[Congressional Record (Bound Edition), Volume 147 (2001), Part 6]
[Senate]
[Pages 8035-8059]
[From the U.S. Government Publishing Office, www.gpo.gov]



          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. INHOFE:

[[Page 8036]]

  S. 878. A bill to amend the Internal Revenue Code of 1986 to prorate 
the heavy vehicle use tax between the first and subsequent purchasers 
of the same vehicle in one taxable period; to the Committee on Finance.
  Mr. INHOFE. Mr. President, I rise today to talk about a bill that 
will help many truck-drivers across the country. As we all know, the 
trucking industry has incurred an incredible cost increase in recent 
years due to higher fuel prices and other taxes. One of my 
constituents, Phillip Parks, has felt this tremendous financial burden 
and, as a result, sold his truck and got out of the business 
altogether.
  The heavy vehicle use tax is one tax many truck drivers, like Mr. 
Parks, are required to pay each year. Under the current IRS code, when 
a vehicle over 75,000 pounds is purchased and driven over 5,000 miles, 
the owner must pay a $550 heavy-use tax. However, if the owner sells 
the vehicle in the same year, he or she is unable to receive a refund 
on this tax, while the person buying the vehicle does not have to pay 
the tax during that year since it has already been paid. This is what 
happened to Mr. Parks.
  My bill will not only make this tax more fair, but will provide some 
much-needed relief for people who wish to sell their trucks within the 
same year they bought them. The Heavy Vehicle Use Tax Equity Act will 
require the purchaser to pay a prorated tax on the vehicle, while the 
person selling it will receive a refund for the portion of the tax 
relative to the time in which they owned it.
  I am pleased to introduce this bill that will help make our complex 
tax code more equitable while putting money back into the hands of 
hard-working Americans, like Phillip Parks of Stillwell, OK.
                                 ______
                                 
      By Mr. SANTORUM:
  S. 879. A bill to amend the Internal Revenue Code of 1986 to expand 
the tip tax credit to employers of cosmetologists and to promote tax 
compliance in the cosmetology sector; to the Committee on Finance.
  Mr. SANTORUM. Mr. President, I ask unanimous consent that the text of 
the bill be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 879

       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 ``Cosmetology Tax Fairness and 
     Compliance Act of 2001''.

     SEC. 2. EXPANSION OF CREDIT FOR PORTION OF SOCIAL SECURITY 
                   TAXES PAID WITH RESPECT TO EMPLOYEE TIPS.

       (a) Expansion of Credit to Other Lines of Business.--
     Paragraph (2) of section 45B(b) of the Internal Revenue Code 
     of 1986 is amended to read as follows:
       ``(2) Application only to certain lines of business.--In 
     applying paragraph (1), there shall be taken into account 
     only tips received from customers or clients in connection 
     with--
       ``(A) the providing, delivering, or serving of food or 
     beverages for consumption if the tipping of employees 
     delivering or serving food or beverages by customers is 
     customary, or
       ``(B) the providing of any cosmetology service for 
     customers or clients at a facility licensed to provide such 
     service if the tipping of employees providing such service is 
     customary.''
       (b) Definition of Cosmetology Service.--Section 45B of such 
     Code is amended by redesignating subsections (c) and (d) as 
     subsections (d) and (e), respectively, and by inserting after 
     subsection (b) the following new subsection:
       ``(c) Cosmetology Service.--For purposes of this section, 
     the term `cosmetology service' means--
       ``(1) hairdressing,
       ``(2) haircutting,
       ``(3) manicures and pedicures,
       ``(4) body waxing, facials, mud packs, wraps, and other 
     similar skin treatments, and
       ``(5) any other beauty related service provided at a 
     facility at which a majority of the services provided (as 
     determined on the basis of gross revenue) are described in 
     paragraphs (1) through (4).''
       (c) Effective Date.--The amendments made by this section 
     shall apply to tips received for services performed after 
     December 31, 2001.

     SEC. 3. INFORMATION REPORTING AND TAXPAYER EDUCATION FOR 
                   PROVIDERS OF COSMETOLOGY SERVICES.

       (a) In General.--Subpart B of part III of subchapter A of 
     chapter 61 of the Internal Revenue Code of 1986 is amended by 
     inserting after section 6050S the following new section:

     ``SEC. 6050T. RETURNS RELATING TO COSMETOLOGY SERVICES AND 
                   INFORMATION TO BE PROVIDED TO COSMETOLOGISTS.

       ``(a) In General.--Every person (referred to in this 
     section as a `reporting person') who--
       ``(1) employs 1 or more cosmetologists to provide any 
     cosmetology service,
       ``(2) rents a chair to 1 or more cosmetologists to provide 
     any cosmetology service on at least 5 calendar days during a 
     calendar year, or
       ``(3) in connection with its trade or business or rental 
     activity, otherwise receives compensation from, or pays 
     compensation to, 1 or more cosmetologists for the right to 
     provide cosmetology services to, or for cosmetology services 
     provided to, third-party patrons,

     shall comply with the return requirements of subsection (b) 
     and the taxpayer education requirements of subsection (c).
       ``(b) Return Requirements.--The return requirements of this 
     subsection are met by a reporting person if the requirements 
     of each of the following paragraphs applicable to such person 
     are met.
       ``(1) Employees.--In the case of a reporting person who 
     employs 1 or more cosmetologists to provide cosmetology 
     services, the requirements of this paragraph are met if such 
     person meets the requirements of sections 6051 (relating to 
     receipts for employees) and 6053(b) (relating to tip 
     reporting) with respect to each such employee.
       ``(2) Independent contractors.--In the case of a reporting 
     person who pays compensation to 1 or more cosmetologists 
     (other than as employees) for cosmetology services provided 
     to third-party patrons, the requirements of this paragraph 
     are met if such person meets the applicable requirements of 
     section 6041 (relating to returns filed by persons making 
     payments of $600 or more in the course of a trade or 
     business), section 6041A (relating to returns to be filed by 
     service-recipients who pay more than $600 in a calendar year 
     for services from a service provider), and each other 
     provision of this subpart that may be applicable to such 
     compensation.
       ``(3) Chair renters.--
       ``(A) In general.--In the case of a reporting person who 
     receives rent or other fees or compensation from 1 or more 
     cosmetologists for use of a chair or for rights to provide 
     any cosmetology service at a salon or other similar facility 
     for more than 5 days in a calendar year, the requirements of 
     this paragraph are met if such person--
       ``(i) makes a return, according to the forms or regulations 
     prescribed by the Secretary, setting forth the name, address, 
     and TIN of each such cosmetologist and the amount received 
     from each such cosmetologist, and
       ``(ii) furnishes to each cosmetologist whose name is 
     required to be set forth on such return a written statement 
     showing--

       ``(I) the name, address, and phone number of the 
     information contact of the reporting person,
       ``(II) the amount received from such cosmetologist, and
       ``(III) a statement informing such cosmetologist that (as 
     required by this section), the reporting person has advised 
     the Internal Revenue Service that the cosmetologist provided 
     cosmetology services during the calendar year to which the 
     statement relates.

       ``(B) Method and time for providing statement.--The written 
     statement required by clause (ii) of subparagraph (A) shall 
     be furnished (either in person or by first-class mail which 
     includes adequate notice that the statement or information is 
     enclosed) to the person on or before January 31 of the year 
     following the calendar year for which the return under clause 
     (i) of subparagraph (A) is to be made.
       ``(c) Taxpayer Education Requirements.--In the case of a 
     reporting person who is required to provide a statement 
     pursuant to subsection (b), the requirements of this 
     subsection are met if such person provides to each such 
     cosmetologist annually a publication, as designated by the 
     Secretary, describing--
       ``(1) in the case of an employee, the tax and tip reporting 
     obligations of employees, and
       ``(2) in the case of a cosmetologist who is not an employee 
     of the reporting person, the tax obligations of independent 
     contractors or proprietorships.

     The publications shall be furnished either in person or by 
     first-class mail which includes adequate notice that the 
     publication is enclosed.
       ``(d) Definitions.--For purposes of this section--
       ``(1) Cosmetologist.--
       ``(A) In general.--The term `cosmetologist' means an 
     individual who provides any cosmetology service.
       ``(B) Anti-avoidance rule.--The Secretary may by regulation 
     or ruling expand the term `cosmetologist' to include any 
     entity or arrangement if the Secretary determines that 
     entities are being formed to circumvent the reporting 
     requirements of this section.
       ``(2) Cosmetology service.--The term `cosmetology service' 
     has the meaning given to such term by section 45B(c).

[[Page 8037]]

       ``(3) Chair.--The term `chair' includes a chair, booth, or 
     other furniture or equipment from which an individual 
     provides a cosmetology service (determined without regard to 
     whether the cosmetologist is entitled to use a specific 
     chair, booth, or other similar furniture or equipment or has 
     an exclusive right to use any such chair, booth, or other 
     similar furniture or equipment).
       ``(e) Exceptions for Certain Employees.--Subsection (c) 
     shall not apply to a reporting person with respect to an 
     employee who is employed in a capacity for which tipping (or 
     sharing tips) is not customary.''
       (b) Conforming Amendments.--
       (1) Section 6724(d)(1)(B) of such Code (relating to the 
     definition of information returns) is amended by 
     redesignating clauses (xi) through (xvii) as clauses (xii) 
     through (xviii), respectively and by inserting after clause 
     (x) the following new clause:
       ``(xi) section 6050T(a) (relating to returns by cosmetology 
     service providers).''
                                 ______
                                 
      By Mr. DeWINE (for himself and Mrs. Lincoln):
  S. 880. A bill to amend title XVIII of the Social Security Act to 
provide adequate coverage for immunosuppressive drugs furnished to 
beneficiaries under the Medicare Program that have received an organ 
transplant, and for other purposes; to the Committee on Finance.
  Mr. DeWINE. Mr. President, I rise today to introduce a bill with my 
colleague, Senator Lincoln, to help those with End Stage Renal Disease, 
ESRD, who receive Medicare-eligible kidney transplants. Our bill would 
help these patients maintain access to life-saving drugs needed to 
prevent their immune systems from rejecting their new organs.
  With each kidney that is successfully transplanted, a gift of new 
life is given to the recipient. This precious gift should not be 
jeopardized simply because the recipient is unable to pay for the 
immunosuppressive drugs that help ensure that his or her immune system 
does not reject the new organ. It defies common sense for Medicare to 
cover expensive kidney transplant operations, but not cover the drugs 
necessary to preserve the transplanted organ.
  I would like to thank my colleagues for supporting the passage of 
most of the bill that I introduced last Congress--S. 631--which was 
passed as part of the Medicare Benefits and Improvement Protection Act, 
BIPA. This law eliminated the 36-month time limitation for Medicare 
coverage of immunosuppressive medications for transplant recipients who 
(1) received a Medicare transplant and (2) have Medicare-age or 
disability status. However, transplant recipients whose Medicare 
eligibility is based solely on their End Stage Renal Disease, ESRD, 
status did not qualify for the extended coverage under BIPA and remain 
limited to coverage for 36 months post-transplant.
  The bill we are introducing today simply would eliminate the 36-month 
time limitation for Medicare immunosuppressive drug coverage for the 
population that was not covered under last year's BIPA provision. Under 
current law, an individual with ESRD retains his or her Medicare 
coverage for all medical needs for 36 months post-transplant. This bill 
would eliminate the 36-month time limitation for the purpose of paying 
for the immunosuppressive drugs only--all other Medicare coverage, 
including that related to other post-transplant needs, would cease 
after 36 months, as under current law.
  A 1999 Institute of Medicine, IOM, study estimated the cost of 
providing indefinite coverage of all Medicare-covered kidney 
transplants at $848 million over five years. The IOM estimate of 
eliminating the time limitation for Medicare-aged and disabled 
transplant recipients only, covered under BIPA, was $566 million over 
five years. This represents a difference of only $282 million over five 
years to cover the rest of the ESRD population.
  Furthermore, our bill would make Medicare the secondary payer after 
36 months for beneficiaries who do not have Medicare-age or disability 
status, which the IOM report did not consider. Recipients covered by 
our bill would be subject to the same Part B premium, deductible, and 
coinsurance that other beneficiaries pay to receive full Part B 
coverage.
  Medicare will pay for another transplant (average cost is $100,000) 
or dialysis, annual cost is more than $50,000, if a transplant fails. 
It makes far better sense from an economic and social perspective to 
extend Medicare coverage for the anti-rejection medications especially 
at a time when the number of people waiting for a kidney transplant in 
this country exceeds 48,000 people.
  I urge my colleagues to support our bill and help those who receive 
Medicare-eligible transplants gain access to the immunosuppressive 
drugs they need to prevent their bodies from rejecting transplanted 
kidneys.
  This legislation is supported by the National Kidney Foundation, the 
American Society of Transplantation, the American Society of Pediatric 
Nephrology, the North American Transplant Coordinators Organization, 
LifeCenter, the Association of Organ Procurement Organizations, the 
American Kidney Fund, and the Polycystic Kidney Disease Foundation.
  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. 880

       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 ``Immunosuppressive Drug 
     Coverage Act of 2001''.

     SEC. 2. PROVISION OF APPROPRIATE COVERAGE OF 
                   IMMUNOSUPPRESSIVE DRUGS UNDER THE MEDICARE 
                   PROGRAM.

       (a) Continued Entitlement to Immunosuppressive Drugs for 
     Kidney Transplant Recipients.--
       (1) In general.--Section 226A(b)(2) of the Social Security 
     Act (42 U.S.C. 426-1(b)(2)) is amended by inserting ``(except 
     for coverage of immunosuppressive drugs under section 
     1861(s)(2)(J))'' after ``shall end''.
       (2) Application.--In the case of an individual whose 
     eligibility for benefits under title XVIII of the Social 
     Security Act (42 U.S.C. 1395 et seq.) has ended except for 
     the coverage of immunosuppressive drugs by reason of the 
     amendment made by paragraph (1), the following rules shall 
     apply:
       (A) The individual shall be deemed to be enrolled in part B 
     of the original medicare fee-for-service program under title 
     XVIII of the Social Security Act (42 U.S.C. 1395j et seq.) 
     for purposes of receiving coverage of such drugs.
       (B) The individual shall be responsible for the full part B 
     premium under section 1839 of such Act (42 U.S.C. 1395r) in 
     order to receive such coverage.
       (C) The provision of such drugs shall be subject to the 
     application of--
       (i) the part B deductible under section 1833(b) of such Act 
     (42 U.S.C. 1395l(b)); and
       (ii) the coinsurance amount applicable for such drugs (as 
     determined under such part B).
       (D) If the individual is an inpatient of a hospital or 
     other entity, the individual is entitled to receive coverage 
     of such drugs under such part B.
       (3) Establishment of procedures in order to implement 
     coverage.--The Secretary of Health and Human Services shall 
     establish procedures for--
       (A) identifying beneficiaries that are entitled to coverage 
     of immunosuppressive drugs by reason of the amendment made by 
     paragraph (1); and
       (B) distinguishing such beneficiaries from beneficiaries 
     that are enrolled under part B of title XVIII of the Social 
     Security Act for the complete package of benefits under such 
     part.
       (4) Technical amendment.--Subsection (c) of section 226A 
     (42 U.S.C. 426-1), as added by section 201(a)(3)(D)(ii) of 
     the Social Security Independence and Program Improvements Act 
     of 1994 (Public Law 103-296; 108 Stat. 1497), is redesignated 
     as subsection (d).
       (b) Extension of Secondary Payer Requirements for ESRD 
     Beneficiaries.--Section 1862(b)(1)(C) of the Social Security 
     Act (42 U.S.C. 1395y(b)(1)(C)) is amended by adding at the 
     end the following new sentence: ``With regard to 
     immunosuppressive drugs furnished on or after the date of 
     enactment of the Immunosuppressive Drugs Coverage Act of 
     2001, this subparagraph shall be applied without regard to 
     any time limitation.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to drugs furnished on or after the date of 
     enactment of this Act.

     SEC. 3. PLANS REQUIRED TO MAINTAIN COVERAGE OF 
                   IMMUNOSUPPRESSIVE DRUGS.

       (a) Application to Certain Health Insurance Coverage.--
       (1) In General.--Subpart 2 of part A of title XXVII of the 
     Public Health Service Act (42 U.S.C. 300gg-4 et seq.) is 
     amended by adding at the end the following:

[[Page 8038]]



     ``SEC. 2707. COVERAGE OF IMMUNOSUPPRESSIVE DRUGS.

       ``A group health plan (and a health insurance issuer 
     offering health insurance coverage in connection with a group 
     health plan) shall provide coverage of immunosuppressive 
     drugs that is at least as comprehensive as the coverage 
     provided by such plan or issuer on the day before the date of 
     enactment of the Immunosuppressive Drug Coverage Act of 2001, 
     and such requirement shall be deemed to be incorporated into 
     this section.''.
       (2) Conforming amendment.--Section 2721(b)(2)(A) of the 
     Public Health Service Act (42 U.S.C. 300gg-21(b)(2)(A)) is 
     amended by inserting ``(other than section 2707)'' after 
     ``requirements of such subparts''.
       (b) Application to Group Health Plans and Group Health 
     Insurance Coverage Under the Employee Retirement Income 
     Security Act of 1974.--
       (1) In general.--Subpart B of part 7 of subtitle B of title 
     I of the Employee Retirement Income Security Act of 1974 (29 
     U.S.C. 1185 et seq.) is amended by adding at the end the 
     following new section:

     ``SEC. 714. COVERAGE OF IMMUNOSUPPRESSIVE DRUGS.

       ``A group health plan (and a health insurance issuer 
     offering health insurance coverage in connection with a group 
     health plan) shall provide coverage of immunosuppressive 
     drugs that is at least as comprehensive as the coverage 
     provided by such plan or issuer on the day before the date of 
     enactment of the Immunosuppressive Drug Coverage Act of 2001, 
     and such requirement shall be deemed to be incorporated into 
     this section.''.
       (2) Conforming amendments.--
       (A) Section 732(a) of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1185(a)) is amended by 
     striking ``section 711'' and inserting ``sections 711 and 
     714''.
       (B) The table of contents in section 1 of the Employee 
     Retirement Income Security Act of 1974 is amended by 
     inserting after the item relating to section 713 the 
     following new item:

``Sec. 714. Coverage of Immunosuppressive drugs.''.

       (c) Application to Group Health Plans Under the Internal 
     Revenue Code of 1986.--Subchapter B of chapter 100 of the 
     Internal Revenue Code of 1986 is amended--
       (1) in the table of sections, by inserting after the item 
     relating to section 9812 the following new item:

``Sec. 9813. Coverage of immunosuppressive drugs.'';

     and
       (2) by inserting after section 9812 the following:

     ``SEC. 9813. COVERAGE OF IMMUNOSUPPRESSIVE DRUGS.

       ``A group health plan shall provide coverage of 
     immunosuppressive drugs that is at least as comprehensive as 
     the coverage provided by such plan on the day before the date 
     of enactment of the Immunosuppressive Drug Coverage Act of 
     2001, and such requirement shall be deemed to be incorporated 
     into this section.''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to plan years beginning on or after January 1, 
     2002.
                                 ______
                                 
      By Mr. HATCH (for himself and Mr. Biden):
  S. 881. A bill to amend the Taxpayer Relief Act of 1997 to provide 
for consistent treatment of survivor benefits for public safety 
officers killed in the line of duty; to the Committee on Finance.
  Mr. HATCH. Mr. President, today, my good friend and colleague, 
Senator Biden, and I are introducing legislation we have drafted to 
help ease the burden of those whose husband or wife or father or mother 
was a public safety officer and has made the ultimate sacrifice and 
died while protecting the citizens of this Nation. I am speaking of the 
families of law enforcement officers, firefighters, and rescue squad or 
ambulance crew members who have lost a loved one in the line of duty.
  The Hatch-Biden bill we introduce in the Senate today, the Fallen 
Hero Survivor Benefit Fairness Act of 2001, is designed to make annuity 
benefits for survivors of public safety officers killed in the line of 
duty tax free, so long as the annuity is provided under a governmental 
plan to the surviving spouse or to the child of the deceased officer.
  In the Taxpayer Relief Act of 1997, Congress took an important step 
in showing our appreciation for this country's fallen heroes by 
exempting from taxation survivor benefits for those killed in the line 
of duty after December 31, 1996. This change has undoubtedly made a 
significant difference to many such surviving families.
  But what about the families of fallen heroes who died before that 
date? Should not their government-provided survivor annuities be tax-
free as well? Of course they should.
  This bill provides tax equity for those survivors receiving annuities 
for officers who died on or before December 31, 1996. We must make this 
tax-free treatment available for all survivors of peace officers who 
gave their lives to make this great country a safer place for us all to 
live. The tax correction in this bill would not be retroactive. Rather, 
it provides that payments from a qualified survivor annuity received 
after December 31, 2001, would qualify for tax-free treatment, even if 
the peace officer was killed prior to the effective date of the 
Taxpayer Relief Act of 1997 provision.
  We are not talking about a great deal of money here. The Joint 
Committee on Taxation estimates this correction would result in about 
$5 million per year in lost revenue or a total cost of $46 million over 
10 years. This is not a high price to pay to show this country's 
gratitude for the service these men and women who are public safety 
officers perform each day when they leave their homes, the risks they 
take, and for the ultimate sacrifice some of them have made.
  Last week, the House Committee on Ways and Means approved identical 
legislation to correct this problem, and I am told the bill is coming 
before the entire House for a vote today. Mr. President, this week (May 
13-19, 2001) is National Police Week. Although it does not begin to pay 
our debt to these men and women and their survivors, I cannot think of 
a better way to honor those public service officers who have died in 
the line of duty than to pass bills like this one that recognize their 
sacrifices and attempt to help their survivors with their burdens. I 
hope our colleagues will join us in cosponsoring this bill and in 
passing this legislation this week.
  Mr. President, I ask unanimous consent that the bill be printed in 
the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 881

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Fallen Hero Survivor Benefit 
     Fairness Act of 2001''.

     SEC. 2. CONSISTENT TREATMENT OF SURVIVOR BENEFITS FOR PUBLIC 
                   SAFETY OFFICERS KILLED IN THE LINE OF DUTY.

