr. McDermott), and I ask unanimous consent 
that he be allowed to further allocate the time.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from New York?
  There was no objection.
  Mr. THOMAS. Mr. Speaker, I yield 15 minutes of my time to the 
gentleman from Wisconsin (Mr. Sensenbrenner), and I ask unanimous 
consent that he be permitted to control that time.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from California?
  There was no objection.
  Mr. THOMAS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I find it rather interesting that during the debate on 
H.R. 7, that there were statements made about the tax portion of the 
bill, especially in terms of title I, almost rising to the level of 
derision on the amount of money that was provided to individuals who 
did not itemize their tax deductions. One gentleman called it nonsense 
in terms of what, on a bipartisan basis, we are doing in changing the 
Tax Code.
  I do not know about you, but I have had some enjoyment watching, over 
these recent evenings, the programs on dinosaurs, ``When Dinosaurs 
Roamed America,'' on the Discovery Channel. Frankly, some of the facts 
that have been mentioned on the program are staggering. For example, in 
referring to the sauropods which were the largest dinosaurs to roam 
America and they were herbivores, to give some understanding, I guess, 
of the size of these beasts, it was indicated that, on a daily average, 
they left about 2,000 pounds of fecal material.
  I just pondered that fact, because in listening to my Democratic 
colleagues stand up and deride the tax portion of H.R. 7, I am 
fascinated to find that in their offering of their substitute, when 
they had a clean sheet of paper and, of course, if they deride the 
amount of money provided to nonitemizers, they certainly could have 
picked any number they thought was appropriate. If they thought those 
provisions to corporations were inadequate, they certainly could have 
picked any structure they wanted, and they are saying they are going to 
pay for their proposal, and, therefore, they had any amount of money 
that they chose to pay for any program they thought was appropriate for 
charitable giving.
  Do you know what that clean, white sheet of paper turned into? It 
turned into word for word, sentence for sentence, paragraph for 
paragraph the charitable giving portion of H.R. 7. Yes, my friends. The 
substitute's tax portion is absolutely identical, notwithstanding all 
of their criticism of the majority's bill.
  And so when I think back at that 2,000 pounds, I just wonder what 
Democratosaurus can produce. We have seen the first major installment.
  For them to stand up and ridicule the charitable tax provisions in 
the bill and then turn right around and word for word incorporate them 
in the substitute certainly is a really big pile.
  Mr. Speaker, I reserve the balance of my time.
  Mr. McDERMOTT. Mr. Speaker, I yield myself a couple of minutes here.
  The distinguished chairman of the Committee on Ways and Means 
certainly is an erudite speaker and I appreciate his great erudition on 
these matters.

                              {time}  1345

  However, the gentleman knows that since he runs the House, he sets 
the rules. You would not let us have a clean amendment. You said, you 
have to do a substitute; and you have got to make it germane. You made 
it so tight, we did not have any way to do it but to use your stupid 
vehicle.
  But we wanted to pay for it. If we could have added an amendment and 
simply paid for it, we would have done it, because we would have proven 
the hypocrisy of what has gone on on the other side.

[[Page 13807]]

  You are offering this amendment, and you have broken the budget; and 
you are into Social Security, and you will not pay for this.
  That is what the people need to understand. We are willing to pay for 
what we do. It will turn out in this vote that you are not. You are 
simply doing a PR exercise.
  Everybody on the other side already has their press release ready: 
``Today we gave a charitable choice to every American. They can 
participate.'' It is an empty sack.
  Mr. Speaker, I yield 1\1/4\ minutes to the gentleman from Indiana 
(Mr. Roemer).
  Mr. ROEMER. Mr. Speaker, I thank the gentleman for yielding me time.
  Mr. Speaker, as a person that strongly believes that our religious 
and faith-based organizations have an important and vital role in 
potentially helping us solve problems, particularly for the poor, I 
rise in opposition to the underlying bill.
  Thomas Jefferson wrote: ``Politics, like religion, hold up the 
torches of martyrdom to the reformers of error.''
  The reformers of error in this instance are the authors of this bill, 
and they are so for two reasons: we have a very important separation, a 
wall, a separation of church and State in this country; and, instead of 
breaking it down, they are tunneling under it.
  On page 45 of their bill, instead of having money go directly to 
these institutions, we can use vouchers or certificates or other forms 
of reimbursement. We have rejected vouchers to our public schools; we 
should reject vouchers to our houses of private worship.
  Finally, Mr. Speaker, on the tax cut: I voted for a tax cut, a $1.3 
trillion tax cut. This one is $13.3 billion. We just had $40 billion 
evaporate from the surplus in one month. We should not vote for more 
tax cuts in this body until we know what that surplus is going to be 
like.
  So on constitutional grounds and fiscally responsible grounds, we 
should reject this underlying bill and support the substitute.
  Mr. THOMAS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, let us revisit the comments made by the gentleman from 
Washington, that he was required to utilize exactly the same tax 
provisions.
  Now, that is simply factually false. He could have changed the dollar 
amount to 50, 100, 250, 1,000. For him to wring his hands and say he 
was required to follow exactly to the word the majority's tax 
provisions is to simply say that the Demosaurus pile grows and grows.
  Mr. Speaker, it is my privilege to yield 1 minute to the gentlewoman 
from Pennsylvania (Ms. Hart).
  Ms. HART. Mr. Speaker, I rise in opposition to the substitute and in 
support of the bill as it stands. The Community Solutions Act is just 
that. The Community Solutions Act is designed to aid organizations that 
aid communities.
  This is not a jobs bill. I repeat, this is not a jobs bill. This is 
designed to give more resources to the organizations who know their 
communities, the organizations who are driven by faith and charity to 
help people in communities who need help. It is not designed to create 
a bunch of new jobs. In fact, hopefully, the only people who will take 
any jobs that may be created by this bill are those who are motivated 
by charity. These jobs will not pay lots of money.
  The goal here is to help people. The goal here is to allow those who 
have been helping people for years to get a few more resources from the 
Government to do an even better job than they do now.
  Mr. McDERMOTT. Mr. Speaker, I yield 2 minutes to the gentleman from 
Maryland (Mr. Hoyer).
  Mr. HOYER. Mr. Speaker, I thank the gentleman for yielding me time.
  Mr. Speaker, America is the greatest country on the face of the 
Earth, and in part it is because of the inspiration that our Founding 
Fathers had in the drafting of the Constitution and the promulgation of 
the first 10 amendments: ``We hold these truths to be self-evident.''
  The gentlewoman says this is not a jobs bill, and she is correct. 
This is a bill about doing what our faiths tell us to do: lifting 
people up, reaching out to them, helping them. My party believes in 
that. I think the other party does as well.
  I was a Jaycee. The Jaycee creed starts with these lines, that faith 
in God gives meaning and purpose to life.
  I am a Baptist. There are many faiths represented in this body. I am 
also from Maryland. In April of 1649, Maryland passed an act on 
religion, now known as the Act on Toleration. It was one of the first 
statutes in these colonies that said we were going to make sure that 
the State did not infringe upon religion. Why? Because the Calvert 
family was Catholic, and the majority of the colony was Protestant, and 
they wanted to make sure that the Government did not infringe upon the 
right to practice their religion, which is, of course, why they came to 
these colonies.
  This is a fundamental issue. That is why this substitute is so good, 
because among those principles that we hold dear in America and the 
reason we are so great is because we do not believe in discrimination, 
knowing full well that some practice it, but that discrimination is not 
one of those truths that we hold self-evident.
  In the fifties and sixties and throughout our history, men and women 
have died for that principle. Let us have the courage to vote for that 
principle. Vote for this substitute and vote against the underlying 
bill.
  Mr. THOMAS. Mr. Speaker, it is my pleasure to yield 2 minutes to the 
gentleman from Indiana (Mr. Souder).
  Mr. SOUDER. Mr. Speaker, first I want to praise the chairman of the 
Committee on Ways and Means for his ability to work his contributions 
within the budget context. We would have all preferred to go to $500, 
but he has taken a stair-step method that enables people who do not 
take large tax deductions to take the small increments that many small 
churches were asking us to do.
  It is appalling that Members have stood on this floor and mocked 
those who do not have large resources, but who would like to contribute 
to their local resources. I praise the gentleman for his effort.
  But I think it is also important to make clear today that in fact we 
are not looking just to protect religious liberty in this bill; but the 
way it has been debated on this floor, it would repeal religious 
liberty that has stood for many years.
  For example, if we make religious liberty subject to State and local 
laws, contractual provisions that prohibit a religious organization 
from maintaining its internal autonomy, which is not true currently, 
could be used to require religious health services to distribute 
condoms. If we repeal the religious liberty amendment and make it 
subservient to State and local laws, it is a slippery slope for other 
issues such as Medicaid, where it could require Catholic hospitals to 
perform abortions. This has huge ramifications in our society, if you 
make religious liberty subject to State and local laws.
  Religious liberty. We are in a very difficult area. It is a very 
uncomfortable area to debate, whether people of faith who have had 
centuries of positions on difficult issues like homosexuality, or other 
churches that may or may not, for example, have male nuns or female 
priests, whether they have to, in order to participate in any 
government program, lose their religious liberty.
  It will have a chilling effect not only on what could be done, but we 
are looking at reach-back provisions here if we start to apply this 
standard on what we are already doing in the AIDS area, where many 
churches have reached out over the years and have never been told 
before that suddenly they have to change their internal structure of 
their church to be eligible for government money. We are heading down a 
very slippery slope if we repeal religious liberty in America.
  Mr. McDERMOTT. Mr. Speaker, I yield 2 minutes to the gentleman from 
New Jersey (Mr. Pascrell).
  Mr. PASCRELL. Mr. Speaker, I thank the gentleman for yielding me 
time.

[[Page 13808]]

  Mr. Speaker, on page 40 of H.R. 7 is the very crux of why we believe 
that this is a particularly pernicious, pernicious, amendment. A young 
lady comes walking along, and suppose her purse falls and something 
pops out of the purse. Lo and behold, it is birth control pills. Under 
this piece of legislation, if that particular religion does not accept 
forms of prevention, that woman could be fired on the spot because they 
do not accept it. You tell me where it is she is protected in this 
legislation?
  In the early days of the Bush administration, the Office of Faith-
Based Initiatives was created with the great idea that religious 
community-based organizations are the best source of social services.
  I support the Rangel-Conyers-Frank-Nadler-Scott substitute. I was the 
mayor of Paterson before I came to the Congress, a city whose residents 
rely on exactly the social programs this legislation is designated to 
help. Believe me, my city counted on these social services, nonprofit 
organizations, many of them religiously affiliated, to supplement the 
city, State and Federal programs that already exist.
  But as a former mayor, as a former State legislator, I have grave 
reservations about the number of provisions in the Community Solutions 
Act which would supersede State and local civil rights laws and, in 
essence, allow religious institutions to discriminate, despite 
receiving Federal dollars.
  The Rangel substitute corrects every inequity and every 
discriminatory possibility. It recognizes the unique contributions of 
religious organizations to the community. Unlike the base bill, this 
amendment not only creates a new program, but it also pays for the 
program.
  Mr. THOMAS. Mr. Speaker, it is my privilege to yield 2 minutes to the 
gentleman from Texas (Mr. DeLay), the majority whip of the House of 
Representatives.
  Mr. DeLAY. Mr. Speaker, I thank the gentleman for yielding me time.
  Mr. Speaker, I come to this debate today in a very solemn mood, but a 
very excited mood at the same time, it is kind of a conflicting 
emotion, because this is the beginning of a debate that we have been 
looking for for a long, long time; in fact, my entire adult life. This 
is the beginning of a very real debate in this country over two very 
distinctly different world views.
  For 40 to 50 years, we have had the world view, as exemplified by the 
opposition all day long today, a world view that has been going on for 
40 or 50 years, and that world view basically is man can build Utopia, 
and what can undermine that building of Utopia is bringing God into the 
mix. So they have spent 40 to 50 years getting God out of our 
institutions, and they have fought very long and been very successful 
at it.
  Yet now we have a President that comes along and says, no, faith is 
important; what you believe is important. What you believe is what you 
are, and we need to bring it back in, because the world view that says 
we are going to build Utopia by building huge government to do 
everything for you, faith does not have to enter into it.
  Do you know what the result of that is? Look at what has happened 
over the last 40 or 50 years to the culture, the fabric of the culture 
of this country. I do not have time to list it here, but we all know 
what I am talking about. The culture, very fabric has been ripped 
apart, the culture of this country.
  Now we want to bring it back in, and part of rebuilding that culture 
is faith, faith in something bigger than yourself, and that, to many of 
us, is God; and we want to bring God back into it. But they want to 
continue to discriminate against those that want to bring in faith-
based institutions, that have proven to be successful.

