[Congressional Record (Bound Edition), Volume 149 (2003), Part 7]
[Senate]
[Pages 9906-9916]
[From the U.S. Government Publishing Office, www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. STEVENS (for himself, Mr. Campbell, Mr. Domenici, Mr. 
        Hatch, Mr. Inouye, and Ms. Murkowski):
  S. 931. A bill to direct the Secretary of the Interior to undertake a 
program to reduce the risks from and mitigate the effects of avalanches 
on visitors to units of the National Park System and on other 
recreational users of public land; to the Committee on Energy and 
Natural Resources.
  Mr. STEVENS. Mr. President, today I introduce, with Senators 
Campbell, Domenici, Hatch, Inouye, and Murkowski, the Federal Land 
Recreational Visitor Protection Act of 2003.
  Across our State of Alaska, Western States, and areas of the 
Northeast, local governments and businesses struggle each year to 
remove potential avalanches or recover form the disastrous effects of 
avalanches. The West

[[Page 9907]]

Wide Avalanche Network calculated avalanche damage totals for the 
Western U.S. between $600 thousand and $800 thousand annually. These 
costs do not include the economic losses from town cut-off by 
avalanches. In our state alone, the Safety Center estimates upwards of 
$18 million in direct damages both to private property and economic 
losses over the past 5 years.
  While such damage can bring hardships to many local communities, none 
can compare with the loss of a friend or family member. The U.S. 
averages 30 deaths a year from avalanches, a majority of which are 
results of recreational activities in unmitigated avalanche areas. Some 
States set aside money for rescues prior to the winter season, knowing 
that the resources required to clear all avalanche threats are not at 
hand.
  This bill brings those resources to the entities that need them the 
most, enabling us to significantly reduce the effects of avalanches on 
visitors, recreational users, transportation corridors, and our local 
communities.
                                 ______
                                 
      By Mr. BREAUX (for himself, Mr. Ensign, Mr. Crapo, and Mr. 
        Bunning):
  S. 932. A bill to amend the Internal Revenue Code of 1986 to allow a 
credit against income tax for taxpayers owning certain commercial power 
takeoff vehicles; to the Committee on Finance.
  Mr. BREAUX. Mr. President, today I rise to introduce the Fuel Tax 
Equalization Credit for Substantial Power Takeoff Vehicles Act. This 
bill upholds a long-held principle in the application of the Federal 
fuels excise tax, and restores this principle for certain single engine 
``dual-use'' vehicles.
  This long-held principle is simple: fuel consumed for the purpose of 
moving vehicles over the road is taxed, while fuel consumed for ``off-
road'' purposes is not taxed. The tax is designed to compensate for the 
wear and tear impacts on roads. Fuel used for a non-propulsion ``off-
road'' purpose has no impact on the roads. It should not be taxed as if 
it does. This bill is based on this principle, and it remedies a 
problem created by IRS regulations that control the application of the 
federal fuels excise tax to ``dual-use'' vehicles.
  Duel-use vehicles are vehicles that use fuel both to propel the 
vehicle on the road, and also to operate separate, on-board equipment. 
The two prominent examples of duel-use vehicles are concrete mixers, 
which use fuel to rotate the mixing drum, and sanitation trucks, which 
use fuel to operate the compactor. Both of these trucks move over the 
road, but at the same time, a substantial portion of their fuel use is 
attributable to the non-propulsion function.
  The current problem developed because progress in technology has 
outstripped the regulatory process. In the past, duel-use vehicles 
commonly had two engines, IRS regulations, written in the 1950's, 
specifically exempt the portion of fuel used by the separate engine 
that operates special equipment such as a mixing drum or a trash 
compactor. These IRS regulations reflect the principle that fuel 
consumed for non-propulsion purposes is not taxed.
  Today, however, typical duel-use vehicles use only one engine. The 
single engine both propels the vehicle over the road and powers the 
non-propulsion function through ``power takeoff.'' a major reason for 
the growth of these single-engine, power takeoff vehicles is that they 
use less fuel. And a major benefit for everyone is that they are better 
for the environment.
  Power takeoff was not in widespread use when the IRS regulations were 
drafted, and the regulations deny an exemption for fuel used in single-
engine, duel-use vehicles. The IRS defends its distinction between one-
engine and two-engine, vehicles based on possible administrative 
problems if vehicle owners were permitted to allocate fuel between the 
propulsion and non-propulsion functions.
  Our bill is designed to address the administrative concerns expressed 
by the IRS, but at the same time, restore tax fairness for fuel-use 
vehicles with one engine. The bill does this by establishing an annual 
tax credit available for taxpayers that own a licensed and insured 
concrete mixer or sanitation truck with a compactor. The amount of the 
credit is $250 and is a conservative estimate of the excise taxes 
actually paid, based on information compiled on typical sanitation 
trucks and concrete mixers.
  In sum, as a fixed income tax credit, no audit or administrative 
issue will arise about the amount of fuel used for the off-road 
purpose. At the same time, the credit provides a rough justice method 
to make sure these taxpayers are not required to pay tax on fuels that 
they shouldn't be paying. Also, as an income tax credit, the proposal 
would have no effect on the highway trust fund.
  I would like to stress that I believe the IRS' interpretation of the 
law is not consistent with long-held principles under the tax law, 
despite their administrative concerns. Quite simply, the law should not 
condone a situation where taxpayers are required to pay the excise tax 
on fuel attributable to non-propulsion functions. This bill corrects an 
unfair tax that should have never been imposed in the first place, I 
urge my colleagues to cosponsor this important piece of 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:

       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 ``Fuel Tax Equalization Credit 
     for Substantial Power Takeoff Vehicles Act''.

     SEC. 2. CREDIT FOR TAXPAYERS OWNING COMMERCIAL POWER TAKEOFF 
                   VEHICLES.

       (a) In General.--Subpart D of part IV of subchapter A of 
     chapter 1 of the Internal Revenue Code of 1986 (relating to 
     business-related credits) is amended by adding at the end the 
     following new section:

     ``SEC. 45G. COMMERCIAL POWER TAKEOFF VEHICLES CREDIT.

       ``(a) General Rule.--For purposes of section 38, the amount 
     of the commercial power takeoff vehicles credit determined 
     under this section for the taxable year is $250 for each 
     qualified commercial power takeoff vehicle owned by the 
     taxpayer as of the close of the calendar year with or within 
     which the taxable year ends.
       ``(b) Definitions.--For purposes of this section--
       ``(1) Qualified commercial power takeoff vehicle.--The term 
     `qualified commercial power takeoff vehicle' means any 
     highway vehicle described in paragraph (2) which--
       ``(A) is propelled by any fuel subject to tax under section 
     4041 or 4081, and
       ``(B) is used in a trade or business or for the production 
     of income (and is licensed and insured for such use).
       ``(2) Highway vehicle described.--A highway vehicle is 
     described in this paragraph if such vehicle is--
       ``(A) designed to engage in the daily collection of refuse 
     or recyclables from homes or businesses and is equipped with 
     a mechanism under which the vehicle's propulsion engine 
     provides the power to operate a load compactor, or
       ``(B) designed to deliver ready mixed concrete on a daily 
     basis and is equipped with a mechanism under which the 
     vehicle's propulsion engine provides the power to operate a 
     mixer drum to agitate and mix the product en route to the 
     delivery site.
       ``(c) Exception for Vehicles Used by Governments, Etc.--No 
     credit shall be allowed under this section for any vehicle 
     owned by any person at the close of a calendar year if such 
     vehicle is used at any time during such year by--
       ``(1) the United States or an agency or instrumentality 
     thereof, a State, a political subdivision of a State, or an 
     agency or instrumentality of one or more States or political 
     subdivisions, or
       ``(2) an organization exempt from tax under section 501(a).
       ``(d) Denial of Double Benefit.--The amount of any 
     deduction under this subtitle for any tax imposed by 
     subchapter B of chapter 31 or part III of subchapter A of 
     chapter 32 for any taxable year shall be reduced (but not 
     below zero) by the amount of the credit determined under this 
     subsection for such taxable year.''.
       (b) Credit Made Part of General Business Credit.--
     Subsection (b) of section 38 of the Internal Revenue Code of 
     1986 (relating to general business credit) is amended by 
     striking ``plus'' at the end of paragraph (14), by striking 
     the period at the end of paragraph (15) and inserting ``, 
     plus'', and by adding at the end the following new paragraph:
       ``(16) the commercial power takeoff vehicles credit under 
     section 45G(a).''.
       (c) No Carryback Before January 1, 2003.--Subsection (d) of 
     section 39 of the Internal Revenue Code of 1986 (relating to 
     carryback and carryforward of unused credits) is amended by 
     adding at the end the following new paragraph:

[[Page 9908]]