       Subsection (b) of section 1528 of the Taxpayer Relief Act 
     of 1997 (Public Law 105-34) is amended by striking the period 
     and inserting ``, and to amounts received in taxable years 
     beginning after December 31, 2001, with respect to 
     individuals dying on or before December 31, 1996.''.
                                 ______
                                 
      By Ms. MIKULSKI (for himself, Ms. Snowe, Mrs. Murray, Ms. 
        Collins, and Mr. Sarbanes):
  S. 882. A bill to amend title II of the Social Security Act to 
provide that a monthly insurance benefit thereunder shall be paid for 
the month in which the recipient dies, subject to a reduction of 50 
percent if the recipient dies during the first 15 days of such month, 
and for other purposes; to the Committee on Finance.
  Ms. MIKULSKI. Mr. President, today, I rise to talk about an issue 
that is very important to me, very important to my constituents in 
Maryland and very important to the people of the United States of 
America.
  For the fourth Congress in a row, I am joining in a bipartisan effort 
with my friend and colleague, Senator Olympia Snowe, to end an unfair 
policy of the Social Security System.
  Senator Snowe and I are introducing the Social Security Family 
Protection Act. This bill addresses retirement security and family 
security. We want the middle class of this Nation to know that we are 
going to give help to those who practice self-help.
  What is it I am talking about? I was shocked when I found out that 
Social Security does not pay benefits for the last month of life. If a 
Social Security retiree dies on the 18th of the month or even on the 
30th of the month, the surviving spouse or family members must send 
back the Social Security check for that month.
  I think that is an harsh and heartless rule. That individual worked 
for Social Security benefits, earned those benefits, and paid into the 
Social Security

[[Page 8039]]

trust fund. The system should allow the surviving spouse or the estate 
of the family to use that Social Security check for the last month of 
life.
  This legislation has an urgency. When a loved one dies, there are 
expenses that the family must take care of. People have called my 
office in tears. Very often it is a son or a daughter that is grieving 
the death of a parent. They are clearing up the paperwork for their mom 
or dad, and there is the Social Security check. And they say, `Senator, 
the check says for the month of May. Mom died on May 28. Why do we have 
to send the Social Security check back? We have bills to pay. We have 
utility coverage that we need to wrap up, mom's rent, or her mortgage, 
or health expenses. Why is Social Security telling me, `Send the check 
back or we're going to come and get you'?'
  With all the problems in our country today, we ought to be going 
after drug dealers and tax dodgers, not honest people who have paid 
into Social Security, and not the surviving spouse or the family who 
have been left with the bills for the last month of their loved one's 
life. They are absolutely right when they call me and say that Social 
Security was supposed to be there for them.
  I've listened to my constituents and to the stories of their lives. 
What they say is this: ``Senator Mikulski, we don't want anything for 
free. But our family does want what our parents worked for. We do want 
what we feel we deserve and what has been paid for in the trust fund in 
our loved one's name. Please make sure that our family gets the Social 
Security check for the last month of our life.''
  That is what our bill is going to do. That is why Senator Snowe and I 
are introducing the Family Social Security Protection Act. When we talk 
about retirement security, the most important part of that is income 
security. And the safety net for most Americans is Social Security.
  We know that as Senators we have to make sure that Social Security 
remains solvent, and we are working to do that. We also don't want to 
create an undue administrative burden at the Social Security 
Administration--a burden that might affect today's retirees. But it is 
absolutely crucial that we provide a Social Security check for the last 
month of life.
  How do we propose to do that? We have a very simple, straightforward 
way of dealing with this problem. Our legislation says that if you die 
before the 15th of the month, you will get a check for half the month. 
If you die after the 15th of the month, your surviving spouse or the 
family estate would get a check for the full month.
  We think this bill is fundamentally fair. Senator Snowe and I are 
old-fashioned in our belief in family values. We believe you honor your 
father and your mother. We believe that it is not only a good religious 
and moral principle, but it is good public policy as well.
  The way to honor your father and mother is to have a strong Social 
Security System and to make sure the system is fair in every way. That 
means fair for the retiree and fair for the spouse and family. We 
strongly feel that the current system is an injustice to spouses and 
families across the Nation. Just because a beneficiary passes away, it 
does not mean that their bills can go unpaid. Join us to correct this 
policy and to ensure that families and recipients are protected during 
this difficult time. That is why we support making sure that the 
surviving spouse or family can keep the Social Security check for the 
last month of life.
  We urge our colleagues to join us in this effort and support the 
Social Security Family Protection Act.
                                 ______
                                 
      By Mr. DODD:
  S. 883. A bill to ensure the energy self-sufficiency of the United 
States by 2011, and for other purposes; to the Committee on Energy and 
Natural Resources.
  Mr. DODD. Mr. President, I ask unanimous consent that the text of the 
bill be printed in the Record.
  There being no objection, the bill was ordered printed in the Record, 
as follows:

                                 S. 883

       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 ``Energy Independence Act of 
     2001''.

     SEC. 2. DOMESTIC ENERGY SELF-SUFFICIENCY PLAN.

       (a) Strategic Plan.--
       (1) In general.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary of Energy shall develop 
     and submit to Congress a strategic plan to ensure that the 
     United States is energy self-sufficient by the year 2011.
       (2) Recommendations.--The plan developed under paragraph 
     (1) shall include recommendations for legislative and 
     regulatory actions needed to achieve the goal of the plan 
     described in that paragraph.
       (b) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $20,000,000.

     SEC. 3. FEDERAL GOVERNMENT FUEL CELL PILOT PROGRAM.

       (a) Program.--The Secretary of Energy shall establish a 
     program for the acquisition, for use at federally owned or 
     operated facilities, of--
       (1) not to exceed 100 commercially available 200 kilowatt 
     fuel cell power plants;
       (2) not to exceed 20 megawatts of power generated from 
     commercially available fuel cell power plants; or
       (3) a combination of the power plants described in 
     paragraphs (1) and (2).
       (b) Funding.--The Secretary shall provide funding and any 
     other necessary assistance for the purchase, site 
     engineering, installation, startup, training, operation, and 
     maintenance costs associated with the acquisition of the 
     power plants under subsection (a).
       (c) Domestic Assembly.--All fuel cell systems and fuel cell 
     stacks in power plants acquired, or from which power is 
     acquired, under subsection (a) shall be assembled in the 
     United States.
       (d) Site Selection.--In the selection of a federally owned 
     or operated facility as a site for the location of a power 
     plant acquired under this section, or as a site to receive 
     power acquired under this section, priority shall be given to 
     a site with 1 or more of the following attributes:
       (1) A location in an area classified as a nonattainment 
     area under title I of the Clean Air Act (42 U.S.C. 7401 et 
     seq.).
       (2) Computer or electronic operations that are sensitive to 
     power supply disruptions.
       (3) A need for a reliable, uninterrupted power supply.
       (4) A remote location or other factors requiring off-grid 
     power generation.
       (5) Critical manufacturing or other activities that support 
     national security efforts.
       (e) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $140,000,000 for 
     the period of fiscal years 2002 through 2004.

     SEC. 4. PROTON EXCHANGE MEMBRANE DEMONSTRATION PROGRAMS.

       (a) In General.--
       (1) Establishment.--The President, in coordination with the 
     Secretary of Energy, the Secretary of Transportation, the 
     Secretary of Defense, and the Secretary of Housing and Urban 
     Development, shall establish a program for the demonstration 
     of fuel cell proton exchange membrane technology in the areas 
     of responsibility of those Secretaries with respect to 
     commercial, residential, and transportation applications, 
     including buses.
       (2) Focus.--The program established under paragraph (1) 
     shall focus specifically on promoting the application of, and 
     improving manufacturing production and processes for, proton 
     exchange membrane fuel cell technology.
       (3) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this subsection $140,000,000 
     for the period of fiscal years 2002 through 2004.
       (b) Bus Demonstration Program.--
       (1) Establishment.--The President, in coordination with the 
     Secretary of Energy and the Secretary of Transportation, 
     shall establish a comprehensive proton exchange membrane fuel 
     cell bus demonstration program to address hydrogen 
     production, storage, and use in transit bus applications.
       (2) Components.--The program established under paragraph 
     (1) shall--
       (A) cover all aspects of the introduction of proton 
     exchange membrane fuel cells; and
       (B) include provisions for--
       (i) the development, installation, and operation of a 
     hydrogen delivery system located on-site at transit bus 
     terminals;
       (ii) the development, installation, and operation of--

       (I) on-site storage associated with the hydrogen delivery 
     systems; and
       (II) storage tank systems incorporated into the structure 
     of a transit bus;

       (iii) the demonstration of the use of hydrogen as a 
     practical, safe, renewable energy source in a highly 
     efficient, zero-emission power system for buses;
       (iv) the development of a hydrogen proton exchange membrane 
     fuel cell power system that is confirmed and verified as 
     being compatible with transit bus application requirements;
       (v) durability testing of the fuel cell bus at a national 
     testing facility;
       (vi) the identification and implementation of necessary 
     codes and standards for the safe

[[Page 8040]]

     use of hydrogen as a fuel suitable for bus application, 
     including the fuel cell power system and related operational 
     facilities;
       (vii) the identification and implementation of maintenance 
     and overhaul requirements for hydrogen proton exchange 
     membrane fuel cell transit buses; and
       (viii) the completion of a fleet vehicle evaluation program 
     by bus operators along normal transit routes to provide 
     equipment manufacturers and transit operators with the 
     necessary analyses to enable operation of the hydrogen proton 
     exchange membrane fuel cell bus under a range of operating 
     environments.
       (3) Domestic assembly.--All fuel cell systems and fuel cell 
     stacks in power plants acquired, or from which power is 
     acquired, under paragraph (1) shall be assembled in the 
     United States.
       (4) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this subsection $150,000,000 
     for the period of fiscal years 2002 through 2004.

     SEC. 5. FEDERAL VEHICLES.

       (a) In General.--The head of each agency of the Federal 
     Government that maintains a fleet of motor vehicles shall 
     develop, implement by not later than October 1, 2006, and 
     carry out through September 30, 2011, a plan for a transition 
     of the fleet to vehicles powered by fuel cell technology.
       (b) Requirements of Plan.--A plan developed under 
     subsection (a) shall--
       (1) incorporate and build on the results of completed and 
     ongoing Federal demonstration programs, including the program 
     established under section 4; and
       (2) include additional demonstration programs and pilot 
     programs as the head of the applicable agency determines to 
     be necessary to test or investigate available technologies 
     and transition procedures.

     SEC. 6. LIFE-CYCLE COST BENEFIT ANALYSIS.

       Any life-cycle cost benefit analysis carried out by a 
     Federal agency under this Act that concerns an investment in 
     a product, a service, construction, or any other project 
     shall include an analysis of environmental and power 
     reliability factors.

     SEC. 7. STATE AND LOCAL GOVERNMENT INCENTIVES.

       (a) Grant Program.--
       (1) In general.--The Secretary of Energy shall establish a 
     program for to make grants to State or local governments for 
     the use of fuel cell technology in meeting energy 
     requirements of the State or local governments, including the 
     use of fuel cell technology as a source of power for motor 
     vehicles.
       (2) Cost sharing.--The Federal share of the cost of any 
     project or activity funded with a grant under this section 
     shall not exceed 90 percent.
       (b) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $110,000,000 for 
     each of fiscal years 2002 through 2006.
                                 ______
                                 
      By Mr. DOMENICI (for himself and Mrs. Hutchison):
  S. 884. A bill to improve port-of-entry infrastructure along the 
Southwest border of the United States, to establish grants to improve 
ports-of-entry facilities, to designate a port-of-entry as a port 
technology demonstration site, and for other purposes; to the Committee 
on Finance.
  Mr. DOMENICI. Mr. President, I rise today to introduce the Southwest 
Border Port-of-Entry Infrastructure Improvement Act. The Southwest 
border region has been ignored for far too long, and as a result, has 
lagged behind the rest of the Nation in many areas. Poor health and 
environmental quality, inadequate infrastructure, and fewer 
technological and educational resources are common facts of life along 
much of the Southwest Border.
  Last year, the U.S.-Mexico Border had a population of 12.6 million. 
By 2020, the region will have more than 21 million residents. That 
means that the southwest border region is growing at more than twice 
the national average and 40 percent faster than the U.S.'s fastest 
growing states.
  And what has been the engine of this tremendous growth? Trade. When 
the North American Free Trade Agreement came into effect in 1994, U.S.-
Mexico trade totaled $100 billion. In 1999 trade between the two 
countries accounted for $197 billion, a near doubling in only 5 years.
  Unfortunately, we have failed to invest in the Southwest Border to 
accommodate this tremendous growth. In 1999, eighty-six percent of U.S-
Mexico trade was transported across the border by trucks. Yet, rather 
than promote a system where trade can flourish, we have congested 
traffic lanes where drivers have to wait three even 5 hours before 
crossing the border.
  These lines include all manner of people and industry, from a truck 
filled with auto parts en route to Detroit to hungry tourists wanting 
an authentic taco to service employees who live in Mexico and work in 
the United States. The effect of these unnecessary traffic backlogs is 
two-fold.
  First, significant delays at our nation's ports-of-entry along the 
Southwest Border results in inefficient trade. This works at cross 
purposes with ``just in time delivery.''
  A primary reason that U.S.-Mexico trade has increased so dramatically 
is that the border allows companies to benefit from ``just in time'' 
delivery. Using ``just in time,'' firms eliminate warehousing and 
preservation costs, resulting in lower prices and more efficient 
delivery.
  Primary producers, intermediary companies, downstream retailers, and 
customers all rely on the timely delivery of goods and services. But 
huge backlogs makes ``just-in-time'' delivery more like delivery ``some 
time.'' When delivery times increase or are uncertain, associated costs 
increase for everyone down the product and user chain.
  Second, long traffic backlogs detrimentally affect the people who 
live along the Southwest Border.
  A study by the Environmental Protection Agency concluded that, ``the 
border's health conditions and risks * * * are among the most troubling 
and the most serious in the United States.
  Health and environmental problems seem to be most prevalent in 
poverty stricken areas. The Southwest Border is one of the poorest 
regions in the nation. In fact, nearly 27 percent of New Mexico's Dona 
Ana County live below the poverty line, double the national average, 
and other counties along the border are even worse off. For example, 40 
percent of Maverick County, Texas' population live below the poverty 
level.
  We cannot continue to focus on the increased wealth the Nation enjoys 
from trade while ignoring the burden that trade imposes on border 
residents.
  Long backlogs at ports-of-entry along the Southwest Border creates a 
substantial hardship on the people in the region. The EPA report 
concluded that the border disproportionately suffers from serious 
health threats due, in part, to airborne pollutants from vehicle 
emissions.
  Increased trade means ever increasing vehicle emissions. A recent 
study by the North American Commission for Environmental Cooperation 
found that truck traffic increases 8.6 percent per year. An 8.6 percent 
increase means that by 2020, commodity truck flows will be 5.5 times 
greater than 1999 levels.
  That study never considered the recent NAFTA arbitration panel ruling 
that the U.S.'s policy prohibiting Mexican trucks beyond twenty miles 
from the border violates the trade agreement.
  I would like the U.S. to promote trade so that the entire Nation's 
economy continues to grow. Yet, we need to act pro-actively with 
foresight and responsible planning so that the Southwest Border 
infrastructure can adequately handle the projected and likely traffic 
increases.
  I would like to see the engine that is our economy keep running. I 
just want that engine to run faster, quieter, and smoother. That's why 
I am introducing the Southwest Border Infrastructure Improvement Act.
  This bill provides funds to improve our ports-of-entry and ensure 
efficient binational trade in the future.
  Specifically, this bill directs the U.S. Customs Service to update 
the ``Ports of Entry Infrastructure Assessment Study'' within 6 months 
of enactment. Pursuant to the updated study, it provides $500 million 
to be spent over five years for the recommended improvements.
  Second, this legislation recognizes our unique shared border and 
relationship with Mexico. It considers that a unilateral solution along 
a binational border is no solution at all.
  Therefore, this bill establishes a $75 million grant fund for FY02 
and other sums for 2003-2006 through the Department of Transportation 
for port-of-entry infrastructure improvements that would reduce 
negative environmental impacts, such as air pollution,

[[Page 8041]]

associated with cross-border transportation.
  The grant program will be administered by the North American 
Development Bank and certified by the Border Environment Cooperation 
Commission. Grant applicants must meet a dollar for dollar match 
requirement to receive grant funds.
  Last, this bill recognizes that new technologies must be developed to 
facilitate future binational trade. Our current system of processing 
goods at ports is impractical, overly burdensome, and is a substantial 
factor in traffic backlogs.
  In order to innovate more efficient processing systems, this 
legislation designates that a port-of-entry will serve as a site to 
demonstrate port technologies. The Customs Service will carry out a 
program to test and evaluate such new technologies. This bill provides 
$10 million for 2002 and other sums from 2003 through 2006 for that 
purpose.
  The selected port must have sufficient space to conduct the 
demonstration program, have low traffic volume so that new technologies 
may be incorporated without interrupting normal processing activity, 
and have a relatively modern design.
  The recent NAFTA arbitration panel ruling concerning the U.S.'s 
policy prohibiting Mexican trucks from entering the United States 
brings our infrastructure limitations to the forefront. It is 
imperative to improve the Southwest Border's inadequate infrastructure 
and design. We must act to ensure continued national growth while 
working to improve the health and environment of border residents.
                                 ______
                                 
      By Mr. HUTCHINSON (for himself, Mr. Cleland, and Mr. Miller):
  S. 885. A bill to amend title XVIII of the Social Security Act to 
provide for national standardized payment amounts for inpatient 
hospital services furnished under the medicare program; to the 
Committee on Finance.
  Mr. HUTCHINSON. Mr. President, I am pleased today to be joined by 
Senator Cleland of Georgia in introducing the Area Wage and Base 
Payment Improvement Act, which seeks to address Medicare payment 
inequities for rural and small hospitals so they may pay competitive 
wages to attract and retain health care personnel and provide quality 
health care.
  We all know that the health care workforce is shrinking, both in its 
own right and relative to the growing patient population. This is 
illustrated by the nursing profession. The average age of nurses today 
is 43.3 years, and less than 10 percent of the current nurse workforce 
is below age 30. Unfortunately, many nurses are leaving the occupation 
because of low pay, excessive paperwork burdens, a lack of respect, and 
other consequences of being short-staffed, such as overly long shifts, 
mandatory overtime, and the stress of having too many patients under 
their care. The result is that very few new nurses are getting into the 
pipeline to replace those who have retired or left the profession. The 
nursing shortage is being felt in virtually every part of the country, 
but especially in rural areas, where it is hard for hospitals to 
recruit and retain qualified personnel. In my home State of Arkansas, 
where nearly every county is considered a medically underserved area, 
hospitals are reporting over 750 nurse vacancies, this says nothing of 
the other personnel shortages they are experiencing as well.
  Such severe shortages in qualified health care personnel have 
``nationalized'' the market for health care professionals, and 
historically low labor costs in rural and small urban areas have 
disappeared. Hospitals in these areas must compete with large urban 
hospitals for qualified workers and pay higher wages as a result. In 
some cases, rural hospitals are being forced to pay health care 
personnel even more than urban hospitals. For example, a nurse 
practitioner in rural Arkansas is paid $29.04 per hours on average, 
while the same nurse practitioner would be paid $28.22 per hour in an 
urban hospital.
  The Area Wage and Base Payment Improvement Act would address this 
issue by establishing an area wage index floor of 0.925 in order to 
bring payments in areas with the lowest wage indexes up to just below 
the national average of 1.00. The wage index is intended to adjust 
Medicare hospital inpatient and outpatient payments to account for 
varying wage rates paid by hospitals for workers in different market 
areas across the country, but it has not been updated since 1997. In 
Arkansas, the area wage index for rural hospitals is as low as .7445. 
By creating an area wage index floor of .925, as many as 72 hospitals 
in Arkansas and 2,100 hospitals nationwide will see an increase in 
their Medicare payments and their ability to provide competitive wages 
for hospital labor.
  The legislation we are introducing also makes an important change to 
the Medicare payment formula by increasing the Medicare inpatient 
prospective payment system, PPS, base amount for rural and small urban 
hospitals. This base payment is primarily intended to cover labor 
costs. Today, there are two different base payment amounts for 
hospitals paid under the Medicare PPS, hospitals in large urban areas 
receive a base payment of $4,197, while hospitals located in all other 
areas receive a lower amount of $4,130. This legislation will eliminate 
this disparity and create one base payment of $4,197 for all hospitals. 
Nationwide, 2,600 hospitals will benefit from this payment increase.
  The Area Wage and Base Payment Improvement Act will provide critical 
payments to small and rural hospitals striving to provide quality 
health care and put them on an equal footing with large urban hospitals 
in terms of competing for health care personnel. I urge my colleagues 
in the Senate to support this important, bipartisan legislation.
  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. 885

       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 ``Area Wage and Base Payment 
     Improvement Act''.

     SEC. 2. ESTABLISHING A SINGLE STANDARDIZED AMOUNT UNDER 
                   MEDICARE INPATIENT HOSPITAL PPS.

       (a) In General.--Section 1886(d)(3)(A) of the Social 
     Security Act (42 U.S.C. 1395ww(d)(3)(A)) is amended--
       (1) in clause (iv), by inserting ``and ending on or before 
     September 30, 2001,'' after ``October 1, 1995,''; and
       (2) by redesignating clauses (v) and (vi) as clauses (vii) 
     and (viii), respectively, and inserting after clause (iv) the 
     following new clauses:
       ``(v) For discharges occurring in the fiscal year beginning 
     on October 1, 2001, the average standardized amount for 
     hospitals located in areas other than a large urban area 
     shall be equal to the average standardized amount for 
     hospitals located in a large urban area.
       ``(vi) For discharges occurring in a fiscal year beginning 
     on or after October 1, 2002, the Secretary shall compute an 
     average standardized amount for hospitals located in all 
     areas within the United States equal to the average 
     standardized amount computed under clause (v) or this clause 
     for the previous fiscal year increased by the applicable 
     percentage increase under subsection (b)(3)(B)(i) for the 
     fiscal year involved.''.
       (b) Conforming Amendments.--
       (1) Update factor.--Section 1886(b)(3)(B)(i)(XVII) of the 
     Social Security Act (42 U.S.C. 1395ww(b)(3)(B)(i)(XVII)) is 
     amended by striking ``for hospitals in all areas,'' and 
     inserting ``for hospitals located in a large urban area,''.
       (2) Computing drg-specific rates.--
       (A) In general.--Section 1886(d)(3)(D) of such Act (42 
     U.S.C. 1395ww(d)(3)(D)) is amended--
       (i) in the heading by striking ``in different areas'';
       (ii) in the matter preceding clause (i)--

       (I) by inserting ``for fiscal years before fiscal year 
     1997'' before ``a regional DRG prospective payment rate for 
     each region,''; and
       (II) by striking ``each of which is'';

       (iii) in clause (i)--

       (I) by inserting ``for fiscal years before fiscal year 
     2002,'' after ``(i)''; and
       (II) by striking ``and'' at the end;

       (iv) in clause (ii)--

       (I) by inserting ``for fiscal years before fiscal year 
     2002,'' after ``(ii)''; and
       (II) by striking the period at the end and inserting ``; 
     and''; and

       (v) by adding at the end the following new clause:
       ``(iii) for a fiscal year beginning after fiscal year 2001, 
     for hospitals located in all areas, to the product of--

[[Page 8042]]

       ``(I) the applicable average standardized amount (computed 
     under subparagraph (A)), reduced under subparagraph (B), and 
     adjusted or reduced under subparagraph (C) for the fiscal 
     year; and
       ``(II) the weighting factor (determined under paragraph 
     (4)(B)) for that diagnosis-related group.''.
       (B) Technical conforming sunset.--Section 1886(d)(3) of 
     such Act (42 U.S.C. 1395ww(d)(3)) is amended in the matter 
     preceding subparagraph (A) by inserting ``for fiscal years 
     before fiscal year 1997'' before ``a regional DRG prospective 
     payment rate''.

     SEC. 3. FLOOR ON AREA WAGE ADJUSTMENT FACTORS USED UNDER 
                   MEDICARE PPS FOR INPATIENT AND OUTPATIENT 
                   HOSPITAL SERVICES.

       (a) Inpatient PPS.--Section 1886(d)(3)(E) of the Social 
     Security Act (42 U.S.C. 1395ww(d)(3)(E)) is amended--
       (1) by inserting ``(i) In general.--'' before ``The 
     Secretary'', and adjusting the margin two ems to the right;
       (2) by striking ``The Secretary'' and inserting ``Subject 
     to clause (ii), the Secretary''; and
       (3) by adding at the end the following new clause:
       ``(ii) Floor on area wage adjustment factor.--
     Notwithstanding clause (i), in determining payments under 
     this subsection for discharges occurring on or after October 
     1, 2001, the Secretary shall substitute a factor of .925 for 
     any factor that would otherwise apply under such clause that 
     is less than .925. Nothing in this clause shall be construed 
     as authorizing--
       ``(I) the application of the last sentence of clause (i) to 
     any substitution made pursuant to this clause, or
       ``(II) the application of the preceding sentence of this 
     clause to adjustments for area wage levels made under other 
     payment systems established under this title (other than the 
     payment system under section 1833(t)) to which the factors 
     established under clause (i) apply.''.
       (b) Outpatient PPS.--Section 1833(t)(2) of the Social 
     Security Act (42 U.S.C. 1395l(t)(2)) is amended by adding at 
     the end the following: ``For purposes of subparagraph (D) for 
     items and services furnished on or after October 1, 2001, if 
     the factors established under clause (i) of section 
     1886(d)(3)(E) are used to adjust for relative differences in 
     labor and labor-related costs under the payment system 
     established under this subsection, the provisions of clause 
     (ii) of such section (relating to a floor on area wage 
     adjustment factor) shall apply to such factors, as used in 
     this subsection, in the same manner and to the same extent 
     (including waiving the applicability of the requirement for 
     such floor to be applied in a budget neutral manner) as they 
     apply to factors under section 1886.''.

