[Congressional Record (Bound Edition), Volume 147 (2001), Part 4]
[Senate]
[Pages 5239-5245]
[From the U.S. Government Publishing Office, www.gpo.gov]



          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mrs. FEINSTEIN.
  S. 672. A bill to amend the immigration and Nationality Act to 
provide for the continued classification of certain aliens as children 
for purposes of that Act in cases where the aliens ``age-out'' while 
awaiting immigration processing, and for other purposes, to the 
Committee on the Judiciary.
  Mrs. FEINSTEIN. Mr. President, today I am pleased to introduce the 
Child Status Protection Act of 2001. This legislation would protect 
children who are in danger of losing their eligibility for an 
immigration visa because of the inability of the Immigration and 
Naturalization Service INS to process their petitions or applications 
in a timely fashion.
  Children caught in the INS backlogs often face the problem of ``aging 
out'' of eligibility for family-based visas on their 21st birthday. One 
case recently brought to my attention was that of a couple who were 
lawful permanent residents. In 1993, they filed family-based petitions 
for their three children. Although the INS approved the petitions, as 
of March 2000, none of the children had become permanent residents. 
When they turned 21, the two oldest children were switched into another 
visa category because they no longer qualify as ``minor children.'' 
Now, they are in another backlog in which they have to wait another 
eight years to get a green card.
  The legislation I have introduced today would provide a child, whose 
timely filed application for a family-based, employment-based, or 
diversity visa was submitted before the child reached his or her 21st 
birthday, the opportunity to remain eligible for that visa until the 
visa becomes available. The legislation also would protect the child of 
an asylum seeker whose application was submitted prior to the child's 
21st birthday.
  In recent years, the INS has faced a dramatic increase in the number 
of immigration benefit petitions and applications filed. This combined 
with the agency's slow service, and antiquated filing and computer data 
systems, has caused millions of our constituents to endure long waits 
of three to five years before getting their cases adjudicated.
  The INS backlogs have carried a heavy price: children who are the 
beneficiaries of petitions and applications are ``aging out'' of 
eligibility for their visas, even though they were fully eligible at 
the time their applications were filed. This has occurred because some 
immigration benefits are only available to the ``child'' of a United 
States citizen or lawful permanent resident, and the Immigration and 
Nationality Act defines a ``child'' as an unmarried person under the 
age of 21.
  As a consequence, a family whose child's application for admission to 
the United States has been pending for years may be forced to leave 
that child behind either because the INS was unable to adjudicate the 
application before the child's 21st birthday, or because growing 
immigration backlogs in the immigration visa category caused the visa 
to be unavailable before the child reached his 21st birthday. As a 
result, the child loses the right to admission to the United States. 
This is what is commonly known as ``aging out.''
  Situations like these leave both the family and the child in a 
difficult dilemma. Under current law, lawful permanent residents who 
are outside of the United States face a difficult choice when their 
child ``ages-out'' of eligibility for a first preference visa. 
Emigrating parents must decide to either come to the United States and 
leave their child behind, or remain in their country of origin and lose 
out on their American dream in the United States. In the end, we as a 
country stand to lose when we are deprived of their cultural gifts, 
talents and many contributions.
  For lawful permanent residents who already live in the United States, 
their dilemma is different. They must make the difficult choice of 
either sending their child who has ``aged-out'' of visa eligibility 
back to their country of origin, or have the child stay in the United 
States out-of-status, in violation of our immigration laws, and thus, 
vulnerable to deportation. No law should encourage this course of 
action.
  One compelling example is that of 17-year-old Juan, a youngster born 
in Guatemala, who applied for adjustment of status under the Nicaraguan 
and Central American Relief Act in 1999. He is a junior in high school 
with a 4.0 grade point average. His mother came to the United States in 
1986, fleeing life-threatening conditions in Guatemala. Juan, who was 
six years old at the time, joined her four years later. Today, Juan has 
yet to have an interview with the INS. Given the expected three- to 
five-year wait for the INS to

[[Page 5240]]

adjudicate adjustment of status applications, this high achieving 
student may not only miss out on his dream of becoming an engineer, his 
home state of California stands to lose out on the contributions he 
undoubtedly will make.
  The aging out problem also extends to those who have fled persecution 
and are granted asylum in the U.S. Current law permits persons granted 
asylum to have their child join them in the United States. However, if 
the child ages out while the parent's application for asylum is being 
adjudicated, the child is no longer automatically entitled to remain 
with his parent.
  As Members of Congress we, too, have been confronted with this issue. 
Because the Attorney General does not have the discretion to protect 
the status of these children, we often are called upon to introduce 
private bills to grant them the status they deserve. Unfortunately, 
these bills are limited in number and not all deserving children are 
able get private bills introduced on their behalf.
  The Child Status Protection Act of 2001 would correct these 
inequities and help protect a number of children who, through no fault 
of their own, face the consequence of being separated from their 
immediate family. It is a modest but urgently needed reform of our 
immigration laws, and I urge my colleagues to support this legislation. 
I ask unanimous consent that the text of the Child Status Protection 
Act of 2001 be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 672

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Child Status Protection 
     Act''.

     SEC. 2. CHILD STATUS PROTECTION.