       ``(11) No carryback of section 45g credit before january 1, 
     2003.--No portion of the unused business credit for any 
     taxable year which is attributable to the credit determined 
     under section 45G may be carried back to a taxable year 
     beginning before January 1, 2003.''.
       (d) Clerical Amendment.--The table of sections for subpart 
     D of 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:

``Sec. 45G. Commercial power takeoff vehicles credit.''.
       (e) Effective Date.--The amendments made by this section 
     shall apply to taxable years ending after December 31, 2002.
                                 ______
                                 
      By Mr. BAUCUS (for himself, Mr. Grassley, and Mr. McCain):
  S. 936. A bill to amend the Internal Revenue Code of 1986 to deny any 
deduction for certain fines, penalties, and other amounts; to the 
Committee on Finance.
  Mr. BAUCUS. Mr. President, today, we are introducing the ``Government 
Settlement Transparency Act of 2003.'' Over the past several months, we 
have become increasingly concerned about the approval of various 
settlements that allow penalty payments made to the government in 
settlement of a violation or potential violation of the law to be tax 
deductible. This payment structure shifts the tax burden from the 
wrongdoer onto the backs of the American people. This is unacceptable.
  The issue of tax deductibility is particularly relevant in the 
settlement of various SEC investigations into violations or potential 
violations of the securities laws. The corporate meltdown of the past 
two years has caused investors to lose confidence in the stock market. 
To address investors' loss of faith, Congress passed the Sarbanes-Oxley 
Act last July. However, Sarbanes-Oxley begins to address only part of 
the corporate reform problem, as it applies solely to future corporate 
activity. To more fully restore confidence in the markets, America's 
State and Federal regulators are also working to hold accountable the 
corporate executives and others in corporate America responsible for 
damaging investor confidence. With these efforts to achieve greater 
accountability in the business community and ensure the integrity of 
our financial markets, it is important that the rules governing the 
appropriate tax treatment of settlements be clear and adhered to by 
taxpayers.
  Section 162(f) of the Internal Revenue Code provides that no 
deduction is allowed as a trade or business expense under section 
162(a) for the payment of a fine or penalty to a government for 
violation of any law. The enactment of section 162(f) in 1969 codified 
existing case law that denied the deductibility of fines and penalties 
as ordinary and necessary business expenses on the grounds that 
``allowance of the deduction would frustrate sharply defined national 
or state policies proscribing the particular types of conduct evidenced 
by some governmental declaration thereof.'' Treasury regulations 
provide that fine or penalty includes an amount paid in settlement of 
the taxpayer's actual or potential liability for a fine or penalty.
  The legislation introduced today modifies the rules regarding the 
determination of whether payments are nondeductible payments of fines 
of penalties under section 162(f). In particular, the bill generally 
provides that amounts paid or incurred, whether by suit, agreement, or 
otherwise to, or at the direction of, a government in relation to the 
violation of any law or the investigation or inquiry into the potential 
violation of any law are nondeductible. The bill applies to deny a 
deduction for any payment, including those where there is no admission 
of guilt or liability and those made for the purpose of avoiding 
further investigation or litigation.
  An exception applies to payments that the taxpayer establishes are 
restitution. It is intended that a payment will be treated as 
restitution only if the payment is required to be paid to the specific 
persons, or in relation to the specific property, actually harmed by 
the conduct of the taxpayer that resulted in the payment. Thus, a 
payment to or with respect to a class broader than the specific persons 
or property that were actually harmed, for example, to class including 
similarly situated persons or property, does not qualify as 
restitution. Restitution is limited to the amount that bears a 
substantial quantitative relationship to the harm caused by the past 
conduct or actions of the taxpayer that resulted in the payment in 
question. If the party harmed is a government, then restitution 
includes payment to such harmed government, provided the payment bears 
a substantial quantitative relationship to the harm. However, 
restitution does not include reimbursement of government investigative 
or litigation costs, or do payments to whistleblowers.
  The bill would be effective for amounts paid or incurred on or after 
April 28th, 2003, except that it would not apply to amounts paid or 
incurred under any binding order or agreement entered into before such 
date.
  We 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. 936

       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 ``Government Settlement 
     Transparency Act of 2003''.

     SEC. 2. DENIAL OF DEDUCTION FOR CERTAIN FINES, PENALTIES, AND 
                   OTHER AMOUNTS.

       (a) In General.--Subsection (f) of section 162 of the 
     Internal Revenue Code of 1986 (relating to trade or business 
     expenses) is amended to read as follows:
       ``(f) Fines, Penalties, and Other Amounts.--
       ``(1) In general.--Except as provided in paragraph (2), no 
     deduction otherwise allowable shall be allowed under this 
     chapter for any amount paid or incurred (whether by suit, 
     agreement, or otherwise) to, or at the direction of, a 
     government in relation to the violation of any law or the 
     investigation or inquiry into the potential violation of any 
     law.
       ``(2) Exception for amounts constituting restitution.--
     Paragraph (1) shall not apply to any amount which the 
     taxpayer establishes constitutes restitution for damage or 
     harm caused by the violation of any law or the potential 
     violation of any law. This paragraph shall not apply to any 
     amount paid or incurred as reimbursement to the government 
     for the costs of any investigation or litigation.
       ``(3) Treatment of certain nongovernmental regulatory 
     entities.--For purposes of paragraph (1), amounts paid or 
     incurred to, or at the direction of, the following 
     nongovernmental entities shall be treated as amounts paid or 
     incurred to, or at the direction of, a government:
       ``(A) Any nongovernmental entity which exercises self-
     regulatory powers (including imposing sanctions) in 
     connection with a qualified board or exchange (as defined in 
     section 1256(g)(7)).
       ``(B) To the extent provided in regulations, any 
     nongovernmental entity which exercises self-regulatory powers 
     (including imposing sanctions) as part of performing an 
     essential governmental function.''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to amounts paid or incurred after April 27, 2003, 
     except that such amendment shall not apply to amounts paid or 
     incurred under any binding order or agreement entered into on 
     or before April 27, 2003. Such exception shall not apply to 
     an order or agreement requiring court approval unless the 
     approval was obtained on or before April 27, 2003.
                                 ______
                                 
      By Mr. HAGEL (for himself, Mr. Harkin, Mr. Warner, Mr. Chaffee, 
        Ms. Collins, Ms. Snowe, Mr. Coleman, Mr. Kennedy, Mr. Jeffords, 
        Mr. Dodd, Ms. Mikulski, Mrs. Clinton, Mrs. Murray, Mr. 
        Bingaman, and Mr. Reed.):
  S. 939. A bill to amend part B of the individuals with Disabilities 
Education Act to provide full Federal funding of such part, to provide 
an exception to the local maintenance of effort requirements, and for 
other purposes; to the Commitee on Health, Education, Labor, and 
Pensions.
  Mr. HAGEL. 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. 939

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

[[Page 9909]]



     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``IDEA Full-Funding Act of 
     2003''.

     SEC. 2. AMENDMENTS TO IDEA.