                              {time}  1400

  Right in my own district, Chuck Colson's Prison Fellowship took over 
an entire prison on faith. Do we know what the recidivism rate of that 
prison is? Mr. Speaker, it is 3 percent. Because we know that changing 
the heart and mind and soul of men through faith is how they are 
changed.
  That is what we are talking about here. It is more fundamental than 
the petty arguments that we have heard here today. This is vitally 
important, the future of our country and the rebuilding of our culture. 
We must pass this bill without amendment. Vote for the bill and against 
the substitute.
  Mr. McDERMOTT. Mr. Speaker, I yield 2 minutes to the gentleman from 
Texas (Mr. Doggett).
  Mr. DOGGETT. Mr. Speaker, 40 or 50 years, I would tell the gentleman 
from Texas (Mr. DeLay), indeed, 200 years and plus, because some of us 
think that just maybe our Founding Fathers, Mr. Jefferson and Mr. 
Madison and all those that played a role in our Bill of Rights, may 
have known just slightly more than the greats of today such as the 
gentleman from Texas (Mr. DeLay), Mr. Gingrich, the gentleman from 
Texas (Mr. Armey), and the gentleman from Illinois (Mr. Hastert). 
Perhaps they understood the role, the important and vital role that 
religion would play in our society, and they would also recognize that 
we do not need government interfering with it. We do not need 
government funding it.
  Indeed, that is why hundreds of religious leaders, who are doing 
innovative work--enriching and changing lives across this country, have 
opposed this bill. Because they are doing their good deeds, they are 
living their faith and their religion, and they do not even need the 
gentleman from Texas (Mr. DeLay) and the gentleman from Illinois (Mr. 
Hastert) to come in and pass a bill to let them do it.
  Today is a referendum on discrimination. We will have a vote today on 
which the Members of this House will have an opportunity to say whether 
they want to spend Federal tax dollars to encourage discrimination in 
employment or not. And the second matter, the ultimate faith-based 
initiative today is on the issue of fiscal responsibility.
  Mr. Speaker, these Republicans are draining the Medicare Trust Fund 
as quickly as they can turn the spigot. And when they get through 
emptying it, they are moving next to the Social Security Trust Fund. 
That is why rather than remaining true to recent Republican pledges to 
``lockbox'' Medicare, The Director of the Office of Management and 
Budget calls the Medicare Trust Fund ``a fiction,'' Indeed, the real 
fiction is the claim that Republicans can provide tax breaks like this 
and maintain any sense of fiscal responsibility.
  If we think that the gentleman from California (Mr. Thomas) can keep 
coming in here, week after week, with one special interest tax break 
after another, today for those that helped in getting out the 
Republican vote last year in certain parts of the religious community, 
and next week with the breaks for the oil, gas industry nuclear and 
coal industries, if we think that he can provide all of those tax 
breaks and not pay for or provide offsets for a single one of them 
without invading the Medicare Trust Fund and the Social Security Trust 
Fund, Mr. Speaker, if we think he can accomplish that, we are really 
investing the ultimate faith-based initiative.
  Mr. THOMAS. And the Democrats' sorrow pile grows and grows.
  Mr. Speaker, I yield 1 minute to the gentleman from Pennsylvania (Mr. 
Pitts).
  Mr. PITTS. Mr. Speaker, not every human need and social problem 
requires a government program. There are many charitable, 
nongovernmental, nonprofit, humanitarian and faith-based programs that 
work, that are very effective. President Bush has recognized the power 
of faith-based organizations, and he has challenged America to harness 
this power. He points to groups like Teen Challenge that operate in 
Pennsylvania for over 40 years. It has an 86 percent success rate in 
drug and alcohol rehab, and they track their graduates for 7 years 
after they graduate. The government programs we fund have a 6 to 10 
percent success rate. Clearly, there is a difference.
  President Johnson waged a war on poverty. We have declared a war on 
drugs. We have not won those wars. That is because the real problems of 
this country are not money problems,

[[Page 13809]]

they are problems of the spirit. Government cannot create a work ethic 
or make people moral or make people love one another or pray, renew 
communities. Government cannot address the basic problems which are 
problems of the spirit, and these faith-based programs can. Let them 
have a place at the table with their conscience.
  Mr. McDERMOTT. Mr. Speaker, I yield 10 seconds to the articulate 
gentleman from Massachusetts (Mr. Frank).
  Mr. FRANK. Mr. Speaker, there is a flaw in several of the things we 
have heard. The bill specifically says we cannot have a religious and 
theological content in the program. Those who say that the importance 
is to use religion to improve people's lives have not read the bill.
  Mr. McDERMOTT. Mr. Speaker, I yield 1 minute to the gentleman from 
California (Mr. Schiff).
  Mr. SCHIFF. Mr. Speaker, religious institutions have always played a 
vital role in serving the needs of society's most vulnerable members, 
our children, the poor, the disabled, the dispirited, not out of a 
motivation for public funding but driven by the beneficent dictates of 
their faith. That work goes on. It must go on. I applaud the 
administration for the desire to further this goal.
  But this bill is not the way. Providing Federal funding directly or 
indirectly through a massive multi-billion dollar voucher program, 
practically without restriction, for religious or nonreligious 
activities related to the delivery of social service runs squarely into 
conflict with our Constitution.
  Why does that matter? Perhaps the Founding Fathers got it wrong. 
Because there should be no separation of church and State. Perhaps the 
Founding Fathers were simply antagonistic to religion. No, they were 
not. The right of free exercise of religion and against the 
establishment of religion protected in our Bill of Rights are 
intertwined rights. They are inseparable. Allow the establishment of 
religion, and we do away with the free exercise of religion. Allow the 
excessive entanglement of church and State as represented in this bill, 
and we do not serve church or State.
  Mr. THOMAS. Mr. Speaker, I yield 2 minutes to the gentleman from 
Florida (Mr. Stearns).
  Mr. STEARNS. Mr. Speaker, I think all of us should reflect a little 
bit and realize that four bills were signed by President Clinton that 
had charitable choice in them and they passed overwhelmingly. I suspect 
that a lot of people that are debating this voted for those bills, 
because they passed 345 to whatever was left.
  Proponents of the idea to substitute their own bill always talk about 
our bill violates the first amendment, and this is a very relevant 
question. It demands some serious consideration. Those who support the 
idea that they want to put in another bill because ours violates the 
first amendment do so because they believe in the first amendment, but 
we all do. The Constitution provides, ``Congress shall make no law 
respecting the establishment of religion or prohibiting the free 
exercise thereof.''
  But this charge is twofold. The first amendment provides that the 
government cannot establish one religion or a religion over a 
nonreligion. But it also, I say to my colleagues, provides that the 
government shall not prohibit the free exercise of religion.
  This is a very important point and the purpose of our bill. With some 
constitutional concerns in mind, we must make certain to allow members 
of organizations seeking to take part in government programs designed 
to meet basic human needs and ensure that capable and qualified 
organizations not be discriminated against on the basis of their 
religious views.
  So charitable choice makes clear that existing Federal law providing 
for the Federal provision of social services should not be read to 
exclude. One cannot exclude faith-based organizations solely on the 
basis of their beliefs.
  So I would conclude, Mr. Speaker, to point out that what we are 
trying to do is exercise freedom of religion, and that is what 
charitable choice does.
  Mr. McDERMOTT. Mr. Speaker, I yield myself such time as I may 
consume.
  This amendment was put out here for a very simple purpose. The 
Republicans have been acting like they had a $500 bank account and they 
were going to write ten $100 checks; and that is what the Committee on 
Ways and Means Chairman led by the Committee on Ways and Means 
Republicans has done, over and over again.
  We received a letter from the gentleman from Iowa (Mr. Nussle) on 
July 11 that said that the surplus remaining was $12 billion. Now, the 
President has yet to submit a defense request to us. The lowest 
estimate anybody has heard is that he wants $10 billion. So if we just 
imagine taking 12 and subtracting 10, we now have $2 billion left in 
surplus, and so then we are almost into Social Security and Medicare. 
Okay?
  Now, we also have stuff coming out of the CBO and the Committee on 
Joint Taxation telling us that the economy has slowed down and the 
revenue estimates are going down. A very conservative estimate of how 
far down they have gone is $20 billion. Now, remember, we have that $2 
billion left, we subtract another 20, we are $18 billion into the 
surplus in Medicare.
  Mr. Speaker, I do not know how many times I have heard people come 
out and say, we are going to put a lockbox on these funds. By God, we 
are going to put a lockbox on this, on Social Security, and lock up all 
that Medicare.
  Right here, before we pass this foolish bill, we are already $18 
billion into the Medicare money. Now we have another $13 billion here. 
So now we are up to $31 billion, and next week we are all going to get 
a chance to come out here and pass a bill about energy cuts. I have 
forgotten what that one is. I think it is $33 billion. And we know that 
$500 checking account that we wrote $1,000 worth of checks on, we are 
going to write about $5,000 worth of checks by the time we are done. We 
are bankrupt, unless we go into Social Security and Medicare.
  Now, we can do all the dancing we want out here and talk all about 
the issue of the first amendment. I mean, people are acting like 
somehow we cannot fund social services done by faith-based groups. As I 
said earlier, that is nonsense. Catholic charities, Jewish Charities, 
Lutheran World Service, on the list goes, the Salvation Army, the whole 
works, they all have tremendous amounts of Federal money, and they 
follow rules. And that section of this bill that wants to take away the 
rules or start bending the rules is going to wind up with people facing 
indictments. We are going to have ministers who think they can come 
down here to the government, get a bag full of money and go home and do 
whatever they want with it, and they are going to wind up being 
indicted.
  Now, we had one of our colleagues, some of my colleagues may 
remember, runs a great, large church, and he spent a lot of money 
defending himself against the charge that he was spending Federal money 
in a religious way. He ultimately won, but we are going to see that 
this is not a free bag of money to just go and take for church leaders 
to take home and do whatever they want with. The Supreme Court, the 
district courts, the courts of appeal have been clear on this issue.
  The gentleman from Texas acts like the country started when the 
Democrats were picking up the pieces after the Republican debacle of 
the 1920s. This country spent 200 years with a separation of church and 
State. It does not need this bill, and it is fiscally absolutely 
irresponsible.
  Mr. THOMAS. Mr. Speaker, I yield myself 10 seconds. The Democrats' 
pile of sorrows grows and grows. The bank that the gentleman described 
existed only when the Democrats controlled the House of Representatives 
and ran a bank that did just exactly what the gentleman described.
  Mr. Speaker, I yield 2 minutes to the gentleman from Wisconsin (Mr. 
Green).
  Mr. GREEN of Wisconsin. Mr. Speaker, I thank the gentleman for 
yielding me this time.



  It is interesting that speaker after speaker today on both sides of 
the aisle

[[Page 13810]]

has begun his or her remarks by citing some faith-based organization 
back in his or her own district that is doing such a wonderful job and 
then talking about how incredibly supportive they are of those 
organizations. Yet, with their substitute and with their attacks, the 
opposition would add burden after burden after burden on these very 
organizations. In fact, the last speaker would scare faith-based 
organizations to make sure that they do not take advantage of this law. 
Worse yet, some of them, some of them would like to remove the 
religious exemption that these organizations have enjoyed for years and 
which has been upheld by this body and the United States Supreme Court.