  Mr. CLELAND. Mr. President. I want to thank my distinguished 
colleague from Arkansas, Senator Tim Hutchinson, for his leadership on 
the Area Wage and Base Payment Improvement Act. I am very pleased to 
join Senator Hutchinson in this bipartisan measure to address Medicare 
inequities in the wage index for rural and community hospitals.
  The severe shortage of nurses and other crucial health care workers 
has driven salaries higher to compete for these employees. The current 
Medicare wage index for rural areas reimburses at a lower rate which is 
based on 1997 data. In an increasingly competitive market for health 
care workers, rural area hospitals are in their ability to provide 
quality care.
  Our proposal establishes a ``floor'' on the area wage index and will 
adjust Medicare inpatient and outpatient prospective payments (PPS) for 
rural and small metropolitan hospitals. By setting a floor on the area 
wage index of 0.925, our proposed correction would bring Medicare 
payments in areas with the lowest wage index up to just below the 
national average which is established at 1.00. The impact of the 0.925 
floor is estimated to help more than 2100 mostly rural, but also some 
urban hospitals across the country.
  This measure also increases the Medicare PPS base, of which a 
significant portion is to cover hospital labor costs. Today's 
competitive labor market has reduced the disparity in wages between 
large urban hospitals and rural and small metropolitan facilities. It 
makes sense that Medicare needs to move to one base payment for the 
inpatient PPS. The key issue here should be access to health care. For 
states like Georgia and Arkansas, with a large number of residents 
living in rural areas, the closing or downsizing of hospital beds 
because of out-of-date Medicare payment rates and insufficient health 
workers to provide safe care is creating a health care catastrophe.
  Our measure is the companion bill to H.R. 1609. We urge our 
colleagues to support this bicameral, bipartisan effort to ensure 
access to rural and smaller metropolitan hospitals for Medicare 
beneficiaries.
                                 ______
                                 
      By Mr. WELLSTONE:
  S. 886. A bill to establish the Katie Poirer Abduction Emergency 
Fund, and for other purposes; to the Committee on the Judiciary.
  Mr. WELLSTONE. Mr. President, last year in my home State, a talented, 
spirited young woman named Katie Poirier was abducted from the her job 
at a Carlton County convenience store. Within days of her 
disappearance, there was an enormous outpouring of community concern 
and support, with hundreds of volunteers helping local law enforcement 
search for Katie. Tragically, Katier's body was later recovered and a 
suspect arrested and tried for her murder.
  The Poirier, Holmquist and Swanson cases in Minnesota, all involving 
abductions and homicides, demonstrate that resources and good 
information are absolutely crucial to successful law enforcement, 
particularly in our small towns and rural communities which are too 
often overlooked.
  To that end, I am re-introducing legislation called ``Katie's Law,'' 
in honor of Katie Poirier, which will give rural law enforcement the 
assistance they need to deal with high profile, major crimes.
  This legislation will establish a Federal ``Katie Poirier Abduction 
Emergency Fund'' to assist local and rural law enforcement agencies 
with the unanticipated expenses of major crimes. Second, it will 
provide grants to local and rural law enforcement agencies to integrate 
their identification technologies, or to establish systems that work 
with the FBI's Integrated Automated Fingerprint Identification System, 
IAFIS. In many rural communities, this will cut down the time it takes 
to identify a violent suspect from two months to two hours.
  There are hundreds of thousands adult and child abductions and 
homicides each year in rural counties. When a high profile, major crime 
occurs, like the Wetterling or Poirier abduction, local and rural law 
enforcement with small budgets are frequently overwhelmed by the 
financial demands these large cases make. The overwhelming hours and 
investigative demand can wipe out small budgets with expenses, 
including overtime pay, transporting witnesses and suspects if there is 
a change of trial venue, as occurred in the Poirier case, and other 
unanticipated costs.
  As the sheriffs across my home State will tell you, the first 72 
hours in an abduction case are the most critical. After that, the 
chances of locating the victim alive drop dramatically. No matter how 
short staffed or small the budget, law enforcement must put its pedal 
to the metal 100 percent after an abduction or homicide. It is crucial 
that rural law enforcement agencies with limited resources handling 
major crimes get the support they need from the State and Federal 
governments.
  In Minnesota when a high profile case occurs, a joint task force is 
established between the Bureau of Criminal Apprehension, the FBI, and 
the local law enforcement agency. Sheriffs I have spoken with say the 
task force model is effective and extremely helpful. Yet, they still 
must cover many unanticipated expenses such as huge surges in overtime. 
Many of them just can't do it. As one sheriff said to my staff, ``I am 
running my agency on fumes, not gas. I've got nothing left.''
  My bill would establish a Federal Abduction Emergency Fund to help 
small law enforcement agencies with expenses from high-profile, major 
crimes, including kidnaping and homicides. The Attorney General would 
make grants available to state agencies to distribute to local and 
rural law enforcement agencies in need. The total amount would be $10 
million for each of three years.
  Second, my legislation will provide local law enforcement officers 
with the resources to use the latest identification system to solve and 
prevent crime.

[[Page 8043]]

Access to quality, accurate information in a timely fashion is of vital 
importance in that effort.
  One of the best tools available is the FBI's IAFIS system. Since 
rural and local enforcement often do not have the funds to access the 
FBI's Integrated Automated Fingerprint Identification System, (IAFIS), 
they are at a disadvantage when trying to identify violent offenders.
  State and local law enforcement organizations need to develop and 
upgrade their criminal information and identification systems, as well 
as integrate those systems with other jurisdictions. The Federal 
Government has invested billions in information and identification 
systems whose benefits will go largely unrealized unless local law 
enforcement receive the resources to be able to participate in these 
systems.
  Unfortunately, there is a wide disparity between the criminal 
identification systems that are now available, and the ability of state 
and local law enforcement to use them. Many states, including 
Minnesota, have been developing systems which will allow, at a minimum, 
the most populous areas to link up to the FBI's IAFIS system. However, 
many small, rural localities are being left behind. This reduces the 
capacity of rural law enforcement to quickly verify the identity and 
criminal record of dangerous suspects in their custody.
  Right now, in many rural counties, a sheriff's office may have to 
wait as long as two months to have a suspect positively identified. 
Access to FBI's IAFIS system would allow sheriffs like Ray Hunt to 
determine under two hours a suspect's identity who has an existing file 
with the FBI.
  This legislation will be one step in bridging this gap. It will 
provide grants to states to assist local and rural law enforcement to 
intergrate information technologies or to establish systems that work 
with the FBI's. These funds may be used by local law enforcement 
agencies to integrate information systems with other jurisdictions, or 
for training, and maintenance and purchase of fingerprint 
identification technology. The total amount to be authorized is $20 
million for each of three years.
  ``Katie's Law'' will be instrumental in ensuring that rural law 
enforcement is not left behind. I can never know how the Poirier and 
the other families really feel, the depth of their pain and the 
tremendous losses they have suffered. But, I do know how I feel--we 
must and can do more to safeguard our children and to support rural law 
enforcement prevent and solve violent crimes. I believe ``Katie's Law'' 
is an important step forward in that direction.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 886

       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 ``Katie's Law''.

     SEC. 2. KATIE POIRIER ABDUCTION EMERGENCY FUND.

       (a) Establishment of Abduction Emergency Fund.--Not later 
     than 90 days after the date of enactment of this Act, the 
     Attorney General shall establish the Katie Poirier Abduction 
     Emergency Fund (referred to in this section as the ``fund'') 
     to assist local and rural law enforcement agencies with 
     expenses resulting from a crime, including an abduction or 
     homicide, that results in extraordinary unanticipated costs 
     to the agency because of the magnitude of the crime and the 
     need to adequately respond with personnel and support.
       (b) Emergency Grants.--The Attorney General shall make 
     grants to States to be distributed to local and rural law 
     enforcement agencies as determined by the State.
       (c) Criteria for Grants.--The Attorney General shall 
     establish criteria for awarding grants under this section.
       (d) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section $10,000,000 for 
     each of the fiscal years 2002 through 2004.

     SEC. 3. ESTABLISHMENT OF GRANT PROGRAM TO ASSIST LOCAL AND 
                   RURAL LAW ENFORCEMENT AGENCIES IN ESTABLISHING 
                   OR UPGRADING AN INTEGRATED APPROACH TO DEVELOP 
                   IDENTIFICATION TECHNOLOGIES AND SYSTEMS TO 
                   IMPROVE CRIMINAL IDENTIFICATION.

       (a) In General.--The Attorney General, through the Bureau 
     of Justice Statistics of the Department of Justice, shall 
     make grants to States which shall be used to assist local and 
     rural law enforcement agencies in establishing or upgrading 
     an integrated approach to develop identification technologies 
     and systems to improve criminal identification.
       (b) Criteria for Grants.--The Attorney General shall 
     establish criteria for awarding grants under this section.
       (c) Use of Grants.--Grants under this section may be used 
     by local and rural law enforcement agencies to integrate 
     information technologies or to establish, develop, or upgrade 
     automated fingerprint identification systems, including live 
     scan and other automated systems to digitize fingerprints and 
     communicate prints, that are compatible with standards 
     established by the National Institute of Standards and 
     Technology and interoperable with systems operated by States 
     and the Integrated Automated Fingerprint Identification 
     System of the Federal Bureau of Investigation.
       (d) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section $20,000,000 for 
     each of the fiscal years 2002 through 2004.
                                 ______
                                 
      By Mr. WELLSTONE:
  S. 887. A bill to amend the Torture Victims Relief Act of 1986 to 
authorize appropriations to provide assistance for domestic centers and 
programs for the treatment of victims of torture; to the Committee on 
the Judiciary.
  Mr. WELLSTONE. Mr. President, I am introducing the Torture Victims 
Relief Act of 2001. This bill authorizes increased appropriations to 
provide assistance for domestic centers and programs for the treatment 
of victims of torture. The bill authorizes the authorization levels for 
domestic treatment centers for victims of torture to $20 million for 
fiscal year 2002, double the $10 million amount currently authorized 
for fiscal year 2002 by the Torture Relief Re-authorization Act of 
1999, and $25 million for fiscal year 2003 (an increase of $15 million 
over the current authorization) and establishes an authorization level 
of $30 million for fiscal year 2004.
  Repressive governments frequently make use of torture to silence 
those who are defending human rights and democracy in their own 
country. Many of these people have sought refuge in the United States. 
The additional funding provided in the Torture Relief Act of 2001 
recognizes the debt we own to those courageous people who have made 
extraordinary sacrifices by speaking out for their principles.
  We have come a long way in raising the awareness of torture and 
helping victims of torture since 1985 when the Center for Victims of 
Torture in Minnesota was founded and began its pioneering work with 
torture victims, but still much more needs to be done to stop this 
terrible practice.
  In 1998, as an outgrowth of my work with the Center for Victims of 
Torture, I introduced the Torture Victims Relief Act. It was adopted by 
Congress and became law, PL 105-320. The legislation authorized the 
Department of Health and Human Services to support U.S. treatment 
programs for victims of torture. For Fiscal Year 2000, Congress 
appropriated $7.2 million. The implementing agency, the Office of 
Refugee Settlement, provided 16 grants with this appropriation. About 
twice that number applied for funding with a total request several 
times the available amount. For Fiscal Year 2001, Congress appropriated 
$10 million for this program, the authorized amount. It has become 
obvious that the program is significantly underfunded and requires the 
additional support provided by this legislation.
  The funds will support treatment services to hundreds of victims each 
year in 23 treatment centers, located from New York to California and 
from Minnesota to Texas. The victims have suffered horrendous torture 
and as a consequence suffer from nightmares, anxiety attacks, 
flashbacks, depression and other mental health problems. With treatment 
they can become contributing members of our communities. Without 
treatment, victims potentially become burdens rather than contributors 
to our society.
  Since adoption of TVRA, the number of treatment programs for victims 
of torture has more than doubled. The

[[Page 8044]]

National Consortium of Torture Treatment Programs now include 23 
organizations and others are seeking membership.
  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. 887

       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 ``Torture Victims Relief Act 
     of 2001''.

     SEC. 2. AUTHORIZATION OF APPROPRIATIONS FOR DOMESTIC 
                   TREATMENT CENTERS FOR VICTIMS OF TORTURE.

       (a) Authorization of Appropriations.--Section 5(b)(1) of 
     the Torture Victims Relief Act of 1998 (22 U.S.C. 2152 note) 
     is amended to read as follows:
       ``(b) Funding.--
       ``(1) Authorization of appropriations.--Of the amounts 
     authorized to be appropriated for the Department of Health 
     and Human Services for fiscal years 2002, 2003, and 2004, 
     there are authorized to be appropriated to carry out 
     subsection (a) (relating to assistance for domestic centers 
     and programs for the treatment of victims of torture) 
     $20,000,000 for fiscal year 2002, $25,000,000 for fiscal year 
     2003, and $30,000,000 for fiscal year 2004.''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall take effect October 1, 2001.
                                 ______
                                 
      By Mr. LIEBERMAN:
  S. 888. A bill to amend the Internal Revenue Code of 1986 to provide 
assistance to students and families coping with the costs of higher 
education, and for other purposes; to the Committee on Finance.
  Mr. LIEBERMAN. Mr. President, today I am pleased to introduce the 
College Tuition Assistance Act of 2001, a bill that will provide tax 
relief to middle and lower income American families struggling to pay 
the rising cost of college tuition for their children.
  Last year, at my request, the Committee on Governmental Affairs held 
two days of hearings on the affordability of higher education. Those 
hearings showed that the price of college tuition continues to rise at 
a pace that exceeds the rate of inflation. In fact, the most recent 
data released by the College Board show that since 1980, both public 
and private four-year college tuitions have increased on average more 
than 115 percent over inflation. It's no wonder families are worried 
about their ability to afford a college education for their children, 
and about the student loan debt burden their children may have to bear 
after graduation. We should be worried too--ensuring that higher 
education is affordable is critical to our nation's ability to maintain 
its competitiveness in a global economy. Highly trained, skilled 
workers making good wages are the engine that powers our economy, both 
because of the work they do and the revenue they generate as both 
buyers and sellers of goods and services.
  The College Tuition Assistance Act will help families in four key 
ways:
  First, it will help them pay tuition expenses while students are in 
school, by increasing the value of the current Lifetime Learning 
Credit. Under my bill, while a student is in college, a family would be 
eligible for a tax credit or tax deduction worth as much as $2,800 
toward the first $10,000 in tuition and fees they pay each year. In 
addition, the adjusted income levels at which individuals and families 
qualify for the credit are raised so that more families would be 
eligible to receive this credit.
  Second, my bill would remove the requirement that Pell grants and 
other need-based government aid be subtracted from a family's eligible 
college expenses, allowing those families to qualify for some portion 
of the Lifetime Learning Credit. A problem under current law is that 
the value of need-based aid, such as a Pell grant, received by the 
child of a lower income family may reduce or even eliminate the 
family's eligibility for a tax credit based on tuition expenses. 
However, a recent study by the Congressionally-created Advisory 
Committee on Student Financial Assistance showed that, even after 
receiving need-based aid, students from low-income families have as 
much as $3,800 a year in ``unmet need,'' that is, college expenses that 
are not covered by assistance and which the family may be unable to 
afford. If families are permitted to subtract the value of their 
government aid from their eligible college expenses, they may qualify 
for the first time for the Lifetime Learning Credit and apply this 
money toward the costs of their college student's education. Without 
this help, many students from low-income families might not attend 
college; the Advisory Committee's report says that, because of the 
financial barriers, even the most highly qualified students from low-
income families attend college at a rate that is 20 percent lower than 
equally qualified students from the wealthiest families. For less 
qualified students, this differential is nearly 40 percent.
  Third, the costs of higher education continue to be a burden for many 
students even after graduation, as their student loans come due and 
they find a significant portion of their disposable income going to pay 
interest on these loans. Some graduates find that, even with their 
higher salary, they cannot afford many of the basic things they would 
like to acquire as adults, such as home or car purchases or even 
starting a new family. The College Tuition Assistance Act will expand 
the current tax law in three ways to provide more help offsetting the 
interest costs associated with repayment of student loans after 
graduation. This bill will remove the current five year limit on 
deductions of student loan interest, it will raise the adjusted income 
levels so more individuals and families can qualify for this deduction, 
and it will allow the deduction to be taken for each student in the 
family who owes interest on college loans.
  Finally, studies repeatedly show that the purchasing power of the 
Pell grant itself has been significantly eroded. Recent reports issued 
by the College Board and the American Council on Education show that in 
academic year 1975-1976, the maximum Pell grant covered 78 percent of 
the price of attending a public four-year college; for the current 
academic year, the maximum grant is enough to cover only 39 percent of 
these costs. We must do a better job of funding this crucial assistance 
to low-income students. President Bush, during last year's campaign, 
pledged to increase the maximum Pell grant for first-year students to 
$5,100 from its current level of $3,300. While many experts do not 
support the notion of ``front-loading'' by increasing aid only to 
first-year students, this was at least a significant proposed increase 
in Pell grant funding. The College Tuition Assistance Act will 
encourage meaningful increases in the maximum Pell grant by raising the 
authorization level for academic years 2001-2002 and 2002-2003 to 
$5,800.
  A college degree is a basic necessity in our Innovation Economy and a 
family's financial status should not be the determining factor in 
whether a young person joins society with the advantages of higher 
education or not. I hope, with the support of my colleagues, that we 
can pass the College Tuition Assistance Act in order to ease the burden 
middle and lower income families and their children bear on their way 
to success.
  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. 888

       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 ``College Tuition Assistance 
     Act of 2001''.

     SEC. 2. DEDUCTION FOR HIGHER EDUCATION EXPENSES.

       (a) Deduction Allowed.--Part VII of subchapter B of chapter 
     1 of the Internal Revenue Code of 1986 (relating to 
     additional itemized deductions for individuals) is amended by 
     redesignating section 222 as section 223 and by inserting 
     after section 221 the following:

     ``SEC. 222. HIGHER EDUCATION EXPENSES.

       ``(a) Allowance of Deduction.--
       ``(1) In general.--In the case of an individual, there 
     shall be allowed as a deduction

[[Page 8045]]

     an amount equal to the applicable dollar amount of the 
     qualified tuition and related expenses paid by the taxpayer 
     during the taxable year.
       ``(2) Applicable dollar amount.--The applicable dollar 
     amount for any taxable year shall be determined as follows:

                                                             Applicable
``Taxable year:                                          dollar amount:
  2002......................................................$5,000 ....

  2003 and thereafter......................................$10,000.....

       ``(b) Limitation Based on Modified Adjusted Gross Income.--
       ``(1) In general.--The amount which would (but for this 
     subsection) be taken into account under subsection (a) shall 
     be reduced (but not below zero) by the amount determined 
     under paragraph (2).
       ``(2) Amount of reduction.--The amount determined under 
     this paragraph equals the amount which bears the same ratio 
     to the amount which would be so taken into account as--
       ``(A) the excess of--
       ``(i) the taxpayer's modified adjusted gross income for 
     such taxable year, over
       ``(ii) $50,000 ($100,000 in the case of a joint return), 
     bears to
       ``(B) $10,000 ($20,000 in the case of a joint return).
       ``(3) Modified adjusted gross income.--For purposes of this 
     subsection, the term `modified adjusted gross income' means 
     the adjusted gross income of the taxpayer for the taxable 
     year determined without regard to this section and sections 
     911, 931, and 933.
       ``(4) Adjustments for inflation.--
       ``(A) In general.--In the case of a taxable year beginning 
     after 2001, the $50,000 and $100,000 amounts in paragraph 
     (2)(A)(ii) 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, determined by substituting `calendar year 2000' 
     for `calendar year 1992' in subparagraph (B) thereof.
       ``(B) Rounding.--If any amount as adjusted under 
     subparagraph (A) is not a multiple of $1,000, such amount 
     shall be rounded to the next lowest multiple of $1,000.
       ``(c) Qualified Tuition and Related Expenses.--For purposes 
     of this section, the term `qualified tuition and related 
     expenses' has the meaning given such term by section 
     25A(f)(1) (determined with regard to section 25A(c)(2)(B)).
       ``(d) Special Rules.--
       ``(1) Identification requirement.--No deduction shall be 
     allowed under subsection (a) to a taxpayer with respect to 
     the qualified tuition and related expenses of an individual 
     unless the taxpayer includes the name and taxpayer 
     identification number of such individual on the return of tax 
     for the taxable year.
       ``(2) No double benefit.--
       ``(A) In general.--No deduction shall be allowed under 
     subsection (a) for any expense for which a deduction is 
     allowable to the taxpayer under any other provision of this 
     chapter unless the taxpayer irrevocably waives his right to 
     the deduction of such expense under such other provision.
       ``(B) Denial of deduction to the extent credit is 
     elected.--No deduction shall be allowed under subsection (a) 
     for a taxable year with respect to the qualified tuition and 
     related expenses of an individual to the extent the taxpayer 
     elects to have section 25A apply with respect to such 
     expenses for such year.
       ``(C) Dependents.--No deduction shall be allowed under 
     subsection (a) to any individual with respect to whom a 
     deduction under section 151 is allowable to another taxpayer 
     for a taxable year beginning in the calendar year in which 
     such individual's taxable year begins.
       ``(D) Coordination with exclusions.--A deduction shall be 
     allowed under subsection (a) for qualified tuition and 
     related expenses only to the extent the amount of such 
     expenses exceeds the amount excludable under section 135 or 
     530(d)(2) for the taxable year.
       ``(3) Limitation on taxable year of deduction.--
       ``(A) In general.--A deduction shall be allowed under 
     subsection (a) for qualified tuition and related expenses for 
     any taxable year only to the extent such expenses are in 
     connection with enrollment at an institution of higher 
     education during the taxable year.
       ``(B) Certain prepayments allowed.--Subparagraph (A) shall 
     not apply to qualified tuition and related expenses paid 
     during a taxable year if such expenses are in connection with 
     an academic term beginning during such taxable year or during 
     the first 3 months of the next taxable year.
       ``(4) Adjustment for certain scholarships and veterans 
     benefits.--The amount of qualified tuition and related 
     expenses otherwise taken into account under subsection (a) 
     with respect to the education of an individual shall be 
     reduced (before the application of subsection (b)) by the sum 
     of the amounts received with respect to such individual for 
     the taxable year as--
       ``(A) a qualified scholarship which under section 117 is 
     not includable in gross income,
       ``(B) an educational assistance allowance under chapter 30, 
     31, 32, 34, or 35 of title 38, United States Code, or
       ``(C) a payment (other than a gift, bequest, devise, or 
     inheritance within the meaning of section 102(a) or needs-
     based aid received under part A of title IV of the Higher 
     Education Act of 1965) for educational expenses, or 
     attributable to enrollment at an eligible educational 
     institution, which is exempt from income taxation by any law 
     of the United States.
       ``(5) No deduction for married individuals filing separate 
     returns.--If the taxpayer is a married individual (within the 
     meaning of section 7703), this section shall apply only if 
     the taxpayer and the taxpayer's spouse file a joint return 
     for the taxable year.
       ``(6) Nonresident aliens.--If the taxpayer is a nonresident 
     alien individual for any portion of the taxable year, this 
     section shall apply only if such individual is treated as a 
     resident alien of the United States for purposes of this 
     chapter by reason of an election under subsection (g) or (h) 
     of section 6013.
       ``(7) Regulations.--The Secretary may prescribe such 
     regulations as may be necessary or appropriate to carry out 
     this section, including regulations requiring recordkeeping 
     and information reporting.''.
       (b) Deduction Allowed in Computing Adjusted Gross Income.--
     Section 62(a) of the Internal Revenue Code of 1986 is amended 
     by inserting after paragraph (17) the following:
       ``(18) Higher education expenses.--The deduction allowed by 
     section 222.''.
       (c) Conforming Amendment.--The table of sections for part 
     VII of subchapter B of chapter 1 of the Internal Revenue Code 
     of 1986 is amended by striking the item relating to section 
     222 and inserting the following:

``Sec. 222. Higher education expenses.
``Sec. 223. Cross reference.''.

