[Congressional Record (Bound Edition), Volume 149 (2003), Part 19]
[House]
[Pages 27065-27066]
[From the U.S. Government Publishing Office, www.gpo.gov]




CLARIFICATION OF TAX TREATMENT OF BONDS AND OTHER OBLIGATIONS ISSUED BY 
                      GOVERNMENT OF AMERICAN SAMOA

  Mr. RENZI. Mr. Speaker, I move to suspend the rules and pass the bill 
(H.R. 982) to clarify the tax treatment of bonds and other obligations 
issued by the Government of American Samoa.
  The Clerk read as follows:

                                H.R. 982

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

     SECTION 1. CLARIFICATION OF TAX TREATMENT OF BONDS AND OTHER 
                   OBLIGATIONS ISSUED BY GOVERNMENT OF AMERICAN 
                   SAMOA.

       (a) Exemption of All Bonds From Income Taxation by State 
     and Local Governments.--Subsection (b) of section 202 of 
     Public Law 98-454 (48 U.S.C. 1670) is amended to read as 
     follows:
       ``(b) Exemption of All Bonds From Income Taxation by State 
     and Local Governments.--
       ``(1) In general.--The interest on any bond or other 
     obligation issued by or on behalf of the Government of 
     American Samoa shall be exempt from taxation by the 
     Government of American Samoa and the governments of any of 
     the several States, the District of Columbia, any territory 
     or possession of the United States, and any subdivision 
     thereof.
       ``(2) Exemption applicable only to income taxes.--The 
     exemption provided by paragraph (1) shall not apply to gift, 
     estate, inheritance, legacy, succession, or other wealth 
     transfer taxes.''.

     SEC. 2. EFFECTIVE DATE.

       This Act shall apply to obligations issued after the date 
     of the enactment of this Act.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Arizona (Mr. Renzi) and the gentleman from New Mexico (Mr. Udall) each 
will control 20 minutes.
  The Chair recognizes the gentleman from Arizona (Mr. Renzi).


                             General Leave

  Mr. RENZI. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days within which to revise and extend their remarks 
and include extraneous material on the bill under consideration.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Arizona?
  There was no objection.
  Mr. RENZI. Mr. Speaker, I yield myself such time as I may consume.
  I rise today in support of H.R. 982, a bill to clarify the tax 
treatment of bonds and other obligations issued by the Government of 
American Samoa. This bill, introduced by the gentleman from American 
Samoa (Mr. Faleomavaega), will permit the interest earned on bonds 
issued by the American Samoa Government to be exempt from both State 
and local taxation. Passage of H.R. 982 will provide parity in the tax 
treatment of their bonds with other territories in the United States.
  It is my hope that this legislation would help to provide more 
funding to the American Samoa Government as well as putting this 
territory on the same playing field with others when investors look to 
the islands for economic development.
  At this time, the House Committee on the Judiciary has also passed 
this legislation with strong bipartisan support by their Members. In 
the 107th Congress, we also passed this bill under suspension of the 
rules near the end of that Congress.
  I thank the gentleman from West Virginia (Mr. Rahall) for his work 
with us to move this bill more quickly during this session, and I want 
to thank the gentleman from Wisconsin (Mr. Sensenbrenner) for his 
cooperation in bringing this bill to the floor today. I ask Members to 
adopt H.R. 982.
  Mr. Speaker, I reserve the balance of my time.

[[Page 27066]]



                              {time}  1730

  Mr. UDALL of New Mexico. Mr. Speaker, I yield myself such time as I 
may consume.
  Mr. Speaker, H.R. 982, sponsored by our distinguished colleague, the 
gentleman from American Samoa (Mr. Faleomavaega), is intended to remove 
a barrier to economic development in the U.S. Territory of American 
Samoa.
  In essence, H.R. 982 provides American Samoa parity with other U.S. 
Territories whose bonds are not taxed by the State or local 
governments. I congratulate the gentleman from American Samoa for his 
work on this legislation, and I urge my colleagues to support this 
measure.
  Mr. Speaker, I yield such time as he may consume to the gentleman 
from American Samoa (Mr. Faleomavaega).
  Mr. FALEOMAVAEGA. Mr. Speaker, I rise to express my sense of 
appreciation to the gentleman from Arizona (Mr. Renzi) and the 
gentleman from New Mexico (Mr. Udall) who are both managing several 
pieces of legislation this afternoon. I thank them for their assistance 
and leadership in doing so.
  Mr. Speaker, I would also like to thank the gentleman from California 
(Chairman Pombo) and the gentleman from West Virginia (Mr. Rahall), the 
ranking member, for the Committee on Resources; and the gentleman from 
Wisconsin (Chairman Sensenbrenner) and the gentleman from Michigan (Mr. 
Conyers), the ranking member from the Committee on the Judiciary, for 
their continued support regarding the needs of the territory of 
American Samoa and for their efforts to bring H.R. 982 to the floor 
this afternoon.
  H.R. 982 would amend the U.S. Code to allow interest earned from 
American Samoa bonds to be exempt from both State and local taxation.
  Mr. Speaker, under current Federal law, Congress has expressly 
provided for the exemption of State and local taxes for bonds issued 
for or by the territories of Guam, the Virgin Islands and the 
Commonwealths of Puerto Rico and the Northern Mariana Islands. While 
American Samoa can issue bonds similar to the other territories, the 
interest earned from American Samoa bonds is subject to taxation by 
several States, Washington, D.C. and other territories. This proposed 
legislation would simply provide equity and parity to the territory of 
American Samoa.
  It has been a slight oversight over the years, that is the reason I 
am having to propose this legislation. H.R. 982 would also make 
American Samoa bonds more attractive to investors and will save the 
local government between $20,000 to $50,000 in interest alone on 
municipal bonds it may issue. This legislation will lower the interest 
costs of the prospective sales and will also enable the government to 
address deficiencies in its current infrastructure.
  Mr. Speaker, this legislation is identical to H.R. 1448, which I 
introduced in the 107th Congress, which was adopted by both the 
Committee on the Judiciary and the Committee on Resources, and finally 
agreed to by voice vote on September 24, 2002. Unfortunately, the other 
body was unable to consider this legislation before the 107th Congress 
adjourned.
  However, the Committee on Resources and the Committee on the 
Judiciary have unanimously passed H.R. 982, and I urge my colleagues to 
support this legislation. In doing so, I want to thank committee staff, 
Tony Babauta, and my office staff, Judy Leilani and Lisa Williams, for 
their efforts in making the proper preparations and assisting 
tremendously in bringing this legislation to the floor for 
consideration.
  Mr. RENZI. Mr. Speaker, I reserve the balance of my time.
  Mr. UDALL of New Mexico. Mr. Speaker, I yield myself such time as I 
may consume.
  Mr. Speaker, I just want to congratulate the gentleman from American 
Samoa (Mr. Faleomavaega) on all his hard work in the Committee on 
Resources, his tenacity, and his persistence. I know he has worked hard 
and long on this very important issue to American Samoa. I just want to 
recognize that here today.
  Mr. Speaker, I have no further requests for time, and I yield back 
the balance of my time.
  Mr. RENZI. Mr. Speaker, I have no further requests for time, and I 
yield back the balance of my time.
  The SPEAKER pro tempore (Mr. Boozman). The question is on the motion 
offered by the gentleman from Arizona (Mr. Renzi) that the House 
suspend the rules and pass the bill, H.R. 982.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill was passed.
  A motion to reconsider was laid on the table.

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