[Congressional Record (Bound Edition), Volume 149 (2003), Part 19]
[Senate]
[Pages 26238-26242]
[From the U.S. Government Publishing Office, www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. COLEMAN (for himself, Mr. Graham of South Carolina, and 
        Mr. DeWine):
  S. 1796. A bill to revitalize rural America and rebuild main street, 
and for other purposes; to the Committee on Finance
  Mr. COLEMAN. Mr. President, I ask unanimous consent that the bill I 
introduce today, the rural Renaissance Act, be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1796

       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 ``Rural Renaissance Act''.

     SEC. 2. RURAL RENAISSANCE CORPORATION.

       Subtitle D of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1981 et seq.) is amended by adding at the end 
     the following new section:

     ``SEC. 379E. RURAL RENAISSANCE CORPORATION.

       ``(a) Establishment and Status.--There is established a 
     body corporate to be known as the `Rural Renaissance 
     Corporation' (hereafter in this section referred to as the 
     `Corporation'). The Corporation is not a department, agency, 
     or instrumentality of the United States Government, and shall 
     not be subject to title 31, United States Code.
       ``(b) Principal Office; Application of Laws.--The principal 
     office and place of

[[Page 26239]]

     business of the Corporation shall be in the District of 
     Columbia, and, to the extent consistent with this section, 
     the District of Columbia Business Corporation Act (D.C. Code 
     29-301 et seq.) shall apply.
       ``(c) Functions of Corporation.--The Corporation shall--
       ``(1) issue rural renaissance bonds for the financing of 
     qualified projects as required under section 54 of the 
     Internal Revenue Code of 1986,
       ``(2) establish an allocation plan as required under 
     section 54(f)(2)(A) of such Code,
       ``(3) establish and operate the Rural Renaissance Trust 
     Account as required under section 54(i) of such Code,
       ``(4) perform any other function the sole purpose of which 
     is to carry out the financing of qualified projects through 
     rural renaissance bonds, and
       ``(5) not later than February 15 of each year submit a 
     report to Congress--
       ``(A) describing the activities of the Corporation for the 
     preceding year, and
       ``(B) specifying whether the amounts deposited and expected 
     to be deposited in the Rural Renaissance Trust Account are 
     sufficient to fully repay at maturity the principal of any 
     outstanding rural renaissance bonds issued pursuant to such 
     section 54.
       ``(d) Powers of Corporation.--The Corporation--
       ``(1) may sue and be sued, complain and defend, in its 
     corporate name, in any court of competent jurisdiction,
       ``(2) may adopt, alter, and use a seal, which shall be 
     judicially noticed,
       ``(3) may prescribe, amend, and repeal such rules and 
     regulations as may be necessary for carrying out the 
     functions of the Corporation,
       ``(4) may make and perform such contracts and other 
     agreements with any individual, corporation, or other private 
     or public entity however designated and wherever situated, as 
     may be necessary for carrying out the functions of the 
     Corporation,
       ``(5) may determine and prescribe the manner in which its 
     obligations shall be incurred and its expenses allowed and 
     paid,
       ``(6) may, as necessary for carrying out the functions of 
     the Corporation, employ and fix the compensation of employees 
     and officers,
       ``(7) may lease, purchase, or otherwise acquire, own, hold, 
     improve, use, or otherwise deal in and with such property 
     (real, personal, or mixed) or any interest therein, wherever 
     situated, as may be necessary for carrying out the functions 
     of the Corporation,
       ``(8) may accept gifts or donations of services or of 
     property (real, personal, or mixed), tangible or intangible, 
     in furtherance of the purposes of this section, and
       ``(9) shall have such other powers as may be necessary and 
     incident to carrying out this section.