       (a) Funding.--Section 611(j) of the Individuals with 
     Disabilities Education Act (20 U.S.C. 1411(j)) is amended to 
     read as follows:
       ``(j) Funding.--For the purpose of carrying out this part, 
     other than section 619, there are authorized to be 
     appropriated--
       ``(1) $10,874,000,000 for fiscal year 2004, and, there are 
     hereby appropriated $2,000,000,000 for fiscal year 2004, 
     which shall become available for obligation on July 1, 2004 
     and shall remain available through September 30, 2005;
       ``(2) $12,874,000,000 for fiscal year 2005, and, there are 
     hereby appropriated $4,000,000,000 for fiscal year 2005, 
     which shall become available for obligation on July 1, 2005 
     and shall remain available through September 30, 2006;
       ``(3) $14,874,000,000 for fiscal year 2006, and, there are 
     hereby appropriated $6,000,000,000 for fiscal year 2006, 
     which shall become available for obligation on July 1, 2006 
     and shall remain available through September 30, 2007;
       ``(4) $16,874,000,000 for fiscal year 2007, and, there are 
     hereby appropriated $8,000,000,000 for fiscal year 2007, 
     which shall become available for obligation on July 1, 2007 
     and shall remain available through September 30, 2008;
       ``(5) $18,874,000,000 for fiscal year 2008, and, there are 
     hereby appropriated $10,000,000,000 for fiscal year 2008, 
     which shall become available for obligation on July 1, 2008 
     and shall remain available through September 30, 2009;
       ``(6) $20,874,000,000 for fiscal year 2009, and, there are 
     hereby appropriated $12,000,000,000 for fiscal year 2009, 
     which shall become available for obligation on July 1, 2009 
     and shall remain available through September 30, 2010;
       ``(7) $22,874,000,000 for fiscal year 2010, and, there are 
     hereby appropriated $14,000,000,000 for fiscal year 2010, 
     which shall become available for obligation on July 1, 2010 
     and shall remain available through September 30, 2011;
       ``(8) $24,635,000,000 or the sum of the maximum amounts 
     that all States may receive under subsection (a)(2), 
     whichever is lower, for fiscal year 2011, and, there are 
     hereby appropriated $15,761,000,000 for fiscal year 2011, 
     which shall become available for obligation on July 1, 2011 
     and shall remain available through September 30, 2012, except 
     that if the sum of the maximum amounts that all States may 
     receive under subsection (a)(2) is less than $24,635,000,000, 
     then the amount appropriated in this paragraph shall be 
     reduced by the difference between $24,635,000,000 and the sum 
     of the maximum amounts that all States may receive under 
     subsection (a)(2);
       ``(9) $25,329,000,000 or the sum of the maximum amounts 
     that all States may receive under subsection (a)(2), 
     whichever is lower, for fiscal year 2012, and, there are 
     hereby appropriated $16,455,000,000 for fiscal year 2012, 
     which shall become available for obligation on July 1, 2012 
     and shall remain available through September 30, 2013, except 
     that if the sum of the maximum amounts that all States may 
     receive under subsection (a)(2) is less than $25,329,000,000, 
     then the amount appropriated in this paragraph shall be 
     reduced by the difference between $25,329,000,000 and the sum 
     of the maximum amounts that all States may receive under 
     subsection (a)(2);
       ``(10) $26,005,000,000 or the sum of the maximum amounts 
     that all States may receive under subsection (a)(2), 
     whichever is lower, for fiscal year 2013, and, there are 
     hereby appropriated $17,131,000,000 for fiscal year 2013, 
     which shall become available for obligation on July 1, 2013 
     and shall remain available through September 30, 2014, except 
     that if the sum of the maximum amounts that all States may 
     receive under subsection (a)(2) is less than $26,005,000,000, 
     then the amount appropriated in this paragraph shall be 
     reduced by the difference between $26,005,000,000 and the sum 
     of the maximum amounts that all States may receive under 
     subsection (a)(2); and
       ``(11) such sums as may be necessary for fiscal year 2014 
     and each succeeding fiscal year.''.
       (b) Exception to the Local Maintenance of Effort 
     Requirements.--Section 613(a)(2)(B) of the Individuals with 
     Disabilities Education Act (20 U.S.C. 1413(a)(2)(B)) is 
     amended to read as follows:
       ``(B) Exception.--Notwithstanding the restriction in 
     subparagraph (A)(iii), a local educational agency may reduce 
     the level of expenditures, for 1 fiscal year at a time, if--
       ``(i) the State educational agency determines, and the 
     Secretary agrees, that the local educational agency is in 
     compliance with the requirements of this part during that 
     fiscal year (or, if appropriate, the preceding fiscal year); 
     and
       ``(ii) such reduction is--

       ``(I) attributable to the voluntary departure, by 
     retirement or otherwise, or departure for just cause, of 
     special education personnel;
       ``(II) attributable to a decrease in the enrollment of 
     children with disabilities;
       ``(III) attributable to the termination of the obligation 
     of the agency, consistent with this part, to provide a 
     program of special education to a particular child with a 
     disability that is an exceptionally costly program, as 
     determined by the State educational agency, because the 
     child--

       ``(aa) has left the jurisdiction of the agency;
       ``(bb) has reached the age at which the obligation of the 
     agency to provide a free appropriate public education to the 
     child has terminated; or
       ``(cc) no longer needs such program of special education;

       ``(IV) attributable to the termination of costly 
     expenditures for long-term purchases, such as the acquisition 
     of equipment or the construction of school facilities; or
       ``(V) equivalent to the amount of Federal funding the local 
     educational agency receives under this part for a fiscal year 
     that exceeds the amount the agency received under this part 
     for the preceding fiscal year, but only if these reduced 
     funds are used for any activity that may be funded under the 
     Elementary and Secondary Education Act of 1965 (20 U.S.C. 
     6301 et seq.).''.

       (c) Repeal.--Section 613(a)(2) of the Individuals with 
     Disabilities Education Act (20 U.S.C. 1413(a)(2)) is further 
     amended--
       (1) by striking subparagraph (C);
       (2) by redesignating subparagraph (D) as subparagraph (C); 
     and
       (3) in subparagraph (A)(iii), by striking ``paragraphs (B) 
     and (C)'' and inserting ``paragraph (B)''.
                                  ____

  Mr. HARKIN. Mr. President, today, Senator Hagel and I, and others 
introduce ``The IDEA Full Funding Act of 2003.'' This bill will provide 
increased mandatory funding for the Individuals with Disabilities 
Education Act, IDEA, and meet the Federal Government's commitment to 
pay 40 percent of the average per pupil expenditures. These additional 
funds will ensure that every child with a disability gets a free, 
appropriate public education.
  In 1975, when the IDEA was passed in the House and Senate, there was 
an agreement made by negotiators based on the understanding that the 
Federal Government's goal would be to provide 40 percent of the average 
per pupil expenditures in each local education area. There was no time 
frame placed on this goal, but since that time it has been understood 
that ``full funding'' for IDEA means reaching that 40 percent goal.
  For the past 28 years, we have put additional resources into IDEA but 
we have not come close to full funding. This bill will put our money 
where our mouth is and say that the federal government will be full 
partners with states and local governments in meeting the needs of 
children with disabilities.
  This bill fully funds the IDEA. It appropriates funds for the next 10 
years, gradually increasing the percentage of funds which are mandatory 
and increasing the amounts so that in year 8 we are at the level 
projected to equal 40 percent of the average per pupil expenditure. 
While we have seen welcome increases in IDEA spending over the past few 
years, past year increases do not guarantee future increases. This bill 
guarantees full funding, phased in over 8 years.
  This bill does not create a new entitlement program. It provides 
advanced appropriations for the next 10 years, but it has a set amount 
for each year, not an open-ended figure.
  This bill also provides incentive for compliance with the 
requirements of IDEA. If all of the IDEA-eligible children are getting 
the services that they are entitled to, then local property taxpayers 
get relief.
  Last year, the Senate passed an amendment to the reauthorization of 
the Elementary and Secondary Education Act which would have required 
full funding of IDEA. The full funding provision was not in the final 
conference report. Prior to that amendment, there have been 22 separate 
bills and resolutions in the House and Senate calling for full funding.
  This year, the time has come for full funding to make it into law. It 
has been 28 years since the Federal Government agreed to pay a share of 
IDEA and it is time to meet that goal.
  The IDEA has been remarkably successful. In 1975, only \1/5\ of 
children with disabilities received a formal education and several 
States had laws specifically excluding many children with disabilities, 
including those who were blind, deaf, or had mental health needs from 
receiving such an education. The most recent data on the number of 
children served under IDEA indicates

[[Page 9910]]