       (a) Immediate Relatives.--Section 201(b)(2)(A) of the 
     Immigration and Nationality Act (8 U.S.C. 1151(b)(2)(A)) is 
     amended by adding at the end the following:
       ``(iii) Notwithstanding section 101(b)(1), an unmarried 
     alien 21 years of age or older on whose behalf a petition was 
     filed under section 204 to classify the alien as an immediate 
     relative under clause (i) shall be classified as a child of a 
     citizen of the United States for purposes of that clause, and 
     the petition shall be considered a petition for 
     classification under that clause, if the alien attained 21 
     years of age after the date on which the petition was filed 
     but while the petition is pending before the Attorney 
     General.
       ``(iv) An unmarried alien under 21 years of age on whose 
     behalf a petition was filed under section 204 to classify the 
     alien as an immigrant under section 203(a)(2)(A) shall be 
     classified as a child of a citizen of the United States for 
     purposes of clause (i), and the petition shall be considered 
     a petition for classification under that clause, if a 
     petitioning parent became a naturalized citizen of the United 
     States after the petition was filed but while the petition is 
     pending before the Attorney General..
       ``(v) An unmarried alien who was in a marriage on the date 
     a petition was filed under section 204 to classify the alien 
     as an immigrant under section 203(a)(3) shall be classified 
     as a child of a citizen of the United States for purposes of 
     clause (i), and the petition shall be considered a petition 
     for classification under the clause, if--
       ``(I) the alien's marriage was legally terminated while the 
     petition is pending before the Attorney General; and
       ``(II) the alien was under 21 years of age on the date of 
     legal termination of the marriage.''.
       (b) Family-Sponsored, Employment-Based, and Diversity 
     Immigrants.--Section 203(d) of the Immigration and 
     Nationality Act (8 U.S.C. 1153(d)) is amended to read as 
     follows:
       ``(d) Treatment of Family Members.--
       ``(1) In general.--A spouse or child (as defined in 
     subparagraph (A), (B), (C), (D), or (E) of section 101(b)(1)) 
     shall, if not otherwise entitled to immigrant status and the 
     immediate issuance of a visa under subsection (a), (b), or 
     (c), be entitled to the same status, and the same order of 
     consideration provided in the respective subsection, if 
     accompanying or following to join, the spouse or parent.
       ``(2) Continued classification of certain aliens as 
     children.--An unmarried alien 21 years of age or older on 
     whose behalf a petition was filed under section 204 to 
     classify the alien as an immigrant under subsection (a), (b), 
     or (c), who is accompanying or following to join his or her 
     parent under this section shall be classified as a child for 
     purposes of entitlement to the same immigrant status of the 
     parent, and the petition shall be considered a petition for 
     classification for such purposes, if the alien attained 21 
     years of age after the date on which the petition was filed 
     but while the petition is pending before the Attorney 
     General.''.
       (c) Asylees.--Section 208(b)(3) of the Immigration and 
     Nationality Act (8 U.S.C. 1158(b)(3)) is amended--
       (1) by striking ``A spouse'' and inserting ``(A) In 
     general.--A spouse''; and
       (2) by adding at the end the following:
       ``(B) Continued classification of certain alien as children 
     for asylum eligibility.--A unmarried alien who is 
     accompanying or seeking to join a parent granted asylum under 
     this subsection, who is seeking to be granted asylum under 
     this paragraph, and who was under 21 years of age on the date 
     on which the alien's parent applied for asylum under this 
     section shall continue to be classified as a child for 
     purposes of this paragraph, if the alien attained 21 years of 
     age after the application was filed but while the application 
     is pending before the Attorney General.''.

     SEC. 3. EFFECTIVE DATE.

       Section 2, and the amendments made by section 2 shall apply 
     to--
       (1) all applications and petitions filed before the date of 
     enactment of this Act and pending on such date; and
       (2) all applications and petitions filed on or after such 
     date.
                                 ______
                                 
      By Mr. HAGEL (for himself, Mr. Biden, and Mr. Lugar):
  S. 673. A bill to establish within the executive branch of the 
Government an interagency committee to review and coordinate United 
States nonproliferation efforts in the independent states of the former 
Soviet Union; to the Committee on Government Affairs.
  Mr. HAGEL. Mr. President, today I am introducing a bill to address 
the coordination of spending, both public and private, on U.S. non-
proliferation efforts in Russia. I am pleased to be joined in 
introducing this bill by my colleagues Senators Biden and Lugar.
  In 1991, the world faced the very real specter of nuclear chaos 
erupting from the disintegration of the Soviet Union. Largely through 
the foresight and leadership of Senators Nunn and Lugar, Congress 
established a fledging program that year authorizing the use of Defense 
Department funds to assist with the safe and secure transportation, 
storage, and dismantlement of nuclear, chemical and other weapons in 
the former Soviet Union. The world is a much safer place because of 
these efforts. I commend my friend and co-sponsor, Senator Lugar, for 
the important contribution he has made to the national security of this 
nation.
  In the past ten years the Nunn-Lugar initiative has grown into a 
multi-pronged attack by the Departments of Defense, State and Energy to 
ensure that weapons of mass destruction, weapons-usable material and 
technology, and weapons-related knowledge in Russia and the Newly 
Independent States remain beyond the reach of terrorist and weapons-
proliferating states. This investment has yielded an impressive return. 
Over the past decade, important gains have been made in securing 
weapons, technology and knowledge in the former Soviet Union. By 
assisting Russia we have enhanced our own national security. But this 
success has come with problems of coordination.
  U.S. public spending on non-proliferation programs in the Russian 
Federation suffers from a lack of coordination within and among United 
States Government agencies and departments. As recently as last 
January, a bipartisan task force led by former Senator Howard Baker and 
former White House Counsel Lloyd Cutler released a report calling for 
improved coordination within the U.S. government on non-proliferation 
assistance to Russia. The importance of these programs to the national 
security of this nation demands that we address this issue. We must 
coordinate U.S. government non-proliferation efforts in Russia to 
ensure that our overall spending on these efforts is both efficient and 
maximized to further the national security interests of the United 
States.
  Ensuring the efficiency of our public spending also requires that we 
take into account the increased spending and investment by the United 
States private sector on non-proliferation efforts in Russia. This 
private spending, still small but registering positive results, will 
continue to increase. We must ensure that public spending on Russian 
non-proliferation programs is not in conflict with this important 
contribution from the U.S. private sector.