       (d) Effective Date.--The amendments made by this section 
     shall apply to expenses paid after December 31, 2001 (in 
     taxable years ending after such date), for education 
     furnished in academic periods beginning after such date.

     SEC. 3. EXPANSION OF LIFETIME LEARNING CREDIT.

       (a) In General.--Section 25A(c)(1) of the Internal Revenue 
     Code of 1986 (relating to lifetime learning credit) is 
     amended by striking ``20 percent'' and inserting ``28 
     percent''.
       (b) Increase in AGI Limits.--
       (1) In general.--Subsection (d) of section 25A of the 
     Internal Revenue Code of 1986 is amended to read as follows:
       ``(d) Limitation Based on Modified Adjusted Gross Income.--
       ``(1) Hope credit.--
       ``(A) In general.--The amount which would (but for this 
     subsection) be taken into account under subsection (a)(1) 
     shall be reduced (but not below zero) by the amount 
     determined under subparagraph (B).
       ``(B) Amount of reduction.--The amount determined under 
     this subparagraph equals the amount which bears the same 
     ratio to the amount which would be so taken into account as--
       ``(i) the excess of--

       ``(I) the taxpayer's modified adjusted gross income for 
     such taxable year, over
       ``(II) $40,000 ($80,000 in the case of a joint return), 
     bears to

       ``(ii) $10,000 ($20,000 in the case of a joint return).
       ``(2) Lifetime learning credit.--
       ``(A) In general.--The amount which would (but for this 
     subsection) be taken into account under subsection (a)(2) 
     shall be reduced (but not below zero) by the amount 
     determined under subparagraph (B).
       ``(B) Amount of reduction.--The amount determined under 
     this subparagraph equals the amount which bears the same 
     ratio to the amount which would be so taken into account as--
       ``(i) the excess of--

       ``(I) the taxpayer's modified adjusted gross income for 
     such taxable year, over
       ``(II) $50,000 ($100,000 in the case of a joint return), 
     bears to

       ``(ii) $10,000 ($20,000 in the case of a joint return).
       ``(3) Modified adjusted gross income.--For purposes of this 
     subsection, the term `modified adjusted gross income' means 
     the adjusted gross income of the taxpayer for the taxable 
     year increased by any amount excluded from gross income under 
     section 911, 931, or 933.''.
       (2) Conforming amendment.--Section 25A(h)(2)(A) of such 
     Code is amended by striking ``subsection (d)(2)'' and 
     inserting ``subsection (d)(1)(B) and the $50,000 and $100,000 
     amounts in subsection (d)(2)(B)''.
       (c) Use of Certain Needs-Based Aid for Qualified 
     Expenses.--Section 25A(g)(2)(C) of the Internal Revenue Code 
     of 1986 (relating to adjustment for certain scholarships , 
     etc.) is amended by inserting ``or needs-based aid received 
     under part A of title IV of the Higher Education Act of 
     1965'' after ``section 102(a)''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to expenses paid after December 31, 2001 (in 
     taxable years ending after such date), for education 
     furnished in academic periods beginning after such date.

     SEC. 4. EXPANSION OF STUDENT LOAN INTEREST DEDUCTION.

       (a) Per Student Basis.--
       (1) In general.--Section 221(b)(1) of the Internal Revenue 
     Code of 1986 (relating to maximum deduction) is amended by 
     inserting

[[Page 8046]]

     ``with respect to qualified education loans of each eligible 
     student'' after ``paragraph (2),''.
       (2) Effective date.--The amendment made by this subsection 
     shall apply with respect to any loan interest paid after 
     December 31, 2001, in taxable years ending after such date.
       (b) Elimination of 60-Month Limit.--
       (1) In general.--Section 221 of the Internal Revenue Code 
     of 1986 (relating to interest on education loans) is amended 
     by striking subsection (d) and by redesignating subsections 
     (e), (f), and (g) as subsections (d), (e), and (f), 
     respectively.
       (2) Conforming amendment.--Section 6050S(e) of such Code is 
     amended by striking ``section 221(e)(1)'' and inserting 
     ``section 221(d)(1)''.
       (3) Effective date.--The amendments made by this subsection 
     shall apply with respect to any loan interest paid after 
     December 31, 2001, in taxable years ending after such date.
       (c) Increase in Income Limitation.--
       (1) In general.--Section 221(b)(2)(B) of the Internal 
     Revenue Code of 1986 (relating to amount of reduction) is 
     amended by striking clauses (i) and (ii) and inserting the 
     following:
       ``(i) the excess of--

       ``(I) the taxpayer's modified adjusted gross income for 
     such taxable year, over
       ``(II) $40,000 ($80,000 in the case of a joint return), 
     bears to

       ``(ii) $15,000 ($20,000 in the case of a joint return).''.
       (2) Conforming amendment.--Section 221(g)(1) of such Code 
     is amended by striking ``$60,000'' and inserting ``$80,000''.
       (3) Effective date.--The amendments made by this subsection 
     shall apply to taxable years ending after December 31, 2001.

     SEC. 5. PELL GRANTS.

       Section 401(b)(2)(A) of the Higher Education Act of 1965 
     (20 U.S.C. 1070a(b)(2)(A)) is amended--
       (1) in clause (iii), by striking ``$5,100'' and inserting 
     ``$5,800''; and
       (2) in clause (iv), by striking ``$5,400'' and inserting 
     ``$5,800''.
                                 ______
                                 
      By Mr. FRIST (for himself, Mr. Breaux, and Mr. Jeffords):
  S. 889. A bill to protect consumers in managed care plans and in 
other health coverage; to the Committee on Health, Education, Labor, 
and Pensions.
  Mr. FRIST. Mr. President, I rise today on behalf of my colleagues 
Senator Breaux and Senator Jeffords to introduce the Bipartisan 
Patients' Bill of Rights Act of 2001. This new, balanced patients' 
rights initiative truly represents a bipartisan breakthrough in this 
ongoing debate.
  For over 5 years, we have been engaged in debate about how best to 
protect patients in managed care plans. The time for debate and 
discussion is over. We need to act and to move forward to make progress 
on this issue in this Congress.
  The legislation we are introducing today is designed to do just that. 
It builds upon, incorporates, and refines the best ideas that have been 
put forth by both Republicans and Democrats over the past few years. 
I'd like to particularly acknowledge the work of Senator Nickles, 
Senator Kennedy, and Senator Jeffords. And of Representative Norwood, 
Representative Dingell, Representative Thomas, Representative Boehner, 
Representative Shadegg, and Speaker Hastert.
  Importantly, the legislation we are introducing today meets the 
principles the President outlined earlier this year, and can be signed 
into law. Patients have waited far too long for these needed 
protections.
  As a physician, I am particularly gratified that the legislation we 
are introducing is being supported by a wide range of groups 
representing physicians and providers, including the American College 
of Surgeons, the Society of Thoracic Surgeons, the American College of 
Cardiology, the American Society of Anesthesiologists, the American 
Society for Gastrointestinal Endoscopy, the American Society of 
Clinical Pathologists, the American Academy of Dermatology Association, 
the American Association of Orthopaedic Surgeons, the American 
Association of Neurological Surgeons, the American Urological 
Association, the American Society of Clinical Pathologists, the 
American College of Emergency Physicians, the American Society of 
Cataract and Refractive Surgery, the American Psychological 
Association, and the American Physical Therapy Association.
  As others review the details of this legislation, I hope and expect 
that support will continue to grow.
  Let me briefly outline the highlights of our legislation.
  The Bipartisan Patients' Bill of Rights Act of 2001 protects all 
Americans in private health plans. At the same time, it gives deference 
to the states by allowing state managed care laws to continue in force 
so long as they are consistent with our principles.
  The bill also includes a comprehensive set of patient protections. 
For example, it guarantees emergency coverage under a ``prudent 
layperson'' standard. It guarantees direct access for women to OB/GYNs, 
and allows patients to choose a pediatrician as their child's primary 
health care provider. The legislation also bans so-called ``gag 
clauses'' in health plan contracts; prohibits discrimination against 
health professionals based solely on their license, guarantees access 
to needed prescription drugs that are not part of a health plan's 
formulary; and contains many other important protections.
  Because one of the best ways to improve our health care system is to 
make sure consumers are fully informed, the Bipartisan Patients' Bill 
of Rights Act of 2001 also requires health plans to disclose to 
enrollees extensive information about their health coverage, including 
providing information about the new Federal rights they will be 
guaranteed as a result of this legislation.
  The heart of the legislation is a new, independent, impartial 
external medical review to make sure patients can get the care they 
need when they need it. The independent review in our bill will help 
ensure that qualified doctors, not health plans, will make medical 
decisions.
  Importantly, the legislation includes new, expanded remedies to hold 
health plans accountable in federal court. As I have often said, 
litigation should be a last resort. But when patients have been harmed 
by a health plan delay or denial of care, or where a plan refuses to 
comply with an external review decision, patients should be allowed to 
enforce those rights in Federal court.
  For the first time under our legislation, patients will be able to 
sue for monetary damages in federal court. Economic damages are 
unlimited. Noneconomic damages are capped at $500,000.
  In addition, patients can go to court at any time to get the health 
benefits they need through injunctive relief if going through the 
internal or external review process would cause them irreparable harm.
  While we provide important new federal legal rights, we do not 
preempt the progress states have made. Our bill expressly protects 
state HMO liability laws and state court jurisdiction over malpractice 
cases against HMOs where health plans are making ``treatment'' or 
``health care delivery'' decisions.
  During this time of rapidly rising health care costs, Congress must 
be extremely careful to protect employers who voluntarily sponsor 
health coverage for over one hundred million Americans from the 
increased risk of litigation simply for offering their employees 
coverage. Our bill accomplishes this by giving employers the statutory 
right to appoint insurance carriers or third-party administrators who 
are making coverage decisions as ``designated decision makers'' who may 
be sued in federal court.
  Finally, the Bipartisan Patients' Bill of Rights Act of 2001 ensures 
that treating physicians and health professionals are not subject to 
new, expanded liability. We make clear that doctors who are providing 
care or treatment directly to patients cannot be ``designated decision 
makers'' unless they agree in writing to do so and meet the bill's 
strict solvency and financial requirements.
  Let me again thank my cosponsors, Senators Breaux and Jeffords, for 
their hard work on this legislation. And let me also express my 
gratitude to the patient and provider groups who have endorsed our 
legislation.
  I believe this legislation can gather even more support over time, 
and become a vehicle for breaking through the gridlock and partisan 
divisions that have prevented us from making progress during the past 5 
years on this issue. I look forward to working with my colleagues to 
ensure that we pass a

[[Page 8047]]

bill that the President can sign into law to guarantee patients the 
protections they need.
  I ask unanimous consent that a summary of the legislation be printed 
in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

        Bipartisan Patients' Bill of Rights Act of 2001--Summary

       Today, Senators Bill Frist (R-TN), John Breaux (D-LA), and 
     James Jeffords (R-VT) introduced the first bipartisan managed 
     care reform legislation in the 107th Congress that meets the 
     patient protection principles outlined by President Bush in 
     February of this year.
       The ``Bipartisan Patients' Bill of Rights Act of 2001'' 
     guarantees that all Americans covered by private health plans 
     will be protected through a new comprehensive, common-sense 
     set of patient protections guaranteed by federal law. This 
     centrist proposal builds upon and incorporates the best 
     elements of the patients' rights legislation developed during 
     the past two Congresses by both Republicans and Democrats.
       The Bipartisan Patients' Bill of Rights Act will ensure 
     that all Americans covered by private health plans get the 
     care they need and deserve by guaranteeing access to medical 
     specialists, emergency care, needed prescription drugs, 
     point-of-service coverage, and coverage for clinical trials. 
     Patients will be guaranteed access to important information 
     about their health coverage. Doctors, not health plans, will 
     make medical decisions. And, for the first time, all 
     Americans will be able to appeal health plan coverage denials 
     to independent doctors to get rapid, unbiased decisions. 
     Unlike other managed care reform proposals before Congress 
     this year, the bipartisan Frist-Breaux-Jeffords bill will not 
     unnecessarily drive up consumers' health care costs, threaten 
     employers who do not make medical decisions with costly and 
     unnecessary lawsuits, or add significant bureaucratic red 
     tape to the private health care system.
       All the protections in the Frist-Breaux-Jeffords bipartisan 
     ``Patients' Bill of Rights Act'' apply to all 170 million 
     Americans covered by private-sector group health plans, and 
     fully-insured state and local government plans.
       At the same time, the legislation recognizes that the 
     federal government does not have all the answers. States will 
     play the primary role in enforcing the bill's requirements 
     with respect to health insurers and will have flexibility to 
     apply for certification from the Secretary of Health and 
     Human Services (HHS) that their laws are consistent with the 
     patient protection requirements in the bill. A federal 
     advisory board would evaluate state-passed consumer 
     protections under this standard and make recommendations to 
     the Secretary of HHS.
       If a state does not have a law, or adopt a law, consistent 
     with the new federal requirements, federal fall-back 
     legislation would apply. In this case, the U.S. Department of 
     Labor, DOL, would enforce the requirement for fully-insured 
     group health plans, about 75 million people, and HHS would 
     enforce the provision in the individual insurance market, 
     about 22 million people, and for fully-insured state and 
     local government plans, roughly 17 million people. DOL will 
     enforce all the Act's provisions with respect to self-insured 
     private group health plans (roughly 56 million people).
       The Bipartisan Patients' Bill of Rights Act of 2001 
     includes a comprehensive set of commonsense protections to 
     ensure that patients have access to the care, treatment, and 
     information they need.
       Patients can go the nearest hospital emergency room to get 
     the emergency care they need regardless of whether the 
     emergency room is in their health plan's network.
       Employers that offer only closed panel health plans will be 
     required to offer a point-of-service coverage options to 
     their workers.
       Health plans that offer obstetrician/gynecological services 
     must provide women with direct access to an OB/GYN specialist 
     for OB/GYN covered services.
       Health plans must allow patients to choose a pediatrician 
     as their child's primary health care provider.
       When a health care provider is terminated or leaves a 
     health plan's network, the plan must ensure that patients 
     with serious and complex illnesses, and those who are 
     receiving institutional care, may continue treatment with 
     their health care provider for up to 90 days. Health plans 
     also must guarantee that women can continue care with their 
     OB/GYN through post-pregnancy care, and for the remainder of 
     an individual's life in the case of a patient who is 
     terminally ill.
       Health plans that provide prescription drugs through a 
     formulary must ensure that physicians and pharmacists help 
     develop and review the formulary. They also must ensure that 
     patients have access to medically-necessary prescription 
     medications that are not part of the formulary.
       Health plans must ensure that patients receive timely 
     access to specialty medical care when needed. If a plan lacks 
     an appropriate specialist within its network, the plan must 
     guarantee access to a specialist outside the network at no 
     additional cost to the patient.
       Health plans are required to cover routine patient costs 
     associated with participation in approved clinical trials for 
     patients who have life-threatening or serious illnesses for 
     which no standard treatment is effective.
       Patients who need medical advice should not have to worry 
     that their doctor will be prohibited by a health plan 
     contract from discussing all possible treatment options. 
     Therefore, the legislation bans so-called ``gag rules'' in 
     providers' contracts and otherwise prevents health plans from 
     restricting health care professionals from communicating with 
     their patients about treatment options.
       Health plans may not exclude doctors and other health 
     professionals from providing services that are covered by the 
     plan based solely on a health professional's license or 
     certification.
       Health plans must ensure inpatient coverage for the 
     surgical treatment of breast cancer for a period of time 
     determined by a doctor, in consultation with the patient.
       Health plans must disclose the methods they use for 
     compensating health care professionals and providers. In 
     addition, a comprehensive study is authorized to determine 
     the range of provider compensation methods and evaluate the 
     effect of such methods on provider behavior.
       Health plans are required, on an annual basis, to provide a 
     wide range of information to enrollees about the plan's 
     coverage, including detailed descriptions of benefits and 
     cost-sharing requirements.
       To ensure that patients' health care claims are handled 
     fairly from the outset, the legislation contains new rules 
     governing health plans' timing and handling of initial and 
     internal claims. Plans are required to expedite 
     determinations where appropriate.
       The time frames are as follows: Routine Prior 
     Authorization: 14 business days; Expedited Prior 
     Authorization: 72 hours; Concurrent Review: 24 hours.
       When health plans deny patients coverage based on a 
     determination that the care is not medically necessary or 
     appropriate, or that the treatment is experimental or 
     investigational, or where a claim for coverage requires an 
     evaluation of medical facts, the Bipartisan Patients' Bill of 
     Rights Act guarantees patients access to timely independent 
     medical review.
       The legislation requires external medical review decisions 
     to be made by physicians and health care professionals 
     independent of the health plan who practice in a similar 
     specialty as the physician or professional who recommended 
     the care in the first place. In making a decision, 
     independent medical reviewers must take into account all 
     appropriate and available information, including scientific 
     and clinical evidence. Determinations are to be made without 
     deference to the plan's coverage decision and reviewers are 
     not bound by the plan's definitions of medical necessity or 
     experimental/investigational. Independent medical reviewers' 
     decisions are binding on health plans; plans must provide 
     coverage in accordance with the recommendations and time 
     frames established by the independent medical reviewer.
       If a plan fails to comply with the decision of an 
     independent medical reviewer and a patient is harmed, the 
     legislation provides new, expanded legal remedies to hold 
     health plans accountable in federal court.
       A new, exclusive federal legal remedy that provides 
     monetary damages will be available to participants and 
     beneficiaries in employer-sponsored health plans. This remedy 
     is available when an external medical reviewer overturns the 
     plan's decision and the patient is harmed because the plan 
     failed to exercise ordinary care in complying with the 
     external review decision. The new remedy also allows lawsuits 
     in federal court when health plans fail to exercise ordinary 
     care in denying coverage initially or upon internal review, 
     resulting in a harmful delay of coverage.
       Patients must exhaust the external review process before 
     seeking damages in federal court. However, they may go to 
     court at any time to receive injunctive relief, i.e., the 
     court can require the health plan to approve needed care, if 
     they demonstrate that exhausting internal or external review 
     would cause irreparable harm. Patients who are harmed by a 
     plan's failure to exercise ordinary care may receive 
     unlimited economic damages in federal court. They also may be 
     awarded non-economic damages up to $500,000.
       At the same time, the legislation retains the current law 
     distinction with respect to remedies in the areas that the 
     courts have determined are traditional areas of state 
     concern, such as the ``quality of health care'' and 
     ``treatment'' standards. The bill respects and reinforces 
     state court jurisdiction over quality of care and treatment 
     claims by expressly stating that any harm resulting from 
     treatment and health care delivery activities will continue 
     to be subject to state law remedies.
       When a patient files an appeal and the external reviewer 
     determines that the appeal is not subject to independent 
     medical review, a federal court may assess a civil penalty up 
     to $100,000 when the denial causes substantial harm to the 
     patient.
       The Frist-Breaux-Jeffords legislation protects employers 
     who do not make medical

[[Page 8048]]

     decisions from lawsuits. The legislation gives employers 
     statutory authority to designate a party or parties, such as 
     the insurance carrier or the third-party administrator that 
     will have clear and exclusive authority to make 
     determinations that give rise to legal causes of action. In a 
     fully insured group health plan, this ``designated decision-
     maker'' is always the insurance carrier, unless the employer 
     expressly takes back responsibility from the carrier. 
     Designated decision-makers must demonstrate that they can 
     fulfill their responsibilities, including financial 
     obligations that stem from liability, by obtaining liability 
     insurance or by meeting certain capital and surplus 
     requirements.
       The Frist-Breaux-Jeffords legislation also helps protect 
     doctors and other health professionals from new, expanded 
     federal liability by expressly providing that health care 
     professionals who directly deliver care or treatment, or who 
     provide services to patients, can not be sued for coverage 
     decisions as designated decision-makers unless they expressly 
     agree in writing to be the designated decision-maker and meet 
     the bill's strict financial requirements. Further, insurance 
     companies may not appoint treating health professionals as 
     designated decision-makers under the bill.