that over 6 million children are currently benefiting from the law.
  Although IDEA has been successful, there is more work to be done. 
Every time I speak to school districts in Iowa, they tell me that the 
costs of special education are very difficult for them to manage. Some 
parents of children with disabilities also complain that their children 
are not getting the education promised by IDEA.
  This bill will provide significant additional resources. In 2003, we 
are funding $17.6 percent of the cost at 8.8 billion dollars. Under our 
bill, this number rises steeply to 22 percent of the cost and 10.8 
billion dollars in 2004. The increases continue until 2011, when we 
reach 40 percent and an expenditure of 24.6 billion. Iowa sees its 
funding rise from 96 million in 2003 to 278.3 million in 2011. We are 
more than doubling the resources going to special education in Iowa and 
elsewhere.
  I want to thank Senator Hagel for his ongoing leadership on this 
issue and for his work in achieving bipartisan support for this bill. I 
also want to thank Senators Kennedy, Jeffords and Dodd for their 
longstanding commitment to fully funding IDEA. In addition, I want to 
acknowledge all of the co-sponsors of this bill, who are joining me 
today in leading the way for Congress to finally pass full funding into 
law.
  This is a win-win-win bill. With this advance appropriations, 
students with disabilities will get the public education they have a 
right to, school districts will be able to provide services without 
cutting into their general education budgets, and in cases where all 
IDEA-eligible children are getting the services they are entitled to, 
property taxpayers get relief.
  Ms. MIKULSKI. Mr. President, I rise in support of the IDEA Full 
Funding Act of 2003. I'm so proud to cosponsor this important 
legislation. This bill provides mandatory increases for IDEA funding 
each year, so that the Federal Government will be paying its full share 
of the cost of special education by 2011. This legislation is long 
overdue. I think it's shocking that the President is fighting for tax 
breaks for zillionaires while delaying help for those who need it 
most--the children with special needs and their parents and teachers. 
We must fully fund IDEA to ensure that children with disabilities are 
receiving the services they need to succeed with their classmates in 
public schools.
  In 1975, Congress promised to pay 40 percent of the cost of special 
education when it passed the Individuals with Disabilities Education 
Act. Yet it has never paid more than 17.5 percent. That means local 
districts must make up the difference, either by cutting from other 
education programs or by raising taxes. I don't want to force States 
and local school districts to forage for funds, cut back on teacher 
training, or delay school repairs because the Federal Government has 
failed to live up to its commitment to special education. That's why 
fully funding IDEA is one of my top priorities.
  Everywhere I go in Maryland, I hear about IDEA. I hear about it in 
urban, rural, and suburban communities, from Democrats and Republicans, 
and from parents and teachers. They tell me that the Federal Government 
is not living up to its promise, that special education costs about 18 
percent of the average school budget, that schools are suffering, and 
the parents are worried.
  Parents today are under a lot of stress--sometimes working two jobs 
just to make ends meet, trying to find day care for their kids, and 
elder care for their own parents. The Federal Government shouldn't add 
to their worries by not living up to its obligations. With the Federal 
Government not paying its share of special ed these parents have real 
questions in their minds: Will my child have a good teacher? Will the 
classes have up-to-date textbooks? Will they be learning what they need 
to know?
  Parents of disabled children face such a tough burden already. School 
should not be one of the many things they have to worry about, 
particularly when the laws are already on the books to guarantee their 
child a public school education. The bottom line is that the Federal 
Government is shortchanging these parents by not paying its share of 
special ed costs.
  This bill will give local governments the resources they need to 
improve education for all children. It will free up money in local 
budgets for hiring more teachers, buying new textbooks and technology, 
and repairing old school buildings. It will help the teachers who 
struggle with teaching the toughest students. It will help students 
with disabilities and their families by providing enough funding for 
special education programs so parents can have one less thing to worry 
about, and students get the opportunities they deserve.
  Full funding of IDEA is essential. It will give disabled children a 
chance to succeed in school and in life without shortchanging other 
vital education programs. It will give parents peace of mind about 
their children's education. Let's pass this bill as soon as possible.
                                 ______
                                 
      By Mr. GRAHAM of South Carolina:
  S. 940. A bill to amend the Immigration and Nationality Act relating 
to naturalization through service in the Armed Forces of the United 
States; to the Committee on the Judiciary.
  Mr. GRAHAM of South Carolina. 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. 940

       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 ``Armed Forces Citizenship Act 
     of 2003''.

     SEC. 2. NATURALIZATION THROUGH SERVICE IN THE ARMED FORCES OF 
                   THE UNITED STATES.

       (a) Minimum Period of Service Eliminated.--Section 328(a) 
     of the Immigration and Nationality Act (8 U.S.C. 1439(a)) is 
     amended by striking ``for a period or periods aggregating 
     three years,''.
       (b) Prohibition on Imposition of Fees Relating to 
     Naturalization.--Section 328(b) of the Immigration and 
     Nationality Act (8 U.S.C. 1439(b)) is amended--
       (1) in paragraph (3)--
       (A) by striking ``honorable. The'' and inserting 
     ``honorable (the''; and
       (B) by striking ``discharge.'' and inserting ``discharge); 
     and''; and
       (2) by adding at the end the following:
       ``(4) notwithstanding any other provision of law, no fee 
     shall be charged or collected from the applicant for filing 
     an application under subsection (a) or for the issuance of a 
     certificate of naturalization upon citizenship being granted 
     to the applicant, and no clerk of any State court shall 
     charge or collect any fee for such services unless the laws 
     of the State require such charge to be made, in which case 
     nothing more than the portion of the fee required to be paid 
     to the State shall be charged or collected.''.
       (c) Conduct of Naturalization Proceedings Overseas for 
     Members of the Armed Forces of the United States.--
     Notwithstanding any other provision of law, the Secretary of 
     Homeland Security, the Secretary of State, and the Secretary 
     of Defense shall ensure that any applications, interviews, 
     filings, oaths, ceremonies, or other proceedings under title 
     III of the Immigration and Nationality Act (8 U.S.C. 1401 et 
     seq.) relating to naturalization of members of the Armed 
     Forces are available through United States embassies, 
     consulates, and as practicable, United States military 
     installations overseas.
       (d) Revocation of Citizenship for Separation from Military 
     Service Under Other Than Honorable Conditions.--Section 328 
     of the Immigration and Nationality Act (8 U.S.C. 1439) is 
     amended by adding at the end the following:
       ``(f) Citizenship granted pursuant to this section may be 
     revoked in accordance with section 340 if at any time 
     subsequent to naturalization the person is separated from the 
     military, air, or naval forces under other than honorable 
     conditions, and such ground for revocation shall be in 
     addition to any other provided by law. The fact that the 
     naturalized person was separated from the service under other 
     than honorable conditions shall be proved by a duly 
     authenticated certification from the executive department 
     under which the person was serving at the time of 
     separation.''.
       (e) Technical and Conforming Amendment.--Section 328(b)(3) 
     of the Immigration and Nationality Act (8 U.S.C. 1439(b)(3)) 
     is amended by striking ``Attorney General'' and inserting 
     ``Secretary of Homeland Security''.
                                 ______
                                 
      By Mr. BROWNBACK (for himself and Mr. Nelson of Nebraska):
  S. 942. A bill to amend title XVIII of the Social Security Act to 
provide for improvements in access to services in

[[Page 9911]]

rural hospitals and critical access hospitals; to the Committee on 
Finance.
  Mr. BROWNBACK. Mr. President, rural America has been depopulating at 
an alarming rate. The same is true for the rural counties in Kansas. In 
fact, over half of the counties in the State are losing population.
  We are going to stop that trend.
  Senators, like Ben Nelson and I, who grew up in small towns know a 
little secret. Rural America is a great place to live. However, for 
rural towns to compete with urban areas for talented young people, they 
have to be able to provide the basics--like high quality health care.
  For the hospitals represented here today to be able to provide high 
quality health care for rural America, they have to be able to count on 
Medicare for fair reimbursement. For quite a few hospitals in Kansas, 
70 and 80 percent of their caseload is paid for by Medicare. For the 
communities these hospitals serve, fair Medicare reimbursement is 
vitally important.
  Unfortunately, much of the regulation that comes out of CMS is based 
on economics of scale. The actuaries and accountants in Baltimore 
produce payment systems and formulas for reimbursement. The assumption 
is that the hospitals that are the most efficient will be the most 
successful. Unfortunately, efficiency is often a product of volume. If 
you treat 5,000 stroke patients in a year, you are probably going to be 
more efficient than if you treat only 5.
  Efficiency is a laudable goal, but it shouldn't be the only goal of 
Medicare. Particularly, when it comes to providing health care in a 
hospital with fewer than 50 beds.
  That is why Senator Nelson and I are introducing the ``Rural 
Community Hospital Assistance Act of 2003.'' Rather than rely on 
formulas calculated by CMS bureaucrats in Baltimore, the hospitals 
covered under our bill will rely on cost-based reimbursement. In 
addition, the bill recognizes that these hospitals don't have the 
volume to cover bad debt from patients and to keep up with growing 
demands for new technology and infrastructure.
  This bill will create a new Rural Community Hospital designation 
within Medicare for rural hospitals with fewer than 50 beds.
  These hospitals will be eligible for cost-based reimbursement for 
impatient and outpatient services; a technology and infrastructure add 
on; cost based reimbursement for home health services where the 
provider is isolated; cost based reimbursement for ambulance services; 
and the restoration of Medicare bad debt payments at 100 percent.
  And the cost of the bill, which we believe with stabilize health care 
in rural America, is less than \1/2\ of 1 percent of annual Medicare 
expenditures.
  This is an important bill for rural hospitals; and I don't think you 
can overestimate the importance of rural hospitals to the communities 
they serve.
  Mr. NELSON of Nebraska. Mr. President, today I join Senator Brownback 
in introducing the Rural Community Hospital Assistance Act. This 
legislation is intended to ensure the future of small rural hospitals 
by restructuring the way they are reimbursed for Medicare services by 
basing the reimbursements on actual costs instead of the current pre-
set cost structure.
  Current law allows for very small hospitals--designated Critical 
Access Hospitals, CAH, to receive cost-based Medicare reimbursements. 
To qualify as a CAH the facility must have no more than 15 acute care 
beds.
  In rural communities, hospital facilities that are slightly larger 
than the 15 bed limit share with Critical Access Hospitals the same 
economic conditions, the same treatment challenges, the same disparity 
in coverage area but do not share the same reimbursement arrangement. 
These rural hospitals have to compete with larger urban-based hospitals 
that can perform the same services at drastically reduced costs. They 
are also discouraged from investing in technology and other methods to 
improve the quality of care in their communities because those 
investments are not supported by Medicare reimbursement procedures.
  The legislation would provide cost-based Medicare reimbursement by 
creating a new ``rural'' designation under the Medicare reimbursement 
system. This new designation would benefit seven Nebraska hospitals. 
Hospitals in McCook, Alliance, Broken Bow, Beatrice, Columbus, Holdrege 
and Lexington would fall under this new designation, and would have 
similar benefits provided to nearly sixty other Nebraska hospitals 
classified under the CAH system.
  The legislation would also improve the hospitals with critical access 
status. Nearly sixty existing CAH facilities in Nebraska already 
receive cost-based reimbursements for inpatient and outpatient 
services. The legislation would further assist these existing CAH 
facilities by allowing them a return on equity for technology and 
infrastructure investments and by extending the cost-based 
reimbursement to certain post-acute services.
  Rural hospitals cannot continue to provide these services without 
having Medicare cover the costs. If something is not done, the larger 
hospitals may be forced to cut back on the number of beds they keep--
and the number of people they care for, and others may be forced to 
close their doors. These hospitals provide jobs, good wages, health 
care and economic development opportunity for these communities. 
Without access to these hospitals, these communities would not survive. 
The Rural Community Hospital Assistance Act will ensure that the 
community has access to high quality health care that is affordable to 
the patient and the provider.
                                 ______
                                 