                              {time}  1415

  But remember this, the first amendment to the Constitution says that 
government shall not establish a religion, but it also requires us to 
honor religious liberty. We have done so for years. We have done so in 
the years since charitable choice. Some here today would delete that 
exemption.
  Mr. Speaker, maybe we should have that debate on the floor of this 
House, but that is not the debate today. This is not about scaring 
faith-based organizations, this is not about putting burdens on them, 
this is about turning them from rivals in the minds of too many people 
to partners.
  America is hurting. America has needs. America has challenges. 
Neighborhood after neighborhood has challenges. There are organizations 
in these neighborhoods ready and willing to make a difference. We 
should stand by their sides. We should extend a helping hand. If we do 
this, we can win the war on poverty. We can change America for the 
good.
  I ask my friends to oppose this substitute amendment, support this 
bill, and let us get it to the President's desk.
  Mr. THOMAS. Mr. Speaker, it is my pleasure to yield 1 minute to the 
gentleman from Georgia (Mr. Kingston).
  Mr. KINGSTON. Mr. Speaker, I thank the gentleman for yielding time to 
me.
  I want to say to my good friends on the left, gee, whiz, they must 
have trouble sleeping. Since 1996, this basically has been the law, 
that charitable institutions, faith-based institutions, can participate 
in welfare distribution, welfare services.
  Now all we are doing is saying two things, that we want to expand 
that eligibility to say that faith-based institutions who are 
delivering social services, like job training, like drug addiction, 
like feeding the hungry, that they can participate in grants.
  I know Members are very, very proud of the great job that the 
government has been doing since the War on Poverty. We have only spent 
billions and billions of dollars, and the poverty level has not 
decreased.
  What we are saying is, let us think outside the box. Let us expand 
it. Let us let faith-based institutions get in there.
  The second part, which is very important, is let people have a 
charitable contribution deduction on their taxes to encourage more 
giving to charity. We think this is important.
  I know that the left, and I want to say the Washington left, because 
I want to say to my Democrat friends back home, all the Democrats back 
home support this. The traditional liberals back home think this is a 
good idea. I would be very careful before I listen to my Washington 
friends.
  Mr. THOMAS. Mr. Speaker, it is my pleasure to yield the remainder of 
my time to the gentleman from South Dakota (Mr. Thune).
  The SPEAKER pro tempore (Mr. LaHood). The gentleman from South Dakota 
(Mr. Thune) is recognized for 15 seconds.
  Mr. THUNE. Mr. Speaker, as we close this debate, I would like to say 
that I had the opportunity last April to travel around my home State of 
South Dakota and visit a few of the hardworking local charities that 
would benefit from this legislation.
  I am continually amazed by the kind hearts of the neighborhood saints 
who work and volunteer at these organizations day in and day out. These 
folks serve the poor, the weak, and the victimized.
  We need to support this legislation, because these organizations can 
make a difference in people's lives. We need to defeat the Democrat 
substitute and pass H.R. 7.
  Mr. McDERMOTT. Mr. Speaker, I ask unanimous consent that the 
gentleman from New York (Mr. Nadler) be allowed to manage the 15 
minutes allocated to the Committee on the Judiciary.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Washington?
  There was no objection.
  Mr. NADLER. Mr. Speaker, I yield myself 2 minutes.
  Mr. Speaker, it is unfortunate that we have been forced by the 
Republican leadership to consider many of the principle problems with 
this bill in one substitute amendment. It would have been better to 
have an open debate on separate amendments, but that might have been 
proven embarrassing.
  Therefore, we have this substitute, which does several things. It 
prohibits employment discrimination and preemption of State and local 
civil rights laws with Federal funds, it provides offsets for the costs 
of the bill, it deletes the sweeping new provisions permitting agencies 
to convert more than $47 billion in government programs into private 
vouchers without congressional review, and it protects participants 
from religious coercion.
  If Members do not believe in employment discrimination and if they 
support the civil rights laws of their community, they should vote for 
the substitute. If Members are concerned about the administration 
having unfettered discretion to turn billions of dollars of social 
services into vouchers without any congressional review, they should 
vote for the substitute.
  If Members think that the charitable deductions established in this 
bill should be paid for by a slightly lower tax cut to the very 
wealthy, rather than by raiding the Social Security and Medicare trust 
funds, they should vote for the substitute.
  If Members are fiscal conservatives and think tax cuts must be paid 
for, they should vote for the substitute.
  If Members believe that the most vulnerable members of our society 
should be free from religious coercion when they seek help, then they 
should vote for the substitute.
  Some Members may want the substitute to do something more or may wish 
the substitute did not do something that it does. But if Members are 
concerned that this bill is flawed and want to make their concerns 
known, they should remember that their choice is between the substitute 
and the bill. If Members do not vote for the substitute, they should 
not delude themselves into believing the concerns will be addressed 
down the road.
  If the Republican leadership of the House thinks they can muscle this 
flawed legislation through the House, they will not pause to repair the 
terrible flaws later.
  Members should vote for the substitute if they have any of these 
concerns. I urge my colleagues to do so.
  Mr. Speaker, I reserve the balance of my time.
  Mr. SENSENBRENNER. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, I rise in strong opposition to the substitute. It not 
only removes key provisions of the bill, but it denies religious 
organizations civil rights protections they currently enjoy.
  Make no mistake about it, the substitute is a radical retrenchment of 
current law which flies in the face of a unanimous Supreme Court which 
upheld religious organizations' exemption from title VII, even when 
they perform social services that contain no religious worship, 
instruction, or proselytization.
  One of the most important charitable choice principles is the 
guarantee of institutional autonomy that allows faith-based 
organizations to select staff on a religious basis. H.R. 7 preserves 
this guarantee and is supported by no less a civil rights leader than 
Rosa Parks. She has said that H.R. 7 is

[[Page 13811]]

an important response to urban America in its reduction of 
discriminatory barriers currently suffered by many grass roots churches 
who are unable to access funding for educational and social welfare 
programs.
  Now, if churches are allowed to compete for Federal social service 
funds, they must be able to remain as churches while doing so, and 
being able to hire those of the same faith is absolutely essential to 
being a church.
  Even former Vice President Al Gore during his campaign, and in a 
speech to the Salvation Army, said that, ``Faith-based organizations 
can provide jobs and job-training, counseling and mentoring, food and 
basic medical care. They can do so with public funds, and without 
having to alter the religious character that is so often the key to 
their effectiveness.''
  Again, the only way a church can retain its religious character is if 
it can hire staff with those who share the same faith.
  In addition, the small churches of America will often be providing 
the social services covered by H.R. 7 with the same staff they 
currently have. That staff likely shares the same religious faith.
  The substitute would make it impossible, impossible for these small 
churches to contribute to Federal efforts against desperation and 
hopelessness, and it is precisely these small churches that H.R. 7 
intends to welcome into that effort.
  Section 702 of the Civil Rights Act of 1964 has for decades exempted 
private nonprofit religious organizations engaged in both religious and 
secular nonprofit activities from title VII's prohibition on 
discrimination in employment based upon religion. The Supreme Court, 
including Justices Brennan and Marshall, upheld this exemption in the 
Amos case:
  ``Section 702(a) is not waived or forfeited when a religious 
organization receives Federal funding. No provision of section 702 
states that its exemption of nonprofit religious organizations from 
title VII's prohibition on discrimination in employment is forfeited 
when a faith-based organizations receives a Federal grant,'' but the 
substitute would do just that, and change current law.
  The portion of the substitute that says that no Federal funds can go 
to an organization that engages in sectarian instruction, worship, or 
proselytization at the same time and place as a government program is 
fatally unclear. Does it mean that no sectarian activities can occur 
anywhere in a church when only the church basement is being used to run 
a life-skills class under a covered Federal program? If two rooms in 
the church are being used to shelter a battered spouse, does the rest 
of the church have to cease all religious functions?
  The substitute contains language that may say yes to those questions. 
Inner-city churches in low-income neighborhoods simply cannot afford to 
set up duplicate facilities to run these social service programs. The 
substitute punishes small churches, particularly those in poor 
neighborhoods that cannot and should not have to set up two different 
buildings to take part in Federal social service programs.
  Regarding the indirect funding language of the bill, the Supreme 
Court approved indirect funding as a way to much reduce church-state 
separation as far back as 1983 in Mueller v. Allen and in Witters v. 
The Washington Department of Social Services to the Blind in 1986.
  Subsection l in H.R. 7 is about more than vouchers, which is just one 
type of indirect funding mechanism. It is not necessary that a 
beneficiary actually be handed a piece of paper called a voucher and 
carry it to the point of service.
  According to the Supreme Court, indirect funding is where a 
beneficiary has genuine choice of social service providers; where the 
exercise of that choice determines which provider ultimately receives 
the funding, because the beneficiary decides where the funding goes and 
not the government.
  The Supreme Court has said that the government's responsibility stops 
with the beneficiary. Therefore, whether the funds end up in a secular 
or religious group is a matter of private choice, and the establishment 
clause does not regulate private choices.
  The minority party complains of hazards of church-state separation 
with H.R. 7. When the majority proposes subsection l, which would 
alleviate all these first amendment concerns of entanglement, and 
threats to the autonomy of the faith-based organizations, they object 
to the perfect solution to their complaints.
  The minority also acts like indirect funding is a new and untested 
idea. We have been living with the child care development block grant 
act since late 1990. With this act, the Federal Government has been 
funding services provided by churches via indirect aid, which provide 
over 40 percent of the indigent day care in this country.
  It has resulted in no problems. Indeed, none of the radical 
separationist organizations have dared to even file a lawsuit to 
challenge this act.
  It is not just day care that can be funded by indirect aid. Alcohol 
and drug rehabilitation centers can also work in this manner. The State 
and local government determines who meets the qualifications for these 
services, and counselors work with qualified individuals to look over 
the centers available in his or her community. The individual makes a 
choice, and a call is made affecting a referral. The beneficiary goes 
to the rehab center and is enrolled. Then the center notifies the 
State, and checks are sent each month that the services are rendered to 
that beneficiary.
  Subsection l is also narrowly drafted. A cabinet level Secretary does 
not have carte blanche. No program can be shifted to indirect aid 
without three requirements being met: one, it must be consistent with 
the purpose of the program; two, it must be feasible; and three, it 
must be efficient. This discretion can be challenged under the 
administrative procedure act.
  For all these reasons, I urge my colleagues to oppose the substitute.
  Mr. Speaker, I reserve the balance of my time.
  Mr. RANGEL. Mr. Speaker, I yield myself 15 seconds to correct the 
misstatement of fact by the distinguished chairman who stated that 
churches can discriminate. They can, but not with Federal funds. This 
bill would allow them to discriminate with Federal funds. The motion to 
substitute would say they cannot.
  Mr. Speaker, I will later include for the Record the letter from Rosa 
Parks saying she does not support discrimination with Federal funds.
                                              Rosa & Raymond Parks


                               Institute for Self Development,

                                       Detroit, MI, June 26, 2001.
     Hon. John Conyers, Jr.,
     Ranking Member, House Judiciary Committee,
     Rayburn House Office Building, Washington, DC.
       Dear John: As you know, I support legislative efforts to 
     enhance the ability of religious and other faith-based groups 
     to receive government funding in order to respond to 
     community problems.
       I believe that helping grassroots churches access this 
     funding can be fully consistent with our civil rights laws 
     and the First Amendment This is why I want to express my 
     support for amendments you plan to offer when the House 
     Judiciary Committee considers H.R. 7 which would insure that 
     government funds provided to religious organizations are not 
     used to keep churches or other non-profits from working 
     together for the betterment of us all. We do not want to 
     change the 1964 Civil Rights Bill that we fought so hard to 
     achieve.
       Churches already know that they cannot use food or other 
     services they may provide as an excuse to force people to 
     accept their religious views, while using government funds. I 
     am certainly in support of making sure that does not happen.
       John, we have both spent our entire lives fighting against 
     discrimination and in favor of the protections set forth in 
     our Bill of Rights. The last thing we would want to do is 
     permit H.R. 7 to be used to narrow the civil rights laws or 
     to intrude on the First Amendment. It is my hope that 
     adoption of these amendments will help broaden the bipartisan 
     support for the bill and allow the measure to be quickly 
     passed into law so that churches can increase their role in 
     fighting poverty and other urban ills.
       God bless you and your good work.
           Peace and Prosperity,
                                                       Rosa Parks.

  Mr. NADLER. Mr. Speaker, I yield 1 minute to the gentleman from 
Missouri (Mr. Gephardt), the distinguished minority leader.

[[Page 13812]]


  Mr. GEPHARDT. Mr. Speaker, I rise to speak in favor of this 
substitute. I believe it is a superior bill to deal with this very 
important problem.
  I am saddened to stand before the Members in opposition to the 
language of the bill that is on the floor. In my view, this bill 
represents a missed opportunity to extend the good works of faith-based 
organizations.
  I am a strong supporter of not-for-profit and faith-based 
organizations. I believe they provide tremendous help to people all 
over this country. They feed the hungry. They put roofs over people's 
heads. They tend to the most underprivileged in our society, the 
poorest members of our communities. They are vital to every community 
in America, and as forces for good in our society, they are simply 
irreplaceable.
  But I do not believe that we should accept the premise of the 
legislation before us. I believe in the Golden Rule: ``Do unto others 
as you would have them do unto you.'' I do not think that we should 
expand government support for institutions at the expense of 
fundamental civil rights and antidiscrimination protections for all 
Americans.
  Millions of people, African Americans, Hispanic Americans, women, 
gays and lesbians, the disabled, people of all different faiths, enjoy 
more opportunity and equality because of the these laws.