[[Page 5241]]

  The Non-Proliferation Assistance Coordination Act of 2001 calls on 
the President to create an interagency committee that will monitor and 
coordinate the implementation of United States non-proliferation 
efforts in Russia. Under the direction of the President's National 
Security Assistant, representatives from the Departments of State, 
Defense, Energy and Commerce would provide guidance on coordinating, 
de-conflicting and maximizing the utility of United States public 
spending on our important non-proliferation efforts in Russia. I 
believe U.S. non-proliferation efforts in Russia, first initiated a 
decade ago under the leadership of Senators Lugar and Nunn, have made 
lasting contributions to the national security of the United States. 
This bill will ensure that future non-proliferation assistance to 
Russia is well spent.
  Mr. President, I ask unanimous consent that the full text of the bill 
be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 673

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Nonproliferation Assistance 
     Coordination Action of 2001''.

     SEC. 2. FINDINGS.

       Congress finds that--
       (1) United States nonproliferation efforts in the 
     independent states of the former Soviet Union have achieved 
     important results in ensuring that weapons of mass 
     destruction, weapons-usable material and technology, and 
     weapons-related knowledge remain beyond the reach of 
     terrorists and weapons-proliferating states;
       (2) although these efforts are in the United States 
     national security interest, the effectiveness of these 
     efforts suffers from a lack of coordination within and among 
     United States Government agencies;
       (3) increased spending and investment by the United States 
     private sector on nonproliferation efforts in the independent 
     states of the former Soviet Union, specifically, spending and 
     investment by the United States private sector in job 
     creation initiatives and proposals for unemployed Russian 
     weapons scientists and technicians, is making an important 
     contribution in ensuring that knowledge related to weapons of 
     mass destruction remains beyond the reach of terrorists and 
     weapons-proliferating states; and
       (4) increased spending and investment by the United States 
     private sector on nonproliferation efforts in the independent 
     states of the former Soviet Union requires the establishment 
     of a coordinating body to ensure that United States public 
     and private efforts are not in conflict, and to ensure that 
     public spending on efforts by the independent states of the 
     former Soviet Union is maximized to ensure efficiency and 
     further United States national security interests.

     SEC. 3. INDEPENDENT STATES OF THE FORMER SOVIET UNION 
                   DEFINED.

       In this Act, the term ``independent states of the former 
     Soviet Union'' has the meaning given the term in section 3 of 
     the FREEDOM Support Act (22 U.S.C. 5801).

     SEC. 4. ESTABLISHMENT OF COMMITTEE ON NON-PROLIFERATION 
                   ASSISTANCE TO THE INDEPENDENT STATES OF THE 
                   FORMER SOVIET UNION.

       (a) Establishment.--There is established within the 
     executive branch of the Government an interagency committee 
     known as the ``Committee on Nonproliferation Assistance to 
     the Independent States of the Former Soviet Union'' (in this 
     Act referred to as the ``Committee'').
       (b) Membership.--
       (1) In general.--The Committee shall be composed of five 
     members, as follows:
       (A) A representative of the Department of State designated 
     by the Secretary of State.
       (B) A representative of the Department of Energy designated 
     by the Secretary of Energy.
       (C) A representative of the Department of Defense 
     designated by the Secretary of Defense.
       (D) A representative of the Department of Commerce 
     designated by the Secretary of Commerce.
       (E) A representative of the Assistant to the President for 
     National Security Affairs designated by the Assistant to the 
     President.
       (2) Level of representation.--The Secretary of a department 
     named in subparagraph (A), (B), (C), or (D) of paragraph (1) 
     shall designate as the department's representative an 
     official of that department who is not below the level of an 
     Assistant Secretary of the department.
       (b) Chair.--The representative of the Assistant to the 
     President for National Security Affairs shall serve as Chair 
     of the Committee. The Chair may invite the head of any other 
     department or agency of the United States to designate a 
     representative of that department or agency to participate 
     from time to time in the activities of the Committee.

     SEC. 5. DUTIES OF COMMITTEE.

       (a) In General.--The Committee shall have primary 
     continuing responsibility within the executive branch of the 
     Government for--
       (1) monitoring United States nonproliferation efforts in 
     the independent states of the former Soviet Union; and
       (2) coordinating the implementation of United States policy 
     with respect to such efforts.
       (b) Duties Specified.--In carrying out the responsibilities 
     described in subsection (a), the Committee shall--
       (1) arrange for the preparation of analyses on the issues 
     and problems relating to coordination within and among United 
     States departments and agencies on nonproliferation efforts 
     of the independent states of the former Soviet Union;
       (2) arrange for the preparation of analyses on the issues 
     and problems relating to coordination between the United 
     States public and private sectors on nonproliferation efforts 
     in the independent states of the former Soviet Union, 
     including coordination between public and private spending on 
     nonproliferation programs of the independent states of the 
     former Soviet Union and coordination between public spending 
     and private investment in defense conversion activities of 
     the independent states of the former Soviet Union;
       (3) provide guidance on arrangements that will coordinate, 
     de-conflict, and maximize the utility of United States public 
     spending on nonproliferation programs of the independent 
     states of the former Soviet Union to ensure efficiency and 
     further United States national security interests;
       (4) encourage companies and nongovernmental organizations 
     involved in nonproliferation efforts of the independent 
     states of the former Soviet Union to voluntarily report these 
     efforts to the Committee;
       (5)(A) arrange for the preparation of analyses on the 
     issues and problems relating to the coordination between the 
     United States and other countries with respect to 
     nonproliferation efforts in the independent states of the 
     former Soviet Union; and
       (B) provide guidance and arrangements that will coordinate, 
     de-conflict, and maximize the utility of United States public 
     spending on nonproliferation programs of the independent 
     states of the former Soviet Union to ensure efficiency and 
     further United States national security interests; and
       (6) consider, and make recommendations to the President and 
     Congress with respect to, proposals for new legislation or 
     regulations relating to United States nonproliferation 
     efforts in the independent states of the former Soviet Union 
     as may be necessary.