      By Mr. JEFFORDS (for himself, Mr. Durbin, Mr. Reid, and Mr. 
        Kerry):
  S. 944. A bill to enhance national security, environmental quality, 
and economic stability by increasing the production of clean, 
domestically produced renewable energy as a fuel source for the 
national electric system; to the Committee on Energy and Natural 
Resources.
  Mr. JEFFORDS. Mr. President, I rise today to introduce, along with 
Senators Durbin, Reid, and Kerry, the ``Renewable Energy Investment Act 
of 2003.''
  This legislation will guarantee that by the year 2020, twenty percent 
of our electricity will be produced from renewable energy resources. 
These resources include wind, biomass, solar, ocean, geothermal and 
landfill gas.
  Again and again, I have heard members come to this floor and say how 
important renewable energy is to our environment, to our national 
security, and to our domestic economic stability. I agree. But if we 
want to achieve these great benefits, we must, as they say, ``put our 
money where our mouth is.'' It is time to pass realistic, achievable 
standards to guarantee that renewable energy is produced.
  The Renewable Energy Investment Act of 2003 is a very important step 
in that direction. It will create a renewable portfolio standard or 
``RPS'' under which utilities and others who supply electricity to 
retail consumers will be required to ensure that by the year 2020, 
twenty percent of our domestic electricity is generated from renewable 
energy sources. The RPS in this legislation provides a flexible, 
market-driven system of tradeable credits by which utilities can 
readily achieve these renewable energy requirements.
  Why twenty percent by 2020? Because the U.S. Department of Energy, 
through its Energy Information Administration, has repeatedly indicated 
that requiring that twenty percent of our electricity come from 
renewable energy by the year 2020 will actually lower overall consumer 
energy costs, while at the same time achieving tremendous environmental 
benefits.
  According to the most recent estimates derived from the Department of 
Energy, consumer electricity prices under a twenty percent renewable 
portfolio standard would be largely the same as without one. According 
to the Department of Energy, retail electricity costs by the year 2020 
without an RPS would be 6.5 cents per kilowatt hour. If a 20 percent 
RPS is in effect, retail electricity costs would be approximately 6.7 
cents per kilowatt hour.

[[Page 9912]]

  However, the Department of Energy studies also indicate that because 
an RPS creates a more diverse and competitive market for energy supply, 
overall domestic consumer energy costs will actually decrease by almost 
nine percent.
  Equally important, shifting to greater renewable energy production 
will have dramatic impacts on human health and the environment. The 
Department of Energy has found that, as demand for energy grows, 
without changes to Federal law U.S. carbon emissions will increase 
forty seven percent above the 1990 level by 2020. However, with a 
twenty percent renewables standard, U.S. carbon dioxide emissions will 
decrease by more than eighteen percent by 2020.
  Electricity production, primarily from burning coal, is the source of 
an estimated sixty six percent of sulfur oxide, SOx, 
emissions. These chemicals are the main cause of acid rain, which kills 
rivers and lakes, and damages crops and buildings. Burning fossil fuels 
to produce electricity also emits nitrogen oxides, NOx, 
which cause health-damaging smog. Ground-level ozone caused by nitrogen 
oxide contributes to asthma, bronchitis and other respiratory problems.
  Electricity produced from nuclear power, while not responsible for 
the emissions associated with burning of fossil fuels, results in 
highly toxic, and essentially permanent wastes for which no complete 
disposal option currently exists.
  Switching to renewable resources virtually eliminates these concerns. 
The Renewable Energy Investment Act of 2003 will help reduce emissions 
of carbon dioxide, sulfur dioxide, nitrogen dioxide, mercury and 
particulate matter, without creation of toxic wastes.
  The twenty percent RPS established in this legislation will also 
create thousands of new, high quality jobs and bring significant new 
investment to rural communities. It will create an estimated $80 
million in new capitol investment, and result in more than $5 billion 
in new property tax revenues.
  It will bring increased diversity to our energy sector, creating 
greater market stability and reducing the price spikes that so often 
plague our domestic natural gas markets.
  Greater diversity also reduces the vulnerability of our energy 
infrastructure to terrorist threats.
  In a letter to Congress shortly after the attacks of September 11, 
2001, several national security experts endorsed congressional passage 
of an RPS. The letter, signed by former CIA director James Woolsey; 
former National Security Advisor to President Reagan, Robert McFarlane; 
and former Chairman of the Joint Chiefs of Staff, Thomas Moorer, stated 
that a strong RPS is an important component of addressing the 
significant challenges to America's new energy security.
  Rapidly increasing the production of renewable energy is vital to 
America's future. We must be willing to take the steps necessary to 
make that happen. The Renewable Energy Investment Act of 2003 is an 
essential part of that goal and I urge my colleagues to join with me in 
supporting 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. 944

       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 ``Renewable Energy Investment 
     Act of 2003.''

     SEC. 2. DEFINITIONS.

       In this Act:
       (1) Biomass.--
       (A) In general.--The term ``biomass'' means--
       (i) organic material from a plant that is planted for the 
     purpose of being used to produce energy;
       (ii) nonhazardous, cellulosic or agricultural waste 
     material that is segregated from other waste materials and is 
     derived from--

       (I) a forest-related resource, including--

       (aa) mill and harvesting residue;
       (bb) precommercial thinnings;
       (cc) slash; and
       (dd) brush;

       (II) an agricultural resource, including--

       (aa) orchard tree crops;
       (bb) vineyards;
       (cc) grains;
       (dd) legumes;
       (ee) sugar; and
       (ff) other crop byproducts or residues; or

       (III) miscellaneous waste such as--

       (aa) waste pallet;
       (bb) crate; and
       (cc) landscape or right-of-way tree trimmings; and
       (iii) animal waste that is converted to a fuel rather than 
     directly combusted, the residue of which is converted to a 
     biological fertilizer, oil, or activated carbon.
       (B) Exclusions.--The term ``biomass'' does not include--
       (i) incineration of municipal solid waste;
       (ii) recyclable postconsumer waste paper;
       (iii) painted, treated, or pressurized wood;
       (iv) wood contaminated with plastic or metal; or
       (v) tires.
       (2) Distributed generation.--The term ``distributed 
     generation'' means reduced electricity consumption from the 
     electric grid due to use by a customer of renewable energy 
     generated at a customer site.
       (3) Incremental hydropower.--The term ``incremental 
     hydropower'' means additional generation achieved from 
     increased efficiency after January 1, 2003, at a 
     hydroelectric dam that was placed in service before January 
     1, 2003.
       (4) Landfill gas.--The term ``landfill gas'' means gas 
     generated from the decomposition of household solid waste, 
     commercial solid waste, or industrial solid waste disposed of 
     in a municipal solid waste landfill unit (as those terms are 
     defined in regulations promulgated under subtitle D of the 
     Solid Waste Disposal Act (42 U.S.C. 6941 et seq.)).
       (5) Renewable energy.--The term ``renewable energy'' means 
     electricity generated from--
       (A) a renewable energy source; or
       (B) hydrogen that is produced from a renewable energy 
     source.
       (6) Renewable energy source.--The term ``renewable energy 
     source'' means--
       (A) wind;
       (B) ocean waves;
       (C) biomass;
       (D) solar sources;
       (E) landfill gas;
       (F) incremental hydropower; or
       (G) a geothermal source.
       (7) Retail electric supplier.--The term ``retail electric 
     supplier'', with respect to any calendar year, means a person 
     or entity that--
       (A) sells retail electricity to consumers; and
       (B) sold not less than 500,000 megawatt-hours of electric 
     energy to consumers for purposes other than resale during the 
     preceding calendar year.
       (8) Secretary.--The term ``Secretary'' means the Secretary 
     of Energy.