  Mr. JEFFORDS. Mr. President, today, I am pleased to join with 
Senators Bill Frist and John Breaux in introducing the Bipartisan 
Patients' Bill of Rights Act of 2001, bipartisan managed care reform 
legislation that meets the patient protection principles outlined by 
President Bush for a bill he would sign into law. The President's 
strong support for our legislation is proof that he is providing the 
necessary leadership to bring Republicans and Democrats to the table to 
develop managed care protections for all Americans.
  Some believe that the answer to improving our Nation's health care 
quality is to allow greater access to the State's tort system. However, 
you simply cannot sue your way to better health. Rather, we believe 
that patients must get the care they need when they need it. Under the 
Bipartisan Patient Bill of Rights patients have access to an 
independent external medical review process for denials of care. 
Decisions are made by practicing physicians or professionals, 
independent of the plan. Prevention, not litigation, is the best 
medicine.
  A new Federal remedy that provides damages will be available to 
Americans in employer-sponsored health plans when an external review 
entity overturns the plan's decision and the patient is harmed. 
Employers who do not make medical decisions are protected from 
frivolous and unnecessary lawsuits by enabling them to legally 
designate a party that will have clear and exclusive authority to make 
coverage determinations.
  Our Bipartisan Patients' Bill of Rights Act of 2001 has much in 
common with the managed care legislation introduced by Senators McCain, 
Edwards and Kennedy. They share provisions that provide new patient 
protections. Each provides for information to assist consumers in 
navigating the health care system. Most importantly, the bills provide 
for an internal and external independent review process with strong new 
remedies when the external view process fails. Our primary area of 
disagreement lies in the degree that employers are protected from 
multiple causes of action in multiple venues and the provision of a 
reasonable cap on damages.
  Fortunately, I believe we can provide the key protections that 
consumers want at a minimal cost and without disruption of coverage, if 
we apply these protections responsibly and where they are needed, 
without adding significant new costs, increasing litigation, and micro-
managing health plans.
  Our goal is to give Americans the protections they want and need in a 
package that they can afford and that we can enact. This is why I 
believe the Bipartisan Patients' Bill of Rights Act of 2001 represents 
true managed care protections that can be signed into law.
                                 ______
                                 
      By Mr. McCAIN (for himself, Mr. Lieberman, Mr. Schumer, Mr. 
        DeWine, and Mr. Carper):
  S. 890. A bill to require criminal background checks on all firearms 
transactions occurring at events that provide a venue for the sale, 
offer for sale, transfer, or exchange of firearms, and to provide 
additional resources for gun crime enforcement; to the Committee on the 
Judiciary.
  Mr. McCAIN. Mr. President, I rise today to introduce legislation to 
finally close what has become known as the ``gun show loophole'' and 
provide more resources to prosecute violations of gun laws. This bill, 
``The Gun Show Loophole Closing and Gun Law Enforcement Act of 2001,'' 
stops criminals from evading a background check while respecting the 
rights of individuals who enjoy attending and purchasing firearms at 
public gun show events and helps puts criminals who use guns behind 
bars. I am pleased to have as cosponsors Senators Lieberman, Schumer, 
DeWine, and Carper.
  Since the Brady law went into effect, Federal law requires anyone 
buying a gun at a gun store to undergo a background check, but the law 
does not apply to private individuals selling guns, such as at gun 
shows. At gun shows, both licensed and unlicensed gun sellers offer 
guns for sale. At tables operated by licensed dealers, buyers must go 
through a background check; at tables operated by private sellers 
federal law requires no background check, and 32 states do not require 
such checks either.
  Criminals and gun traffickers have figured this out. Gun shows are 
the second leading source of illegal guns recovered in gun trafficking 
investigations. According to a recent report by Americans for Gun 
Safety, ``the states that do not require background checks at gun shows 
are flooding the rest of the nation with crime guns.'' While 95 percent 
of buyers are cleared within two hours, the 5 percent who are not are 
20 times more likely to be a prohibited purchaser. Background checks 
are an essential part of keeping guns from criminals and other 
prohibited individuals.
  This gun show bill will require background checks at each of the 
4,500 gun shows that occur every year. It does so in a way that is 
balanced and protects the rights of those who enjoy gun shows. It is 
the first gun safety legislation that is genuinely bipartisan and it is 
the only bill that creates real incentives for states to improve their 
criminal history records in order to make the National Instant Check 
System, NICS, faster and more accurate. And this bill contains no 
provisions that are designed to hurt legitimate gun show business.
  This bill eliminates the confusing definition of previous bills and 
defines a gun show as any event where at least 75 guns are available 
for sale. This bill corrects a flaw in previous bills and excludes from 
background checks the sale of a gun either from the seller's home or to 
an immediate family member.
  The sticking point in previous failed gun show bills was over the 
maximum time allowed to complete a background check: 3 business days, 
which is current law for licensed dealers, or a shorter time due to the 
transience of gun shows.
  This bill creates an innovative compromise. For the first three years 
after the bill becomes law, it extends current law to gun shows: 3 
business days. But after three years, states may apply for a waiver 
from the U.S. Attorney General to reduce the maximum wait to conclude a 
background check for sales between unlicensed individuals at gun shows 
to 24 hours, but only when that state has automated its records may a 
waiver be granted so that a shortened time period won't allow criminals 
and other illegal buyers to get guns. It creates accountability so that 
states can only receive this waiver when at least 95 percent of their 
disqualifying records dating back 30 years are computerized.
  During the first three years, three business days is the maximum time 
it can take to run a check for unlicensed sellers. If, after those 
three business days the buyer has not been denied, he or she can 
purchase the gun. It is not a waiting period; if you clear the system, 
you immediately get your gun. If, after three years, a state has 
sufficiently computerized their records, 24 hours is the new maximum 
time it can take to run a check for unlicensed sellers.

[[Page 8049]]

  Background checks do not hurt gun show business in any way. For 
example, Pennsylvania currently requires background checks for all gun 
sales and hosts the second most gun shows in the Nation, hundreds every 
year. And unlike previous bills, this bill creates no new onerous 
reporting requirements for gun sales at gun shows but requires only the 
same paperwork required for gun sales from a licensed gun store.
  This bill will reduce crime by providing for tougher enforcement of 
current gun laws. This bill adds new ATF agents and gun crime 
prosecutors, expands Project Exile, calls for more resources for gun 
tracing and more research into new ``smart gun" technologies, and 
provides much needed money for states to automate their records.
  Recently, the States of Oregon and Colorado overwhelmingly passed 
statewide referenda closing the gun show loophole. I wholeheartedly 
supported those efforts. Given the overwhelming support that the people 
of these two states provided to closing the gun show loophole, I think 
it is time that we have a national requirement for background checks 
for all sales at gun shows. In the end, it will require parity between 
gun stores and gun shows, help stop criminals from getting guns on the 
black market, reduce the interstate trafficking of guns, and will not 
harm gun show operators.
  I do not view my stance on the gun show loophole as inconsistent with 
my twenty-year long Congressional voting record on gun-related issues. 
I will always be a strong defender of law-abiding Americans' Second 
Amendment rights, but with rights, come responsibilities. And we have a 
responsibility to help keep guns out of the hands of criminals while 
protecting the rights of honest, law-abiding citizens.
  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. 890

       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 ``Gun Show Loophole Closing 
     and Gun Law Enforcement Act of 2001''.

             TITLE I--GUN SHOW LOOPHOLE CLOSING ACT OF 2001

     SEC. 101. SHORT TITLE.

       This title may be cited as the ``Gun Show Loophole Closing 
     Act of 2001''.

     SEC. 102. DEFINITIONS.

       Section 921(a) of title 18, United States Code, is amended 
     by adding at the end the following:
       ``(35) Special firearms event.--The term `special firearms 
     event'--
       ``(A) means any event at which 75 or more firearms are 
     offered or exhibited for sale or exchange, if 1 or more of 
     the firearms has been shipped or transported in, or otherwise 
     affects, interstate or foreign commerce; and
       ``(B) does not include an offer or exhibit of firearms for 
     sale or exchange by an individual from the personal 
     collection of that individual, at the private residence of 
     that individual, if the individual is not required to be 
     licensed under sections 923 and 931.
       ``(36) Special firearms event frequent operator.--The term 
     `special firearms event frequent operator' means any person 
     who operates 2 or more special firearms events in a 6 month 
     period.
       ``(37) Special firearms event infrequent operator.--The 
     term `special firearms event infrequent operator' means any 
     person who operates not more than 1 special firearms event in 
     a 6 month period.
       ``(38) Special firearms event licensee.--The term `special 
     firearms event licensee' means any person who has obtained 
     and holds a valid license in compliance with section 931(d) 
     and who is authorized to contact the national instant 
     criminal background check system on behalf of another 
     individual who is not licensed under this chapter for the 
     purpose of conducting a background check for a potential 
     firearms transfer at a special firearms event in accordance 
     with section 931(c).
       ``(39) Special firearms event vendor.--The term `special 
     firearms event vendor' means any person who is not required 
     to be licensed under section 923, who exhibits, sells, offers 
     for sale, transfers, or exchanges 1 or more firearms at a 
     special firearms event, regardless of whether or not the 
     person arranges with the special firearms event promoter for 
     a fixed location from which to exhibit, sell, offer for sale, 
     transfer, or exchange 1 or more firearms.''.

     SEC. 103. REGULATION OF FIREARMS TRANSFERS AT SPECIAL 
                   FIREARMS EVENTS.

       (a) In General.--Chapter 44 of title 18, United States 
     Code, is amended by adding at the end the following:

     ``Sec. 931. Regulation of firearms transfers at special 
       firearms events

       ``(a) Special Firearms Event Operators.--
       ``(1) Registration of special firearms event operators.--
       ``(A) In general.--It shall be unlawful for any person to 
     operate a special firearms event unless that person registers 
     with the Secretary in accordance with regulations promulgated 
     by the Secretary.
       ``(B) Fees.--The Secretary shall be prohibited from 
     imposing or collecting any fee from special firearms event 
     operators in connection with the registration requirement in 
     subparagraph (A).
       ``(2) Responsibilities of special firearms events frequent 
     operators.--It shall be unlawful for a special firearms 
     events frequent operator to organize, plan, promote, or 
     operate a special firearms event unless that operator--
       ``(A) has an annual operating license for special firearms 
     events frequent operators issued by the Secretary pursuant to 
     regulations promulgated by the Secretary;
       ``(B) not later than 30 days before commencement of the 
     special firearms event, notifies the Secretary of the date, 
     time, duration, and location of the special firearms event, 
     the vendors planning to participate, and any other 
     information concerning the special firearms event as the 
     Secretary may require by regulation;
       ``(C) not later than 72 hours before commencement of the 
     special firearms event, submits to the Secretary an updated 
     list of all special firearms event vendors planning to 
     participate, and any other information concerning such 
     vendors as the Secretary may require by regulation;
       ``(D) before commencement of the special firearms event, or 
     in the case of a vendor who arrives after the commencement of 
     the event, upon the arrival of the vendor, verifies the 
     identity of each special firearms event vendor participating 
     in the special firearms event by examining a valid 
     identification document (as defined in section 1028(d)(2)) of 
     the vendor containing a photograph of the vendor;
       ``(E) before commencement of the special firearms event, or 
     in the case of a vendor who arrives after the commencement of 
     the event, upon the arrival of the vendor, requires each 
     special firearms event vendor to sign--
       ``(i) a ledger with identifying information concerning the 
     vendor; and
       ``(ii) a notice advising the vendor of the obligations of 
     the vendor under this chapter;
       ``(F) notifies each person who attends the special firearms 
     event of the requirements of this chapter, in accordance with 
     such regulations as the Secretary shall prescribe;
       ``(G) not later than 5 days after the last day of the 
     special firearms event, submits to the Secretary a copy of 
     the ledger and notice described in subparagraph (E); and
       ``(H) maintains a copy of the records described in 
     subparagraphs (C) through (E) at the permanent place of 
     business of the operator for such period of time and in such 
     form as the Secretary shall require by regulation.
       ``(3) Responsibilities of special firearms events 
     infrequent operators.--It shall be unlawful for a special 
     firearms event infrequent operator to organize, plan, 
     promote, or operate a special firearms event unless that 
     person--
       ``(A) not later that 30 days before commencement of the 
     special firearms event, notifies the Secretary of the date, 
     time, duration, and location of the special firearms event;
       ``(B) not later than 72 hours before commencement of the 
     special firearms event, submits to the Secretary a list of 
     all special firearms event vendors planning to participate in 
     the special firearms event and any other information 
     concerning such vendors as the Secretary may require by 
     regulation;
       ``(C) before commencement of the special firearms event, or 
     in the case of a vendor who arrives after the commencement of 
     the event, upon the arrival of the vendor, verifies the 
     identity of each special firearms event vendor participating 
     in the special firearms event by examining a valid 
     identification document (as defined in section 1028(d)(2)) of 
     the vendor containing a photograph of the vendor;
       ``(D) before commencement of the special firearms event, or 
     in the case of a vendor who arrives after the commencement of 
     the event, upon the arrival of the vendor, requires each 
     special firearms event vendor to sign--
       ``(i) a ledger with identifying information concerning the 
     vendor; and
       ``(ii) a notice advising the vendor of the obligations of 
     the vendor under this chapter;
       ``(E) notifies each person who attends the special firearms 
     event of the requirements of this chapter, in accordance with 
     such regulations as the Secretary shall prescribe;
       ``(F) not later than 5 days after the last day of the 
     special firearms event, submits to the Secretary a copy of 
     the ledger and notice described in subparagraph (D); and
       ``(G) maintains a copy of the records described in 
     subparagraphs (B) through (D) at

[[Page 8050]]

     the permanent place of business of the special firearms event 
     promoter for such period of time and in such form as the 
     Secretary shall require by regulation.
       ``(b) Responsibilities of Transferors Other Than 
     Licensees.--
       ``(1) In general.--If any part of a firearm transaction 
     takes place at a special firearms event, or on the curtilage 
     of the event, it shall be unlawful for any person who is not 
     licensed under this chapter to transfer a firearm to another 
     person who is not licensed under this chapter, unless the 
     firearm is transferred through a licensed importer, licensed 
     manufacturer, licensed dealer, or a special firearms event 
     licensee in accordance with subsection (c).
       ``(2) Criminal background checks.--A person who is subject 
     to the requirement of paragraph (1) shall not--
       ``(A) transfer the firearm to the transferee until the 
     licensed importer, licensed manufacturer, licensed dealer, or 
     a special firearms event licensee through which the transfer 
     is made makes the notification described in subsection 
     (c)(2)(A); or
       ``(B) transfer the firearm to the transferee if the person 
     has been notified under subsection (c)(2)(B) that the 
     transfer would violate section 922 or would violate State 
     law.
       ``(3) Absence of recordkeeping requirements.--Nothing in 
     this section shall permit or authorize the Secretary to 
     impose recordkeeping requirements on any nonlicensed special 
     firearms event vendor.
       ``(c) Responsibilities of Licensees.--A licensed importer, 
     licensed manufacturer, licensed dealer, or special firearms 
     event licensee who agrees to assist a person who is not 
     licensed under this chapter in carrying out the 
     responsibilities of that person under subsection (b) with 
     respect to the transfer of a firearm shall--
       ``(1) except as provided in paragraph (2), comply with 
     section 922(t) as if transferring the firearm from the 
     inventory of the licensed importer, licensed manufacturer, or 
     licensed dealer to the designated transferee (although a 
     licensed importer, licensed manufacturer, or licensed dealer 
     complying with this subsection shall not be required to 
     comply again with the requirements of section 922(t) in 
     delivering the firearm to the nonlicensed transferor);
       ``(2) not later than 3 business days (meaning a day on 
     which State offices are open), or if the event is held in a 
     State that has been certified by the Attorney General under 
     section 104 of the Gun Show Loophole Closing Act of 2001, not 
     later than 24 hours (or 3 business days if additional 
     information is required in order to verify disqualifying 
     information from a State that has not been certified by the 
     Attorney General) notify the nonlicensed transferor and the 
     nonlicensed transferee--
       ``(A) of any response from the national criminal background 
     check system, or if the licensee has had no response from the 
     national criminal background check system within the time 
     period set forth in paragraph (2), notify the nonlicensed 
     transferor that no response has been received and that the 
     transfer may proceed; and
       ``(B) of any receipt by the licensed importer, licensed 
     manufacturer, or licensed dealer of a notification from the 
     national instant criminal background check system that the 
     transfer would violate section 922 or would violate State 
     law;
       ``(3) in the case of a transfer of 2 or more firearms on a 
     single day to a person other than a licensee, prepare a 
     report of the multiple transfers, which report shall be--
       ``(A) on a form specified by the Secretary; and
       ``(B) not later than the close of business on the date on 
     which the multiple transfer occurs, forwarded to--
       ``(i) the office specified on the form described in 
     subparagraph (A); and
       ``(ii) the appropriate State law enforcement agency of the 
     jurisdiction in which the transfer occurs; and
       ``(4) comply with all record keeping requirements under 
     this chapter.
       ``(d) Special Firearms Event License.--
       ``(1) In general.--The Secretary shall issue a special 
     firearms event license to a person who submits an application 
     for a special firearms event license in accordance with this 
     subsection.
       ``(2) Application.--The application required by paragraph 
     (1) shall be approved if--
       ``(A) the applicant is 21 years of age or over;
       ``(B) the application includes a photograph and the 
     fingerprints of the applicant;
       ``(C) the applicant (including, in the case of a 
     corporation, partnership, or association, any individual 
     possessing, directly or indirectly, the power to direct or 
     cause the direction of the management and policies of the 
     corporation, partnership, or association) is not prohibited 
     from transporting, shipping, or receiving firearms or 
     ammunition in interstate or foreign commerce under subsection 
     (g) or (n) of section 922;
       ``(D) the applicant has not willfully violated any of the 
     provisions of this chapter or regulations issued thereunder;
       ``(E) the applicant has not willfully failed to disclose 
     any material information required, or has not made any false 
     statement as to any material fact, in connection with his 
     application; and
       ``(F) the applicant certifies that--
       ``(i) the applicant meets the requirements of subparagraphs 
     (A) through (D) of section 923(d)(1);
       ``(ii) the business to be conducted under the license is 
     not prohibited by State or local law in the place where the 
     licensed premises is located; and
       ``(iii) the business will not be conducted under the 
     license until the requirements of State and local law 
     applicable to the business have been met.
       ``(3) Application and approval.--
       ``(A) In general.--On approval of an application as 
     provided in this subsection and payment by the applicant of a 
     fee of $200 for 3 years, and upon renewal of valid 
     registration a fee of $90 for 3 years, the Secretary shall 
     issue to the applicant an instant check registration, and 
     advise the Attorney General of that registration.
       ``(B) NICS.--A special firearms licensee may contact the 
     national instant criminal background check system established 
     under section 103 of the Brady Handgun Violence Prevention 
     Act (18 U.S.C. 922 note) for information about any individual 
     desiring to obtain a firearm at a gun show from any special 
     firearms event vendor who has requested the assistance of the 
     registrant in complying with subsection (c) with respect to 
     the transfer of the firearm, during the 3-year period that 
     begins with the date the registration is issued.
       ``(4) Requirements.--The requirements for a special 
     firearms event licensee shall not exceed the requirements for 
     a licensed dealer and the record keeping requirements shall 
     be the same.
       ``(5) Restrictions.--
       ``(A) Background checks.--A special firearms event licensee 
     may have access to the national instant criminal background 
     check system to conduct a background check only at a special 
     firearms event and only on behalf of another person.
       ``(B) Transfer of firearms.--A special firearms event 
     licensee shall not transfer a firearm at a special firearms 
     event.
       ``(e) Firearm Transaction Defined.--In this section, the 
     term `firearm transaction'--
       ``(1) includes the sale, offer for sale, transfer, or 
     exchange of a firearm; and
       ``(2) does not include--
       ``(A) the mere exhibition of a firearm; or
       ``(B) the sale, transfer, or exchange of firearms between 
     immediate family, including parents, children, siblings, 
     grandparents, and grandchildren.''.
       (b) Penalties.--Section 924(a) of title 18, United States 
     Code, is amended by adding at the end the following:
       ``(7)(A)(i) Whoever knowingly violates section 931(a)(1) 
     shall be--
       ``(I) fined under this title, imprisoned not more than 2 
     years, or both; and
       ``(II) in the case of a second or subsequent conviction, 
     such person shall be fined under this title, imprisoned not 
     more than 5 years, or both.
       ``(ii) Whoever knowingly violates section 931(a)(2) shall 
     be fined under this title, imprisoned not more than 5 years, 
     or both.
       ``(iii) Whoever knowingly violates section 931(a)(3) shall 
     be fined under this title, imprisoned not more than 2 years, 
     or both.
       ``(B) Whoever knowingly violates section 931(b) shall be--
       ``(i) fined under this title, imprisoned not more than 2 
     years, or both; and
       ``(ii) in the case of a second or subsequent conviction, 
     such person shall be fined under this title, imprisoned not 
     more than 5 years, or both.
       ``(C) Whoever knowingly violates section 931(c) shall be 
     fined under this title, imprisoned not more than 5 years, or 
     both.
       ``(D) In addition to any other penalties imposed under this 
     paragraph, the Secretary may, with respect to any person who 
     violates any provision of section 931--
       ``(i) if the person is registered pursuant to section 
     931(a), after notice and opportunity for a hearing, suspend 
     for not more than 6 months or revoke the registration of that 
     person under section 931(a); and
       ``(ii) impose a civil fine in an amount equal to not more 
     than $10,000.''.
       (c) Technical and Conforming Amendments.--Chapter 44 of 
     title 18, United States Code, is amended in the chapter 
     analysis, by adding at the end the following:

``931. Regulation of firearms transfers at special firearms events.''.

     SEC. 104. OPTION FOR 24-HOUR BACKGROUND CHECKS AT SPECIAL 
                   FIREARMS EVENTS FOR STATES WITH COMPUTERIZED 
                   DISQUALIFYING RECORDS AND PROGRAMS TO IMPROVE 
                   STATE DATABASES.

       (a) Option For 24-Hour Requirement.--
       (1) In general.--Effective 3 years after the date of 
     enactment of this Act, a State may apply to the Attorney 
     General for certification of the 24-hour verification 
     authority of that State.
       (2) Certification.--The Attorney General shall certify a 
     State for 24-hour verification authority only upon a clear 
     showing by the State that not less than 95 percent of all 
     records containing information that would disqualify an 
     individual under subsections (g) and (n) of section 922 of 
     title 18, United States Code, or under State law, is 
     available on computer records in the State, and is searchable 
     under the national instant criminal background check system 
     established

[[Page 8051]]

     under section 103 of the Brady Handgun Violence Prevention 
     Act (18 U.S.C. 922 note).
       (3) Disqualifying information.--Such disqualifying 
     information shall include, at a minimum, the disqualifying 
     records for that State going back 30 years from the date of 
     application to the Attorney General for certification.
       (4) 24-Hour provision.--Upon certification by the Attorney 
     General, the 24-hour provision in section 931(c)(2) of title 
     18, United States Code, shall apply to the verification 
     process (for transfers between unlicensed persons) in that 
     State unless additional information is required in order to 
     verify disqualifying information from a State that has not 
     been certified by the Attorney General, in which case the 3 
     business day limit shall apply.
       (5) Annual review.--The Attorney General shall annually 
     review and revoke for any State not in compliance the 
     certification required in the amendment made by paragraph 
     (1).
       (b) Priority.--The Attorney General shall give priority to 
     background check requests at special firearms events made 
     pursuant to section 931 of title 18, United States Code, as 
     added by this Act.
       (c) Study.--Not later than 180 days after the date of 
     enactment of this Act, the Attorney General shall identify 
     and report to Congress the reasons for delays in background 
     checks at the Federal and State levels and include 
     recommendations for eliminating those delays.
       (d) Grant Program.--
       (1) In general.--The Attorney General is authorized to make 
     grants to States to assist in the computerization of the 
     criminal conviction records and other disqualifying records 
     of that State and with other issues facing States that want 
     to apply for certification under section 104(a) of this 
     title.
       (2) Authorization.--There are authorized to be appropriated 
     such sums as are necessary for fiscal years 2002 through 2004 
     to carry out this subsection.

     SEC. 105. INSPECTION AUTHORITY.

       Section 923(g)(1)(B), of title 18, United States Code, is 
     amended by striking ``or licensed dealer'' and inserting 
     ``licensed dealer, or special firearms event operator''.

     SEC. 106. INCREASED PENALTIES FOR SERIOUS RECORDKEEPING 
                   VIOLATIONS BY LICENSEES.

       Section 924(a)(3) of title 18, United States Code, is 
     amended to read as follows:
       ``(3)(A) Except as provided in subparagraph (B), any 
     licensed dealer, licensed importer, licensed manufacturer, 
     licensed collector, or special firearms event licensee who 
     knowingly makes any false statement or representation with 
     respect to the information required by this chapter to be 
     kept in the records of a person licensed under this chapter, 
     or violates section 922(m) shall be fined under this title, 
     imprisoned not more than 1 year, or both.
       ``(B) If the violation described in subparagraph (A) is in 
     relation to an offense--
       ``(i) under paragraph (1) or (3) of section 922(b), such 
     person shall be fined under this title, imprisoned not more 
     than 5 years, or both; or
       ``(ii) under subsection (a)(6) or (d) of section 922, such 
     person shall be fined under this title, imprisoned not more 
     than 10 years, or both.''.

     SEC. 107. INCREASED PENALTIES FOR VIOLATIONS OF CRIMINAL 
                   BACKGROUND CHECK REQUIREMENTS.

       Section 924(a) of title 18, United States Code, is 
     amended--
       (1) in paragraph (5), by striking ``subsection (s) or (t) 
     of section 922'' and inserting ``section 922(s)''; and
       (2) by adding at the end the following:




       ``(8) Whoever knowingly violates section 922(t) shall be 
     fined under this title, imprisoned not more than 5 years, or 
     both.''.

     SEC. 108. RULE OF INTERPRETATION.

       A provision of State law is not inconsistent with this 
     title or an amendment made by this title if the provision 
     imposes a regulation or prohibition of greater scope or a 
     penalty of greater severity than any prohibition or penalty 
     imposed by this title or an amendment made by this title.

