[Congressional Record (Bound Edition), Volume 149 (2003), Part 9]
[Senate]
[Pages 11767-11791]
[From the U.S. Government Publishing Office, www.gpo.gov]




    JOBS AND GROWTH TAX RELIEF RECONCILIATION ACT OF 2003--Continued

  Mr. BAUCUS. Mr. President, what is the regular order?
  The PRESIDING OFFICER. The reconciliation act, and it is necessary to 
set aside the pending Burns amendment.
  Mr. BAUCUS. I ask unanimous consent that the Burns amendment be set 
aside.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 614

  The PRESIDING OFFICER. The business now is the amendment of the 
Senator from Michigan.
  Who yields time?
  Ms. STABENOW. Mr. President, I ask unanimous consent that Senator 
Mikulski be added as a cosponsor of the amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Ms. STABENOW. Mr. President, I urge my colleagues to support this 
very important amendment for the seniors of this country. This does 
that. First and foremost, before we pass the dividend tax cut and the 
top rate tax cut, we will proceed to develop and pass a comprehensive 
prescription drug benefit that is equivalent to what we receive in the 
Senate. I have heard many colleagues express the concern I share, which 
is that the seniors and the disabled of this country ought to have the 
same ability to have the prescription drug coverage we as Federal 
employees do.
  This amendment simply sets our priorities straight. It says before we 
proceed with these two tax cuts, we will pass a comprehensive 
prescription drug benefit based on FEHBP, the most common portion of 
which is used by Senate and House Members. I urge my colleagues to 
support this amendment.
  The PRESIDING OFFICER. Who yields time? The Senator from Iowa.
  Mr. GRASSLEY. Mr. President, I oppose this amendment. I feel exactly 
about Medicare and prescription drug issues as the Senator from 
Michigan, but this is not the way to do it. This amendment reduces our 
jobs and growth package even before the Finance Committee takes up a 
comprehensive prescription drug benefit and Medicare improvement bill.
  I hope everybody knows that I am very committed to reporting a $400 
billion bill out of the Finance Committee, and doing it this summer, 
hopefully within the month. This will add a comprehensive prescription 
drug benefit for seniors.
  The amendment before us jumps the gun. I am working in a bipartisan 
way on a prescription drug policy that fits within that $400 billion 
framework in our budget resolution. In fact, I have a 4 o'clock meeting 
today with Senators on that issue that, obviously, I am not going to be 
able to keep because of these rollcall votes. We need to keep the jobs 
and growth package complete.
  The PRESIDING OFFICER. The Senator's time has expired.
  Mr. GRASSLEY. Mr. President, I want to raise a point of order. This 
upsets the balance of our bill. This language is not germane to the 
measure before the Senate. Therefore, I raise a point of order under 
section 305(b)(2) of the Congressional Budget Act.
  The PRESIDING OFFICER. The Senator from Michigan.
  Ms. STABENOW. Due to the fact the budget resolution does not contain 
enough revenue to do what our distinguished chairman has just 
indicated,

[[Page 11768]]

this amendment is necessary to make that happen. Pursuant to section 
904 of the Congressional Budget Act of 1974, I move to waive the 
applicable sections of that act and the budget resolution for the 
consideration of the pending amendment. I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The question is on agreeing to the motion. The clerk will call the 
roll.
  The assistant legislative clerk called the roll.
  The yeas and nays resulted--yeas 44, nays 56, as follows:

                      [Rollcall Vote No. 159 Leg.]

                                YEAS--44

     Akaka
     Bayh
     Biden
     Bingaman
     Boxer
     Byrd
     Cantwell
     Chafee
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham (FL)
     Harkin
     Hollings
     Inouye
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Murray
     Nelson (FL)
     Pryor
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Stabenow
     Wyden

                                NAYS--56

     Alexander
     Allard
     Allen
     Baucus
     Bennett
     Bond
     Breaux
     Brownback
     Bunning
     Burns
     Campbell
     Carper
     Chambliss
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Jeffords
     Kyl
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nelson (NE)
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner
  The PRESIDING OFFICER. On this vote, the yeas are 44, the nays are 
56. Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is rejected. The point of order is 
sustained, and the amendment falls.
  Mr. GRASSLEY. Mr. President, I move to reconsider the vote.
  Mr. BAUCUS. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The next amendment is the Warner amendment. The Senator from Iowa.
  Mr. GRASSLEY. I ask unanimous consent that the Warner amendment be 
set aside to take up another amendment, and then we will take up the 
Warner amendment next.
  The PRESIDING OFFICER. Is there objection? Without objection, it is 
so ordered.