     SEC. 3. RENEWABLE ENERGY GENERATION STANDARDS.

       (a) Renewable Energy Credits.--
       (1) In general.--For each calendar year beginning in 
     calendar year 2006, each retail electric supplier shall 
     submit to the Secretary, not later than April 30 of each 
     year, renewable energy credits in an amount equal to the 
     required annual percentage of the retail electric supplier's 
     total amount of kilowatt-hours of nonhydropower electricity 
     sold to consumers during the previous calendar year.
       (2) Carryover of renewable energy credits.--A renewable 
     energy credit for any year that is not used to satisfy the 
     minimum requirement for that year may be carried over for use 
     within the next 2 years.
       (b) Required Annual Percentage.--Of the total amount of 
     nonhydropower electricity sold by each retail electric 
     supplier during a calendar year, the amount generated by 
     renewable energy sources shall be not less than the 
     percentage specified below:

Calendar year:                Percentage of Renewable energy each year:
  2006-2009......................................................5 ....

  2010-2014.....................................................10 ....

  2015-2019.....................................................15 ....

  2020 and subsequent years.....................................20.....

       (c) Submission of Renewable Energy Credits.--
       (1) In general.--To meet the requirements under subsection 
     (a), a retail electric supplier shall submit to the 
     Secretary--
       (A) renewable energy credits issued to the retail electric 
     supplier under subsection (e);
       (B) renewable energy credits obtained by purchase or 
     exchange under subsection (f);
       (C) renewable energy credits purchased from the United 
     States under subsection (g); or
       (D) any combination of renewable energy credits obtained 
     under subsections (e), (f), and (g).
       (2) No double counting.--A renewable energy credit may be 
     counted toward compliance with subsection (a) only once.
       (d) Renewable Energy Credit Program.--Not later than 1 year 
     after the date of enactment of this Act, the Secretary shall 
     establish a program to issue, monitor the sale or exchange 
     of, and track renewable energy credits.
       (e) Issuance of Renewable Energy Credits.--

[[Page 9913]]

       (1) Application.--
       (A) In general.--Under the program established under 
     subsection (d), an entity that generates electric energy 
     through the use of a renewable energy resource may apply to 
     the Secretary for the issuance of renewable energy credits.
       (B) Contents.--An application under subparagraph (A) shall 
     indicate--
       (i) the type of renewable energy resource used to produce 
     the electric energy;
       (ii) the State in which the electric energy was produced; 
     and
       (iii) any other information that the Secretary determines 
     to be appropriate.
       (2) Issuances.--
       (A) In general.--Except as provided in subparagraph (C), 
     the Secretary shall issue to an entity applying under this 
     subsection 1 renewable energy credit for each kilowatt-hour 
     of renewable energy generated in any State from the date of 
     enactment of this Act and in each subsequent calendar year.
       (B) Vesting.--A renewable energy credit will vest with the 
     owner of the system or facility that generates the renewable 
     energy unless the owner explicitly transfers the renewable 
     energy credit.
       (C) Amount.--The Secretary shall issue 3 renewable energy 
     credits for each kilowatt-hour of distributed generation.
       (3) Eligibility.--
       (A) In general.--To be eligible for a renewable energy 
     credit, the unit of electricity generated through the use of 
     a renewable energy resource shall be sold for retail 
     consumption or used by the generator.
       (B) Energy generated from a combination of sources.--If 
     both a renewable energy resource and a nonrenewable energy 
     resource are used to generate the electric energy, the 
     Secretary shall issue renewable energy credits based on the 
     proportion of the renewable energy resource used.
       (C) Identification of type and date.--The Secretary shall 
     identify renewable energy credits by the type and date of 
     generation.
       (4) Sale under contract under purpa.--In a case in which a 
     generator sells electric energy generated through the use of 
     a renewable energy resource to a retail electric supplier 
     under a contract subject to section 210 of the Public 
     Utilities Regulatory Policies Act of 1978 (16 U.S.C. 824a-3), 
     the retail electric supplier shall be treated as the 
     generator of the electric energy for the purposes of this Act 
     for the duration of the contract.
       (f) Sale or Exchange of Renwable Energy Credits.--
       (1) In general.--A renewable energy credit may be sold or 
     exchanged by the entity issued the renewable energy credit or 
     by any other entity that acquires the renewable energy 
     credit.
       (2) Manner of sale.--A renewable energy credit may be sold 
     or exchanged in any manner not in conflict with existing law, 
     including on the spot market or by contractual arrangements 
     of any duration.
       (g) Purchase From the United States.--
       (1) In general.--The Secretary shall offer renewable energy 
     credits for sale at the lesser of 3 cents per kilowatt-hour 
     or 110 percent of the average market value of renewable 
     energy credits for the applicable compliance period.
       (2) Adjustment for inflation.--On January 1 of each year 
     following calendar year 2006, the Secretary shall adjust for 
     inflation the price charged per renewable energy credit for 
     the calendar year.
       (h) State Programs.--Nothing in this section precludes any 
     State from requiring additional renewable energy generation 
     in the State under any renewable energy program conducted by 
     the State not in conflict with this Act.
       (i) Consumer Allocation.--
       (1) Rates.--The rates charged to classes of consumers by a 
     retail electric supplier shall reflect a proportional 
     percentage of the cost of generating or acquiring the 
     required annual percentage of renewable energy under 
     subsection (a).
       (2) Representations to customers.--A retail electric 
     supplier shall not represent to any customer or prospective 
     customer that any product contains more than the percentage 
     of eligible resources if the additional amount of eligible 
     resources is being used to satisfy the renewable generation 
     requirement under subsection (a).
       (j) Enforcement.--
       (1) In general.--A retail electric supplier that does not 
     submit renewable energy credits as required under subsection 
     (a) shall be liable for the payment of a civil penalty.
       (2) Amount.--The amount of a civil penalty under paragraph 
     (1) shall be calculated on the basis of the number of 
     renewable energy credits not submitted, multiplied by the 
     lesser of 4.5 cents or 300 percent of the average market 
     value of renewable energy credits for the compliance period.
       (k) Information Collection.--The Secretary may collect the 
     information necessary to verify and audit--
       (1) the annual electric energy generation and renewable 
     energy generation of any entity applying for renewable energy 
     credits under this section;
       (2) the validity of renewable energy credits submitted by a 
     retail electric supplier to the Secretary; and
       (3) the quantity of electricity sales of all retail 
     electric suppliers.
       (l) Voluntary Participation.--The Secretary may issue a 
     renewable energy credit under subsection (e) to any entity 
     not subject to the requirements of this Act only if the 
     entity applying for the renewable energy credit meets the 
     terms and conditions of this Act to the same extent as 
     entities subject to this Act.

     SEC. 4. STATE RENEWABLE ENERGY GRANT PROGRAM.

       (a) Distribution of Amounts.--The Secretary shall 
     distribute amounts received from sales under subsection 3(h) 
     and from amounts received under subsection 3(k) to States to 
     be used for the purposes of this section.
       (b) Program.--
       (1) In general.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary shall establish a 
     program to promote State renewable energy production and use.
       (2) Use of funds.--The Secretary shall make funds available 
     under this section to State energy agencies for grant 
     programs for--
       (A) renewable energy research and development;
       (B) loan guarantees to encourage construction of renewable 
     energy facilities;
       (C) consumer rebate or other programs to offset costs of 
     small residential or small commercial renewable energy 
     systems including solar hot water; or
       (D) promotion of distributed generation.
       (c) Preference.--In allocating funds under the program, the 
     Secretary shall give preference to--
       (1) States that have a disproportionately small share of 
     economically sustainable renewable energy generation 
     capacity; and
       (2) State grant programs that are most likely to stimulate 
     or enhance innovative renewable energy technologies.
                                 ______
                                 