       ``(e) Nonprofit Entity; Restriction on Use of Moneys; 
     Conflict of Interests; Independent Audits.--
       ``(1) Nonprofit entity.--The Corporation shall be a 
     nonprofit corporation and shall have no capital stock.
       ``(2) Restriction.--No part of the Corporation's revenue, 
     earnings, or other income or property shall inure to the 
     benefit of any of its directors, officers, or employees, and 
     such revenue, earnings, or other income or property shall 
     only be used for carrying out the purposes of this section.
       ``(3) Conflict of interests.--No director, officer, or 
     employee of the Corporation shall in any manner, directly or 
     indirectly participate in the deliberation upon or the 
     determination of any question affecting his or her personal 
     interests or the interests of any corporation, partnership, 
     or organization in which he or she is directly or indirectly 
     interested.
       ``(4) Independent audits.--An independent certified public 
     accountant shall audit the financial statements of the 
     Corporation each year. The audit shall be carried out at the 
     place at which the financial statements normally are kept and 
     under generally accepted auditing standards. A report of the 
     audit shall be available to the public and shall be included 
     in the report required under subsection (c)(5).
       ``(f) Tax Exemption.--The Corporation, including its 
     franchise and income, is exempt from taxation imposed by the 
     United States, by any territory or possession of the United 
     States, or by any State, county, municipality, or local 
     taxing authority.
       ``(g) Management of Corporation.--
       ``(1) Board of directors; membership; designation of 
     chairperson and vice chairperson; appointment considerations; 
     term; vacancies.--
       ``(A) Board of directors.--The management of the 
     Corporation shall be vested in a board of directors composed 
     of 7 members appointed by the President, by and with the 
     advice and consent of the Senate.
       ``(B) Chairperson and vice chairperson.--The President 
     shall designate 1 member of the Board to serve as Chairperson 
     of the Board and 1 member to serve as Vice Chairperson of the 
     Board.
       ``(C) Individuals from private life.--Five members of the 
     Board shall be appointed from private life.
       ``(D) Federal officers and employees.--Two members of the 
     Board shall be appointed from among officers and employees of 
     agencies of the United States concerned with rural 
     development.
       ``(E) Appointment considerations.--All members of the Board 
     shall be appointed on the basis of their understanding of and 
     sensitivity to rural development processes. Members of the 
     Board shall be appointed so that not more than 4 members of 
     the Board are members of any 1 political party.
       ``(F) Terms.--Members of the Board shall be appointed for 
     terms of 3 years, except that of the members first appointed, 
     as designated by the President at the time of their 
     appointment, 2 shall be appointed for terms of 1 year and 2 
     shall be appointed for terms of 2 years.
       ``(G) Vacancies.--A member of the Board appointed to fill a 
     vacancy occurring before the expiration of the term for which 
     that member's predecessor was appointed shall be appointed 
     only for the remainder of that term. Upon the expiration of a 
     member's term, the member shall continue to serve until a 
     successor is appointed and is qualified.
       ``(2) Compensation, actual, necessary, and transportation 
     expenses.--Members of the Board shall serve without 
     additional compensation, but may be reimbursed for actual and 
     necessary expenses not exceeding $100 per day, and for 
     transportation expenses, while engaged in their duties on 
     behalf of the Corporation.
       ``(3) Quorum.--A majority of the Board shall constitute a 
     quorum.
       ``(4) President of corporation.--The Board of Directors 
     shall appoint a president of the Corporation on such terms as 
     the Board may determine.''.