     SEC. 6. ADMINISTRATIVE SUPPORT.

       All United States departments and agencies shall provide, 
     to the extent permitted by law, such information and 
     assistance as may be requested by the Committee or the 
     Secretary of State in carrying out their functions and 
     activities under this Act.

     SEC. 7. CONFIDENTIALITY OF INFORMATION.

       Information which has been submitted or received in 
     confidence shall not be publicly disclosed, except to the 
     extent required by law, and such information shall be used by 
     the Committee only for the purpose of carrying out the 
     functions and activities set forth in this Act.

     SEC. 8. STATUTORY CONSTRUCTION.

       Nothing in this Act--
       (1) applies to the data-gathering, regulatory, or 
     enforcement authority of any existing United States 
     department or agency over nonproliferation efforts in the 
     independent states of the former Soviet Union, and the review 
     of those efforts undertaken by the Committee shall not in any 
     way supersede or prejudice any other process provided by law; 
     or
       (2) applies to any activity that is reportable pursuant to 
     title V of the National Security Act of 1947 (50 U.S.C. 413 
     et seq.).
                                 ______
                                 
      By Ms. COLLINS (for herself and Ms. Landrieu):
  S. 674. A bill to amend the Internal Revenue Code of 1986 to provide 
new tax incentives to make health insurance more affordable for small 
businesses, and for other purposes; to the Committee on Finance.
  Ms. COLLINS. Mr. President, I am pleased to join with my colleague 
from Louisiana, Senator Landrieu, in introducing bipartisan 
legislation, the Access to Affordable Health Care Act, that is designed 
to make health insurance more affordable both for individuals and for 
small businesses that provide health care coverage for their employees.
  In the past few years, Congress has taken some major steps to expand 
access to affordable health insurance for all Americans. One of the 
first bills I sponsored on coming to the Senate was legislation to 
establish the State Children's Health Insurance Program,

[[Page 5242]]

which was enacted as part of the Balanced Budget Act. States have 
enthusiastically responded to this program, which now provides 
affordable health insurance coverage to over two million children 
nationwide, including nearly 10,000 in Maine's expanded Medicaid and 
CubCare programs.
  Thanks to these efforts, coupled with an increase in employer 
coverage fueled by our strong economy, we are making some progress. For 
the first time in twelve years, the number of Americans without health 
insurance actually dropped from about 44 million to 42.6 million. While 
this is good news, it by no means minimizes the problem. There are 
still far too many Americans without health insurance. Clearly, we must 
make health insurance more available and affordable.
  Since most Americans get their health insurance through the 
workplace, it is a common assumption that people without health 
insurance are unemployed. The fact is, however, that most uninsured 
Americans are members of families with at least one full-time worker: 
85 percent of the Americans who do not have health insurance are in a 
family with a worker.
  Uninsured, working Americans are most often employees of small 
businesses, the backbone of the economy in Maine. Some 60 percent of 
uninsured workers are employed by small firms. If we want to reduce the 
number of uninsured Americans, we need to consider how we can help more 
small businesses afford health insurance for their employees.
  According to a recent National Federation of Independent Businesses 
survey, the cost of health insurance is the number one problem facing 
small businesses. And it has been since 1986. It is time for us to 
listen and to lend a hand to these small businesses.
  Small employers generally face higher costs for health insurance than 
larger firms, which makes them less likely to offer coverage. Premiums 
are generally higher for small businesses because they do not have as 
much purchasing power as large companies, which limits their ability to 
bargain for lower rates. They also have higher administrative costs 
because they have fewer employees among whom to spread the fixed costs 
of a health benefits plan. Moreover, they are not as able to spread 
risks of medical claims over as many employees as can large firms.
  As a consequence, only 42 percent of small businesses with fewer than 
50 employees offer health insurance to their employees. By way of 
contrast, more than 95 percent of businesses with 100 or more employees 
offer insurance.
  Moreover, the smaller the business, the less likely it is to offer 
health insurance to its employees. Small businesses want to provide 
health insurance for their employees, but the cost is often just too 
high.
  Simply put, the biggest obstacle to health care coverage in the 
United States today is cost. While American employers everywhere, from 
giant multinational corporations to the small corner store, are facing 
huge hikes in their health insurance costs, these rising costs are 
particularly problematic for small businesses and their employees. Many 
small employers are facing premium increases of 15 to 30 percent or 
more. This can cause them either to drop their health benefits or to 
pass the additional costs on to their employees through increased 
deductibles, higher copays or premium hikes. This, too, is troubling 
and will likely add to the ranks of the uninsured since it will cause 
some employees, particularly lower-wage workers who are 
disproportionately affected by increased costs, to drop or turn down 
coverage when it is offered to them.
  According to another survey of small businesses, two-thirds of small 
business owners said that they would seriously consider offering health 
benefits if they were provided with some assistance with premiums. 
Almost one-half would consider doing so if their costs fell 10 percent.
  To respond to these findings, we are introducing the Access to 
Affordable Health Care Act, which will help small employers cope with 
these rising costs. Our bill will provide new tax credits for small 
businesses to help make health insurance more affordable. It will 
encourage those small businesses that do not currently offer health 
insurance to do so and will help businesses that currently do offer 
insurance to continue coverage even in the face of rising costs.
  Under our proposal, employers with fewer than ten employees will 
receive a tax credit of 50 percent of the employer contribution to the 
cost of employee health insurance. Employers with ten to 25 employees 
will receive a 30 percent credit. Under the bill, the credit would be 
based on an employer's yearly qualified health insurance expenses of up 
to $2,000 for individual coverage and $4,000 for family coverage.
  The legislation we are introducing will also make health insurance 
more affordable for individuals and families who must purchase health 
insurance on their own. The Access to Affordable Health Care Act will 
provide an above-the-line tax deduction for individuals who pay at 
least 50 percent of the cost of their own health and long-term care 
insurance. Regardless of whether an individual takes the standard 
deduction or itemizes, he or she will be provided relief by the new 
above-the-line deduction.
  The bill also will allow self-employed Americans to deduct the full 
amount of their health care premiums. Some 25 million Americans are in 
families headed by a self-employed individual, of these, five million 
are uninsured. Establishing parity in the tax treatment of health 
insurance costs between the self-employed and those working for large 
businesses is not just a matter of equity. It will also help to reduce 
the number of uninsured, but working Americans. Our bill will make 
health insurance more affordable for the 82,000 people in Maine who are 
self-employed. They include our lobstermen, our hairdressers, our 
electricians, our plumbers, and the many owners of mom-and-pop stores 
that dot communities throughout the state.
  The Access to Affordable Health Care Act, which has been endorsed by 
the National Federation of Independent Business, will help small 
businesses afford health insurance for their employees, and it will 
also make coverage more affordable for working Americans who must 
purchase it on their own. I urge my colleagues to join us as cosponsors 
of this important legislation.
                                 ______
                                 