                              {time}  1430

  These are living, breathing parts of the American democracy, making a 
tremendous difference in people's everyday lives.
  I believe the President's faith-based initiative rolls back these 
protections; protections which ironically our leading reverends and 
Rabbis and religious luminaries have fought for and won; protections 
which further the fundamental humanist principles of equality, 
individual liberty, and freedom.
  The consequences of this bill, unintended or not, are that it will be 
easier for these important institutions to ignore fundamental State, 
local, and Federal antidiscrimination laws. Just last week, The 
Washington Post reported that the Bush administration had reached some 
kind of an agreement with the Salvation Army. In exchange for political 
support, the White House would consider exemption for the Salvation 
Army from local and State laws protecting gay Americans from 
discrimination. This was a sad development, and it indicates the kinds 
of problems this law creates for potentially millions of Americans in 
every corner of our society.
  I am also concerned that the bill has a tax incentive that is not 
paid for, and a very small incentive that will have little or no effect 
on charitable giving. We continue to worry about going into Medicare 
and Social Security Trust Funds in this budget, and we should not pass 
new tax breaks without finding offsets so we do not invade these 
critical programs.
  Finally, I think this bill violates the fundamental church-State 
separation that is still a fundamental principle of our democracy. This 
bill will invite government regulation of religious institutions; and 
through a little known loophole, it will invite government scrutiny of 
the allocation of government-wide vouchers, which will blur the line 
separating church from State, weakening our Bill of Rights.
  In short, I do not think this bill is what the American people want, 
and I do not believe this is what the House of Representatives wants 
for our country. Americans enjoy the wonderful protections afforded by 
the Bill of Rights, the Civil Rights Act of 1964, and the countless 
critical civil rights laws at State and local level. They have made 
more freedom and more equality everyday reality in people's lives. I 
urge Members to vote for this substitute so that we can support faith-
based institutions in ways that will not harm the people of this great 
democracy but will uphold the role of faith in our great and diverse 
Nation.
  Mr. SENSENBRENNER. Mr. Speaker, I yield 2 minutes to the gentleman 
from Illinois (Mr. Kirk).
  Mr. KIRK. Mr. Speaker, I would like to engage the author of the bill 
in a colloquy.
  Many H.R. 7 supporters have questioned why this issue is suddenly 
being discussed, since the most recent version of the charitable choice 
signed into law last year included the following provision: ``Nothing 
in this section shall be construed to modify or affect the provisions 
of any other Federal or State law or any regulation that relates to 
discrimination in employment.'' Is that not correct?
  Mr. WATTS of Oklahoma. Mr. Speaker, will the gentleman yield?
  Mr. KIRK. I yield to the gentleman from Oklahoma.
  Mr. WATTS of Oklahoma. Mr. Speaker, yes, that is an accurate 
characterization.
  Mr. KIRK. H.R. 7, as currently written, does not include similar 
language prohibiting the preemption of State and local laws; is that 
not correct?
  Mr. WATTS of Oklahoma. If the gentleman will continue to yield, yes, 
that is correct.
  Mr. KIRK. If a State law prohibits discrimination based on a 
particular characteristic, and in a religious organization would 
ordinarily, based on State law, be required to comply with that law, 
would H.R. 7 change that situation in any way?
  Mr. GREEN of Wisconsin. Mr. Speaker, will the gentleman yield?
  Mr. KIRK. I yield to the gentleman from Wisconsin.
  Mr. GREEN of Wisconsin. Mr. Speaker, yes, H.R. 7 would change this 
situation, in a particular instance. If a religious organization were 
to use funds where the State funds have been commingled with Federal 
funds, it could assert its right under subsection (d) and (e) of H.R. 7 
against the enforcement of State or local procurement provisions that 
limited the religious organization's ability to staff on a religious 
basis.
  Mr. KIRK. Mr. Speaker, reclaiming my time, I thank the gentleman from 
Wisconsin for that clarification.
  Several constitutional lawyers have informed me that H.R. 7 would 
indeed change the existing situation. This is precisely where we seem 
to most disagree on the direction our policy should move in. I would 
hope that the gentleman from Oklahoma (Mr. Watts) would commit to 
working with those of us who are concerned about this issue to craft 
language which would ensure that these organizations comply with State 
and local civil rights laws which exist in communities across the 
Nation.
  The gentleman from California (Mr. Dreier) and several 
representatives of the leadership have expressed their desire to 
clarify this issue in conference.
  Mr. WATTS of Oklahoma. If the gentleman will further yield, as 
sponsors of the bill, the gentleman from Ohio (Mr. Hall) and I are 
willing to make the commitment that we will more clearly address this 
issue in conference and with the gentleman as the process moves along.
  Mr. KIRK. Mr. Speaker, I thank the gentleman.
  Mr. NADLER. Mr. Speaker, I yield 2 minutes to the gentleman from 
North Carolina (Mr. Watt).
  Mr. WATT of North Carolina. Mr. Speaker, to be honest, on days like 
today, I am just saddened to be a part of this body. We bring bills 
like this to the floor and we scream at each other; and the truth of 
the matter is that there are wonderful, good people on both sides of 
this issue.
  There are people, black and white, Republicans and Democrats, and I 
could use all of my time, who have spent their entire lives fighting 
against discrimination. Some of them are supporting this bill; some of 
them are opposing this bill. The ones who are supporting it, I believe, 
are supporting it because they believe that the benefits outweigh the 
detriment, and those who oppose it believe that the detriment outweighs 
the benefit. I happen to be in that latter category.
  I have spent my entire life fighting against discrimination in every 
form, racial, religious, gender, sexual orientation, without exception; 
and I will not vote for a bill that sanctions discrimination in 
religion. And that is what this bill does.
  Now, some of us can say that it is worth the price to do that, and I 
will respect a colleague who says that. But

[[Page 13813]]

I will not respect anybody who gets up and denies that the bill does 
not do that. Even the gentleman from Oklahoma (Mr. Watts) acknowledged 
that right now he is going to work on it in conference.
  The time to work on the bill is here, now, in the committee, in the 
House. And if it does not measure up, we should vote it down and 
support the Democratic substitute.
  Mr. SENSENBRENNER. Mr. Speaker, I yield 1 minute to the gentleman 
from Illinois (Mr. Hastert), the distinguished Speaker of the House.
  Mr. HASTERT. Mr. Speaker, I rise in support of the President's faith-
based initiative and urge all of my colleagues to vote for it.
  This is a bipartisan bill. I worked last year with President Clinton 
to do the urban renewal on a bipartisan basis. This idea is not new. 
When the urban renewal bill was moved last year, I think it almost had 
unanimous consent on both sides of the aisle.
  Why, and why is this important? As we walked through this situation, 
and I kind of led the antidrug effort, at least on this side of the 
aisle for a couple of years before I got another job, we found that 
when we walked into drug treatment organizations that were usually 
government-run, we had recidivism rates of 95, 96, and 97 percent. When 
we walked into faith-based organizations to see what their results 
were, we had recidivism rates as low as 24 and 25 percent. It works.
  When people care about people and offer their time and their faith 
and their hard work and their commitment and devotion to change 
people's lives, it works. Not only does it have the net result of 
changing people's lives, allowing people to live a better life, 
allowing their children and their grandchildren to live a better life, 
it is also one of the things that, as we look around here, is a little 
cost effective. If we have recidivism rates of 95, 96, and 97 percent 
and then turn around and have an answer where recidivism rates are a 
third of that or less than that, then that is a good idea. It is 
something we ought to look at.
  I believe we need to put the protections in. We need to have the 
safeguards, and we are trying to do that. I think the good faith of the 
sponsor says he will do that.
  This is a good idea. It is not a new idea. It is part of President 
Clinton's urban renewal that we did just last year. It is something 
that works, something that is eminently good common sense. So let us 
move forward with this. Let us pass it. Let us get it into the Senate. 
Let us work through the process. Let us lead. Let us do what is right 
for America.
  I commend the sponsor and those who support it, and I appreciate the 
gentleman from the other side of the aisle, the gentleman from Ohio 
(Mr. Hall), who has worked on this as well. I have walked a lot of 
districts, both Republican and Democrat districts. I walked with the 
gentleman from Illinois (Mr. Davis) and the gentleman from Illinois 
(Mr. Rush) in Chicago, and have talked to people who have been able to 
change people's lives. Let us give them a chance to do a better job.
  Mr. NADLER. Mr. Speaker, I am pleased to yield 2 minutes to the 
gentleman from Massachusetts (Mr. Frank).
  Mr. FRANK. Mr. Speaker, there is virtual unanimity here on the goal 
the Speaker stated. We simply do not believe that to get the benefit of 
these decent well-motivated individuals who run the faith-based 
institutions that we have to give them the right to discriminate.
  Now, we were told, well, there is probably a concession that there 
are parts of this bill that would allow too much discrimination, but 
they will be fixed in conference. It is funny, when I heard this was 
the faith-based bill, I thought they were talking about faith in God, 
not faith in the Senate. I think there is a lot less of that over here 
than of the other.
  This bill clearly authorizes the preemption of State and local civil 
rights laws. What it says is with Federal money, doing purely secular 
activities, albeit motivated by faith, they can violate State and local 
laws. And if the money is commingled, if there is State money and local 
money, and they try to condition that money on their policies, the 
Federal money wipes that out. It also allows religious discrimination.
  It seems to me to disserve the faith-based communities. It insults 
them to say that they can only go forward if they are allowed to 
violate otherwise applicable State law and discriminate on these 
grounds.
  And let me address one absolute inaccuracy. The suggestion that we 
have heard, that the substitute and then the subsequent recommit, 
somehow will enact the National Gay Rights Bill, that is absolutely and 
completely and totally false. All this says is that where there are 
existing State, State antidiscrimination laws, and an organization 
would otherwise be covered by them, they are still covered. Federal 
money does not become the universal solvent. If an organization is in a 
State and they get Federal highway money, that does not exempt them 
from State laws. If they get Federal housing money, it does not exempt 
them from State laws.
  Do my colleagues really think so little, those on the other side, of 
churches and faith-based institutions, and synagogues and mosques, as 
to think they will not do this faith-based charity unless they are 
given a special right to violate State laws and discriminate against 
people? I think we are the ones who truly show faith in them.

                              {time}  1445

  Mr. SENSENBRENNER. Mr. Speaker, I yield 1\1/2\ minutes to the 
gentleman from Ohio (Mr. Hall).
  Mr. HALL of Ohio. Mr. Speaker, I have heard a lot of interesting 
stories today. Some of the speakers, I think, have pointed out worst-
case scenarios. These scenarios have never actually come about. They 
have never happened. We have voted on this four times in the Congress, 
and these worst-case scenarios have never happened.
  This is about the little guy. It is about the man or woman that is 
helping the least and the lost of our society. It is about the small 
organization with a few employees, maybe two, three or four employees. 
It might be one person, the same person dishing out cereal in the 
morning. He is also the person that is leading the Bible class in the 
afternoon. He probably has got a jobs program late in the afternoon. At 
night, he is turning off the lights; and probably just before that, he 
swept the floor.
  That is what it is about. This is not about a group of people that 
works 40 hours a week. It is about people that nobody ever heard of. 
Nobody ever knows them. They never see their name in the paper. They do 
not work 40 hours a week. They work 50, 60, 70 hours. They work because 
they love, and they work because of their faith.
  Finally, I wanted say that we need to be careful. I especially say 
this to my Democratic colleagues: We dismiss and we discourage people 
of faith in this country with our words and our actions sometimes; and 
we almost, to a point, put out a sign that says you are not welcome in 
our party.
  Vote against this substitute. Vote for this bill.
  Mr. NADLER. Mr. Speaker, I yield 2 minutes to the gentleman from 
Massachusetts (Mr. Delahunt).
  Mr. DELAHUNT. Mr. Speaker, I certainly do not want to discourage 
people of faith. I want to encourage them. But that is not what this 
debate is about.
  In fact, I am more confused now than I was before after listening to 
the colloquy between the sponsor of the bill and the gentleman from 
Indiana (Mr. Hastert). We are going to work on this in conference. We 
are going to work on States' right. I thought we did that some 200 
years ago. Whatever happened to States' rights?
  It seems that devolution, that fundamental principle of the Reagan 
revolution is no longer operative.
  I look at my friends on the other side of the aisle. The Contract 
with America which spoke so clearly about local control seems to have 
been discarded. Well, it is clear to me that States' rights in this 
Chamber are no longer in vogue today or with this administration, at 
least on this particular issue.
  Remember, last week we learned that the Salvation Army had lobbied 
the

[[Page 13814]]