     SEC. 3. CREDIT TO HOLDERS OF RURAL RENAISSANCE BONDS.

       (a) In General.--Part IV of subchapter A of chapter 1 of 
     the Internal Revenue Code of 1986 (relating to credits 
     against tax) is amended by adding at the end the following 
     new subpart:

  ``Subpart H--Nonrefundable Credit for Holders of Rural Renaissance 
                                 Bonds

``Sec. 54. Credit to holders of rural renaissance bonds.

     ``SEC. 54. CREDIT TO HOLDERS OF RURAL RENAISSANCE BONDS.

       ``(a) Allowance of Credit.--In the case of a taxpayer who 
     holds a rural renaissance bond on a credit allowance date of 
     such bond which occurs during the taxable year, there shall 
     be allowed as a credit against the tax imposed by this 
     chapter for such taxable year an amount equal to the sum of 
     the credits determined under subsection (b) with respect to 
     credit allowance dates during such year on which the taxpayer 
     holds such bond.
       ``(b) Amount of Credit.--
       ``(1) In general.--The amount of the credit determined 
     under this subsection with respect to any credit allowance 
     date for a rural renaissance bond is 25 percent of the annual 
     credit determined with respect to such bond.
       ``(2) Annual credit.--The annual credit determined with 
     respect to any rural renaissance bond is the product of--
       ``(A) the applicable credit rate, multiplied by
       ``(B) the outstanding face amount of the bond.
       ``(3) Applicable credit rate.--For purposes of paragraph 
     (2), the applicable credit rate with respect to an issue is 
     the rate equal to an average market yield (as of the day 
     before the date of sale of the issue) on outstanding long-
     term corporate debt obligations (determined in such manner as 
     the Secretary prescribes).
       ``(4) Credit allowance date.--For purposes of this section, 
     the term `credit allowance date' means--
       ``(A) March 15,
       ``(B) June 15,
       ``(C) September 15, and
       ``(D) December 15.
     Such term includes the last day on which the bond is 
     outstanding.
       ``(5) Special rule for issuance and redemption.--In the 
     case of a bond which is issued during the 3-month period 
     ending on a credit allowance date, the amount of the credit 
     determined under this subsection with respect to such credit 
     allowance date shall be a ratable portion of the credit 
     otherwise determined based on the portion of the 3-month 
     period during which the bond is outstanding. A similar rule 
     shall apply when the bond is redeemed.
       ``(c) Limitation Based on Amount of Tax.--
       ``(1) In general.--The credit allowed under subsection (a) 
     for any taxable year shall not exceed the excess of--
       ``(A) the sum of the regular tax liability (as defined in 
     section 26(b)) plus the tax imposed by section 55, over
       ``(B) the sum of the credits allowable under this part 
     (other than this subpart and subpart C).
       ``(2) Carryover of unused credit.--If the credit allowable 
     under subsection (a) exceeds the limitation imposed by 
     paragraph (1) for such taxable year, such excess shall be 
     carried to the succeeding taxable year and added to the 
     credit allowable under subsection (a) for such taxable year.
       ``(d) Credit Included in Gross Income.--Gross income 
     includes the amount of the credit allowed to the taxpayer 
     under this section (determined without regard to subsection 
     (c)) and the amount so included shall be treated as interest 
     income.

[[Page 26240]]

       ``(e) Rural Renaissance Bond.--For purposes of this part, 
     the term `rural renaissance bond' means any bond issued as 
     part of an issue if--
       ``(1) 95 percent or more of the proceeds from the sale of 
     such issue are to be used--
       ``(A) for expenditures incurred after the date of the 
     enactment of this section for any qualified project, or
       ``(B) for deposit in the Rural Renaissance Trust Account 
     for repayment of rural renaissance bonds at maturity,
       ``(2) the bond is issued by the Rural Renaissance 
     Corporation, is in registered form, and meets the rural 
     renaissance bond limitation requirements under subsection 
     (f),
       ``(3) except for bonds issued in accordance with subsection 
     (f)(4), the term of each bond which is part of such issue 
     does not exceed 30 years,
       ``(4) the payment of principal with respect to such bond is 
     the obligation of the Rural Renaissance Corporation, and
       ``(5) the issue meets the requirements of subsection (g) 
     (relating to arbitrage).
       ``(f) Limitation on Amount of Bonds Designated.--
       ``(1) National limitation.--There is a rural renaissance 
     bond limitation for each calendar year. Such limitation is--
       ``(A) for 2004--
       ``(i) with respect to bonds described in subsection 
     (e)(1)(A), $50,000,000,000, plus
       ``(ii) with respect to bonds described in subsection 
     (e)(1)(B), such amount (not to exceed $15,000,000,000) as 
     determined necessary by the Rural Renaissance Corporation to 
     provide funds in the Rural Renaissance Trust Account for the 
     repayment of rural renaissance bonds at maturity, and
       ``(B) except as provided in paragraph (3), zero thereafter.
       ``(2) Limitation allocated to qualified projects among 
     states.--
       ``(A) In general.--Subject to subparagraph (B), the 
     limitation applicable under paragraph (1)(A)(i) for any 
     calendar year shall be allocated by the Rural Renaissance 
     Corporation for qualified projects among the States under an 
     allocation plan established by the Corporation and submitted 
     to Congress for consideration.
       ``(B) Minimum allocations to states.--In establishing the 
     allocation plan under subparagraph (A), the Rural Renaissance 
     Corporation shall ensure that the aggregate amount allocated 
     for qualified projects located in each State under such plan 
     is not less than $500,000,000.
       ``(3) Carryover of unused limitation.--If for any calendar 
     year--
       ``(A) the rural renaissance bond limitation amount, exceeds
       ``(B) the amount of bonds issued during such year by the 
     Rural Renaissance Corporation,