     SEC. 109. EFFECTIVE DATE.

       This title and the amendments made by this title shall take 
     effect 180 days after the date of enactment of this Act.

               TITLE II--GUN LAW ENFORCEMENT ACT OF 2001

     SEC. 201. SHORT TITLE.

       This title may be cited as the ``Gun Law Enforcement Act of 
     2001''.

     SEC. 202. STATE AND LOCAL GUN CRIME PROSECUTORS.

       (a) Purpose.--The purpose of this section is to--
       (1) provide funding for State and local prosecutors to 
     focus on gun prosecutions in high gun crime areas; and
       (2) double funding for such programs from fiscal year 2001 
     to 2002.
       (b) Authorization.--There are authorized to be appropriated 
     $150,000,000 for fiscal year 2002 to the Attorney General to 
     provide grants to States and units of local government to 
     support prosecutions in high gun crime areas by State and 
     local prosecutors.

     SEC. 203. NATIONAL PROJECT EXILE.

       (a) Purpose.--The purpose of this section is to provide 
     funding to replicate the success of the Project EXILE 
     program.
       (b) Authorization.--There are authorized to be appropriated 
     $20,000,000 for fiscal year 2002 to the Attorney General to 
     provide for additional Assistant United States Attorneys to 
     establish not to exceed 100 Project EXILE programs with local 
     United States Attorneys and local jurisdictions.
       (c) Media Awareness.--From amounts authorized by subsection 
     (b), the Attorney General may provide funds to participating 
     local jurisdictions.

     SEC. 204. FUNDING FOR ADDITIONAL ATF AGENTS.

       There are authorized to be appropriated $18,000,000 for 
     fiscal year 2002 to the Secretary of the Treasury for the 
     purpose of funding the hiring of an additional 200 agents for 
     the Bureau of Alcohol, Tobacco, and Firearms.

     SEC. 205. GUN TRACING AND YOUTH CRIME GUN INTERDICTION.

       There are authorized to be appropriated $20,000,000 for 
     fiscal years 2002 through 2005 to the Secretary of the 
     Treasury for the purpose of--
       (1) funding additional resources for the Bureau of Alcohol, 
     Tobacco, and Firearms to trace guns involved in gun crimes; 
     and
       (2) expanding the Youth Crime Gun Interdiction Initiative 
     to 250 cities over the 4 years funding is authorized.

     SEC. 206. SMART GUN TECHNOLOGY.

       There are authorized to be appropriated $10,000,000 for 
     fiscal year 2002 to the National Institute for Justice for 
     the purpose of making grants to research entities developing 
     technologies that limit the use of a gun to the owner.

     SEC. 207. REPORT ON BRADY ENFORCEMENT.

       Not later than February 1 of each year--
       (1) the Attorney General shall report to Congress--
       (A) the number of prosecutions resulting from background 
     checks conducted pursuant to the Brady Handgun Violence 
     Prevention Act;
       (B) what barriers exist to prosecutions under that Act; and
       (C) what steps could be taken to maximize prosecutions; and
       (2) the Secretary of Treasury shall report to Congress--
       (A) the number of investigations conducted pursuant to the 
     Brady Handgun Violence Prevention Act;
       (B) the number of investigations initiated but not pursued 
     under that Act;
       (C) the number of firearms retrieved as transferred in 
     contravention of that Act; and
       (D) what barriers exist to investigations under that Act.

  Mr. LIEBERMAN. Mr. President, I am proud to join Senator McCain, 
Senator DeWine, Senator Schumer, and Senator Carper in introducing this 
important legislation. This bill aims to build common ground on gun 
violence, a problem that has too often divided Members of Congress. And 
we are going to build that common ground on commonly held American 
values. As citizens of this great Democracy, we have rights and we have 
responsibilities. We have the right to own guns, but we have a 
responsibility not to sell them to criminals. That is the simple but 
important set of values on which the legislation we introduce today is 
founded.
  For several decades, our nation has had a clear policy against 
allowing convicted felons to buy guns, because we know that mixing 
criminals and guns far too often yields violent results. Through the 
Brady law, we established what seems like an obvious corollary to that 
policy--a requirement that those selling guns determine whether someone 
trying to buy a firearm isn't supposed to get one before they sell it 
to them. The Brady law has been an enormous success. Since its 
enactment, background checks have kept well over half a million people 
who by law are not allowed to own guns from getting guns, saving an 
untold number of our citizens from the violence, injury or death the 
sale of many of these guns would have brought.
  The Brady law, however, contained an unfortunate loophole that has 
since been exploited to allow convicted felons and other people who 
shouldn't own guns to evade the background check requirement by buying 
their guns at gun shows. The problem is that Brady applies only to 
Federal Firearms Licensees, so-called FFLs, people who are in the 
business of selling guns. Brady explicitly exempts from the background 
check requirement anyone ``who makes occasional sales, exchanges, or 
purchases of firearms for the enhancement of a personal collection or 
for a hobby, or who sells all or part of his personal collection of 
firearms.'' As a result, any person selling

[[Page 8052]]

guns as a hobby or only occasionally, whether at a gun show, flea 
market or elsewhere, need not obtain a federal license and therefore 
has no obligation to conduct a background check. This means that any 
person wanting to avoid a background check can go to a gun show, find 
out which vendors are not FFLs, and buy a gun. And this is dangerous 
not only because it allows convicted felons and other prohibited 
persons to buy guns, but also because, in contrast to FFLs, non-FFLs 
have no obligation to keep records of the transaction, thereby 
depriving law enforcement of the ability to trace the gun if it later 
turns up at a crime scene.
  Our bill will change that. We will make sure that no one will be able 
to buy a gun at a gun show without it first being determined whether 
that person is a convicted felon or is a member of one of the other 
categories of people we all agree should not be allowed to buy guns.
  Senator McCain and I have heard the concerns expressed about past 
proposals to close the gun show loophole, and we have tried hard in our 
bill to make sure those concerns are addressed.
  First, our bill has a simple definition of a gun show, an event where 
75 or more guns are offered or exhibited for sale--and we make clear 
that that definition doesn't include sales from a private collection by 
nonlicensed sellers out of their homes.
  Second, to respond to the argument that previous proposals made it 
too difficult for nonlicensed sellers to fulfill the background check 
requirement, our bill makes sure that nonlicensed sellers will have 
easy access to someone who can initiate background checks for them, by 
creating a new class of licensee whose sole purpose will be to initiate 
background checks at gun shows.
  Third, we have tried to respond to those who say that a three-day 
check is too long for gun shows, because those events only last a 
couple of days. It is worth noting that the length allowed for the 
check doesn't affect the majority of gun purchasers, because 72 percent 
of checks are completed within 30 seconds and almost 95 percent are 
done within two hours. We have come up with a compromise that 
authorizes a State to move to a 24-hour check for nonlicensed dealers 
at gun shows--when the State can prove that a 24-hour check is 
feasible. A State can prove that by showing that 95 percent of the 
records that would disqualify people in that State from buying guns are 
computerized and searchable by the NICS system.
  Now I know that there are many, including President Bush, who argue 
that what we need to solve the gun violence problem are not new laws 
but the enforcement of existing ones. I agree with part of that 
statement. Our bill authorizes significant increases in funding for a 
number of gun enforcement programs, including state and local gun crime 
prosecutors, Project Exile, additional ATF agents, gun tracing and 
smart gun technology. I am pleased that the President said yesterday 
that he supported a large chunk of what we are proposing today.
  But I believe we must go farther than that, because we will never be 
able to enforce existing laws unless we close the loopholes in them 
that criminals exploit. And we all know that there is a big loophole in 
the provision saying that felons aren't supposed to buy guns, and that 
is that criminals know that if they go to a gun show, they will be able 
to avoid the background check that was set up to keep them from getting 
guns.
  Gun crime remains a critical public safety problem. For too long, it 
has unnecessarily divided the Congress, and the American people have 
been left to suffer the violent consequences. But the reality is that 
most of us agree on most of the critical questions. We agree that the 
laws on the books should be enforced, that the rights of law-abiding 
gun owners should be protected, and that convicted felons shouldn't be 
able to get guns. The bill we are introducing today would write those 
principles into law. I hope all of my colleagues support it.
                                 ______
                                 
      By Mr. DODD:
  S. 891. A bill to amend the Truth in Lending Act with respect to 
extensions of credit to consumers under the age of 21; to the Committee 
on Banking, Housing, and Urban Affairs.
  Mr. DODD. Mr. President, I rise today to introduce legislation 
designed to help avoid the growing problem of credit card indebtedness.
  This legislation is fairly straightforward. It would not prohibit 
people younger than 21 from obtaining a credit card. It simply requires 
that when issuing credit cards to persons under the age of 21, the 
issuers obtain an application that contains: 1. the signature of a 
parent, guardian, or other qualified individual willing to take 
financial responsibility for the debt; or 2. information indicating 
that the young person has a job or some means of repaying any credit 
extended; or 3. proof that applicant has completed a certified credit 
counseling course.
  One of the most troubling developments in the hotly contested battle 
between credit card issuers to sign up new customers has been the 
aggressive way in which they have targeted people under the age of 21, 
particularly college students.
  Solicitations to this age group have become more intense for a 
variety of reasons. First, it is one of the few market segments in 
which there are always new customers to go after; every year, 25 to 30 
percent of undergraduates are fresh faces entering their first year of 
college.
  Second, it is also an age group in which brand loyalty can be readily 
established. In the words of one major credit card issuer: ``We are in 
the relationship business, and we want to build relationships early 
on.'' In fact, most people hold on to their first credit card for up to 
15 years.
  Many, if not most, credit card issuers exercise prudence in issuing 
cards to young people. But some credit card issuers do not. They target 
vulnerable young people in our society and extend them large amounts of 
credit with little if any consideration to whether or not there is a 
reasonable expectation of repayment. As a result, more and more young 
people are falling into a financial hole from which they were unable to 
escape.
  Experts estimate that the current economic downturn could force a 
record 1.5 million Americans into bankruptcy this year. About a third 
of them will be in their 20s and early 30s. According to the American 
Bankruptcy Institute, just five years ago, only 1 percent of personal 
bankruptcies filed were by those age 25 or younger. By 1998, that 
number had risen to nearly 5 percent.
  Financial regulators, including the Federal Reserve Board and the 
Federal Deposit Insurance Corporation, have stated that loans made 
without consideration of the borrower's ability to repay constitutes an 
``unsafe and unsound'' business practice. They have criticized such 
lending practices as ``imprudent.'' Thus, an economic downturn coupled 
with ``imprudent'' lending practices could have a devastating effect 
not only on credit card consumers, but on financial institutions, as 
well.
  The business practices of many credit card companies on college 
campuses are extremely troubling. Some credit card issuers actively 
entice colleges and universities to help promote their products. 
According to University of Houston Professor Robert Manning, during the 
next five years, banks will pay the largest 250 universities nearly $1 
billion annually for exclusive marketing rights on campus.
  A recent ``60 Minutes II'' piece vividly illustrated the impact that 
credit card debt can have on college students. A crew from the show, on 
a major public university campus, and with the use of hidden cameras, 
filmed vendors pushing free T-shirts, hats, and other enticements with 
credit card applications. ``60 Minutes II'' revealed that this 
university is being paid $13 million over ten years by a credit card 
company for the right to have a presence on campus and use the 
university logo on its cards.
  This public university is making money off students who use these 
credit cards, the report said. As part of the agreement, the university 
receives 0.4

[[Page 8053]]

percent of each purchase made with the cards. In a sense, this 
university has a vested interest in getting their students in as much 
debt as possible.
  The ``60 Minutes II'' piece also told the story of one student, Sean 
Moyer, and his desperate attempts to handle massive credit card debt. 
This student's life began to spin out of control as the huge debts he 
racked up in just three years of college began to become, in his mind, 
insurmountable. As a result of mounting credit card debts, he was 
unable to get loans to go to law school like he dreamed, and his 
parents could not afford to pay his way. So in February 1998, Sean took 
his own life.
  ``It is obscene that the university is making money off the suffering 
of their students,'' said Sean Moyer's mother. Sean Moyer had 12 credit 
cards and more than $10,000 in debts when he committed suicide nearly 
three years ago, she related. He had two jobs: one at the library and 
another as a security guard at a local hotel, but he still could not 
pay his collectors, she said.
  Even three years after her son's death, she still gets pre-approved 
credit card offers in Sean's name from some of the same companies that 
he owed thousands of dollars. One company pre-approved Sean for a 
$100,000 credit line, she said.
  Last Congress, I went to the main campus of the University of 
Connecticut to meet with student leaders about this issue; quite 
honestly, I was surprised at the amount of solicitations going on in 
the student union. I was even more surprised at the degree to which the 
students themselves were concerned about the constant barrage of offers 
they were receiving.
  These offers seem very attractive. One student intern in my office 
received four solicitations in just two weeks, one promised ``eight 
cheap flights while you still have 18 weeks of vacation.'' Another 
promised a platinum card with what appeared to be a low interest rate, 
until one reads in the fine print that it applied only to balance 
transfers, not to the account overall. Only one of the four offered a 
brochure about credit terms but, in doing so, also offered a ``spring 
break sweepstakes.''
  Last year, the Chicago Tribune reported that the average college 
freshman will receive 50 solicitations during their ``first few 
months'' at college. It further reported that ``college students get 
green-lighted for a line of credit that can reach more than $10,000, 
just on the strength of a signature and a student ID.''
  There is a serious public policy question about whether people in 
this age bracket can be presumed to be able to make the sensible 
financial choices that are being forced upon them from this barrage of 
marketing.
  While it is very difficult to get reliable information from credit 
card issuers about their marketing practices to people under the age of 
21, the statistics that are available are disconcerting.
  Nellie Mae, a major student loan provider in New England, conducted a 
recent survey of the students who had applied for student loans. It 
termed the results ``alarming.'' The study found: 78 percent of all 
undergraduate students have a least one credit card--up from 67 percent 
in 1998; of those students, the average credit card balance is $2,748, 
up from $1,879 in 1998; and 32 percent of undergraduates had four or 
more credit cards.
  Some college administrators, bucking the trend to use credit card 
issuers as a source of income, have become so concerned that they have 
banned credit card companies from their campuses, and have even gone so 
far as to ban credit card advertisements from the campus bookstore. 
Recently, colleges around the nation, ranging from New York's SUNY 
Buffalo to Georgia Tech in Atlanta, have begun to ban the marketing of 
credit cards on their campuses.
  Let me touch on an important component of this amendment--credit 
counseling. Much as we encourage children who reach driving age to take 
drivers' education courses to prevent automobile accidents, we should 
teach younger consumers the basics of credit to avoid financial wrecks. 
Educating our nation's youth about the responsibilities of financial 
management is critical, and we do not currently do a good enough job in 
this area.
  While there is overwhelming evidence that student debt is 
skyrocketing, most surveys also show that this same group of consumers 
is woefully uninformed about basic credit card terms and issues.
  According to the Jump$tart Coalition for Personal Financial Literacy, 
a nonprofit group which conducts an annual national survey on high 
school seniors' knowledge of personal finance, basic financial skills 
are even poorer today than they were three years ago.
  I agree with those who argue that there are many millions of people 
under the age of 21 who hold full time jobs and are as deserving of 
credit as anyone over the age of 21. I also agree that students should 
continue to have access to credit and that we should not try to 
prohibit the market from making that credit available.
  However, the period of time from 18 to 21 is an age of transition 
from adolescence to adulthood. As we do in many other places in the 
federal law, some extra care is needed to make sure that mistakes made 
from youthful inexperience do not haunt these young people for the rest 
of their lives.
  Federal law already says that people under the age of 21 shouldn't 
drink alcohol. Our tax code makes the presumption that if someone is a 
full-time student under the age of 23, they are financially dependent 
on their parents or guardians.
  Is it so much to ask that credit card issuers find out if someone 
under the age of 21 is financially capable of paying back the debt? Or 
that their parents are willing to assume financial responsibility? Or 
that they understand the nature and conditions of the debt they are 
incurring?
  Many responsible credit card issuers already require this information 
in one form or another. Is it too much to ask that the entire credit 
card industry strive to meet their own best practices when it comes to 
our kids?
  Providing fair access to credit is something I have fought for 
throughout my tenure in the United States Senate. And credit cards play 
a valuable role in assisting in their pursuit of the American dream. I 
do not believe that this legislation is either unduly burdensome on the 
credit card industry or unfair to people under the age of 21.
  The fact of the matter is that excessive solicitations assume that if 
the young adult is unable to pay, they will be bailed out by their 
parents. Many times this means that parents must sacrifice other things 
in order to make sure that their child does not start out their adult 
life in a financial hole or with an ugly black mark on their credit 
history.
  This measure is critical to ensuring that credit cards are both 
issued and used responsibly. I urge my colleagues to support this 
important legislation.
  I ask unanimous consent that the text of the bill, a letter of 
endorsement from Consumers Union, the Consumer Federation of America, 
and the U.S. Public Interest Research Group, as well as referenced 
newspaper articles be printed in the Record.
  There being no objection, the bill and additional material were 
ordered to be printed in the Record, as follows:

                                 S. 891

       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 ``Underage Consumer Credit 
     Protection Act of 2001''.

     SEC. 2. EXTENSIONS OF CREDIT TO UNDERAGE CONSUMERS.

       Section 127(c) of the Truth in Lending Act (15 U.S.C. 
     1637(c)) is amended by adding at the end the following:
       ``(6) Applications from underage consumers.--
       ``(A) Prohibition on issuance.--No credit card may be 
     issued to, or open end credit plan established on behalf of, 
     a consumer who has not attained the age of 21, unless the 
     consumer has submitted a written application to the card 
     issuer that meets the requirements of subparagraph (B).
       ``(B) Application requirements.--An application to open a 
     credit card account by an individual who has not attained the 
     age of 21 as of the date of submission of the application 
     shall require--
       ``(i) the signature of the parent, legal guardian, or 
     spouse of the consumer, or any

[[Page 8054]]

     other individual having a means to repay debts incurred by 
     the consumer in connection with the account, indicating joint 
     liability for debts incurred by the consumer in connection 
     with the account before the consumer has attained the age of 
     21;
       ``(ii) submission by the consumer of financial information 
     indicating an independent means of repaying any obligation 
     arising from the proposed extension of credit in connection 
     with the account; or
       ``(iii) proof by the consumer that the consumer has 
     completed a credit counseling course of instruction by a 
     nonprofit budget and credit counseling agency approved by the 
     Board for such purpose.
       ``(C) Minimum requirements for counseling agencies.--To be 
     approved by the Board under subparagraph (B)(iii), a credit 
     counseling agency shall, at a minimum--
       ``(i) be a nonprofit budget and credit counseling agency, 
     the majority of the board of directors of which--

       ``(I) is not employed by the agency; and

       ``(II) will not directly or indirectly benefit financially 
     from the outcome of a credit counseling session;

       ``(ii) if a fee is charged for counseling services, charge 
     a reasonable fee, and provide services without regard to 
     ability to pay the fee; and
       ``(iii) provide trained counselors who receive no 
     commissions or bonuses based on referrals, and demonstrate 
     adequate experience and background in providing credit 
     counseling.''.

     SEC. 3. REGULATORY AUTHORITY.

       The Board of Governors of the Federal Reserve System may 
     issue such rules or publish such model forms as it considers 
     necessary to carry out section 127(c)(6) of the Truth in 
     Lending Act, as added by this Act.
                                  ____



                                Consumer Federation of America

                                                     May 14, 2001.
       Dear Senator Dodd: Consumers Union, the Consumer Federation 
     of America, and U.S. Public Interest Research Group support 
     the Underage Consumer Credit Protection Act of 2001 that 
     addresses the growing problem of credit card debt among young 
     Americans.
       Your bill would require that a credit card issuer undertake 
     reasonable steps to verify that students have the means to 
     repay their credit card debts. In the alternative, a credit 
     card could be issued to a student who completes a credit-
     counseling course. This is a reasonable approach--to protect 
     the safety and soundness of financial institutions and help 
     America's youth who every day face aggressive marketing 
     tactics from the credit industry.
       According to bank regulatory agencies, including the 
     Federal Reserve Board and the Federal Deposit Insurance 
     Corporation, making loans without any regard for the 
     borrower's ability to repay, as card issuers do with college 
     students, is ``unsafe and unsound.'' The regulators have 
     criticized such lending practices as ``imprudent.'' The 
     student loan corporation, Nellie Mae, said in a recent report 
     that the increase in the number of students having a credit 
     card includes students who would not have been given credit 
     cards in past years, certainly not without a co-signer. The 
     report also pointed to the need for counseling students at 
     the front end--before the student obtains a credit card. 
     Nellie Mae found that: Some students unwittingly accumulate 
     credit card debt, not consciously planning ahead whether they 
     can afford to borrow that sum, and not aware of the actual 
     finance charges they will pay over time. Having a card 
     doesn't necessarily indicate knowledge about the 
     ramifications of borrowing in general; nor does it show that 
     the student has evaluated the benefit and costs of borrowing 
     with a credit card vs. other types of financing. Without 
     assistance, these students may not have the know-how to 
     borrow wisely on the front end.
       The credit card industry has targeted America's youth with 
     relentless marketing ploys and tactics that seem designed to 
     drive those students into debt. According to Nellie Mae, more 
     than 70 percent of undergraduates possess at least one credit 
     card. The average debt for undergraduates who do not pay off 
     their bill every month is more than $2,000. Many students end 
     up dropping out of school under the weight of such debt. 
     Congress should respond to this growing crisis on college 
     campuses. And the problem could get worse as high school 
     students are also receiving credit card offers.
       Many colleges and universities not only permit aggressive 
     credit card marketing on campus; they actually benefit 
     financially from this marketing. Credit card issuers pay 
     institutions for sponsorship of school programs, for support 
     of student activities, for rental of on-campus solicitation 
     tables, and for exclusive marketing agreements, such as 
     college ``affinity'' cards.
       Congress should require lending institutions to act in a 
     safe and sound manner by verifying that the person to whom 
     that credit card issuer is extending credit has the ability 
     to repay. In the absence of acting in a safe and sound 
     manner, the least that could be done is to give student's 
     some of the tools that could be useful in avoiding financial 
     trouble through credit counseling at the front end. The 
     Senate should pass the Underage Consumer Credit Protection 
     Act to preserve the soundness of our financial institutions 
     and help America's youth handle the aggressive credit card 
     industry practices.
     Frank Torres,
       Consumers Union.
     Travis Plunkett,
       Consumer Federation of America.
     Ed Mierzwinski,
       U.S. Public Interest Research Group.
                                  ____


                [From the Chicago Tribune, May 7, 1999]

   Charged With Teaching Young People To Save; Educational Campaign 
 Attempts To Give Students Basic Financial Survival Skills, Including 
                            Handling Credit

                           (By Humberto Cruz)

       It should come as no surprise. Forty percent of American 
     students between the ages of 16 and 22 said they are likely 
     to buy a pair of jeans or something similar they ``really'' 
     like even if they are short of money.
       And 22 percent would pay for it with a credit card.
       But then, isn't that what they see their parents do? Deeper 
     in debt than ever before, Americans owe a record $565 billion 
     on credit cards, or more than $7,000 per balance-revolving 
     household, based on figures from the Federal Reserve.
       ``We have an economy that encourages people to borrow and 
     spend more than they have,'' said Dallas L. Salisbury, 
     chairman and CEO of the American Savings Education Council in 
     Washington, D.C.
       Salisbury is talking about the barrage directed at all of 
     us to spend, spend, spend. The enticing offers to sign up for 
     home-equity loans greater than the value of our homes. The 
     culture of instant gratification that demands that if you 
     want something you get it now, and damn the consequences.
       ``We need to teach our kids very early on how skeptical 
     they should be of this type of thing,'' Salisbury said. ``And 
     how dangerous it is to get yourself buried in debt.''
       Reaching young people is the goal for the coming year of 
     the ``Facts on Savings and Investing'' campaign, launched in 
     1998 by a national partnership of government agencies, 
     securities regulators and business, education and consumer 
     groups.
       ``We asked ourselves what our priorities should be, and one 
     thing that has come down loud and clear is the necessity to 
     get many people to start saving early,'' said Salisbury, who 
     is also president and CEO of the Employee Benefit Research 
     Institute in Washington.
       As part of the campaign, the savings council and the 
     institute released a ``Youth & Money'' survey of 560 high 
     school and 440 college students conducted by the research 
     firm Mathew Greenwald & Associates.
       The survey found that most students feel confident they 
     understand financial matters. But their behavior suggests 
     they don't know nearly as much as they think, and that many 
     are falling into bad habits.
       For example, less than half save at least something 
     whenever they receive money or get paid, only 23 percent draw 
     up a monthly budget and stick to it, and 28 percent of those 
     with credit cards roll over debt month after month.
       Perhaps more telling, one-fourth of the students who think 
     they do a good job of managing their money do not think 
     regular savings is a very high priority, when in fact it 
     should be.
       And 25 percent of the students with credit cards who say 
     they do a good job of managing their money roll over debt 
     every month, one of the worst financial habits anybody can 
     have.
       ``One has to presume they are influenced just by watching 
     their parents,'' Salisbury said. ``They end up `learning' 
     things they would be better off not to learn.''
       But if parents can't or won't help, what is the solution? 
     The survey showed an overwhelming majority of students, or 94 
     percent, go first to their parents for financial information 
     and advice. Only 21 percent had taken a financial education 
     course in school, although 62 percent had the chance to do 
     so.
       Among those who did, 41 percent said they began saving, 28 
     percent said they increased their savings, 28 percent said 
     they invested their savings differently, and 19 percent said 
     they developed a budget. The Youth & Money survey, however, 
     questions whether the students actually changed their 
     behavior as opposed to just saying they did.
       Still, Salisbury is among a big majority of Americans--
     count me in, too--who believe financial education should be 
     mandatory in high school. A recent nationwide survey by the 
     National Council on Economic Education found that 96 percent 
     of adults believe basic economics should be a required part 
     of the high school curriculum.
       Currently, 38 of the 50 states have adopted guidelines for 
     teaching economics in high school, but only 16 mandate that 
     schools offer a course and just 13 require that students take 
     the course. Even in those states, more needs to be done, and 
     is being done, to train teachers and incorporate more basic 
     financial literacy concepts in the course.
       ``They all should do it,'' Salisbury said. ``If we require 
     students to take English and to take history to graduate, we 
     should require that they learn basic financial survival 
     skills.''