      By Mr. McCAIN:
  S. 945. A bill to amend title 37, United States Code, to improve the 
process for adjusting the rates of pay for members of the uniformed 
services; to the Committee on Armed Services.
  Mr. McCAIN. Mr. President, I am proud to sponsor the Military Pay 
Comparability Act of 2003. In 1999, the Committee on Armed Services 
passed landmark legislation providing significant benefits to the 
entire Total Force. I believe we must improve upon this legislation so 
that we not only eliminate ``pay comparability gap,'' but ensure that 
we do not recreate one in the future.
  Under the 1999 legislation, military raises will exceed growth in the 
ECI by one-half percent per year through fiscal year 2006. However, 
starting in 2007, military raises will revert to being capped one-half 
percentage point below the ECI.
  As a former ranking member and long-time member on the Personnel 
Subcommittee when Senator John Glenn was the chairman, my experience 
with capping military raises below ECI during the last three decades 
shows that such caps inevitably lead to significant retention problems 
among second-term and career service members.
  Those retention problems cost our Nation more in the long run in 
terms of lost military experience, decreased readiness, and increased 
training costs. Since military pay was last comparable with private 
sector pay in 1982, military pay raises have lagged a cumulative 6.4 
percent behind private sector wage growth--although recent efforts of 
the executive and legislative branches have reduced the gap 
significantly from its peak of 13.5 percent in 1999. Our efforts in 
1999 increased pay raises, reformed the pay tables, took nearly 12,000 
service members off of food stamps, and established a military Thrift 
Savings Plan.
  We have to improve upon the 1999 law to ensure future raises track to 
civilian pay growth so we don't fall back into pay caps that will get 
us back in the negative retention/readiness cycle. Subsequent raises 
after 2006 must sustain full comparability with increases in the ECI. A 
key principal of the all volunteer force, AVF, is that military pay 
raises must match private sector pay growth, as measured by ECI. Our 
action in this area will send a strong message of support to our 
service men and women and their families that will continue to promote 
high morale, better quality-of-life, and a more ready military force.
  I ask unanimous consent that the text of the legislation be printed 
in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

[[Page 9914]]



                                 S. 945

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

     SECTION 1. REVISED ANNUAL PAY ADJUSTMENT PROCESS.

       (a) Requirement for Annual Adjustment.--Subsection (a) of 
     section 1009 of title 37, United States Code, is amended to 
     read as follows:
       ``(a) Requirement for Annual Adjustment.--Effective on 
     January 1 of each year, the rates of basic pay for members of 
     the uniformed services under section 203(a) of this title 
     shall be increased under this section.''.
       (b) Effectiveness of Adjustment.--Subsection (b) of such 
     section is amended by striking ``shall--'' and all that 
     follows and inserting ``shall have the force and effect of 
     law.''.
       (c) Percentage of Adjustment.--Subsection (c) of such 
     section is amended to read as follow:
       ``(c) Equal Percentage Increase for All Members.--(1) 
     Subject to subsection (d), an adjustment made under this 
     section in a year shall provide all eligible members with an 
     increase in the monthly basic pay that is the percentage 
     (rounded to the nearest one-tenth of 1 percent) by which the 
     ECI for the base quarter of the year before the preceding 
     year exceeds the ECI for the base quarter of the second year 
     before the preceding calendar year (if at all).
       ``(2) Notwithstanding paragraph (1), but subject to 
     subsection (d), the percentage of the adjustment taking 
     effect under this section during each of fiscal years 2004, 
     2005, and 2006, shall be one-half of 1 percentage point 
     higher than the percentage that would otherwise be applicable 
     under such paragraph.''.
       (d) Publication of Adjusted Rates.--Subsection (e) of such 
     section is amended--
       (1) by striking ``(e) Notice of Allocations.--'' and 
     inserting ``(e) Notification and Publication Requirements.--
     (1)''; and
       (2) by adding at the end the following new paragraph:
       ``(2) The rates of basic pay that take effect under this 
     section shall be printed in the Federal Register and the Code 
     of Federal Regulations.''.
       (e) Presidential Determination of Need for Alternative Pay 
     Adjustment.--Such section is further amended--
       (1) by redesignating subsection (g) as subsection (h); and
       (2) by inserting after subsection (f) the following new 
     subsection (g):
       ``(g) Presidential Determination of Need for Alternative 
     Pay Adjustment.--(1) If, because of national emergency or 
     serious economic conditions affecting the general welfare, 
     the President considers the pay adjustment which would 
     otherwise be required by this section in any year to be 
     inappropriate, the President shall prepare and transmit to 
     Congress before September 1 of the preceding year a plan for 
     such alternative pay adjustments as the President considers 
     appropriate, together with the reasons therefor.
       ``(2) In evaluating an economic condition affecting the 
     general welfare under this subsection, the President shall 
     consider pertinent economic measures including the Indexes of 
     Leading Economic Indicators, the Gross National Product, the 
     unemployment rate, the budget deficit, the Consumer Price 
     Index, the Producer Price Index, the Employment Cost Index, 
     and the Implicit Price Deflator for Personal Consumption 
     Expenditures.
       ``(3) The President shall include in the plan submitted to 
     Congress under paragraph (1) an assessment of the impact that 
     the alternative pay adjustments proposed in the plan would 
     have on the Government's ability to recruit and retain well-
     qualified persons for the uniformed services.''.
       (f) Definitions.--Such section, as amended by subsection 
     (e), is further amended by adding at the end the following:
       ``(i) Definitions.--In this section:
       ``(1) The term `ECI' means the Employment Cost Index (wages 
     and salaries, private industry workers) published quarterly 
     by the Bureau of Labor Statistics.
       ``(2) The term `base quarter' for any year is the 3-month 
     period ending on September 30 of such year.''.
                                 ______
                                 
      By Mr. LEAHY (for himself, Mr. Grassley, Mr. Durbin, Mr. 
        Feingold, Mr. Kohl, and Mr. Schumer):
  S. 946. A bill to enhance competition for prescription drugs by 
increasing the ability of the Department of Justice and Federal Trade 
Commission to enforce existing antitrust laws regarding brand name 
drugs and generic drugs; to the Committee on the Judiciary.
  Mr. LEAHY. Mr. President, last November, the Drug Competition Act 
passed the Senate by unanimous consent. This morning, I am proud to 
join Senator Grassley, along with Senators Durbin, Feingold, Kohl and 
Schumer in re-introducing this important bill, I hope that in this 
Congress it is actually enacted into law. Prescription drug prices are 
rapidly increasing, and are a source of considerable concern to many 
Americans, especially senior citizens and families. Generic drug prices 
can be as much as 80 percent lower than the comparable brand name 
version.
  While the Drug Competition Act is small in terms of length, it is 
large in terms of impact. It will ensure that law enforcement agencies 
can take quick and decisive action against companies that are driven 
more by greed than by good sense. It gives the Federal Trade Commission 
and the Justice Department access to information about secret deals 
between drug companies that keep generic drugs off the market. This is 
a practice that hurts American families, particularly senior citizens, 
by denying them access to low-cost generic drugs, and further inflating 
medical costs.
  Last fall, the Federal Trade Commission released a comprehensive 
report on barriers the entry of generic drugs into the pharmaceutical 
marketplace. The FTC had two recommendations to improve the current 
situation and to close the loopholes in the law that allow drug 
manufacturers to manipulate the timing of generics' introduction to the 
market. One of those recommendations was simply to enact our bill, as 
the most effective solution to the problem of ``sweetheart'' deals 
between brand name and generic drug manufacturers that keep generic 
drugs off the market, thus depriving consumers of the benefits of 
quality drugs at lower prices. In short, this bill enjoys the 
unqualified endorsement of the current FTC, which follows on the 
support by the Clinton Administration's FTC during the initial stages 
of our formulation of this bill. We can all have every confidence in 
the common sense approach that our bill takes to ensuring that our law 
enforcement agencies have the information they need to take quick 
action, if necessary, to protect consumers from drug companies that 
abuse the law.
  Under current law, the first generic manufacturer that gets 
permission to sell a generic drug before the patent on the brand-name 
drug expires, enjoys protection from competition for 180 days--a 
headstart on other generic companies. That was a good idea--but the 
unfortunate loophole exploited by a few is that secret deals can be 
made that allow the manufacturer of the generic drug to claim the 180-
day grace period--to block other generic drugs from entering the 
market--while, at the same time, getting paid by the brand-name 
manufacturer not to sell the generic drug.
  Our legislation closes this loophole for those who want to cheat the 
public, but keeps the system the same for companies engaged in true 
competition. I think it is important for Congress not to overreact and 
throw out the good with the bad. Most generic companies want to take 
advantage of this 180-day provision and deliver quality generic drugs 
at much lower costs for consumers. We should not eliminate the 
incentive for them. Instead, we should let the FTC and Justice look at 
every deal that could lead to abuse, so that only the deals that are 
consistent with the intent of that law will be allowed to stand. The 
Drug Competition Act accomplishes precisely that goal, and helps ensure 
effective and timely access to generic pharmaceuticals that can lower 
the cost of prescription drugs for seniors, for families, and for all 
of us.
  I regret that some in the Senate stalled action on this worthwhile 
measure until very late in the last Congress and that the House chose 
not to act at all, and I hope that the growing need for more cost-
effective health care solutions will serve as a catalyst for quick 
action on this needed legislation.
  Mr. GRASSLEY. Mr. President, I am pleased to join Senator Leahy today 
in introducing the Drug Competition Act of 2003. This bill will help 
Federal regulators ensure that there is full and unfettered access to 
competition for prescription drugs under the law. As the past Chairman 
of the Special Committee on Aging and now as the Chairman of the 
Finance Committee, I want to make sure that American consumers--
especially our seniors--are able to get the life-saving drugs they need 
in a competitive manner.