     the rural renaissance bond limitation amount for the 
     following calendar year shall be increased by the amount of 
     such excess. Any carryforward of a rural renaissance bond 
     limitation amount may be carried only to calendar year 2005 
     or 2006.
       ``(4) Issuance of small denomination bonds.--From the rural 
     renaissance bond limitation for each year, the Rural 
     Renaissance Corporation shall issue a limited quantity of 
     rural renaissance bonds in small denominations suitable for 
     purchase as gifts by individual investors wishing to show 
     their support for investing in rural America.
       ``(g) Special Rules Relating to Arbitrage.--
       ``(1) In general.--Subject to paragraph (2), an issue shall 
     be treated as meeting the requirements of this subsection if 
     as of the date of issuance, the Rural Renaissance Corporation 
     reasonably expects--
       ``(A) to spend at least 95 percent of the proceeds from the 
     sale of the issue for 1 or more qualified projects within the 
     3-year period beginning on such date,
       ``(B) to incur a binding commitment with a third party to 
     spend at least 10 percent of the proceeds from the sale of 
     the issue, or to commence construction, with respect to such 
     projects within the 6-month period beginning on such date, 
     and
       ``(C) to proceed with due diligence to complete such 
     projects and to spend the proceeds from the sale of the 
     issue.
       ``(2) Rules regarding continuing compliance after 3-year 
     determination.--If at least 95 percent of the proceeds from 
     the sale of the issue is not expended for 1 or more qualified 
     projects within the 3-year period beginning on the date of 
     issuance, but the requirements of paragraph (1) are otherwise 
     met, an issue shall be treated as continuing to meet the 
     requirements of this subsection if either--
       ``(A) the Rural Renaissance Corporation uses all unspent 
     proceeds from the sale of the issue to redeem bonds of the 
     issue within 90 days after the end of such 3-year period, or
       ``(B) the following requirements are met:
       ``(i) The Rural Renaissance Corporation spends at least 75 
     percent of the proceeds from the sale of the issue for 1 or 
     more qualified projects within the 3-year period beginning on 
     the date of issuance.
       ``(ii) The Rural Renaissance Corporation spends at least 95 
     percent of the proceeds from the sale of the issue for 1 or 
     more qualified projects within the 4-year period beginning on 
     the date of issuance, and uses all unspent proceeds from the 
     sale of the issue to redeem bonds of the issue within 90 days 
     after the end of the 4-year period beginning on the date of 
     issuance.
       ``(h) Recapture of Portion of Credit Where Cessation of 
     Compliance.--
       ``(1) In general.--If any bond which when issued purported 
     to be a rural renaissance bond ceases to be such a qualified 
     bond, the Rural Renaissance Corporation shall pay to the 
     United States (at the time required by the Secretary) an 
     amount equal to the sum of--
       ``(A) the aggregate of the credits allowable under this 
     section with respect to such bond (determined without regard 
     to subsection (c)) for taxable years ending during the 
     calendar year in which such cessation occurs and the 2 
     preceding calendar years, and
       ``(B) interest at the underpayment rate under section 6621 
     on the amount determined under subparagraph (A) for each 
     calendar year for the period beginning on the first day of 
     such calendar year.
       ``(2) Failure to pay.--If the Rural Renaissance Corporation 
     fails to timely pay the amount required by paragraph (1) with 
     respect to such bond, the tax imposed by this chapter on each 
     holder of any such bond which is part of such issue shall be 
     increased (for the taxable year of the holder in which such 