[[Page 8055]]

       If they all did, maybe the students could then educate 
     their parents on the basics of budgeting and handling credit. 
     Then saving and investing would not be a subject that 30 
     percent of parents never discuss with their children, 
     according to the Youth & Money survey.
       ``What's most effective is for students to take what they 
     learn in school about finance and discuss it with their 
     parents,'' said Paul Yakoboski, director of research for the 
     savings council.


             teens able to calculate how savings can add up

       Would you shell out $4,700 for a pair of sneakers? How 
     about $2,800 for a computer game or $300 for a fast-food 
     meal?
       The sums may sound outlandishly high, but that is how much 
     a 13-year-old could save if he invested for retirement, 
     rather than spending $75 for a pair of sneakers, $45 for a 
     computer game and $5 for a fast-food meal, according to ``AIE 
     Savings Calculator,'' which was launched recently on the Web 
     at www.investoreducation.org by the non-profit Alliance for 
     Investor Education.
       The calculator allows a child to enter his or her age, a 
     typical purchase or any dollar amount, and then see how much 
     the money might be worth if it was invested for 10 years, 25 
     years and to the age of retirement. The calculator is based 
     on an 8 percent annual rate of growth, a stock market average 
     in recent years.
                                  ____


                    [From USA Today, Feb. 13, 2001]

                     Debt Smothers Young Americans

                          (By Christine Dugas)

       For many living in a world of easy credit, digging out of 
     debt can become a way of life: 18- to 35-year-olds often live 
     paycheck to paycheck, using credit for restaurant meals and 
     high-tech toys. A news study says the average undergrad now 
     owes $2,748 on credit cards.
       As a freshman at the University of Houston in 1995, 
     Jennifer Massey signed up for a credit card and got a free T-
     shirt. A year later, she had piled up about $20,000 on debt 
     on 14 credit cards.
       Paige Hall, 34, returned from her honeymoon in 1997 to find 
     herself laid off from her job at a mortgage company in 
     Atlanta. She was out of work for 4 months. She and her 
     husband, Kevin, soon were trying to figure out how to pay 
     $18,200 in bills from their wedding, honeymoon and 
     furnishings for their new home.
       By the time Mistie Medendorp was 29, she had $10,000 in 
     credit card debt and $12,000 in student loans.
       Like no other generation, today's 18- to 35-year-olds have 
     grown up with a culture of debt--a product of easy credit, a 
     booming economy and expensive lifestyles.
       They often live paycheck to paycheck and use credit cards 
     and loans to finance restaurant meals, high-tech toys and new 
     cars that they couldn't otherwise afford, according to market 
     researchers, debt counselors and consumer advocates.
       ``Lenders are much more willing to take a risk on people 
     under 25 than they were 15 years ago,'' says Nina Prikazsky, 
     a vice president at student loan corporation Nellie Mae. 
     ``They will give out credit cards based on a college 
     student's expected ability to repay the bills.''
       Young people are taking advantage of the offers. A study 
     out today from Nellie Mae shows that the average credit card 
     debt among undergraduate students increased by nearly $1,000 
     in the past two years. On average, they owed $2,748 last 
     year, up from $1,879 in 1998.
       At a time when they could be setting aside money for a down 
     payment on a home, many young people are mortgaging their 
     financial future. Instead of getting a head start on saving 
     for retirement, they are spending years digging themselves 
     out of debt.
       ``I knew for a while that I had a problem. I wouldn't say I 
     was living high on the hog, but when I wanted clothes, I'd 
     buy a new outfit,'' says Medendorp, an Atlanta resident. 
     ``I'd go out to eat and charge it on my cards. There were a 
     bunch of small expenses that added up and got out of 
     control.''
       Massey, Hall and Medendorp each ended up seeking help from 
     a local consumer credit counseling service. Hundreds of 
     thousands more young people like them are turning to credit 
     counseling or bankruptcy because they can no longer juggle 
     their bills.
       In 1999 alone, an estimated 461,000 Americans younger than 
     35 sought protection from their creditors in bankruptcy, up 
     from about 380,000 in 1991, according to Harvard Law School 
     professor Elizabeth Warren, principal researcher in a 
     national survey of debtors who filed for bankruptcy.
       At the Consumer Credit Counseling Service of Greater 
     Denver, more than half of all the clients are 18 to 35 years 
     old, says Darrin Sandoval, director of operations. On 
     average, they have 30% more debt than all other age groups, 
     he says.
       ``By the time they begin to settle into a suburban 
     lifestyle, they are barely able to meet their debt 
     obligations,'' Sandoval says. ``If there is a job loss, an 
     unexpected medical expense or the birth of a child, they 
     supplement their income with credit cards. Soon they are 
     being financially crushed.''


                               Debt heads

       Unlike the baby boom generation--raised by Depression-era 
     parents--young Americans today are often unfazed by the 
     amount of debt they carry.
       ``This generation has lived through a time when everything 
     was on the upswing,'' says J. Walker Smith, president of 
     Yankelovich Partners, a market research firm. ``There is no 
     sense of worry about being over-leveraged. It all seems to 
     work out.''
       Kevin Jackson, a 32-year-old software engineer in Denver, 
     has about $8,000 in credit card debt and a $20,000 home-
     equity loan. He doesn't believe he has a debt problem, though 
     his goal is to reduce his credit card balance to $2,000.
       ``You learn to live with a certain amount of debt,'' he 
     says. ``It's a means to an end. There is something to be said 
     for paying for everything and something to be said for 
     enjoying life, as long as you do it responsibly.''
       Unfortunately, enjoying life can be expensive, especially 
     for many young Americans who feel it is essential to have the 
     latest high-tech products and services, such as a cellphone, 
     pager, voice mail, a computer with a second phone line or a 
     DSL connection, an Internet service provider and a Palm 
     Pilot.
       Jackson just bought a DVD player and a big-screen TV. ``I 
     try to control costs,'' he says. ``I easily could have spent 
     $5,000 on the TV, but instead I paid $2,000 and I got a one-
     year, no-interest deal.''
       Movies, TV shows and advertising only reinforce the idea 
     that young people are entitled to have an affluent lifestyle. 
     ``We're encouraged to overspend,'' says Jason Anthony, 31, 
     co-author of Debt-free by 30, a book he wrote with a friend 
     after they found themselves drowning in debt.
       ``We all see shows like Melrose Place and Beverly Hills 
     90210. It creates tremendous pressure to keep up. I'm one of 
     the few persons who think a recession will be good for my 
     generation. Our expectations are so elevated. In the frenzy 
     to keep up, we've gotten into financial trouble,'' he says.


                         The perils of plastic

       Consumers like Massey, who get bogged down in credit card 
     debt before they even graduate from college, learn the hard 
     way about managing money. Now 24 and married, Massey has a 
     good job in marketing. She has cut up her credit cards and is 
     gradually repaying her debts. However, there have been 
     consequences: She had to explain to her boss that because she 
     no longer has a credit card, she cannot travel for work if it 
     involves renting a car or booking a hotel reservation on her 
     own. She had to tell her husband about her debt problems 
     before they were married.
       ``I lack confidence now,'' Massey says. ``I'm hard on 
     myself because of my mistakes. But I blame the credit card 
     companies and the university for allowing them to promote the 
     cards on campus without educating students about credit.''
       The percentage of undergraduate college students with a 
     credit card jumped from 67% in 1998 to 78% last year, 
     according to the Nellie Mae study. And many of them are 
     filing their wallets with cards. Last year, 32% said they had 
     four or more cards, up from 27% two years earlier.
       Although graduate students have an even bigger appetite for 
     credit, they are starting to show signs of restraint. Their 
     average debt declined slightly from $4,925 in 1998 to $4,776 
     last year, Nellie Mae says.
       Many young people will be saddled with credit card debts 
     for years, experts say. Among all age groups, credit card 
     holders younger than 35 are the least likely to pay their 
     bills in full each month, according to Robert Manning, author 
     of Credit Card Nation.
       Though credit cards and uncontrolled spending are a 
     combustible combination, many young people are pushed to the 
     financial edge by the staggering cost of college. The average 
     annual tuition at a four-year private university jumped to 
     $16,332 last year from $7,207 in 1980, according to the 
     College Board. Between 1991 and 2000, the average student 
     loan burden among households under 35 increased nearly 142% 
     to $15,700, according to an exclusive analysis of the 
     finances of 18- to 34-year-olds for USA TODAY by Claritas, a 
     market research firm based in San Diego.
       Those who choose to go on and get a graduate degree pay an 
     even higher price. Another Nellie Mae study found that those 
     who borrow for graduate work, and specifically those in 
     expensive professional programs in law and medicine, are 
     likely to have unusually high debt burdens that are not 
     always offset by comparably high salaries.
       Karen Mann didn't need a survey to come to that conclusion. 
     Her husband, Michael, is about to start his career as an 
     orthopedic surgeon after racking up $400,000 in loans during 
     four years of undergraduate school, four years of medical 
     school, one year in an MBA program and a 5-year residency 
     program.
       During his residency and a subsequent fellowship, payments 
     and some of the interest on his student loan have been 
     deferred. Soon they'll have to begin paying them off.
       The interest payment alone is $20,000 a year.
       The Manns are not extravagant, ``I've always saved, and I 
     have a budget,'' says Karen, 31. ``I'd love to buy a house, 
     but there's no way. We haven't been able to afford kids yet. 
     The loans are so awesome that you do get crazy.''

[[Page 8056]]




                    paying for everything with cash

       The Manns are not alone in having to defer important goals 
     because of heavy debt loads. Medendorp, a social worker in 
     Decatur, Ga., lives on a budget and is diligently paying her 
     bills with the help of a Consumer Credit Counseling Service 
     debt-management plan. She pays for everything with cash. 
     There are many things she'd like to do but can't afford, such 
     as having laser eye surgery, going back to school and buying 
     a home.
       ``When you get in a tar pit, forget about buying a home,'' 
     author Anthony says. ``Instead of saving for a down payment, 
     you're making credit card payments.''
       At a time when the overall U.S. homeownership rate has 
     risen to historic highs, young Americans are less likely than 
     people their age 10 years ago to buy a home. The 
     homeownership rate for heads of households younger than 35 
     had declined from 41.2% in 1982 to 39.7% in 1999, according 
     to the Census Bureau. And if they own a home, young people 
     tend to make smaller down payments or borrow against what 
     equity they have. As a result, the average amount of equity 
     accumulated by homeowners younger than 35 has shrunk to about 
     $49,200 in 1999, from $57,100 10 years earlier, according to 
     a study from the Consumer Federation of America.
       ``For middle-income Americans, the most important form of 
     private savings is home equity,'' says Stephen Brobeck, 
     executive director of the Consumer Federation of America. 
     ``It's essential to have paid off a mortgage by retirement so 
     that living expenses are lower and one has an asset that can 
     be borrowed on or sold if necessary.''
       By almost every measure, young people are falling behind. 
     Between 1995 and 1998, the median net worth of families rose 
     for all age groups except for the under-35 group. Their 
     median net worth declined from $12,700 to $9,000, according 
     to the Federal Reserve.
       That is not to say that young people today are slackers and 
     deadbeats, as they have sometimes been characterized. Many 
     work hard and often make good incomes. Although they may have 
     a lot of debt, they also are very focused on saving and 
     investing, especially through 401(k)-type retirement 
     accounts. Jackson, for example, contributes the maximum to 
     his 401(k) plan.
       ``They want to protect themselves against future 
     uncertainty,'' Smith says. ``They absolutely don't expect 
     that Social Security will be around for them.''
       But it's hard to save money if you are head over heels in 
     debt. Massey earns $32,000 a year. With her husband, their 
     annual income is more than $100,000. ``But we're still broke 
     trying to pay our bills,'' she says.
                                 ______
                                 
      By Mr. HARKIN:
  S. 892. A bill to amend the Clean Air Act to phase out the use of 
methyl tertiary butyl ether in fuels of fuel additives, to promote the 
use of renewable fuels, and for other purposes; to the Committee on 
Environment and Public Works.
  Mr. HARKIN. Mr. President, I am introducing today legislation 
designed to address the extensive problems that have been caused by the 
gasoline additive methyl tertiary butyl ether, MTBE, to make 
appropriate revisions to the reformulated gasoline, RFG, program in the 
Clean Air Act, and to increase greatly the use of renewable motor 
vehicle fuels. The bill is similar to legislation I introduced in the 
previous Congress.
  We have to get MTBE out of our gasoline. This is absolutely clear. 
Even in Iowa, where we are not required to have oxygenated fuels or 
RFG, a recent survey found a surprising level of water contamination 
with MTBE. So my legislation requires a phased reduction in the use of 
MTBE in motor fuel and then a prohibition of MTBE in fuel or fuel 
additives beginning three years after enactment.
  My legislation recognizes the benefits that have been provided by the 
oxygen content requirement in the reformulated gasoline program. Oxygen 
added to gasoline reduces emissions of carbon monoxide, toxic compounds 
and fine particulate matter. So my legislation continues the oxygen 
content requirement, but it would allow, in certain circumstances upon 
a proper showing, averaging of the oxygen content requirement over a 
period of time up to a year.
  The legislation also ensures that all health benefits of the 
reformulated gasoline program are maintained and improved, and includes 
very strong provisions to ensure that there is no backsliding in air 
quality and health benefits from cleaner burning reformulated gasoline. 
The petroleum companies would also be prohibited from taking the 
pollutants from gasoline in some areas and putting them back into 
gasoline in other areas of the country that are not subject to the more 
stringent air quality standards. Those are referred to as the anti-
dumping protections. My bill places tighter restrictions on highly 
polluting aromatic and olefin content of reformulated gasoline.
  My legislation also recognizes the important role of renewable fuels 
in improving our environment, building energy security for out nation, 
and increasing farm income, economic growth and job creation, 
especially in rural areas. The legislation creates a national renewable 
content requirement for motor vehicle fuel. The requirement would not 
be a mandate that any particular user of gasoline or diesel fuel has to 
use the renewable fuel, but it would require the petroleum industry to 
ensure that renewable fuels make up a certain minimum percentage of the 
total U.S. supply of motor vehicle fuel, gasoline and diesel fuel. By 
2011, that percentage would be about 5 percent on a volume basis, 3.3 
percent based on energy content or approximately 10 billion gallons 
based on current estimates of gasoline and diesel consumption.
  Overall, this legislation will get MTBE out of gasoline, maintain and 
improve the air quality and health benefits of the reformulated 
gasoline program and the Clean Air Act, and put our nation on a solid 
path toward greater use of renewable fuels.
  I urge my colleagues to support this important legislation.
  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. 892

       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 ``Clean and Renewable Fuels 
     Act of 2001''.

     SEC. 2. USE AND CLEANUP OF METHYL TERTIARY BUTYL ETHER.

       (a) In General.--Section 211(c) of the Clean Air Act (42 
     U.S.C. 7545(c)) is amended by adding at the end the 
     following:
       ``(5) Prohibition on methyl tertiary butyl ether and other 
     ether compounds.--
       ``(A) Specified nonattainment areas.--
       ``(i) In general.--Effective beginning January 1, 2002, a 
     person shall not sell or dispense to ultimate consumers any 
     fuel or fuel additive containing methyl tertiary butyl ether 
     in an area of the United States other than an area described 
     in clause (ii).
       ``(ii) Areas.--An area described in this clause is an area 
     that is a specified nonattainment area--

       ``(I) that is required to meet the oxygen content 
     requirement for reformulated gasoline established under 
     subsection (k); and
       ``(II) in which methyl tertiary butyl ether was used to 
     meet the oxygen content requirement before January 1, 2001.

       ``(B) Interim period of use of mtbe in a fuel or fuel 
     additive.--
       ``(i) Phased reduction.--

       ``(I) In general.--The Administrator shall promulgate 
     regulations to require--

       ``(aa) during the 1-year period beginning on the date that 
     is 1 year after the date of enactment of this paragraph, a 
     \1/3\ reduction in the quantity of methyl tertiary butyl 
     ether that may be sold or dispensed for use in a fuel or fuel 
     additive;
       ``(bb) during the 1-year period beginning on the date that 
     is 2 years after the date of enactment of this paragraph, a 
     \2/3\ reduction in the quantity of methyl tertiary butyl 
     ether that may be sold or dispensed for use in a fuel or fuel 
     additive; and
       ``(cc) that in no area does the quantity of methyl tertiary 
     butyl ether sold or dispensed for use in a fuel or fuel 
     additive increase.

       ``(II) Basis for reductions.--Reductions under subclause 
     (I) shall be based on the quantity of methyl tertiary butyl 
     ether sold or dispensed for use in a fuel or fuel additive in 
     the United States during the 1-year period ending on the date 
     of enactment of this paragraph.
       ``(III) Equitable treatment.--The regulations promulgated 
     by the Administrator under subclause (I) shall, to the 
     maximum extent practicable, provide equitable treatment--

       ``(aa) on a geographical basis; and
       ``(bb) among fuel manufacturers, refiners, distributors, 
     and retailers.

       ``(IV) Trading of authorizations to sell or dispense 
     mtbe.--To facilitate the most orderly and efficient reduction 
     in the use of methyl tertiary butyl ether in a fuel or fuel 
     additive, the regulations promulgated by the Administrator 
     under subclause (I) may allow for persons subject to the 
     regulations to sell to and purchase from each other 
     authorizations to sell or dispense methyl tertiary butyl 
     ether for use in a fuel or fuel additive.

       ``(ii) Labeling.--

[[Page 8057]]

       ``(I) In general.--The Administrator shall promulgate 
     regulations that require any person selling or dispensing 
     gasoline that contains methyl tertiary butyl ether at retail 
     prominently to label the gasoline dispensing system for the 
     gasoline with a notice--

       ``(aa) stating that the gasoline contains methyl tertiary 
     butyl ether; and
       ``(bb) providing such information concerning the human 
     health and environmental risks associated with methyl 
     tertiary butyl ether as the Administrator determines to be 
     appropriate.

       ``(II) Period of effectiveness.--The regulations 
     promulgated under subclause (I) shall be effective during the 
     period--

       ``(aa) beginning as soon as practicable, but not later than 
     60 days, after the date of enactment of this paragraph; and
       ``(bb) ending on the date that is 3 years after the date of 
     enactment of this paragraph.
       ``(C) Prohibition on use of mtbe in a fuel or fuel 
     additive.--Effective beginning on the date that is 3 years 
     after the date of enactment of this paragraph, a person shall 
     not manufacture, introduce into commerce, offer for sale, 
     sell, or dispense a fuel or fuel additive containing methyl 
     tertiary butyl ether or any other ether compound.
       ``(D) Waiver.--The Administrator may by regulation waive 
     the prohibition under subparagraph (C) with respect to an 
     ether compound other than methyl tertiary butyl ether if the 
     Administrator determines that the use of the ether compound 
     in a fuel or fuel additive will not pose a significant risk 
     to human health or the environment.
       ``(E) Areas of mtbe contamination.--If the Administrator 
     finds that methyl tertiary butyl ether is contaminating or 
     posing a substantial risk of contamination of soil, ground 
     water, or surface water in an area, the Administrator may 
     take such action as is necessary to protect human health and 
     the environment in the area, including requiring a more rapid 
     reduction (including immediate termination) of the quantity 
     of methyl tertiary butyl ether sold or dispensed for use in a 
     fuel or fuel additive in the area than required under 
     subparagraph (A) or (B).
       ``(F) State authority to regulate mtbe.--Notwithstanding 
     any other provision of law, a State may impose such 
     restrictions, including a prohibition, on the manufacture, 
     sale, or use of methyl tertiary butyl ether in a fuel or fuel 
     additive as the State determines to be appropriate to protect 
     human health and the environment.''.
       (b) Remedial Action Concerning MTBE Contamination.--
       (1) Underground storage tanks.--Section 9003(h) of the 
     Solid Waste Disposal Act (42 U.S.C. 6991b(h)) is amended by 
     striking paragraph (3) and inserting the following:
       ``(3) Priority.--In carrying out a corrective action under 
     this subsection, or in issuing an order that requires an 
     owner or operator to carry out a corrective action under this 
     subsection, the Administrator (or a State under paragraph 
     (7)) shall give priority to a release of petroleum from an 
     underground storage tank that poses the greatest threat to 
     human health, human welfare, and the environment.''.
       (2) Cleanup guidelines.--Section 1442 of the Safe Drinking 
     Water Act (42 U.S.C. 300j-1) is amended by adding at the end 
     the following:
       ``(f) Cleanup Guidelines for MTBE.--
       ``(1) In general.--The Administrator--
       ``(A) shall develop technical guidelines to assist States, 
     local governments, private landowners, and other interested 
     parties in the investigation and cleanup of methyl tertiary 
     butyl ether in soil or ground water; and
       ``(B) may enter into cooperative agreements with the United 
     States Geological Survey, the Department of Agriculture, 
     States, local governments, private landowners, and other 
     interested parties--
       ``(i) to establish voluntary pilot projects for the cleanup 
     of methyl tertiary butyl ether and the protection of private 
     wells from contamination by methyl tertiary butyl ether; and
       ``(ii) to provide technical assistance in carrying out such 
     projects.
       ``(2) Private wells.--This subsection does not authorize 
     the issuance of guidance or regulations concerning the use or 
     protection of private wells.''.
       (3) State source water assessment programs.--Section 
     1453(a) of the Safe Drinking Water Act (42 U.S.C. 300j-13(a)) 
     is amended by adding at the end the following:
       ``(8) MTBE contamination.--
       ``(A) In general.--The Administrator shall amend the 
     guidance under this subsection to require that State source 
     water assessment programs be revised to give high priority to 
     ground water areas and aquifers that have been contaminated, 
     or are most vulnerable to contamination, by methyl tertiary 
     butyl ether.
       ``(B) Approval of revisions.--Each revision under 
     subparagraph (A) shall be submitted and approved or 
     disapproved by the Administrator in accordance with the 
     schedule described in paragraph (3).''.