White House for a regulation exempting them from State and local laws 
to protect employees from discrimination based on sexual orientation. 
Then there was an uproar, and that effort was quickly abandoned.
  Well, they will not need a regulation if this bill becomes law today 
as it is presently drafted because religious organizations will be able 
to evade State and local laws simply by receiving a Federal grant. They 
will be free to deny a job to qualified workers. We must not let this 
happen.
  Support the substitute. Defend States' rights and defeat the 
underlying bill.
  Mr. NADLER. Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from 
New York (Mr. Weiner).
  Mr. WEINER. Mr. Speaker, I agree with the sponsors and advocates of 
this bill. As we look around our communities, it is undeniable the best 
homeless facilities, drug treatment, even job training courses are not 
city and State run. They are run by churches and synagogues.
  The supporters of this bill are right. We ought not rule out a 
compassionate program simply because it is motivated by a calling from 
God. I do not support those who believe that this bill is the handiwork 
of the radical right. This is the product of a very real desire to 
replicate the great works that are quietly and effectively working all 
throughout this Nation.
  The gentleman from Ohio (Mr. Hall), the gentleman from Oklahoma (Mr. 
Watts) and the gentleman from Wisconsin (Mr. Sensenbrenner) are decent 
and caring individuals who seek to do what is best.
  I will vote yes on this bill if we can make a much improved bill and 
perfect it further.
  First, let us restate what is the agreed-upon purpose of bill. Today, 
we vote to fund secular services in a nonreligious environment, no 
preaching, no proselytizing. It is right there in the bill. The bill, 
to its credit, makes that very clear. There is no reason to want to 
discriminate in hiring of a typing teacher or an after school art 
teacher. None of us would support such discrimination in these purely 
nonreligious environments.
  We should guarantee that this discrimination does not take place.
  To be clear, I strongly support Title 7 language of the Civil Rights 
Act of 1964. There is no reason to extend this protection to the 
programs we consider today.
  Secondly, I ask the sponsors, why should the passage of this effort 
drag down local and State human rights and anti-discrimination laws?
  It is ironic that many of the excellent and active religious 
organizations who support this bill were at the forefront of the laws 
that are being passed in the States and cities to protect the most 
vulnerable.
  As a former city councilman, I share the chagrin so often expressed 
by my conservative colleagues about the way we frequently trample on 
carefully considered local laws. There is no good reason to do that in 
this bill.
  When my colleagues advocate for the bill, I hear no good explanation 
for that preemption.
  Finally, as I said, I do not agree with the theorists that this bill 
is a subterfuge for a sinister agenda. Some have called me naive in 
that.
  Now after the bill was considered carefully and thoughtfully in two 
committees of this House, a new section was added which dramatically 
changes the way we administer virtually every social service program, 
every housing program, every anti-crime program by permitting a 
voucher-driven reorganization.
  Mr. Speaker, this broad administrative change that impacts $47 
billion of grant programs has no place in this bill.
  Fortunately, I can and will vote for the Faith Based Initiative Bill 
today. I will be voting for the Rangel Conyers substitute which irons 
out the last of the wrinkles in this bill.
  It ensures the best of the desires of this house--increased Federal 
funding for local religious based programs. And it makes it clear what 
we already know--there will be no discrimination in hiring.
  It preserves state and local human rights laws. And it leaves the 
voucher debate for another day. Modest improvements that--if made--can 
make this a bill that unifies this body around the principles that 
unify this Nation.
  Mr. NADLER. Mr. Speaker, I yield 1 minute to the gentleman from 
Washington (Mr. Inslee).
  Mr. INSLEE. Mr. Speaker, I commend all those on both sides of the 
aisle who are trying to figure out a way to assist faith-based 
organizations. But I think, given the nature of the debate, we need to 
pay due to the devil, and the devil truly is in the details on this 
important subject.
  Mr. Speaker, the unfortunate detail that I learned is that in the 
underlying bill it allows, it condones, it sanctions an employer to use 
tax-based money to hang out a sign saying we would like a drug 
therapist counselor, but no Jews need apply. That is wrong. It breaks 
faith with what Thomas Jefferson was so instrumental in giving to the 
world, which is tolerance for religious freedom. The separation of 
church and State is not because faith is only of small importance, it 
is because it is of great importance.
  Vote for the substitute which helps faith-based organizations but 
keeps faith with the idea of religious freedom.
  The SPEAKER pro tempore (Mr. LaHood). The gentleman from New York 
(Mr. Nadler) has 2\1/4\ minutes remaining, and the gentleman from 
Wisconsin (Mr. Sensenbrenner) has 3 minutes remaining. The gentleman 
from Wisconsin has one final speaker to close.
  Mr. NADLER. Mr. Speaker, I yield 1 minute to the gentleman from Texas 
(Mr. Edwards).
  Mr. EDWARDS. Mr. Speaker, a few moments ago when the Speaker of the 
House said this bill is not a new idea, the gentleman was absolutely 
correct. The idea of having tax dollars subsidize our churches and 
houses of worship was debated 200 years ago by our Founding Fathers. In 
answering that question, they felt so strongly about it that they not 
only put it into law, they embedded it into the first 16 words of the 
Bill of Rights, the proposition that religion in America is best served 
when we keep the hand of government regulation out of our houses of 
worship.
  When supporters of the bill today say we voted on funding of 
subsidizing religious discrimination in the past and we voted to 
directly fund churches in the past, they fail to point out that most of 
those debates were at 1:00 a.m. or 12:30 a.m. on the floor of the House 
with only two or three Members here on a 20-minute debate. I know 
because I have one of those three Members.
  Mr. Speaker, this bill was wrong at 1:00 a.m. in the morning, and it 
is wrong today. Direct funding of our churches was wrong 200 years ago, 
as evidenced by our Founding Fathers' writing of the Bill of Rights; 
and it is wrong today.
  Mr. NADLER. Mr. Speaker, I yield 1 minute to the gentlewoman from 
Texas (Ms. Eddie Bernice Johnson).
  Ms. EDDIE BERNICE JOHNSON of Texas. Mr. Speaker, as Chair of the 
Congressional Black Caucus, I want to share with my colleagues that we 
have a unanimous vote to vote against this bill and to support the 
substitute. It should not be a surprise why. We all are victims of 
discrimination. We do not want to roll back the clock. We are 
recipients of faith-based leadership throughout our history. We are not 
afraid of faith-based organizations. We support them. We work with 
them.
  All of the ministers who were brought here were snookered to think 
that they were getting something, until they found this clause in the 
bill.
  Mr. Speaker, they unanimously decided that it was not worth rolling 
back the clock and codifying discrimination again in the year 2001. I 
would ask all of the Members to please support the substitute and vote 
down the main bill.
  Mr. NADLER. Mr. Speaker, I yield 1\1/4\ minutes to myself.
  Mr. Speaker, churches have a role to play in the provision of social 
services, but Members should vote for the substitute to make sure that 
this bill does not establish employment discrimination with public 
funds, with preemption of State and local civil rights law, to make 
sure the bill provides offsets

[[Page 13815]]

for the cost of the bill, to make sure that we protect participants 
from leadership coercion, and that we do not voucherize $47 billion 
worth of programs without congressional review.
  Mr. SENSENBRENNER. Mr. Speaker, I yield the balance of my time to the 
gentleman from Oklahoma (Mr. Watts).
  Mr. WATTS of Oklahoma. Mr. Speaker, I thank the gentleman from 
Wisconsin (Mr. Sensenbrenner), the chairman of the Committee on the 
Judiciary, and the gentleman from California (Mr. Thomas), the chairman 
of the Committee on Ways and Means, for their efforts in getting this 
bill to the floor of the House today.
  Mr. Speaker, let me clarify some things that have been said. We do 
not spend one dime of Social Security or Medicare money to pay for this 
bill. Nothing in this bill changes any of the civil rights laws. I, 
too, have been a beneficiary of civil rights law. We do not add or take 
away from the 1964 Civil Rights Act.
  Mr. Speaker, we do not violate the artificial argument of church and 
State, because this bill is not about church or State. It is about 
people in the trenches every day having more resources to feed the 
hungry, to clothe the naked, to house the homeless, to help the drug 
and alcohol addicted.
  This is not about funding faith. It is about people. It is about 
their hopes, their dreams, their ideas, their ambitions and, most 
importantly, their goodness. We do not fund churches, mosques, 
synagogues. We fund their compelling faith to assist those in need. 
This bill is about standing with people all over America who cannot 
afford to contribute to any of our campaigns. They cannot give money to 
some political party or political action committees. They just have a 
compelling love and a compelling faith to assist those people in their 
communities that need help.

                              {time}  1500

  We should work with them, not against those people in our legislative 
efforts.
  It is fascinating to me the arguments that I have heard, and I too 
know of many black ministers who have fought for civil rights. Many of 
the black ministers who came here in April to the faith-based summit, 
they knew exactly what they were getting into. Just yesterday we got an 
endorsement letter from the Southern Christian Leadership Conference, 
an organization made up of many black ministers from around the country 
who stood in the civil rights effort. Rosa Parks, Catholic bishops, 
people from all walks of life, the Jewish community, all have supported 
this bill.
  As the gentleman from North Carolina said, there are many people on 
both sides of this debate, both sides of the aisle, who are good 
people, who see the world differently, who say that we should allow all 
people that want to help, give them opportunities just to compete for 
the dollars. There is no preference. There is no set-aside. We just say 
faith-based organizations should have an opportunity to compete on a 
level playing field. Give them the opportunity to do what they do best. 
They do not get their names in the paper. They do not work a half a 
day. Yes, they work a half a day. They work the first 12 hours and 
somebody else works the other 12. They do not get their names in the 
paper, they do not get a lot of attention, they just love the people 
who have the same ZIP Code that they have in trying to meet their 
needs.
  Vote ``no'' on the substitute. Vote ``yes'' on H.R. 7.
  Mr. DAVIS of Illinois. Mr. Speaker, I rise in support of the 
Democratic Substitute for the Community Solutions Act as there are 
thousands of communities and millions of people in our country who have 
serious problems and are in need of real solutions.
  I rise in support of this legislation, not because I believe that it 
is Panacea, I don't believe in one-stop cure-alls for the overwhelming 
magnitude of social, emotional, spiritual and economic ills which 
plague our society and are in need of every rational, logical, and 
proven approach that we can muster.
  And yes, Mr. Speaker, I support this legislation because I have 
faith, faith in the ability of religious institutions to provide human 
services without proselytizing. I have faith in these institutions to 
organize themselves into corporate business entities to develop 
programs, to keep records, and to manage their affairs in compliance 
with legal requirements. I also have confidence in the ability of these 
institutions to magnify the Golden Rule, ``Do unto others as you would 
have them do unto you.''
  I have listened intently to the issues raised by my colleagues who 
are concerned about legislation and I commend them for their diligence. 
I appreciate their concerns about charitable choice, ranging from 
discrimination to infringement on individual liberties.
  However, charitable choice is already a part of three Federal social 
programs: One, the Personal Responsibility and Work Opportunity 
Reconciliation Act of 1996; two, the Community Services Block Grant Act 
of 1998, and is part of the 2000 Reauthorization of funding for the 
Substance Abuse and Mental Health Services Administration.
  Each of these programs possess the overarching goal of helping those 
in poverty, or treating those suffering from chemical dependency, and 
the programs seem to achieve their purposes by providing resources in 
the most effective and efficient manner. The opponents of this 
legislation have expressed concern about the possible erosion of rights 
and protections of program participants and beneficiaries. (And rightly 
so, nothing could be more important). Therefore, I am pleased that the 
crafters of this legislation (the Democratic Substitute) have taken 
note and forthrightly addressed these concerns.
  We must be aware of the fact that many people in poverty, suffer from 
some form of drug dependency. Alcohol, narcotics, and in some 
instances, even legalized prescription or over-the-counter-drugs.
  Many of these individuals have been beaten down, have virtually given 
up, and have lost the will to overcome their difficulties.
  It is in these instances and situations, Mr. Speaker, that I believe 
the Community Solutions Act can and will help the most.
  It reminds us, Mr. Speaker, that poverty, deprivation and the 
inability to cope with anxiety, frustration, hopelessness is still 
rampart in our society. Take for example, if you will an ex-offender, 
unable to get a job, illiterate, semi-illiterate, disavowed by the 
ambiguities and contradictions of a sometimes cold, misunderstanding, 
uncaring or unwilling-to-help society, creates the need for something 
different; new theories, old theories reinforced, new approaches, new 
treatment modalities.
  A preacher friend of mine was fond of saying that new occasions call 
for new truths, new situations make ancient remedies uncouth.
  Well, I can tell you Mr. Speaker, the drug problem in this country is 
so overwhelming, so difficult to deal with, so pervasive . . . the 
Mental health challenges require so much, the abused, neglected and 
abandoned problems require psychiatrists, counselors, psychologists, 
well developed pharmaceuticals and all of the social health, physical 
health and professional treatment that we can muster, but I also 
believe that we could use a little Balm of Gilead to have and hold, I 
do believe that we could use a little Balm of Gilead to help heal our 
sin, sick souls.
  After reading much of the material and listening to the debate, I am 
convinced that the activities covered and being promoted by this 
legislation are too broad to leave under the exemption of section 702 
of the 1964 Civil Rights Act which allows religious institutions to 
make employment decisions outside the protection of section 703 dealing 
with race, color, religion, or national origin; and then in 1972, the 
Equal Employment Opportunity Act of 1974, which broadened the scope of 
section 702 and permitted religious institutions to make religion-based 
employment decisions in all their activities, rather than just 
religious ones.
  While the Republican bill correctly addresses race, color, and 
national origin, it is regrettably silent on the question of sexual 
orientation; thereby leaving a loophole which I find totally 
unacceptable.
  Mr. Speaker, I am told that the cost of drug abuse to society is 
estimated at $16 billion annually, in less time than it takes to debate 
this bill, another 14 infants will be born into poverty in America, 
another 10 will be born without health insurance, and one more child 
will be neglected or abused. In fact, the number of persons in our 
country below the poverty level in 1999 was 32.3 million.
  This legislation recognizes the fact that we must commandeer and 
enlist every weapon in our arsenal to fight the war against poverty, 
crime, mental illness, drug use, and abuse as well as all of the 
maladies that are associated with these debilitating conditions.
  The Democratic substitute for H.R. 7, the Community Solutions Act of 
2001, can lend a helping hand.

[[Page 13816]]