     cessation occurs) by the aggregate decrease in the credits 
     allowed under this section to such holder for taxable years 
     beginning in such 3 calendar years which would have resulted 
     solely from denying any credit under this section with 
     respect to such issue for such taxable years.
       ``(3) Special rules.--
       ``(A) Tax benefit rule.--The tax for the taxable year shall 
     be increased under paragraph (2) only with respect to credits 
     allowed by reason of this section which were used to reduce 
     tax liability. In the case of credits not so used to reduce 
     tax liability, the carryforwards and carrybacks under section 
     39 shall be appropriately adjusted.
       ``(B) No credits against tax.--Any increase in tax under 
     paragraph (2) shall not be treated as a tax imposed by this 
     chapter for purposes of determining--
       ``(i) the amount of any credit allowable under this part, 
     or
       ``(ii) the amount of the tax imposed by section 55.
       ``(i) Rural Renaissance Trust Account.--
       ``(1) In general.--The following amounts shall be held in a 
     Rural Renaissance Trust Account by the Rural Renaissance 
     Corporation:
       ``(A) The proceeds from the sale of all bonds issued under 
     this section.
       ``(B) The amount of any matching contributions with respect 
     to such bonds.
       ``(C) The investment earnings on proceeds from the sale of 
     such bonds.
       ``(D) Any earnings on any amounts described in subparagraph 
     (A), (B), or (C).
       ``(2) Use of funds.--Amounts in the Rural Renaissance Trust 
     Account may be used only to pay costs of qualified projects, 
     redeem rural renaissance bonds, and fund the operations of 
     the Rural Renaissance Corporation, except that amounts 
     withdrawn from the Rural Renaissance Trust Account to pay 
     costs of qualified projects may not exceed the aggregate 
     proceeds from the sale of rural renaissance bonds described 
     in subsection (e)(1)(A).
       ``(3) Use of remaining funds in rural renaissance trust 
     account.--Upon the redemption of all rural renaissance bonds 
     issued under this section, any remaining amounts in the Rural 
     Renaissance Trust Account shall be available to the Rural 
     Renaissance Corporation for any qualified project.
       ``(j) Qualified Project.--For purposes of this section--
       ``(1) In general.--Subject to paragraph (3), the term 
     `qualified project' means a project which--
       ``(A) includes 1 or more of the projects described in 
     paragraph (2),
       ``(B) is located in a rural area, and
       ``(C) is proposed by a State and approved by the Rural 
     Renaissance Corporation.
       ``(2) Projects described.--A project described in this 
     paragraph is--
       ``(A) a water or waste treatment project,
       ``(B) a conservation project, including any project to 
     protect water quality or air quality (including odor 
     abatement), any project to prevent soil erosion, and any 
     project to protect wildlife habitat, including any project to 
     assist agricultural producers in complying with Federal, 
     State, or local regulations,
       ``(C) an affordable housing project,
       ``(D) a community facility project, including hospitals, 
     fire and police stations, and nursing and assisted-living 
     facilities,
       ``(E) a value-added agriculture or renewable energy 
     facility project for agricultural producers or farmer-owned 
     entities, including any project to promote the production or 
     processing of ethanol, biodiesel, animal waste, biomass, raw 
     commodities, or wind as a fuel,
       ``(F) a rural venture capital project for, among others, 
     farmer-owned entities,
       ``(G) a distance learning or telemedicine project,
       ``(H) a project to expand broadband technology, and
       ``(I) a rural teleworks project.
       ``(3) Special rules.--For purposes of this subsection--