      By Mr. ENZI (for himself and Mr. Thomas):
  S. 675. A bill to ensure the orderly development of coal, coalbed 
methane, natural gas, and oil in ``common areas'' of the Powder River 
Basin, Wyoming and Montana, and for other purposes; to the Committee on 
Energy and Natural Resources.
  Mr. ENZI. Mr. President, I rise today to introduce the ``Powder River 
Basin Resource Development Act of 2001.'' This legislation will provide 
a procedure for the orderly and timely resolution of disputes between 
coal producers and oil and gas operators in the Powder River Basin in 
north-central Wyoming and southern Montana. This legislation is 
cosponsored by my colleague from Wyoming, Senator Thomas.
  The Powder River Basin in Wyoming and southern Montana is one of the 
richest energy resource regions in the world. This area contains the 
largest coal reserves in the United States, providing nearly thirty 
percent of America's total coal production. This region also contains 
rich reserves of oil and gas, including coalbed methane. Wyoming is the 
fifth largest producer of natural gas in the county and the sixth 
largest producer of crude oil. The Powder River Basin plays an ever-
increasing role in the development of coalbed methane as Wyoming 
continues to help meet the growing needs for natural gas in the Rocky 
Mountain region and the country as a whole. The Powder River Basin and 
the State of Wyoming as a whole provide many of the resources that heat 
our homes, fuel our cars, generate electricity for our computers, 
microwaves, and televisions. In short, there is very little that any 
one of us does in a day that is not affected by the resources of coal, 
oil, and natural gas.
  The production of these natural resources represents a vital part of 
the

[[Page 5243]]

economy of my home state of Wyoming. The coal and oil and gas 
industries employ more than 21,000 people in Wyoming. We in Wyoming 
educate our students, build our roads, and provide our citizens with 
many of their social services through property taxes, severance taxes, 
and mineral royalties collected from the development of these energy 
resources. Since Wyoming has no state income tax, our State relies very 
heavily on revenues from the minerals extraction industries for our tax 
base.
  Given the great importance both the coal and oil and gas industries 
have to Wyoming's economy, the State of Wyoming and the federal 
government have tried to encourage concurrent development in areas 
where it is feasible and safe to do so. Unfortunately, this is not 
always possible. This legislation provides a procedure for the fair and 
expeditious resolution of conflicts between oil and gas producers and 
coal producers who have conflicting mineral interests on land in the 
Powder River Basin in Wyoming and southern Montana.
  This legislation establishes a specific procedure to resolve 
conflicts between coal producers and oil and gas producers when their 
mineral development rights come into conflict because of overlapping 
leases. First, this proposal requires that once a potential conflict is 
identified, the affected parties must attempt to negotiate an agreement 
between themselves to resolve this conflict. Second, if the parties are 
unable to come to an agreement between themselves, either of the 
parties may file a petition for relief in U.S. district court in the 
district in which the conflict is located. Third, after receiving a 
petition, the court would determine whether an actual conflict exists. 
Fourth, if the court determines that a conflict does in fact exist, the 
court would determine whether the public interest, as determined by the 
greater economic benefit of each mineral, is best served by suspension 
of the federal coal lease or suspension or termination of all or part 
of the oil and gas lease. Fifth, a panel of three experts would be 
assembled to determine the value of the mineral of lesser economic 
value. Each of the parties in conflict would appoint one of the three 
experts. The third expert would be chosen jointly from the two parties. 
Finally, after the panel issues its final valuation report, the court 
would enter an order setting the compensation that is due the developer 
who had to temporarily or permanently forgo his development rights. 
This compensation would be paid by the owner of the mineral of greater 
economic value. A credit against federal royalties would also be 
available for this compensation price for limited number of situations 
where neither the existence of the conflict nor compensation to the 
conflicting mineral owner was foreseen in the original federal lease 
bid.
  The ``Powder River Basin Resource Development Act of 2001'' has 
several benefits over the present system. First, it requires parties 
whose mineral interests come into conflict to attempt to negotiate an 
agreement among themselves before either one of them avails himself of 
the expedited resolution mechanism. No such requirement exists today. 
Second, it directs the Secretary of the Interior to encourage expedited 
development of federal minerals that (1) are leased pursuant to the 
federal Mineral Leasing Act; (2) exist in conflict areas; and (3) which 
may otherwise be lost or bypassed. As such, this legislation encourages 
full and expeditious development of federally leased resources in this 
narrow conflict area where it is economically feasible and safe to do 
so. Third and finally, this bill provides a fair and expeditious 
procedure to resolve conflicts which cannot be resolved between the two 
parties themselves and it does so by ensuring that any mineral owner 
will be fully compensated for any suspension or loss of his mineral 
rights. In turn, this proposal will prevent the serious economic 
hardship to thousands of families and the State treasury that could 
occur if mineral development is stalled for an indefinite amount of 
time due to protracted litigation under the current system.
  This legislation is the result of over two years of work and 
represents the input of all the stakeholders: coalbed methane 
producers, deep oil and gas developers, the coal industry, landowners, 
the State of Wyoming, and the Department of the Interior. It is nearly 
identical to legislation that was favorably reported out of the Senate 
Energy Committee last summer by a voice vote. By providing a fair, 
expeditious, cost-effective and certain method to resolve conflicts 
between mineral producers in one of the most bountiful energy regions 
in the world, the ``Powder River Basin Resource Development Act of 
2001'' represents an important chapter in the continuing effort to 
develop a comprehensive national energy policy for the 21st century.
                                 ______
                                 