  Mr. Speaker, I rest my case and yield back the balance of my time.
  Mr. CONYERS. Mr. Speaker, when I was first elected to this body, if 
someone had told me that in the first year of he 21th century, the U.S. 
Congress would be on the verge of passing a bill making it lawful to 
discriminate with taxpayer funds, I wouldn't have believed them. I 
would have told them that too many had fought too long for us to 
backtrack in the battle against bigotry. Yet that is exactly what this 
bill does, and that is exactly what we are trying to undo with this 
Democratic substitute.
  I am astonished the Bush Administration would fight so strenuously to 
extend the right to discriminate in employment on account of religion. 
If government funds truly will not be used in a non-sectarian manner--
as the Administration claims--why in the world would we want to permit 
discrimination on the basis of religion? I've been asking this question 
for the last month, and have yet to receive any semblance of an 
adequate response.
  Every Member in this body knows that cooking soup for the poor can be 
done equally well by persons of all religious beliefs. But the 
Administration has bent over so far backwards to make sure we do not 
discriminate against religious organizations, that somehow they forgot 
about protecting the actual people--the citizens--against 
discrimination.
  This bill is so extreme it sanctions employment discrimination based 
on so-called ``tenets and teachings.'' This means a religious 
organization could use taxpayer funds to discriminate against gays and 
lesbians, against divorced persons, against unmarried pregnant women, 
against women who have had an abortion, and against persons involved in 
an interracial marriage.
  If you can believe it, the bill gets even worse. The legislation not 
only sets aside federal civil rights laws, it goes as far as to 
eliminate state and local civil rights laws. That means if the voters 
of a state or city had decided as a matter of public policy that 
organizations utilizing taxpayer funds should not be permitted to 
discriminate, that law would be set aside under H.R. 7. This turns the 
principle of federalism completely on its head.
  We shouldn't be surprised that the civil rights community is so 
strongly opposed to the bill. Just last week, Julian Bond, the Chairman 
of the NAACP, declared H.R. 7 will ``erase sixty years of civil rights 
protections.'' The NAACP Legal Defense Fund has written that charitable 
choice is ``wholly inconsistent with longstanding principle that 
federal moneys should not be used to discriminate in any form.'' The 
Leadership Conference on Civil Rights has stated in no uncertain terms 
that charitable choice will ``erode the fundamental principle of non-
discrimination.''
  If our President really wanted to bring us together, he wouldn't push 
this legislation which so strongly divides this body and our nation. He 
would work with us on a true bipartisan basis to expend the role of 
religion in a manner that protects civil rights. We can begin this 
effort by voting yes on the Democratic substitute.
  Mrs. MEEK of Florida. Mr. Speaker, I rise in opposition to H.R. 7, 
the so-called ``Community Solutions Act'', and in support of the 
Rangel-Conyers substitute. I recognize and commend our country's 
religious organizations for the critical role that they play in meeting 
America's social welfare needs. We need to support their efforts and 
encourage them to do even more, but not at the expense of our civil 
rights laws or our Constitution.
  I cannot support legislation that allow religious organizations to 
discriminate in employment on the basis of religion, that preempts 
state and local laws against discrimination, or that breaks down the 
historic separation between Church and State. Nor can I support the 
massive expansion of the use of vouchers contained in H.R. 7, an 
expansion that would allow the Administration to convert $47 billion in 
social service programs into vouchers and allow the recipients of such 
vouchers to discriminate against beneficiaries of such programs on 
account of their religion.
  We should never support such a subterfuge that would allow religious 
organizations indirectly to achieve what they could not do directly, 
that is, to use funds for sectarian instruction, worship, or 
proselytizing. We can never accept a return to the days where we see 
ads that read: No Catholics or no Jews need apply. We simply cannot 
allow it.
  The Rangel-Conyers substitute is the right approach to involving 
faith-based organizations in federal programs. The substitute provides 
that religious organizations receiving federal funds for social 
programs could not discriminate in employment on the basis of an 
employee's religion; prohibits any provision in the bill from 
superseding state or civil rights laws; prohibits religious 
organizations who provide federally funded programs from engaging in 
sectarian activities at the same time and place as the government 
funded program; and strikes the provision in the bill relating to 
governmental provision of indirect funds.
  While many of the advocates of H.R. 7 are very well-intended, this 
legislation is a good example of the devil dressed as an angel of 
light. H.R. 7 includes provisions that sharply attack one of the oldest 
civil rights principles--that the federal government will not fund 
discriminate by others. The bill would allow religious groups that 
receive federal funds to discriminate in their hiring practices--not 
just for workers that they hire to help carry out religious activities 
funded by private contributions, but for workers hired to perform 
secular work with government funding.
  We're not talking here about a provision to insure that a church does 
not have to hire a Jewish person to be a priest or a Catholic to be a 
rabbi. We're talking about a provision that would allow a religious 
organization not to hire a janitor because of that person's religious 
beliefs. This is an outrage!
  For decades, there has been an effective relationship between 
government and religiously affiliated institutions for the provision of 
community-based social services. These organizations, such as Catholic 
Charities, Lutheran Services, United Jewish Communities and numerous 
others, separate religious activities from their social services 
offerings, follow all civil rights laws, follow all state and local 
rules and standards and do not discriminate in staffing. There is no 
reason to remove these effective safeguards.
  Mr. Speaker, let's keep our eye on the ball and focus on the real 
problem. What we really need is legislation to authorize additional 
dollars for social service programs and then fund these programs 
properly, not the Bush Administration's cuts in juvenile delinquency 
programs, in job training, in public housing, in child care, and in 
Temporary Assistance to Needy Families (TANF).
  Mr. Speaker, we can and must do better than H.R. 7. Let's preserve 
our historic commitment not to allow religious organizations to 
discriminate in employment on the basis of religion and preserve our 
Constitution's religious protections. Support the Rangel-Conyers 
substitute. I yield back the balance of my time.
  The SPEAKER pro tempore (Mr. LaHood). Pursuant to House Resolution 
196, the previous question is ordered on the bill, as amended, and on 
the amendment in the nature of a substitute offered by the gentleman 
from New York (Mr. Rangel).
  The question is on the amendment in the nature of a substitute 
offered by the gentleman from New York (Mr. Rangel).
  The question was taken; and the Speaker pro tempore announced that 
the noes appeared to have it.
  Mr. NADLER. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The vote was taken by electronic device, and there were--yeas 168, 
nays 261, not voting 4, as follows:

                             [Roll No. 252]

                               YEAS--168

     Abercrombie
     Ackerman
     Allen
     Andrews
     Baca
     Baird
     Baldacci
     Baldwin
     Barcia
     Barrett
     Becerra
     Berkley
     Berman
     Bishop
     Blagojevich
     Blumenauer
     Bonior
     Borski
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brown (FL)
     Brown (OH)
     Capps
     Capuano
     Cardin
     Carson (IN)
     Carson (OK)
     Clay
     Clayton
     Clyburn
     Condit
     Conyers
     Coyne
     Crowley
     Cummings
     Davis (FL)
     Davis (IL)
     DeFazio
     Delahunt
     DeLauro
     Deutsch
     Dicks
     Dingell
     Dooley
     Doyle
     Edwards
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Filner
     Ford
     Frank
     Frost
     Gephardt
     Gonzalez
     Gordon
     Green (TX)
     Gutierrez
     Harman
     Hastings (FL)
     Hill
     Hilliard
     Hinchey
     Holden
     Holt
     Honda
     Hooley
     Hoyer
     Inslee
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Johnson, E. B.
     Jones (OH)
     Kanjorski
     Kaptur
     Kennedy (RI)
     Kildee
     Kilpatrick
     Kind (WI)
     Kleczka
     Kucinich
     LaFalce
     Lampson
     Langevin
     Lantos
     Larsen (WA)
     Larson (CT)
     Lee
     Levin
     Lewis (GA)
     Lowey
     Luther
     Maloney (CT)
     Maloney (NY)
     Markey
     Mascara
     Matheson
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McGovern
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Millender-McDonald
     Miller, George
     Mink
     Moran (VA)
     Nadler
     Napolitano
     Neal
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Pelosi
     Pomeroy
     Price (NC)
     Rahall
     Rangel
     Reyes
     Rivers
     Rodriguez
     Roemer
     Rothman
     Roybal-Allard
     Rush
     Sabo
     Sanders
     Sawyer
     Schakowsky
     Scott
     Serrano
     Sherman

[[Page 13817]]


     Slaughter
     Smith (WA)
     Solis
     Spratt
     Stark
     Stupak
     Tanner
     Thompson (MS)
     Thurman
     Tierney
     Towns
     Udall (CO)
     Udall (NM)
     Velazquez
     Visclosky
     Watson (CA)
     Watt (NC)
     Waxman
     Weiner
     Wexler
     Woolsey
     Wu
     Wynn

                               NAYS--261

     Aderholt
     Akin
     Armey
     Bachus
     Baker
     Ballenger
     Barr
     Bartlett
     Barton
     Bass
     Bentsen
     Bereuter
     Berry
     Biggert
     Bilirakis
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bono
     Brady (TX)
     Brown (SC)
     Bryant
     Burr
     Burton
     Buyer
     Callahan
     Calvert
     Camp
     Cannon
     Cantor
     Capito
     Castle
     Chabot
     Chambliss
     Clement
     Coble
     Collins
     Combest
     Cooksey
     Costello
     Cox
     Cramer
     Crane
     Crenshaw
     Cubin
     Culberson
     Cunningham
     Davis (CA)
     Davis, Jo Ann
     Davis, Tom
     Deal
     DeGette
     DeLay
     DeMint
     Diaz-Balart
     Doggett
     Doolittle
     Dreier
     Duncan
     Dunn
     Ehlers
     Ehrlich
     Emerson
     English
     Everett
     Ferguson
     Flake
     Fletcher
     Foley
     Forbes
     Fossella
     Frelinghuysen
     Gallegly
     Ganske
     Gekas
     Gibbons
     Gilchrest
     Gillmor
     Gilman
     Goode
     Goodlatte
     Goss
     Graham
     Granger
     Graves
     Green (WI)
     Greenwood
     Grucci
     Gutknecht
     Hall (OH)
     Hall (TX)
     Hansen
     Hart
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Herger
     Hilleary
     Hinojosa
     Hobson
     Hoeffel
     Hoekstra
     Horn
     Hostettler
     Houghton
     Hulshof
     Hunter
     Hutchinson
     Hyde
     Isakson
     Israel
     Issa
     Istook
     Jenkins
     John
     Johnson (CT)
     Johnson (IL)
     Johnson, Sam
     Jones (NC)
     Keller
     Kelly
     Kennedy (MN)
     Kerns
     King (NY)
     Kingston
     Kirk
     Knollenberg
     Kolbe
     LaHood
     Largent
     Latham
     LaTourette
     Leach
     Lewis (CA)
     Lewis (KY)
     Linder
     Lipinski
     LoBiondo
     Lofgren
     Lucas (KY)
     Lucas (OK)
     Manzullo
     McCrery
     McDermott
     McHugh
     McInnis
     McIntyre
     McKeon
     Mica
     Miller (FL)
     Miller, Gary
     Mollohan
     Moore
     Moran (KS)
     Morella
     Murtha
     Myrick
     Nethercutt
     Ney
     Northup
     Norwood
     Nussle
     Oberstar
     Osborne
     Ose
     Otter
     Oxley
     Paul
     Pence
     Peterson (MN)
     Peterson (PA)
     Petri
     Phelps
     Pickering
     Pitts
     Platts
     Pombo
     Portman
     Pryce (OH)
     Putnam
     Quinn
     Radanovich
     Ramstad
     Regula
     Rehberg
     Reynolds
     Riley
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Ross
     Roukema
     Royce
     Ryan (WI)
     Ryun (KS)
     Sanchez
     Sandlin
     Saxton
     Scarborough
     Schaffer
     Schiff
     Schrock
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Shays
     Sherwood
     Shimkus
     Shows
     Shuster
     Simmons
     Simpson
     Skeen
     Skelton
     Smith (MI)
     Smith (NJ)
     Smith (TX)
     Snyder
     Souder
     Stearns
     Stenholm
     Strickland
     Stump
     Sununu
     Sweeney
     Tancredo
     Tauscher
     Tauzin
     Taylor (MS)
     Taylor (NC)
     Terry
     Thomas
     Thompson (CA)
     Thornberry
     Thune
     Tiahrt
     Tiberi
     Toomey
     Traficant
     Turner
     Upton
     Vitter
     Walden
     Walsh
     Wamp
     Waters
     Watkins (OK)
     Watts (OK)
     Weldon (FL)
     Weldon (PA)
     Weller
     Whitfield
     Wicker
     Wilson
     Wolf
     Young (AK)
     Young (FL)

                             NOT VOTING--4

     Engel
     Matsui
     McKinney
     Spence

                              {time}  1530

  Ms. GRANGER, Mrs. NORTHUP, Mrs. KELLY, Mr. BARTLETT of Maryland, Mr. 
HERGER and Mr. OBERSTAR changed their vote from ``yea'' to ``nay.''
  Ms. RIVERS and Mr. HOLDEN changed their vote from ``nay'' to ``yea.''
  So the amendment in the nature of a substitute was rejected.
  The result of the vote was announced as above recorded.

                              {time}  1530

  The SPEAKER pro tempore (Mr. LaHood). The question is on engrossment 
and third reading of the bill.
  The bill was ordered to be engrossed and read a third time, and was 
read the third time.


               Motion to Recommit Offered by Mr. Conyers

  Mr. CONYERS. Mr. Speaker, I offer a motion to recommit.
  The SPEAKER pro tempore. Is the gentleman opposed to the bill?
  Mr. CONYERS. Yes, Mr. Speaker, I am.
  The SPEAKER pro tempore. The Clerk will report the motion to 
recommit.
  The Clerk read as follows:
       Mr. Conyers moves to recommit the bill H.R. 7 to the 
     Committee on the Judiciary with instructions to report the 
     same back to the House forthwith with the following 
     amendments:
       In title II, in the matter proposed to be inserted in the 
     Revised Statutes of the United States as a section 1991--
       (1) in subsection (e), strike the period after ``effect'' 
     and insert ``, except that no religious organization 
     receiving funds through a grant or cooperative agreement for 
     programs described in subsection (c)(4) shall, in expending 
     such funds allocated under such program, discriminate in 
     employment on the basis of an employee's religion, religious 
     belief, or a refusal to hold a religious belief.''; and
       (2) insert after subsection (h) the following:
       ``(i) Local Civil Rights Laws.--Notwithstanding anything to 
     the contrary herein, nothing in this section shall preempt or 
     supersede State or local civil rights laws.
       Redesignate succeeding subsections accordingly.