     SEC. 3. OXYGEN CONTENT REQUIREMENT UNDER REFORMULATED 
                   GASOLINE PROGRAM.

       Section 211(k)(1) of the Clean Air Act (42 U.S.C. 
     7545(k)(1)) is amended--
       (1) in the first sentence--
       (A) by striking ``Within 1 year after the enactment of the 
     Clean Air Act Amendments of 1990,'' and inserting the 
     following:
       ``(A) In general.--Not later than November 15, 1991,''; and
       (B) by inserting before the period at the end the 
     following: ``and opt-in areas under paragraph (6)'';
       (2) in the second sentence--
       (A) by inserting ``and other'' after ``volatile organic''; 
     and
       (B) by inserting ``and precursors of toxic air pollutants'' 
     after ``toxic air pollutants''; and
       (3) by adding at the end the following:
       ``(B) Waiver of per-gallon oxygen content requirement.--
       ``(i) Procedure for submission of petitions.--The 
     Administrator shall promulgate regulations that establish a 
     procedure providing for the submission of petitions for--

       ``(I) a waiver, with respect to an area, of any per-gallon 
     oxygen content requirement established under paragraph (2)(B) 
     or (3)(A)(v); and
       ``(II) the averaging, with respect to an area, of the 
     oxygen content requirement established under paragraphs 
     (2)(B) and (3)(A)(v) over such period of time, not to exceed 
     1 year, as is determined appropriate by the Administrator.

       ``(ii) Criteria for granting of petitions.--After 
     consultation with the Secretary of Energy and the Secretary 
     of Agriculture, the Administrator shall grant a petition 
     submitted under clause (i) if the Administrator finds that 
     granting the petition is necessary--

       ``(I) to avoid a shortage or disruption in supply of 
     reformulated gasoline;
       ``(II) to avoid the payment by consumers of excessive 
     prices for reformulated gasoline; or
       ``(III) to facilitate the attainment by an area of a 
     national primary ambient air quality standard.

       ``(iii) Maintenance of human health and environmental 
     benefits.--The regulations promulgated under clause (i) shall 
     ensure that the human health and environmental benefits of 
     reformulated gasoline are fully maintained during the period 
     of any waiver of a per-gallon oxygen content requirement.''.

     SEC. 4. LIMITATIONS ON AROMATICS AND OLEFINS IN REFORMULATED 
                   GASOLINE.

       Section 211(k)(3)(A) of the Clean Air Act (42 U.S.C. 
     7545(k)(3)(A)) is amended--
       (1) by striking clause (ii) and inserting the following:
       ``(ii) Aromatics.--

       ``(I) In general.--The aromatic hydrocarbon content of the 
     reformulated gasoline shall not exceed 22 percent by volume.
       ``(II) Average.--The average aromatic hydrocarbon content 
     of the reformulated gasoline shall not exceed the average 
     aromatic hydrocarbon content of reformulated gasoline sold in 
     covered areas for use in baseline vehicles when using 
     reformulated gasoline during either calendar year 1999 or 
     calendar year 2000.
       ``(III) Maximum per gallon.--No gallon of reformulated 
     gasoline shall have an aromatic hydrocarbon content in excess 
     of 30 percent.''; and

       (2) by adding at the end the following:
       ``(vi) Olefins.--

       ``(I) In general.--The olefin content of the reformulated 
     gasoline shall not exceed 8 percent by volume.
       ``(II) Average.--The average olefin content of the 
     reformulated gasoline shall not exceed the average olefin 
     content of reformulated gasoline sold in covered areas for 
     use in baseline vehicles when using reformulated gasoline 
     during either calendar year 1999 or calendar year 2000.
       ``(III) Maximum per gallon.--No gallon of reformulated 
     gasoline shall have an olefin content in excess of 10 
     percent.''.

     SEC. 5. MODIFICATION OF PERFORMANCE STANDARDS.

       Section 211(k)(3)(B) of the Clean Air Act (42 U.S.C. 
     7545(k)(3)(B)) is amended--
       (1) in the last sentence of clause (i), by inserting before 
     the period at the end the following: ``, and, to the maximum 
     extent practicable using available science, determined on the 
     basis of the ozone-forming potential of volatile organic 
     compounds and taking into account the effect on ozone 
     formation of reducing carbon monoxide emissions''; and
       (2) in clause (ii)--
       (A) in the first sentence, by inserting ``, or precursors 
     of toxic air pollutants,'' after ``toxic air pollutants'' 
     each place it appears;
       (B) in the second sentence, by inserting before the period 
     at the end the following: ``, or precursors of toxic air 
     pollutants'';
       (C) in the third sentence, by inserting ``, or 
     precursors,'' after ``such air pollutants''; and
       (D) in the last sentence, by inserting before the period at 
     the end the following: ``, and, to the maximum extent 
     practicable using available science, determined on the basis 
     of the relative toxicity or carcinogenic potency, whichever 
     is more protective of human health and the environment''.

     SEC. 6. ANTI-BACKSLIDING.

       (a) In General.--Section 211(k)(3)(B) of the Clean Air Act 
     (42 U.S.C. 7545(k)(3)(B)) is amended--
       (1) in the last sentence, by striking ``Any reduction'' and 
     inserting the following:
       ``(iii) Treatment of greater reductions.--Any reduction''; 
     and

[[Page 8058]]

       (2) by adding at the end the following:
       ``(iv) Anti-backsliding provision.--

       ``(I) In general.--Not later than October 1, 2001, the 
     Administrator shall revise performance standards under this 
     subparagraph as necessary to ensure that--

       ``(aa) the ozone-forming potential, taking into account all 
     ozone precursors (including volatile organic compounds, 
     oxides of nitrogen, and carbon monoxide), of the aggregate 
     emissions during the high ozone season (as determined by the 
     Administrator) from baseline vehicles when using reformulated 
     gasoline does not exceed the ozone-forming potential of the 
     aggregate emissions during the high ozone season from 
     baseline vehicles when using reformulated gasoline that 
     complies with the regulations that were in effect on January 
     1, 2000, and were applicable to reformulated gasoline sold in 
     calendar year 2000 and subsequent calendar years; and
       ``(bb) the aggregate emissions of the pollutants specified 
     in subclause (II), or precursors of those pollutants, from 
     baseline vehicles when using reformulated gasoline do not 
     exceed the aggregate emissions of those pollutants, or 
     precursors, from baseline vehicles when using reformulated 
     gasoline that complies with the regulations that were in 
     effect on January 1, 2000, and were applicable to 
     reformulated gasolines sold in calendar year 2000 and 
     subsequent calendar years.

       ``(II) Specified pollutants.--The pollutants specified in 
     this subclause are--

       ``(aa) toxic air pollutants, categorized by degree of 
     toxicity and carcinogenic potency;
       ``(bb) particulate matter (PM-10) and fine particulate 
     matter (PM-2.5);
       ``(cc) pollutants regulated under section 108; and
       ``(dd) such other pollutants, and precursors to pollutants, 
     as the Administrator determines by regulation should be 
     controlled to prevent the deterioration of air quality and to 
     achieve attainment of a national ambient air quality standard 
     in 1 or more areas.

       ``(III) Adjustment for emissions of carbon monoxide.--

       ``(aa) In general.--In carrying out subclause (I), the 
     Administrator shall adjust the performance standard for 
     emissions of volatile organic compounds under this 
     subparagraph to account for emissions of carbon monoxide that 
     are greater than or less than the carbon monoxide baseline 
     determined under item (bb).
       ``(bb) Carbon monoxide baseline.--The carbon monoxide 
     baseline shall be equal to the mass carbon monoxide emissions 
     achieved by reformulated gasoline that contains 2 percent 
     oxygen by weight and meets the other performance standards 
     under this subparagraph.''.
       (b) Reformulated Gasoline Carbon Monoxide Reduction 
     Credit.--Section 182(c)(2)(B) of the Clean Air Act (42 U.S.C. 
     7511a(c)(2)(B)) is amended by adding at the end the 
     following: ``An adjustment to the volatile organic compound 
     emission reduction requirements under section 
     211(k)(3)(B)(iv) shall be credited toward the requirement for 
     VOC emissions reductions under this subparagraph.''.

     SEC. 7. CERTIFICATION OF FUELS AS EQUIVALENT TO REFORMULATED 
                   GASOLINE.

       Section 211(k)(4)(B) of the Clean Air Act (42 U.S.C. 
     7545(k)(4)(B)) is amended--
       (1) by redesignating clauses (i) and (ii) as subclauses (I) 
     and (II), respectively, and indenting appropriately to 
     reflect the amendments made by this section;
       (2) by striking ``The Administrator'' and inserting the 
     following:
       ``(i) In general.--The Administrator'';
       (3) in clause (i) (as designated by paragraph (2))--
       (A) in subclause (I) (as redesignated by paragraph (1)), by 
     striking ``, and'' and inserting a semicolon;
       (B) in subclause (II) (as redesignated by paragraph (1))--
       (i) by striking ``achieve equivalent'' and inserting the 
     following: ``achieve--
       ``(aa) equivalent'';
       (ii) by striking the period at the end and inserting ``; 
     or''; and
       (iii) by adding at the end the following:
       ``(bb) combined reductions in emissions of ozone forming 
     volatile organic compounds and carbon monoxide that result in 
     a reduction in ozone concentration, as provided in clause 
     (ii)(I), that is equivalent to or greater than the reduction 
     in ozone concentration achieved by a reformulated gasoline 
     meeting the applicable requirements of paragraph (3);''; and
       (C) by adding at the end the following:

       ``(III) achieve equivalent or greater reductions in 
     emissions of toxic air pollutants, or precursors of toxic air 
     pollutants, than are achieved by a reformulated gasoline 
     meeting the applicable requirements of paragraph (3); and
       ``(IV) meet the requirements of paragraph (3)(B)(iv).''; 
     and

       (4) by adding at the end the following:
       ``(ii) Carbon monoxide credit.--

       ``(I) In general.--In determining whether a fuel 
     formulation or slate of fuel formulations achieves combined 
     reductions in emissions of ozone forming volatile organic 
     compounds and carbon monoxide in an area that result in a 
     reduction in ozone concentration that is equivalent to or 
     greater than the reduction in ozone concentration achieved by 
     a reformulated gasoline meeting the applicable requirements 
     of paragraph (3) in the area, the Administrator--

       ``(aa) shall consider, to the extent appropriate, the 
     change in carbon monoxide emissions from baseline vehicles 
     attributable to an oxygen content in the fuel formulation or 
     slate of fuel formulations that exceeds any minimum oxygen 
     content requirement for reformulated gasoline applicable to 
     the area; and
       ``(bb) may consider, to the extent appropriate, the change 
     in carbon monoxide emissions described in item (aa) from 
     vehicles other than baseline vehicles.

       ``(II) Oxygen credits.--Any excess oxygen content that is 
     taken into consideration in making a determination under 
     subclause (I) may not be used to generate credits under 
     paragraph (7)(A).
       ``(III) Relation to title i.--Any fuel formulation or slate 
     of fuel formulations that is certified as equivalent or 
     greater under this subparagraph, taking into consideration 
     the combined reductions in emissions of volatile organic 
     compounds and carbon monoxide, shall receive the same 
     volatile organic compounds reduction credit for the purposes 
     of subsections (b)(1) and (c)(2)(B) of section 182 as a fuel 
     meeting the applicable requirements of paragraph (3).''.

     SEC. 8. ADDITIONAL OPT-IN AREAS UNDER REFORMULATED GASOLINE 
                   PROGRAM.

       Section 211(k)(6) of the Clean Air Act (42 U.S.C. 
     7545(k)(6)) is amended--
       (1) by striking ``(6) Opt-in areas.--(A) Upon'' and 
     inserting the following:
       ``(6) Opt-in areas.--
       ``(A) Classified areas.--
       ``(i) In general.--Upon'';
       (2) in subparagraph (B), by striking ``(B) If'' and 
     inserting the following:
       ``(ii) Effect of insufficient domestic capacity to produce 
     reformulated gasoline.--If'';
       (3) in subparagraph (A)(ii) (as so redesignated)--
       (A) in the first sentence, by striking ``subparagraph (A)'' 
     and inserting ``clause (i)''; and
       (B) in the second sentence, by striking ``this paragraph'' 
     and inserting ``this subparagraph''; and
       (4) by adding at the end the following:
       ``(B) Nonclassified areas.--
       ``(i) In general.--Upon the application of the Governor of 
     a State, the Administrator shall apply the prohibition 
     specified in paragraph (5) in any area in the State that is 
     not a covered area or an area referred to in subparagraph 
     (A)(i).
       ``(ii) Publication of application.--As soon as practicable 
     after receipt of an application under clause (i), the 
     Administrator shall publish the application in the Federal 
     Register.''.

     SEC. 9. UPDATING OF BASELINE YEAR.

       (a) In General.--Section 211(k)(8) of the Clean Air Act (42 
     U.S.C. 7545(k)(8)) is amended--
       (1) by striking subparagraph (A) and inserting the 
     following:
       ``(A) Regulations.--
       ``(i) Emissions.--The Administrator shall promulgate 
     regulations applicable to each refiner, blender, or importer 
     of gasoline ensuring that gasoline sold or introduced into 
     commerce by the refiner, blender, or importer (other than 
     reformulated gasoline subject to the requirements of 
     paragraph (1)) does not result in average per gallon 
     emissions of--

       ``(I) volatile organic compounds;
       ``(II) oxides of nitrogen;
       ``(III) carbon monoxide;
       ``(IV) toxic air pollutants;
       ``(V) particulate matter (PM-10) or fine particulate matter 
     (PM-2.5); or
       ``(VI) any precursor of a pollutant specified in subclauses 
     (I) through (V);

     in excess of such emissions of such pollutants attributable 
     to gasoline sold or introduced into commerce in calendar year 
     1999 or calendar year 2000, in whichever occurred the lower 
     of such emissions, by that refiner, blender, or importer.
       ``(ii) Measurement of average per gallon emissions.--For 
     the purposes of clause (i), average per gallon emissions 
     shall be measured on the basis of--

       ``(I) mass; and
       ``(II) to the maximum extent practicable using available 
     science--

       ``(aa) ozone-forming potential;
       ``(bb) degree of toxicity; and
       ``(cc) carcinogenic potency.
       ``(iii) Aromatic hydrocarbon content and olefin content.--
     The Administrator shall promulgate regulations applicable to 
     each refiner, blender, or importer of gasoline ensuring that 
     gasoline sold or introduced into commerce by the refiner, 
     blender, or importer (other than reformulated gasoline 
     subject to the requirements of paragraph (1)) does not have 
     an aromatic hydrocarbon content or olefin content in excess 
     of such content of gasoline sold or introduced into commerce 
     in calendar year 1999 or calendar year 2000, in whichever 
     occurred the lower of such content, by that refiner, blender, 
     or importer.'';
       (2) in subparagraph (C)--
       (A) by striking ``clauses (i) through (iv)'' and inserting 
     ``subclauses (I) through (VI) of subparagraph (A)(i)'';

[[Page 8059]]

       (B) by inserting ``or volatile organic compounds'' after 
     ``nitrogen''; and
       (C) by striking ``(on a mass basis)'' and inserting ``(as 
     measured in accordance with subparagraph (A)(ii))''; and
       (3) in subparagraph (E)--
       (A) by striking ``calendar year 1990'' and inserting 
     ``calendar year 1999 or calendar year 2000 (as determined 
     under subparagraph (A)(i))''; and
       (B) by striking ``such 1990 gasoline'' and inserting ``such 
     1999 or 2000 gasoline''.
       (b) Regulations.--As soon as practicable after the date of 
     enactment of this Act, the Administrator of the Environmental 
     Protection Agency shall revise the regulations promulgated 
     under section 211(k) of the Clean Air Act (42 U.S.C. 7545(k)) 
     to reflect the amendments made by subsection (a).

     SEC. 10. RENEWABLE CONTENT OF GASOLINE AND DIESEL FUEL.

       (a) In General.--Section 211 of the Clean Air Act (42 
     U.S.C. 7545) is amended--
       (1) by redesignating subsection (o) as subsection (p); and
       (2) by inserting after subsection (n) the following:
       ``(o) Renewable Content of Motor Vehicle Fuel.--
       ``(1) In general.--
       ``(A) Regulations.--Not later than September 1, 2001, the 
     Administrator shall promulgate regulations applicable to each 
     refiner, blender, or importer of motor vehicle fuel to ensure 
     that motor vehicle fuel sold or introduced into commerce in 
     the United States by the refiner, blender, or importer 
     complies with the renewable content requirements of this 
     subsection.
       ``(B) Renewable content requirements.--
       ``(i) In general.--All motor vehicle fuel sold or 
     introduced into commerce in the United States by a refiner, 
     blender, or importer shall contain, on a semiannual average 
     basis, a quantity of fuel derived from a renewable source, 
     measured on a gasoline-equivalent energy content basis (as 
     determined by the Secretary of Energy) that is not less than 
     the applicable percentage by volume for the semiannual 
     period.
       ``(ii) Applicable percentage.--For the purposes of clause 
     (i), the applicable percentage for a semiannual period of a 
     calendar year shall be determined in accordance with the 
     following table:

                                                  Applicable percentage
                                                 of fuel derived from a
``Calendar year:                                      renewable source:
  2001.........................................................0.8 ....

  2002.........................................................1.0 ....

  2003.........................................................1.2 ....

  2004.........................................................1.4 ....

  2005.........................................................1.6 ....

  2006.........................................................1.8 ....

  2007.........................................................2.1 ....

  2008.........................................................2.4 ....

  2009.........................................................2.7 ....

  2010.........................................................3.0 ....

  2011 and thereafter..........................................3.3.....

       ``(C) Fuel derived from a renewable source.--For the 
     purposes of this subsection, a fuel shall be considered to be 
     derived from a renewable source if the fuel--
       ``(i) is produced from--

       ``(I) agricultural commodities, agricultural products, or 
     residues of agricultural commodities or agricultural 
     products;
       ``(II) plant materials, including grasses, fibers, wood, 
     and wood residues;
       ``(III) dedicated energy crops and trees;
       ``(IV) animal wastes, animal byproducts, and other 
     materials of animal origin;
       ``(V) municipal wastes and refuse derived from plant or 
     animal sources; and
       ``(VI) other biomass; and

       ``(ii) is used to replace or reduce the quantity of fossil 
     fuel present in a fuel mixture used to operate a motor 
     vehicle, motor vehicle engine, nonroad vehicle, or nonroad 
     engine.
       ``(D) Credit program.--
       ``(i) In general.--The regulations promulgated under this 
     subsection shall provide for the generation of an appropriate 
     amount of credits by a person that refines, blends, or 
     imports motor vehicle fuel that contains, on a semiannual 
     average basis, a quantity of fuel derived from a renewable 
     source that is greater than the quantity required under 
     subparagraph (B).
       ``(ii) Use of credits.--The regulations shall provide that 
     a person that generates the credits may use the credits, or 
     transfer all or a portion of the credits to another person, 
     for the purpose of complying with subparagraph (B).
       ``(iii) Regulations to prevent excessive geographical 
     concentration.--The Administrator, in consultation with the 
     Secretary of Energy and the Secretary of Agriculture, may 
     promulgate regulations governing the generation and trading 
     of credits described in clause (i) in order to prevent 
     excessive geographical concentration in the use of fuel 
     derived from a renewable source that would tend unduly--

       ``(I) to affect the price, supply, or distribution of such 
     fuel;
       ``(II) to impede the development of the renewable fuels 
     industry; or
       ``(III) to otherwise interfere with the purposes of this 
     subsection.

       ``(2) Waivers.--
       ``(A) In general.--The Administrator, in consultation with 
     the Secretary of Agriculture and the Secretary of Energy, may 
     waive the requirements of paragraph (1)(B) with respect to an 
     area in whole or in part on petition by a State--
       ``(i) based on a determination by the Administrator, after 
     public notice and opportunity for comment, that--

       ``(I) implementation of the requirements would severely 
     harm the economy or environment of the area; or
       ``(II) there is an inadequate domestic supply or 
     distribution capacity with respect to fuel from renewable 
     sources in the area to meet the requirements of paragraph 
     (1)(B); and

       ``(ii) only after a determination by the Administrator that 
     use of the credit program described in paragraph (1)(D) would 
     not adequately alleviate the circumstances on which the 
     petition is based.
       ``(B) Approval.--The Administrator shall approve a waiver 
     under subparagraph (A) only to the extent necessary to--
       ``(i) avoid severe economic or environmental harm; or
       ``(ii) equalize demand with supply or distribution 
     capacity.
       ``(C) Petitions for waivers.--The Administrator, in 
     consultation with the Secretary of Agriculture and the 
     Secretary of Energy--
       ``(i) shall approve or deny a State petition for a waiver 
     of the requirements of paragraph (1)(B) within 180 days after 
     the date on which the petition is received; but
       ``(ii) may extend that period for up to 60 additional days 
     to provide for public notice and opportunity for comment and 
     for consideration of the comments submitted.
       ``(D) Termination of waivers.--A waiver granted under 
     subparagraph (A) shall terminate on the earlier of--
       ``(i) the date on which the Administrator, in consultation 
     with the Secretary of Agriculture and the Secretary of 
     Energy, determines that the reason for the waiver no longer 
     exists; or
       ``(ii) the date that is 1 year after the date on which the 
     waiver is granted.
       ``(3) Reports to congress.--Not less often than every 3 
     years, the Administrator shall--
       ``(A) in consultation with the Secretary of Agriculture, 
     submit to Congress a report that describes--
       ``(i) the impact of implementation of this subsection on--

       ``(I) the demand for farm commodities, biomass, and other 
     materials used for producing fuel derived from a renewable 
     source; and
       ``(II) the adequacy of food and feed supplies; and

       ``(ii) the effect of implementation of this subsection on 
     farm income, employment, and economic growth, particularly in 
     rural areas; and
       ``(B) in consultation with the Secretary of Energy, submit 
     to Congress a report that--
       ``(i) describes greenhouse gas emission reductions that 
     result from implementation of this subsection; and
       ``(ii) assesses the effect of implementation of this 
     subsection on United States energy security and reliance on 
     imported petroleum.''.
       (b) Penalties and Enforcement.--Section 211(d) of the Clean 
     Air Act (42 U.S.C. 7545(d)) is amended--
       (1) in paragraph (1)--
       (A) in the first sentence, by striking ``or (n)'' each 
     place it appears and inserting ``(n), or (o)''; and
       (B) in the second sentence, by striking ``or (m)'' and 
     inserting ``(m), or (o)''; and
       (2) in the first sentence of paragraph (2), by striking 
     ``and (n)'' each place it appears and inserting ``(n), and 
     (o)''.

                          ____________________