      By Mr. HATCH (for himself, Mr. Baucus, Mr. Ensign, Mr. Murkowski, 
        Mr. Torricelli, Mr. Schumer, and Mr. Breaux):
  S. 676. A bill to amend the Internal Revenue Code of 1986 to extend 
permanently the subpart F exemption for active financing income; to the 
Committee on Finance.
  Mr. HATCH. Mr. President, I rise today on behalf of myself and 
Senators Baucus, Ensign, Torricelli, Schumer, Murkowski, and Breaux, to 
introduce legislation to permanently extend the exclusion from Subpart 
F for active financing income earned on business operations overseas. 
This legislation permits American financial services firms doing 
business abroad to continue to defer U.S. tax on their earnings from 
their foreign financial services operations until such earnings are 
returned to the U.S. parent company.
  The permanent extension of this provision is particularly important 
in today's global marketplace. Over the last few years the financial 
services industry has seen technological and global changes that have 
altered the very nature of the way these corporations do business, both 
here and abroad. The U.S. financial industry is a worldwide leader and 
plays a pivotal role in maintaining confidence in the international 
marketplace. It is essential that our tax laws adapt to the fast-paced 
and ever-changing business environment of today.
  Let me outline exactly why this bill is needed. Regulated U.S. 
financial institutions with operations overseas need to retain earnings 
in foreign subsidiaries in order to meet ever-expanding capital 
requirements. Unfortunately, if the tax provision this bill seeks to 
permanently extend is allowed to expire at the end of this year, as is 
scheduled under the current law, those earnings will be subject to 
current U.S. taxation. Obviously, current taxation makes it more costly 
for a growing overseas business to meet those capital requirements, an 
impediment that is not in place for most foreign-based competitors.
  Congress recognized this fact as long ago as the early 1960s, when 
the Kennedy Administration proposed the imposition of current taxation 
for all overseas income of U.S.-based corporations. Counsel for the 
Joint Committee on Taxation testified at that time that Congress could 
not constitutionally tax shareholders on the unremitted earnings of 
foreign subsidiaries except in cases where such tax was necessary to 
prevent the evasion or avoidance of tax. In cutting back the scope of 
the President's proposal, the House Ways and Means Committee stated, in 
part, ``to impose the U.S. tax currently on U.S. shareholders of 
American-owned businesses operating abroad would put such firms at a 
disadvantage with other firms located in the same areas not subject to 
U.S. tax.''
  Forty years later, those words still ring true. The competition 
abroad for U.S. banks, for example, is no longer the Chases, Bankers 
Trusts, and Bank of Americas of the world. They are now Deutschebank, 
ABN Amro, HSBC, and Societe Generale. These foreign-based financial 
institutions are big players in the worldwide arena operating, usually, 
under home-country tax regimes that generally do not tax currently 
their active financial income earned outside their home countries.
  The bill we are introducing today would provide a consistent, 
equitable, and stable international tax regime for

[[Page 5244]]

this important component of our economy. A permanent extension of this 
provision would provide American companies much-needed stability. Our 
current ``on-again, off-again'' habit of annual extension limits the 
ability of U.S.-based firms to compete fully in the marketplace and 
interferes with their decision making and long-term planning. The 
activities that give rise to this income are long-range in nature, not 
easily or inexpensively stopped and started on a year-to-year basis. 
Permanency is the only thing that makes sense when it comes to this 
kind of tax policy.
  This legislation will give U.S.-based financial services companies 
consistency and stability. The permanent extension of this exclusion 
from Subpart F provides tax rules that will ensure that the U.S. 
financial services industry is on an equal competitive footing with 
their foreign-based competitors and, just as importantly, provides tax 
treatment that is consistent with the tax treatment accorded most other 
U.S. companies.
  The world has changed rapidly over the past few years. Like it or 
not, we live and compete in a global economy. In many respects, our Tax 
Code is outdated and represents the world as it was in the 1960s or 
1970s, or in some cases, even before. If we close our eyes to these 
facts, we risk losing our worldwide leadership. The legislation we are 
introducing today will not solve all of our tax problems, nor even all 
of the tax problems of U.S. companies trying to compete 
internationally. It will, however, solve one very important problem. 
And this would be a start from which we can build.
  I urge my colleagues to support this important bill and ask that the 
text of the bill be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 676

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

     SECTION 1. PERMANENT SUBPART F EXEMPTION FOR ACTIVE FINANCING 
                   INCOME.