  Mr. CONYERS (during the reading). Mr. Speaker, I ask unanimous 
consent that the motion be considered as read and printed in the 
Record.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Michigan?
  There was no objection.
  The SPEAKER pro tempore. The Chair recognizes the gentleman from 
Michigan (Mr. Conyers) for 5 minutes in support of his motion.
  Mr. CONYERS. Mr. Speaker, I say to my colleagues, we have had a very 
instructive discourse here today and quite revealing, I believe. As a 
result, this motion to recommit would simply safeguard the Federal, 
State and local civil rights laws as they presently exist.
  Mr. Speaker, bigotry and discrimination have been, unfortunately, our 
Nation's greatest curse for more than 210 years, and we should never, 
ever knowingly adopt legislation which would in any way worsen the 
problem, as the measure before us clearly does. So to my friends on the 
Republican side who urge that we might have created a more narrow 
motion, I say to them just this: It is just as wrong for the bill to 
set aside State and local civil rights laws as it is for the bill to 
set aside Federal civil rights laws.
  We need to fix both problems, and we need to fix them now and not in 
conference or some day later. So let us all of us stop trying to divide 
our Nation by religion, by race, by ethnicity, by sexual orientation. 
Let us pass a motion that I think most of us can agree on so we can 
increase the role of religion without trampling on our precious civil 
rights.
  Mr. Speaker, I yield 1 minute to the gentleman from New York (Mr. 
Nadler), the ranking member of the subcommittee.
  Mr. NADLER. Mr. Speaker, there has been a lot of confusion on this 
point, but the basic question on the facts are simple: Under current 
law, a church may discriminate on religious or other grounds using its 
own funds. Under this bill, a church can discriminate on religious 
grounds, on other grounds, on sexual grounds using its own funds and 
using government taxpayer funds. And if there are any local or State 
civil rights laws that say it cannot, this bill says, never mind, we 
supersede the State or local civil rights laws.
  This motion to recommit is very simple. It says that with government 
funds, with taxpayer funds, one may not discriminate and one may not 
contravene Federal, State or local civil rights laws with government 
funds. With church funds, the law would be unchanged. One can still do 
that, but one cannot discriminate, one cannot say no blacks, no women, 
no Jews, no Catholics, whatever, with government taxpayer funds, 
period.
  I hope everybody will vote for, one would assume, this elementary, 
antidiscrimination civil rights recommit motion.
  Mr. CONYERS. Mr. Speaker, I yield 1 minute to the gentleman from 
Texas (Mr. Edwards).
  Mr. EDWARDS. Mr. Speaker, no American citizen should ever have to 
pass someone else's religious test to qualify for a federally funded 
job. No American, not one, should ever have to be fired from a 
federally funded job solely because of his or her religious faith. It 
is ironic that a bill that was

[[Page 13818]]

designed supposedly to stop discrimination against religion ends up 
authorizing, and then subsidizing, religious discrimination.
  Mr. Speaker, unless this motion to recommit is passed, a group 
associated with Bob Jones University could receive our Federal tax 
dollars and put out a sign that says, ``No Catholics need apply here 
for a federally funded job.'' That is wrong.
  Say no to discrimination and yes to this motion to recommit.
  Mr. CONYERS. Mr. Speaker, I yield the remainder of the time to the 
gentleman from Virginia (Mr. Scott), a member of the Committee on the 
Judiciary.
  Mr. SCOTT. Mr. Speaker, as we listen to all of the programs that 
could be funded under this bill, remember that anything that can be 
funded under this bill can be funded today if the sponsor will abide by 
the civil rights laws. On June 25, 1941, President Roosevelt signed an 
Executive Order number 8802 which prohibited defense contractors from 
discriminating in employment based on race, color, creed or national 
origin. Civil rights laws of the 1960s put those protections into law. 
The vote was not unanimous, but the bills passed.
  Since then, few have questioned whether or not sponsors of Federal 
programs could consider a person's religious beliefs or religious 
practices when they were hiring someone for a job paid for with Federal 
money. But here we are considering a bill with no new money, a bill 
which provides eligibility for funding only to those programs who are 
eligible for funding now, if one would comply with civil rights laws. 
That is not a barrier to funding.
  Mr. Speaker, we do not need new ways to discriminate. Let us maintain 
our civil rights by passing the motion to recommit.
  Mr. SENSENBRENNER. Mr. Speaker, I rise in opposition to the motion to 
recommit.
  The SPEAKER pro tempore. The Chair recognizes the gentleman from 
Wisconsin (Mr. Sensenbrenner) for 5 minutes.
  Mr. SENSENBRENNER. Mr. Speaker, make no mistake about it. This motion 
to recommit is more than a new preemption clause. It denies religious 
organizations, including churches, their current exemption from Title 
VII when they seek to take part in Federal programs to help others. It 
is not the motion to recommit we have been reading about. It is the 
motion to recommit we have been hearing about, plus an atomic bomb for 
faith-based organizations.
  I repeat. This motion to recommit contains more than a preemption 
clause. It trumps the considered judgment of the Congress that passed 
the Civil Rights Act of 1964 and which soundly decided, along with the 
Supreme Court, that churches must be allowed to hire members of their 
own faith in order to remain churches under Federal law. I ask my 
colleagues to remember that when they vote.
  Even Al Gore, during his campaign and in his speech to the Salvation 
Army, said that ``faith-based organizations can provide jobs and job 
training, counseling and mentoring, food and basic medical care. They 
can do so with public funds and without having to alter their religious 
character that is so often the key to their effectiveness.''
  Again, the only way a church can retain its religious character is if 
it can staff itself with those who share the same faith.
  In addition, the small churches of America will often be providing 
the social services covered under H.R. 7 with the same staff they 
currently have, and that staff likely shares the same religious faith. 
The substitute would make it impossible for these small churches to 
contribute to Federal efforts against desperation and helplessness, and 
it is precisely these small churches that H.R. 7 intends to welcome 
into a laudable effort.
  Section 702 of the Civil Rights Act of 1964 has for decades exempted 
nonprofit, private, religious organizations engaged in both religious 
and secular nonprofit activities from Title VII's prohibition on 
discrimination in employment on the basis of religion. The Supreme 
Court, including Justices Brennan and Marshall, upheld this exemption 
in the Amos case.
  Section 702 is not waived or forfeited when a religious organization 
receives Federal funding. No provision in section 702 states that its 
exemption of nonprofit, private, religious organizations from Title 
VII's prohibition on discrimination in employment is forfeited when a 
faith-based organization receives a Federal grant. But the substitute 
would do just that.
  The motion to recommit would prevent Federal equal access rules from 
following Federal funds. Under this motion, States or localities could 
incorporate provisions into their procurement requirements that 
prohibit religious organizations from hiring on a religious basis when 
they take part in covered Federal programs. Such provisions thwart the 
very purpose of this legislation, which is to welcome the very smallest 
of organizations into the Federal fight against poverty.
  I want to emphasize to everyone that the small churches of America 
will be providing the social services covered by H.R. 7 with the same 
staff they currently have, and that staff likely shares the same 
religious faith. State or local procurement requirements that deny them 
the right to retain the same staff will slam the door shut on their 
participation to the detriment of people in need everywhere.
  Churches should be allowed to compete for Federal social service 
funds and remain churches while doing so. The only way a church can 
remain a church is to give them the right to staff itself with those 
that share their faith. Again, this is a bill that really puts the 
small churches in America in the midst of fighting poverty, 
helplessness and despair.
  Mr. Speaker, I urge Members to vote down the motion to recommit. The 
only way we can expand the capacity of the Nation to meet the needs of 
the poor and afflicted is through H.R. 7. Only in this way can we help 
those with highly effective and efficient but small, faith-based 
organizations being in the mix.
  Ms. JACKSON-LEE of Texas. Mr. Speaker, I think all Members of 
Congress welcome the opportunity to search for new options to solve 
historically entrenched problems in all communities in the United 
States. Under established law, the Supreme Court requires a secular 
purpose to sustain the validity of legislation, and the eradication of 
social ills certainly affects all Americans. However, as we consider 
the possibility of allowing faith-based groups to compete for federal 
funding to eradicate social ills, we should be careful to recognize our 
limited powers in this area.
  Mr. Speaker, James Madison, the father of the First Amendment, 
clearly understood the potential harms involved with the commingling of 
church and state when he stated that he ``apprehended the meaning of 
the [Establishment Clause] to be, that Congress should not establish a 
religion, and enforce the legal observation of it by law, nor compel 
men to worship God in any manner contrary to their conscience.'' 1 
Annals of Cong. 758 (Gales & Seaton's ed. 1834) (Aug 15, 1789).
  Mr. Speaker, Madison was concerned that without the Establishment 
Clause, the Necessary and Proper Clause of the Constitution might have 
enabled the Congress to ``make laws of such a nature as might infringe 
the rights of conscience, and establish a national religion; to prevent 
these he assumed the amendment was intended . . .'' because he 
``believed that the people feared one sect might obtain pre-eminence, 
or two combine together, and establish a religion to which they would 
compel others to perform.'' Id.
  We are therefore left with an irony of historical proportions today 
as we discuss H.R. 7, the Community Solutions Act of 2001.'' For as we 
begin our discussion of H.R. 7, I find that the Leadership has 
sponsored legislation contrary to both the intention of the first 
Amendment and its development in Supreme Court precedent.
  Mr. Speaker, the United States has gained a full understanding of the 
First Amendment, and particularly its prohibitions on congressional 
activity toward religion and religious institutions, through the 
development of precedent in case law. Over the years the courts have 
struck a delicate balance between the competing tendencies of the 
Establishment Clause and the Free Exercise Clause.
  Likewise, Mr. Speaker, this body has been diligent in its observance 
of the First Amendment's constitutional prohibitions on religion.

[[Page 13819]]

With few exceptions, this body has diligently followed the directive 
established for the Court by Chief Justice Burger in Walz v. Tax 
Commission of City of New York, 397 U.S. 664 (1970):

       The general principle deducible from the First Amendment 
     and all that has been said by the Court is this: that we will 
     not tolerate either governmentally established religion or 
     governmental interefence with religion. Short of those 
     expressly proscribed governmental acts there is room for play 
     in the joints productive of a benevolent neutrality which 
     will permit religious exercise to exist without sponsorship 
     or interfence.

  Mr. Speaker, it is this spirit that animates my concerns about H.R. 
7, and thus compels me to speak against its passage in this form. 
Specifically, this legislation does not ensure that the delicate 
balance between church and state will be retained if the bill is 
allowed to pass in this form, for despite statements to the contrary, 
the bill might not pass either the effects test or the entanglement 
test of Supreme Court jurisprudence.
  This bill does not provide assurances that the use of federal funds 
will not result in excessive entanglement with government bureaucracy 
and accounting and reporting requirements. The Leadership proposal 
dedicates funds to help sectarian organizations with accounting and 
administrative activities. Won't this have the same effect on promoting 
religion as a ``symbolic union government and religion in one sectarian 
enterprise?'' Grand Rapids School District v. Ball, 473 U.S. 373, 397 
(1985). The mechanisms of this bill place the imprimatur of the 
Congress on impermissibly mingling church and state. This is the wrong 
message to send to the citizens of this country, who have entrusted us 
with the care of the document that sustains our democracy, the 
Constitution.
  Also, by allowing federal agencies to convert funds into vouchers for 
religious organizations, the bill would unilaterally convert over $47 
billion in social service programs that could be used for sectarian 
purposes including proselytization. Court cases such as Roemer v. 
Maryland Public Works, 426 U.S. 736 (1976), permitted subsidies to 
private colleges with sectarian affiliations only because they were not 
pervasively sectarian.
  This is not the case with the organizations that will benefit from 
this bill. This legislation will turn the Court right back to the 
controlling case, Lemon v. Kurtzman, 403 U.S. 602 (1971). 
``Comprehensive, discriminating, and continuing state surveillance will 
inevitably be required to ensure these restrictions are obeyed and the 
First Amendment otherwise respected.'' Id. at 619. In plain language, 
this bill simply requires too much oversight in a manner the Supreme 
Court never intended.
  Mr. Speaker, it is also important to note that by not extending the 
religious exemption in the Civil Rights Act to include activities 
carried out under this subsection, the Congress would establish the 
possibility that organizations could discriminate on the basis of 
religion using federal funds. My conscience as a legislator cannot 
allow me to support this legislation for this reason alone.
  This bill will allow religious groups to discriminate. Even more, it 
will chill the fight for civil rights for all Americans on both the 
state and local level, where great gains have been made in ensuring 
quality for all. I cannot stand the irony that the religious 
institutions of America, which were so influential in the civil rights 
movement, will be allowed to erode the equal protection laws the 
citizens of this nation fought and died for.
  Mr. Speaker, the Democratic substitute to this legislation avoids 
these pitfalls. The substitute legislation specifies that the civil 
rights exemption is not extended to allow groups receiving funds to 
discriminate in employment with taxpayer funds. It also provides that 
state and local civil rights laws are not superceded by the act.
  The substitute bill also provides an offset to the tax code's top 
rate to balance the charitable contribution increase. The rate raises 
the top tax rate by 0.2%.
  Under this proposal, no proselytization can occur at the same time 
and place as a government funded program. The substitute also deletes 
the private voucher provisions that would provide agencies with $47 
billion in discretionary funds, and deletes changes in tort reform that 
absolve businesses of liability.
  The Democratic substitute is a better bill, Mr. Speaker. It pays heed 
to the words of Justice Burger and the precedents of the Supreme Court. 
I urge all members to vote against this measure and for the Democratic 
substitute.
  Mr. SENSENBRENNER. Mr. Speaker, I yield back the balance of my time, 
and I move the previous question on the motion to recommit.
  The previous question was ordered.
  The SPEAKER pro tempore. The question is on the motion to recommit.
  The question was taken; and the Speaker pro tempore announced that 
the noes appeared to have it.