[[Page 9915]]

  Our patent laws provide drug companies with incentives to invest in 
research and development of new drugs. But the law also provides that 
generic drug companies have the ability to get their own drugs on the 
market so that there can be price competition and lower prices for 
prescription drugs. We have a legal system in place that provides for 
such a balance--the Hatch-Waxman law. Ultimately, we want consumers and 
seniors to have more choices and to get drugs at lower prices.
  So, I was concerned when I heard reports that the Federal Trade 
Commission had brought enforcement actions against brand-name and 
generic drug manufacturers that had entered into anti-competitive 
agreements, resulting in the delay of the introduction of lower priced 
drugs. This bill targets that problem.
  Under the Hatch-Waxman Act, manufacturers of generic drugs are 
encouraged to challenge weak or invalid patents on brand-name drugs so 
consumers can benefit from lower generic drug prices. Current law gives 
temporary protection from competition to the first generic drug 
manufacturer that gets exclusive permission to sell a generic drug 
before the patent on the brand-name drug expires. This gives the 
generic firm a 180-day head start on other generic companies.
  However, the FTC discovered that some companies were exploiting this 
law by entering into secret deals, which allowed the generic drug 
makers to claim the 180-day grace period and to block other generic 
drugs from entering the market, while at the same time getting paid by 
the brand-name manufacturer for withholding sales of the generic 
version of the drug. This meant that consumers continued to pay high 
prices for drugs, rather than benefiting from more competitive and 
lower prices. So the FTC brought enforcement actions against these 
companies.
  In addition, the FTC conducted a comprehensive review of agreements 
that impacted the 180-day exclusivity period. The FTC found that there 
are competition problems with some of these agreements that potentially 
delayed generic drug entry into the market. The FTC recommended:

       Given this history, we believe that notification of such 
     agreements to the Federal Trade Commission and the U.S. 
     Department of Justice is warranted. We support the Drug 
     Competition Act of 2001, S. 754, introduced by Senator Leahy, 
     as reported by the Committee on the Judiciary.

  The Drug Competition Act is a simple solution to the 180-day 
exclusivity problems that the FTC has identified. The bill would 
require drug companies that enter agreements relating to the 180-day 
period to file those documents with the FTC and DOJ. It would impose 
sanctions on companies who do not provide timely notification. This 
process would facilitate agency review of the agreements to determine 
whether they have anti-competitive effects.
  The Drug Competition Act will ensure that consumers are not hurt by 
secret, anti-competitive contracts, so that consumers can get 
competition and lower drug prices as soon as possible. I urge my 
colleagues to support this bill.
                                 ______
                                 
      By Mr. SCHUMER:
  S. 948. A bill to require prescription drug manufacturers, packers, 
and distributors to disclose certain gifts provided in connection with 
detailing, promotional, or other marketing activities, and for other 
purposes; to the Committee on Health, Education, Labor, and Pensions.
  Mr. SCHUMER. Mr. President, I ask unanimous consent that the text of 
the bill be printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                 S. 948

       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 ``Drug Company Gift 
     Disclosure Act''.

     SEC. 2. DISCLOSURE BY PRESCRIPTION DRUG MANUFACTURERS, 
                   PACKERS, AND DISTRIBUTORS OF CERTAIN GIFTS.

        Section 503 of the Federal Food, Drug, and Cosmetics Act 
     (21 U.S.C. 353) is amended by adding at the end the 
     following:
       ``(h)(1) Each manufacturer, packer, or distributor of a 
     drug subject to subsection (b)(1) shall disclose to the 
     Commissioner--
       ``(A) not later than June 30, 2004, and each June 30 
     thereafter, the value, nature, and purpose of any--
       ``(i) gift provided during the preceding calendar year to 
     any covered health entity by the manufacturer, packer, or 
     distributor, or a representative thereof, in connection with 
     detailing, promotional, or other marketing activities; and
       ``(ii) cash rebate, discount, or any other financial 
     consideration provided during the preceding calendar year to 
     any pharmaceutical benefit manager by the manufacturer, 
     packer, or distributor, or a representative thereof, in 
     connection with detailing, promotional, or other marketing 
     activities; and
       ``(B) not later than the date that is 6 months after the 
     date of enactment of this subsection and each June 30 
     thereafter, the name and address of the individual 
     responsible for the compliance of the manufacturer, packer, 
     or distributor with the provisions of this subsection.
       ``(2) Subject to paragraph (3), the Commissioner shall make 
     all information disclosed to the Commissioner under paragraph 
     (1) publicly available, including by posting such information 
     on the Internet.
       ``(3) The Commissioner shall keep confidential any 
     information disclosed to or otherwise obtained by the 
     Commissioner under this subsection that relates to a trade 
     secret referred to in section 1905 of title 18, United States 
     Code. The Commissioner shall provide an opportunity in the 
     disclosure form required under paragraph (4) for a 
     manufacturer, packer, or distributor to identify any such 
     information.
       ``(4) Each disclosure under this subsection shall be made 
     in such form and manner as the Commissioner may require.
       ``(5) Each manufacturer, packer, and distributor described 
     in paragraph (1) shall be subject to a civil monetary penalty 
     of not more than $10,000 for each violation of this 
     subsection. Each unlawful failure to disclose shall 
     constitute a separate violation. The provisions of paragraphs 
     (3), (4), and (5) of section 303(g) shall apply to such a 
     violation in the same manner as such provisions apply to a 
     violation of a requirement of this Act that relates to 
     devices.
       ``(6) For purposes of this subsection:
       ``(A) The term `covered health entity' includes any 
     physician, hospital, nursing home, pharmacist, health benefit 
     plan administrator, or any other person authorized to 
     prescribe or dispense drugs that are subject to subsection 
     (b)(1), in the District of Columbia or any State, 
     commonwealth, possession, or territory of the United States.
       ``(B) The term `gift' includes any gift, fee, payment, 
     subsidy, or other economic benefit with a value of $50 or 
     more, except that such term excludes the following:
       ``(i) Free samples of drugs subject to subsection (b)(1) 
     intended to be distributed to patients.
       ``(ii) The payment of reasonable compensation and 
     reimbursement of expenses in connection with any bona fide 
     clinical trial conducted in connection with a research study 
     designed to answer specific questions about drugs, devices, 
     new therapies, or new ways of using known treatments.
       ``(iii) Any scholarship or other support for medical 
     students, residents, or fellows selected by a national, 
     regional, or specialty medical or other professional 
     association to attend a significant educational, scientific, 
     or policy-making conference of the association.''.
                                 ______
                                 
      By Mrs. HUTCHISON (for herself and Mrs. Feinstein):
  S. 949. A bill to establish a commission to assess the military 
facility structure of the United States overseas, and for other 
purposes; to the Committee on Armed Services.
  Mrs. HUTCHISON. Mr. President, today Senator Feinstein and I are 
introducing the ``Overseas Military Facility Structure Review Act'' to 
establish a congressional panel to conduct a detailed study of U.S. 
military facilities overseas. This bill creates a bipartisan 
congressional commission charged with undertaking an objective and 
thorough review of our overseas basing structure. The commission will 
consider a host of criteria to determine whether our overseas bases are 
prepared to meet our needs in the 21st Century. The commission will be 
comprised of national security and foreign affairs experts who will 
present their findings to the 2005 domestic Base Realignment and 
Closure, BRAC, Commission, providing a comprehensive analysis of our 
worldwide base and force structure.
  We believe it is important to determine our overseas basing 
requirements, assess training constraints, and provide recommendations 
on future realignments. As a result, we are proposing legislation that 
would create a

[[Page 9916]]

congressional Overseas Basing Commission to review our basing strategy 
to ensure that it is consistent with both our short- and long-term 
national security objectives. We believe the time is right to move 
forward with a more structured approach to reviewing these overseas 
bases.
  Such a review is timely. The 2005 BRAC is just around the corner and 
some in the Pentagon have suggested it could result in the closure of 
nearly one out of every four domestic bases. Before we close stateside 
military bases, we must first analyze our overseas infrastructure. If 
we reduce our overseas presence, we need stateside bases to station 
returning troops. It is senseless to close bases on U.S. soil in 2005 
only to determine a few years later that we made a costly, irrevocable 
mistake. A painful lesson we learned in the last rounds of closures.
  Though our military force structure has decreased since the Cold War, 
the responsibilities placed upon our service members have significantly 
increased. While operational effectiveness is paramount, it would be 
irresponsible to build on an inefficient, obsolete overseas base 
structure, as we face new strategic threats in the 21st century, taking 
valuable dollars needed elsewhere.

                          ____________________