       (a) Banking, Financing, or Similar Businesses.--Section 
     954(h) of the Internal Revenue Code of 1986 (relating to 
     special rule for income derived in the active conduct of 
     banking, financing, or similar businesses) is amended by 
     striking paragraph (9).
       (b) Insurance Businesses.--Section 953(e) of the Internal 
     Revenue Code of 1986 (defining exempt insurance income) is 
     amended by striking paragraph (10) and by redesignating 
     paragraph (11) as paragraph (10).
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years of a foreign corporation 
     beginning after December 31, 2001, and to taxable years of 
     United States shareholders with or within which such taxable 
     years of such foreign corporation end.

  Mr. BAUCUS. Mr. President, today I am pleased to join my colleague 
Senator Hatch in introducing legislation to permanently extend the 
exception from Subpart F for active financing income.
  Current law contains a temporary provision, expiring at the end of 
this year, that makes sure that the active financial services income 
that a U.S. financial services company earns abroad is not subjected to 
U.S. tax until that income is distributed back to the U.S. parent 
company. Our legislation is intended to keep the U.S. financial 
services industry on an equal footing with foreign-based competitors by 
making this provision permanent.
  The growing interdependence of world financial markets has 
highlighted the need to rationalize U.S. tax rules that undermine the 
ability of American financial services industries to compete in the 
international arena. At the same time, it is important to ensure that 
the U.S. tax treatment of worldwide income does not encourage avoidance 
of U.S. tax through the sheltering of income in foreign tax havens. 
However, I believe it is possible to adequately protect the federal 
fisc without jeopardizing the international expansion and 
competitiveness of U.S.-based financial services companies, including 
finance and credit entities, commercial banks, securities firms, and 
insurance companies.
  The active financing provision is particularly important today. The 
U.S. financial services industry is second to none and plays a pivotal 
role in maintaining confidence in the international marketplace. 
Through our network of tax treaties, we have made tremendous progress 
in gaining access to new foreign markets for this industry in recent 
years. Our tax laws should complement, rather than undermine, this 
effort.
  As is the case with other tax provisions such as the research and 
development tax credit, the temporary nature of the U.S. active 
financing exception denies U.S. companies the certainty enjoyed by 
their foreign competitors. The economic growth of American's financial 
sector is impaired by the uncertainty under the current system created 
by continually extending the exception on a temporary basis. The 
activities that are affected by this provision are long-range in nature 
and therefore those entering into these activities need to know the 
long-range tax consequences of their actions. A permanent extension of 
the active financing exception is needed to allow our financial 
services industry to compete internationally.
  I ask my colleagues to join me in supporting this legislation, and 
provide a consistent, equitable, and stable international tax regime 
for the U.S. financial services industry.
                                 ______
                                 
      By Mr. HATCH (for himself, Mr. Breaux, Mr. Jeffords, Ms. Snowe, 
        Mrs. Lincoln, and Mr. Allard):
  S. 677. A bill to amend the Internal Revenue Code of 1986 to repeal 
the required use of certain principal repayments on mortgage subsidy 
bond financing to redeem bonds, to modify the purchase price limitation 
under mortgage subsidy bond rules based on median family income, and 
for other purposes; to the Committee on Finance.
  Mr. HATCH. Mr. President, I rise today to introduce the Housing Bond 
and Credit Modernization and Fairness Act of 2001. I am joined in this 
effort by Senators Breaux, Jeffords, Allard, Lincoln, and Snowe. This 
legislation will bring about important adjustments in two of the most 
important and popular federal affordable housing programs that have 
been enacted, Housing Bonds, or single family Mortgage Revenue Bonds, 
MRBs, as they are commonly known, and the Low Income Housing Tax 
Credit. Identical legislation was recently introduced in the House by 
Congressmen Amo Houghton and Richard Neal.
  These programs are popular because they are state-administered, 
federal tax incentives to encourage private investment in first-time 
homebuyer mortgages for low and moderate-income families and privately 
developed and owned apartments for low-income renters. The changes 
proposed by this legislation were endorsed by the National Governors 
Association at its recent meeting. The Governors know how important the 
Housing Bond and Housing Tax Credit programs are in efforts to meet the 
housing needs of low and moderate-income families. The bill is also 
supported by the National Council of State Housing Agencies.
  Last year more than 80 members of this Body cosponsored legislation 
that was included in last year's Community Renewal Tax Relief Act of 
2000, which was signed into law by President Clinton. That legislation 
adjusted for past inflation in the operating levels of the Housing Tax 
Credit and MRB programs. Specifically, the Act increased the per capita 
low-income housing tax credit cap as well as the State-volume limits on 
tax-exempt private activity bonds, under which the MRB program falls. 
However, even with these long overdue changes, many people who are 
qualified to receive housing assistance under these programs cannot get 
it. The reason is that a few obsolete provisions in the programs stand 
in the way. The legislation we are introducing today will modernize 
these programs and remove these barriers. Specifically, the bill 
includes three changes.
  First, the bill would repeal the so-called Ten-Year Rule. This rule, 
which was enacted in 1988, prevents states from using mortgage payments 
received ten years after the original Mortgage Revenue Bond was issued 
to make new mortgage loans to additional qualified purchasers. A recent 
report by Merrill Lynch states, ``The Ten-

[[Page 5245]]