[[Page 26241]]

       ``(A) any project described in subparagraph (E) or (F) of 
     paragraph (2) for a farmer-owned entity may be considered a 
     qualified project if such entity is located in a rural area, 
     or in the case of a farmer-owned entity the headquarters of 
     which are located in a nonrural area, if the project is 
     located in a rural area, and
       ``(B) any project for a farmer-owned entity which is a 
     facility described in paragraph (2)(E) for agricultural 
     producers may be considered a qualified project regardless of 
     whether the facility is located in a rural or nonrural area.
       ``(3) Approval guidelines and criteria.--Not later than 60 
     days after the date of the enactment of this section, the 
     Rural Renaissance Corporation shall consult with the 
     appropriate committees of Congress regarding the development 
     of guidelines and criteria for the approval by the 
     Corporation of projects as qualified projects for inclusion 
     in the allocation plan established under subsection (f)(2)(A) 
     and shall submit such guidelines and criteria to such 
     committees.
       ``(k) Other Definitions and Special Rules.--For purposes of 
     this section--
       ``(1) Bond.--The term `bond' includes any obligation.
       ``(2) Rural area.--The term `rural area' means any area 
     other than--
       ``(A) a city or town which has a population of greater than 
     50,000 inhabitants, or
       ``(B) the urbanized area contiguous and adjacent to such a 
     city or town.
       ``(3) Rural renaissance corporation.--The term `Rural 
     Renaissance Corporation' means the Rural Renaissance 
     Corporation established under section 379E of the 
     Consolidated Farm and Rural Development Act.
       ``(4) Treatment of changes in use.--For purposes of 
     subsection (e)(1)(A), the proceeds from the sale of an issue 
     shall not be treated as used for a qualified project to the 
     extent that the Rural Renaissance Corporation takes any 
     action within its control which causes such proceeds not to 
     be used for a qualified project. The Secretary shall specify 
     remedial actions that may be taken (including conditions to 
     taking such remedial actions) to prevent an action described 
     in the preceding sentence from causing a bond to fail to be a 
     rural renaissance bond.
       ``(5) Partnership; s corporation; and other pass-thru 
     entities.--In the case of a partnership, trust, S 
     corporation, or other pass-thru entity, rules similar to the 
     rules of section 41(g) shall apply with respect to the credit 
     allowable under subsection (a).
       ``(6) Bonds held by regulated investment companies.--If any 
     rural renaissance bond is held by a regulated investment 
     company, the credit determined under subsection (a) shall be 
     allowed to shareholders of such company under procedures 
     prescribed by the Secretary.
       ``(7) Credits may be stripped.--Under regulations 
     prescribed by the Secretary--
       ``(A) In general.--There may be a separation (including at 
     issuance) of the ownership of a rural renaissance bond and 
     the entitlement to the credit under this section with respect 
     to such bond. In case of any such separation, the credit 
     under this section shall be allowed to the person who on the 
     credit allowance date holds the instrument evidencing the 
     entitlement to the credit and not to the holder of the bond.
       ``(B) Certain rules to apply.--In the case of a separation 
     described in subparagraph (A), the rules of section 1286 
     shall apply to the rural renaissance bond as if it were a 
     stripped bond and to the credit under this section as if it 
     were a stripped coupon.
       ``(8) Reporting.--The Rural Renaissance Corporation shall 
     submit reports similar to the reports required under section 
     149(e).''.
       (b) Amendments to Other Code Sections.--
       (1) Reporting.--Subsection (d) of section 6049 of the 
     Internal Revenue Code of 1986 (relating to returns regarding 
     payments of interest) is amended by adding at the end the 
     following new paragraph:
       ``(8) Reporting of credit on rural renaissance bonds.--
       ``(A) In general.--For purposes of subsection (a), the term 
     `interest' includes amounts includible in gross income under 
     section 54(d) and such amounts shall be treated as paid on 
     the credit allowance date (as defined in section 54(b)(4)).
       ``(B) Reporting to corporations, etc.--Except as otherwise 
     provided in regulations, in the case of any interest 
     described in subparagraph (A), subsection (b)(4) shall be 
     applied without regard to subparagraphs (A), (H), (I), (J), 
     (K), and (L)(i) of such subsection.
       ``(C) Regulatory authority.--The Secretary may prescribe 
     such regulations as are necessary or appropriate to carry out 
     the purposes of this paragraph, including regulations which 
     require more frequent or more detailed reporting.''.
       (2) Treatment for estimated tax purposes.--
       (A) Individual.--Section 6654 of such Code (relating to 
     failure by individual to pay estimated income tax) is amended 
     by redesignating subsection (m) as subsection (n) and by 
     inserting after subsection (l) the following new subsection:
       ``(m) Special Rule for Holders of Rural Renaissance 
     Bonds.--For purposes of this section, the credit allowed by 
     section 54 to a taxpayer by reason of holding a rural 
     renaissance bond on a credit allowance date shall be treated 
     as if it were a payment of estimated tax made by the taxpayer 
     on such date.''.
       (B) Corporate.--Subsection (g) of section 6655 of such Code 
     (relating to failure by corporation to pay estimated income 
     tax) is amended by adding at the end the following new 
     paragraph:
       ``(5) Special rule for holders of rural renaissance 
     bonds.--For purposes of this section, the credit allowed by 
     section 54 to a taxpayer by reason of holding a rural 
     renaissance bond on a credit allowance date shall be treated 
     as if it were a payment of estimated tax made by the taxpayer 
     on such date.''.
       (c) Clerical Amendments.--
       (1) The table of subparts for part IV of subchapter A of 
     chapter 1 of the Internal Revenue Code of 1986 is amended by 
     adding at the end the following new item:

``Subpart H. Nonrefundable Credit for Holders of Rural Renaissance 
              Bonds.''.
       (2) Section 6401(b)(1) of such Code is amended by striking 
     ``and G'' and inserting ``G, and H''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to obligations issued after the date of the 
     enactment of this Act.
                                 ______
                                 