                             Recorded Vote

  Mr. CONYERS. Mr. Speaker, I demand a recorded vote.
  A recorded vote was ordered.
  The SPEAKER pro tempore. Pursuant to clause 9 of rule XX, the Chair 
will reduce to 5 minutes the minimum time for any electronic vote on 
final passage.
  The vote was taken by electronic device, and there were--ayes 195, 
noes 234, not voting 4, as follows:

                             [Roll No. 253]

                               AYES--195

     Abercrombie
     Ackerman
     Allen
     Andrews
     Baca
     Baird
     Baldacci
     Baldwin
     Barcia
     Barrett
     Becerra
     Bentsen
     Berkley
     Berman
     Berry
     Bishop
     Blagojevich
     Blumenauer
     Bonior
     Borski
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brown (FL)
     Brown (OH)
     Capps
     Capuano
     Cardin
     Carson (IN)
     Carson (OK)
     Clay
     Clayton
     Clement
     Clyburn
     Condit
     Conyers
     Costello
     Coyne
     Crowley
     Cummings
     Davis (CA)
     Davis (FL)
     Davis (IL)
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Deutsch
     Dicks
     Dingell
     Doggett
     Dooley
     Doyle
     Edwards
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Filner
     Foley
     Ford
     Frank
     Frost
     Gephardt
     Gonzalez
     Gordon
     Green (TX)
     Gutierrez
     Harman
     Hastings (FL)
     Hill
     Hilliard
     Hinchey
     Hinojosa
     Hoeffel
     Holden
     Holt
     Honda
     Hooley
     Hoyer
     Inslee
     Israel
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Johnson, E. B.
     Jones (OH)
     Kanjorski
     Kaptur
     Kennedy (RI)
     Kildee
     Kilpatrick
     Kind (WI)
     Kleczka
     Kucinich
     LaFalce
     Lampson
     Langevin
     Lantos
     Larsen (WA)
     Larson (CT)
     Leach
     Lee
     Levin
     Lewis (GA)
     Lofgren
     Lowey
     Luther
     Maloney (CT)
     Maloney (NY)
     Markey
     Mascara
     Matheson
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McDermott
     McGovern
     McNulty
     Meek (FL)
     Meeks (NY)
     Menendez
     Millender-McDonald
     Miller, George
     Mink
     Moore
     Moran (VA)
     Morella
     Murtha
     Nadler
     Napolitano
     Neal
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Pelosi
     Pomeroy
     Price (NC)
     Rahall
     Rangel
     Reyes
     Rivers
     Rodriguez
     Roemer
     Rothman
     Roybal-Allard
     Rush
     Sabo
     Sanchez
     Sanders
     Sandlin
     Sawyer
     Schakowsky
     Schiff
     Scott
     Serrano
     Shays
     Sherman
     Slaughter
     Smith (WA)
     Snyder
     Solis
     Spratt
     Stark
     Strickland
     Stupak
     Tanner
     Tauscher
     Thompson (CA)
     Thompson (MS)
     Thurman
     Tierney
     Towns
     Udall (CO)
     Udall (NM)
     Velazquez
     Visclosky
     Waters
     Watson (CA)
     Watt (NC)
     Waxman
     Weiner
     Wexler
     Woolsey
     Wu
     Wynn

                               NOES--234

     Aderholt
     Akin
     Armey
     Bachus
     Baker
     Ballenger
     Barr
     Bartlett
     Barton
     Bass
     Bereuter
     Biggert
     Bilirakis
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bono
     Brady (TX)
     Brown (SC)
     Bryant
     Burr
     Burton
     Buyer
     Callahan
     Calvert
     Camp
     Cannon
     Cantor
     Capito
     Castle
     Chabot
     Chambliss
     Coble
     Collins
     Combest
     Cooksey
     Cox
     Cramer
     Crane
     Crenshaw
     Cubin
     Culberson
     Cunningham
     Davis, Jo Ann
     Davis, Tom
     Deal
     DeLay
     DeMint
     Diaz-Balart
     Doolittle
     Dreier
     Duncan
     Dunn
     Ehlers
     Ehrlich
     Emerson
     English
     Everett
     Ferguson
     Flake
     Fletcher
     Forbes
     Fossella
     Frelinghuysen
     Gallegly
     Ganske
     Gekas
     Gibbons
     Gilchrest
     Gillmor
     Gilman
     Goode
     Goodlatte
     Goss
     Graham
     Granger
     Graves
     Green (WI)
     Greenwood
     Grucci
     Gutknecht
     Hall (OH)
     Hall (TX)
     Hansen
     Hart
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Herger
     Hilleary
     Hobson
     Hoekstra
     Horn
     Hostettler
     Houghton
     Hulshof
     Hunter
     Hutchinson
     Hyde
     Isakson
     Issa
     Istook
     Jenkins
     John
     Johnson (CT)
     Johnson (IL)
     Johnson, Sam
     Jones (NC)
     Keller
     Kelly
     Kennedy (MN)
     Kerns
     King (NY)
     Kingston
     Kirk
     Knollenberg
     Kolbe
     LaHood
     Largent
     Latham
     LaTourette
     Lewis (CA)
     Lewis (KY)
     Linder
     Lipinski
     LoBiondo
     Lucas (KY)
     Lucas (OK)
     Manzullo
     McCrery
     McHugh
     McInnis
     McIntyre
     McKeon
     Mica
     Miller (FL)
     Miller, Gary
     Mollohan
     Moran (KS)
     Myrick
     Nethercutt
     Ney
     Northup
     Norwood
     Nussle
     Osborne
     Ose
     Otter

[[Page 13820]]


     Oxley
     Paul
     Pence
     Peterson (MN)
     Peterson (PA)
     Petri
     Phelps
     Pickering
     Pitts
     Platts
     Pombo
     Portman
     Pryce (OH)
     Putnam
     Quinn
     Radanovich
     Ramstad
     Regula
     Rehberg
     Reynolds
     Riley
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Ross
     Roukema
     Royce
     Ryan (WI)
     Ryun (KS)
     Saxton
     Scarborough
     Schaffer
     Schrock
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Sherwood
     Shimkus
     Shows
     Shuster
     Simmons
     Simpson
     Skeen
     Skelton
     Smith (MI)
     Smith (NJ)
     Smith (TX)
     Souder
     Stearns
     Stenholm
     Stump
     Sununu
     Sweeney
     Tancredo
     Tauzin
     Taylor (MS)
     Taylor (NC)
     Terry
     Thomas
     Thornberry
     Thune
     Tiahrt
     Tiberi
     Toomey
     Traficant
     Turner
     Upton
     Vitter
     Walden
     Walsh
     Wamp
     Watkins (OK)
     Watts (OK)
     Weldon (FL)
     Weldon (PA)
     Weller
     Whitfield
     Wicker
     Wilson
     Wolf
     Young (AK)
     Young (FL)

                             NOT VOTING--4

     Engel
     McKinney
     Meehan
     Spence

                              {time}  1601

  So the motion to recommit was rejected.
  The result of the vote was announced as above recorded.
  The SPEAKER pro tempore (Mr. LaHood). The question is on the passage 
of the bill.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.
  Mr. SENSENBRENNER. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. This will be a 5-minute vote.
  The vote was taken by electronic device, and there were--yeas 233, 
nays 198, not voting 3, as follows:

                             [Roll No. 254]

                               YEAS--233

     Aderholt
     Akin
     Armey
     Bachus
     Baker
     Ballenger
     Barr
     Bartlett
     Barton
     Bass
     Bereuter
     Biggert
     Bilirakis
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bono
     Brady (TX)
     Brown (SC)
     Bryant
     Burr
     Burton
     Buyer
     Callahan
     Calvert
     Camp
     Cannon
     Cantor
     Capito
     Castle
     Chabot
     Chambliss
     Clement
     Coble
     Collins
     Combest
     Condit
     Cooksey
     Cox
     Cramer
     Crane
     Crenshaw
     Cubin
     Culberson
     Cunningham
     Davis, Jo Ann
     Davis, Tom
     Deal
     DeLay
     DeMint
     Diaz-Balart
     Doolittle
     Dreier
     Duncan
     Dunn
     Ehlers
     Ehrlich
     Emerson
     English
     Everett
     Ferguson
     Flake
     Fletcher
     Foley
     Forbes
     Fossella
     Frelinghuysen
     Gallegly
     Ganske
     Gekas
     Gibbons
     Gilchrest
     Gillmor
     Gilman
     Goode
     Goodlatte
     Gordon
     Goss
     Graham
     Granger
     Graves
     Green (WI)
     Greenwood
     Grucci
     Gutknecht
     Hall (OH)
     Hall (TX)
     Hansen
     Hart
     Hastert
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Herger
     Hilleary
     Hobson
     Hoekstra
     Horn
     Hostettler
     Houghton
     Hulshof
     Hunter
     Hutchinson
     Hyde
     Isakson
     Issa
     Istook
     Jenkins
     Johnson (CT)
     Johnson (IL)
     Johnson, Sam
     Jones (NC)
     Keller
     Kelly
     Kennedy (MN)
     Kerns
     King (NY)
     Kingston
     Kirk
     Knollenberg
     Kolbe
     LaFalce
     LaHood
     Largent
     Latham
     LaTourette
     Leach
     Lewis (CA)
     Lewis (KY)
     Linder
     Lipinski
     LoBiondo
     Lucas (KY)
     Lucas (OK)
     McCrery
     McHugh
     McInnis
     McIntyre
     McKeon
     Mica
     Miller (FL)
     Miller, Gary
     Mollohan
     Moran (KS)
     Myrick
     Nethercutt
     Ney
     Northup
     Norwood
     Nussle
     Osborne
     Ose
     Otter
     Oxley
     Pence
     Peterson (PA)
     Petri
     Phelps
     Pickering
     Pitts
     Platts
     Pombo
     Portman
     Pryce (OH)
     Putnam
     Quinn
     Radanovich
     Ramstad
     Regula
     Rehberg
     Reynolds
     Riley
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Roukema
     Royce
     Ryan (WI)
     Ryun (KS)
     Saxton
     Scarborough
     Schaffer
     Schrock
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Shays
     Sherwood
     Shimkus
     Shows
     Shuster
     Simmons
     Simpson
     Skeen
     Skelton
     Smith (MI)
     Smith (NJ)
     Smith (TX)
     Souder
     Stearns
     Sununu
     Sweeney
     Tancredo
     Tauzin
     Taylor (NC)
     Terry
     Thomas
     Thornberry
     Thune
     Tiahrt
     Tiberi
     Toomey
     Traficant
     Upton
     Vitter
     Walden
     Walsh
     Wamp
     Watkins (OK)
     Watts (OK)
     Weldon (FL)
     Weldon (PA)
     Weller
     Whitfield
     Wicker
     Wilson
     Wolf
     Young (AK)
     Young (FL)

                               NAYS--198

     Abercrombie
     Ackerman
     Allen
     Andrews
     Baca
     Baird
     Baldacci
     Baldwin
     Barcia
     Barrett
     Becerra
     Bentsen
     Berkley
     Berman
     Berry
     Bishop
     Blagojevich
     Blumenauer
     Bonior
     Borski
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brown (FL)
     Brown (OH)
     Capps
     Capuano
     Cardin
     Carson (IN)
     Carson (OK)
     Clay
     Clayton
     Clyburn
     Conyers
     Costello
     Coyne
     Crowley
     Cummings
     Davis (CA)
     Davis (FL)
     Davis (IL)
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Deutsch
     Dicks
     Dingell
     Doggett
     Dooley
     Doyle
     Edwards
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Filner
     Ford
     Frank
     Frost
     Gephardt
     Gonzalez
     Green (TX)
     Gutierrez
     Harman
     Hastings (FL)
     Hill
     Hilliard
     Hinchey
     Hinojosa
     Hoeffel
     Holden
     Holt
     Honda
     Hooley
     Hoyer
     Inslee
     Israel
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     John
     Johnson, E.B.
     Jones (OH)
     Kanjorski
     Kaptur
     Kennedy (RI)
     Kildee
     Kilpatrick
     Kind (WI)
     Kleczka
     Kucinich
     Lampson
     Langevin
     Lantos
     Larsen (WA)
     Larson (CT)
     Lee
     Levin
     Lewis (GA)
     Lofgren
     Lowey
     Luther
     Maloney (CT)
     Maloney (NY)
     Manzullo
     Markey
     Mascara
     Matheson
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McDermott
     McGovern
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Millender-McDonald
     Miller, George
     Mink
     Moore
     Moran (VA)
     Morella
     Murtha
     Nadler
     Napolitano
     Neal
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Paul
     Payne
     Pelosi
     Peterson (MN)
     Pomeroy
     Price (NC)
     Rahall
     Rangel
     Reyes
     Rivers
     Rodriguez
     Roemer
     Ross
     Rothman
     Roybal-Allard
     Rush
     Sabo
     Sanchez
     Sanders
     Sandlin
     Sawyer
     Schakowsky
     Schiff
     Scott
     Serrano
     Sherman
     Slaughter
     Smith (WA)
     Snyder
     Solis
     Spratt
     Stark
     Stenholm
     Strickland
     Stump
     Stupak
     Tanner
     Tauscher
     Taylor (MS)
     Thompson (CA)
     Thompson (MS)
     Thurman
     Tierney
     Towns
     Turner
     Udall (CO)
     Udall (NM)
     Velazquez
     Visclosky
     Waters
     Watson (CA)
     Watt (NC)
     Waxman
     Weiner
     Wexler
     Woolsey
     Wu
     Wynn

                             NOT VOTING--3

     Engel
     McKinney
     Spence

                              {time}  1611

  So the bill was passed.
  The result of the vote was announced as above recorded.
  A motion to reconsider was laid on the table.

                          ____________________