Year Rule, to a large extent, offsets gains from the volume cap 
increase.'' Between 1998 and 2002, this rule will result in the loss of 
over $8.5 billion in mortgage authority, denying over 100,000 qualified 
lower income homebuyers affordable MRB-financed mortgages. Each year, 
the Ten-Year Rule will keep tens of thousands of additional qualified 
lower income homebuyers from getting an affordable MRB-financed 
mortgage, including many in my home State of Utah.
  Second, the bill would replace the current-law unworkable limit on 
the price of the homes these MRB mortgages can finance with a simple 
limit that works. Let me explain. Current law limits the price of homes 
purchased with MRB-financed mortgages to 90 percent of the average area 
home price. States have the option of determining their own purchase 
price limits or of relying on Treasury-published safe harbor limits. 
Most states rely on the Treasury limits because it is costly, 
burdensome, and often impossible to collect accurate and comprehensive 
sales price data.
  The problem is that, like many states, the Treasury Department does 
not have access to reliable and comprehensive sales price data. This 
has especially been a problem for states, such as Utah, with many rural 
areas. In fact, Treasury last issued safe harbor limits in 1994, based 
on 1993 data. Home prices have risen approximately 30 percent in the 
past eight years, and in some areas of the country by a much higher 
percentage. This means that the MRB program simply cannot work in many 
parts of many states because qualified buyers cannot find homes priced 
below the outdated limits. To have an outdated and unworkable 
requirement that holds back the families that this program is designed 
to help is poor public policy that cries out for remedy.
  The bill we are introducing today would allow States to determine 
purchase price limits without reliance on nonexisting sales price data. 
It does this by limiting the purchase price to three and a half times 
the MRB qualifying income limit. In the 106th Congress, I joined my 
friend and colleague from Arkansas, Senator Lincoln, in introducing 
this provision as a stand-alone bill.
  Finally, the bill would make Housing Tax Credit apartment production 
more viable in many very low income, and especially rural, areas by 
allowing the use of the greater of area or statewide median incomes for 
determining qualifying income and rent levels. This is how income and 
rent levels are determined under the very successful multifamily bond 
program. Current law requires States to use area median income to 
determine eligible incomes of Housing Tax Credit tenants. In many very 
low income areas, median incomes are simply too low to generate 
sufficient rents to make these housing projects feasible. Data from HUD 
show that current income limits inhibit Housing Tax Credit development 
in as many as 1,700 of the 2,364 non-metropolitan counties across the 
country.
  The Housing Tax Credit and the MRB programs work and they are 
important to each State. The Congress recognized this last year by 
making the important adjustments in the operating levels of these 
programs to compensate for past inflation. More than 80 senators joined 
us in this effort by cosponsoring the legislation. This was a vital 
first step in improving the ability of these programs to meet the 
affordable housing needs of millions of Americans. Now, we must finish 
the job by correcting the problems in the programs that limit their 
effectiveness in delivering this affordable housing. For those of you 
that cosponsored these bills last year, and those of our colleagues who 
are new to the Senate, I am asking you to join this bipartisan effort 
of Senators from both rural and urban States to see that these 
important provisions are enacted this year.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 677

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Housing Bond and Credit 
     Modernization and Fairness Act of 2001''.

     SEC. 2. REPEAL OF REQUIRED USE OF CERTAIN PRINCIPAL 
                   REPAYMENTS ON MORTGAGE SUBSIDY BOND FINANCINGS 
                   TO REDEEM BONDS.

       (a) In General.--Subparagraph (A) of section 143(a)(2) of 
     the Internal Revenue Code of 1986 (defining qualified 
     mortgage issue) is amended by adding ``and'' at the end of 
     clause (ii), by striking ``, and'' at the end of clause (iii) 
     and inserting a period, and by striking clause (iv) and the 
     last sentence.
       (b) Conforming Amendment.--Clause (ii) of section 
     143(a)(2)(D) of such Code is amended by striking ``(and 
     clause (iv) of subparagraph (A))''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to repayments received after the date of the 
     enactment of this Act.

     SEC. 3. MODIFICATION OF PURCHASE PRICE LIMITATION UNDER 
                   MORTGAGE SUBSIDY BOND RULES BASED ON MEDIAN 
                   FAMILY INCOME.

       (a) In General.--Paragraph (1) of section 143(e) of the 
     Internal Revenue Code of 1986 (relating to purchase price 
     requirement) is amended to read as follows:
       ``(1) In general.--An issue meets the requirements of this 
     subsection only if the acquisition cost of each residence the 
     owner-financing of which is provided under the issue does not 
     exceed the greater of--
       ``(A) 90 percent of the average area purchase price 
     applicable to the residence, or
       ``(B) 3.5 times the applicable median family income (as 
     defined in subsection (f)).''
       (b) Effective Date.--The amendment made by this section 
     shall apply to financing provided, and mortgage credit 
     certificates issued, after the date of the enactment of this 
     Act.

     SEC. 4. DETERMINATION OF AREA MEDIAN GROSS INCOME FOR LOW-
                   INCOME HOUSING CREDIT PROJECTS.

       (a) In General.--Paragraph (4) of section 42(g) of the 
     Internal Revenue Code of 1986 (relating to certain rules made 
     applicable) is amended by striking the period at the end and 
     inserting ``and the term `area median gross income' means the 
     amount equal to the greater of--
       ``(A) the area median gross income determined under section 
     142(d)(2)(B), or
       ``(B) the statewide median gross income for the State in 
     which the project is located.''
       (b) Effective Date.--The amendment made by this section 
     shall apply to--
       (1) housing credit dollar amounts allocated after the date 
     of the enactment of this Act, and
       (2) buildings placed in service after such date to the 
     extent paragraph (1) of section 42(h) of the Internal Revenue 
     Code of 1986 does not apply to any building by reason of 
     paragraph (4) thereof.

                          ____________________