      By Mr. DeWINE (for himself and Mr. Kohl):
  S. 1797. A bill to implement antitrust enforcement enhancements and 
cooperation incentives; to the Committee on the Judiciary.
  Mr. KOHL. Mr. President, I rise today, with my colleague Senator 
DeWine, to introduce the ``Antitrust Criminal Penalty Enhancement and 
Reform Act of 2003.'' This important bipartisan antitrust reform bill 
will strengthen the procedures under which antitrust settlements are 
reviewed by the courts, will increase criminal penalties for the most 
egregious antitrust violations, and will enhance the Justice 
Department's existing leniency program to encourage more antitrust 
criminal wrongdoers to come forward and thereby significantly assist 
the Department in detecting and preventing antitrust conspiracies.
  This bill will accomplish three important goals. First, it will 
strengthen the review of the Justice Department's civil antitrust 
settlements under the Tunney Act. The Tunney Act is an important 
statute, passed nearly thirty years ago, that insures the public 
interest and consumers are protected when the Justice Department 
settles civil antitrust cases. The Tunney Act requires that, before 
entering any proposed consent judgment proposed by the Justice 
Department, the court must determine that the judgment is in the public 
interest. The statute also contains strict procedures for the public 
disclosure of proposed antitrust consent decrees and an opportunity for 
public comment.
  The Tunney Act was passed in 1974 in response to concerns that some 
Justice Department settlements were motivated by inappropriate 
political pressure and were simply inadequate to restore competition or 
protect consumers. Congress concluded that review by the district 
courts to be an essential safeguard to deter the Justice Department 
from settling cases without regard for the public interest or the 
interest of affected consumers. The Tunney Act was enacted to end the 
then-prevalent practice of district judges ``rubber stamping'' 
antitrust consent decrees.
  Unfortunately, in recent years, many courts--including specifically 
the U.S. Court of Appeals for the District of Columbia Circuit--have 
misconstrued the plain meaning of the Tunney Act and have returned to 
the practice of ``rubber stamp'' review of antitrust settlements. The 
controlling precedent in the D.C. Circuit is now that trial courts must 
enter antitrust consent decrees as long as they do not make a ``mockery 
of the judicial power.'' This standard is contrary to the intent of the 
Tunney Act and effectively strips the courts of the ability to engage 
in meaningful review of antitrust settlements.
  Our bill will restore the original intent of the Tunney Act by First, 
providing that courts are to independently determine that antitrust 
settlements are in the public interest, second, setting forth a 
specific list of factors that a court must examine in the course of its 
public interest review--rather than

[[Page 26242]]

may consider as the statute is currently written, and third, requiring 
the government establish that substantial evidence and reasoned 
analysis supports the government's belief that the consent judgment is 
in the public interest. These provisions will make clear that the court 
has the authority to conduct a meaningful review to ensure that 
antitrust settlements are not contrary to the public interest, or to 
competition.
  Second, the bill will enhance criminal penalties for those who 
violate our antitrust laws. It will increase the maximum corporate 
penalty from $10 to $100 million, will increase the maximum individual 
fine from $350,000 to $1 million, and increase the maximum jail term 
for individuals who are convicted of criminal antitrust violations from 
three to ten years. These changes will send the proper message that 
criminal antitrust violations--crimes such as price fixing and bid 
rigging--committed by business executives in a boardroom are serious 
offense that steal from American consumers just as effectively as does 
a street criminal with a gun. We have all learned through unfortunate 
experience in the last few years at some of our largest at most 
respected corporations the serious consequences of crime in the 
boardroom, with literally tens of millions of dollars being looted from 
shareholders. These examples of corporate malfeasance teach us that 
criminal sanctions for white collar crime must be serious enough to 
deter such misbehavior, and our bill will help ensure our antitrust 
penalties are strong enough to accomplish this mission.
  Finally, this bill will give the Justice Department significant new 
tools under its antitrust leniency program. The leniency program 
rewards the first member of a criminal antitrust conspiracy to admit 
its crime to the Justice Department by granting the wrongdoer criminal 
amnesty. This is an important tool for law enforcement officials to 
detect and break up cartels that fix prices and limit supply in our 
economy. This new provision will give the Justice Department the 
ability to offer those applying for leniency the additional reward of 
only facing actual damages in civil suits arising out of the antitrust 
conspiracy, rather than the treble damage liability to which they would 
otherwise be subject. This statutory change will remove a significant 
disincentive to those who would be likely to seek criminal amnesty and 
should result in a substantial increase in the number of antitrust 
conspiracies being detected.
  Each of these three reforms are important measures will significantly 
enhance the enforcement of our nation's antitrust laws. I urge my 
colleagues to support this important measure.

                          ____________________