                     Amendment No. 592, As Modified

  The PRESIDING OFFICER. The next amendment is the Voinovich amendment. 
Who yields time?
  The Senator from Montana.
  Mr. BAUCUS. I understand the regular order is the Voinovich 
amendment. The Senator from Ohio has the right to speak.
  The PRESIDING OFFICER. The Senator is correct.
  The Senator from Ohio.
  Mr. VOINOVICH. I have an amendment that has been modified. The 
modification has been agreed to. I send my amendment, with the 
modification, to the desk.
  The PRESIDING OFFICER. Without objection, the amendment is so 
modified.
  The amendment, as modified, is as follows:

 (Purpose: To establish a blue ribbon commission on comprehensive tax 
                                reform)

       At the appropriate place insert the following:

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Fundamental Tax Reform 
     Commission Act of 2003''.

     SEC. 2. ESTABLISHMENT OF COMMISSION.

       (a) Establishment.--There is established the ``Blue Ribbon 
     Commission on Comprehensive Tax Reform'' (in this Act 
     referred to as the ``Commission'').
       (b) Membership.--
       (1) Composition.--The Commission shall be composed of 12 
     members of whom--
       (A) 1 shall be the Chairman of the Board of Governors of 
     the Federal Reserve System;
       (D) 2 shall be appointed by the majority leader of the 
     Senate;
       (E) 2 shall be appointed by the minority leader of the 
     Senate;
       (F) 2 shall be appointed by the Speaker of the House of 
     Representatives;
       (G) 2 shall be appointed by the minority leader of the 
     House of Representatives; and
       (H) 3 shall be appointed by the President, of which--
       (i) no more than 2 shall be of the same party as the 
     President; and
       (2) Federal employees.--The members of the Commission may 
     be employees or former employees of the Federal Government.
       (3) Date.--The appointments of the members of the 
     Commission shall be made not later than July 30, 2003.
       (c) Period of Appointment; Vacancies.--Members shall be 
     appointed for the life of the Commission. Any vacancy in the 
     Commission shall not affect its powers, but shall be filled 
     in the same manner as the original appointment.
       (d) Initial Meeting.--Not later than 30 days after the date 
     on which all members of the Commission have been appointed, 
     the Commission shall hold its first meeting.
       (e) Meetings.--The Commission shall meet at the call of the 
     Chairman.
       (f) Quorum.--A majority of the members of the Commission 
     shall constitute a quorum, but a lesser number of members may 
     hold hearings.
       (g) Chairman and Vice Chairman.--The President shall select 
     a Chairman and Vice Chairman from among its members.

     SEC. 3. DUTIES OF THE COMMISSION.

       (a) Study.--The Commission shall conduct a thorough study 
     of all matters relating to a comprehensive reform of the 
     Federal tax system, including the reform of the Internal 
     Revenue Code of 1986 and the implementation (if appropriate) 
     of other types of tax systems.
       (b) Recommendations.--The Commission shall develop 
     recommendations on how to comprehensively reform the Federal 
     tax system in a manner that generates appropriate revenue for 
     the Federal Government.
       (c) Report.--Not later than 18 months after the date on 
     which all intitial members of the commission have been 
     appointed pursuant to section 2(b), the Commission shall 
     submit a report to the President and Congress which shall 
     contain a detailed statement of the findings and conclusions 
     of the Commission, together with its recommendations for such 
     legislation and administrative actions as it considers 
     appropriate.

     SEC. 4. POWERS OF THE COMMISSION.

       (a) Hearings.--The Commission may hold such hearings, sit 
     and act at such times and places, take such testimony, and 
     receive such evidence as the Commission considers advisable 
     to carry out this Act.
       (b) Information From Federal Agencies.--The Commission may 
     secure directly from any Federal department or agency such 
     information as the Commission considers necessary to carry 
     out this Act. Upon request of the Chairman of the Commission, 
     the head of such department or agency shall furnish such 
     information to the Commission.
       (c) Postal Services.--The Commission may use the United 
     States mails in the same manner and under the same conditions 
     as other departments and agencies of the Federal Government.
       (d) Gifts.--The Commission may accept, use, and dispose of 
     gifts or donations of services or property.

     SEC. 5. COMMISSION PERSONNEL MATTERS.

       (a) Compensation of Members.--Each member of the Commission 
     who is not an officer or employee of the Federal Government 
     shall be compensated at a rate equal to the daily equivalent 
     of the annual rate of basic pay prescribed for level IV of 
     the Executive Schedule under section 5315 of title 5, United 
     States Code, for each day (including travel time) during 
     which such member is engaged in the performance of the duties 
     of the Commission. All members of the Commission who are 
     officers or employees of the United States shall serve 
     without compensation in addition to that received for their 
     services as officers or employees of the United States.
       (b) Travel Expenses.--The members of the Commission shall 
     be allowed travel expenses, including per diem in lieu of 
     subsistence, at rates authorized for employees of agencies 
     under subchapter I of chapter 57 of title 5, United States 
     Code, while away from their homes or regular places of 
     business in the performance of services for the Commission.
       (c) Staff.--
       (1) In general.--The Chairman of the Commission may, 
     without regard to the civil service laws and regulations, 
     appoint and terminate an executive director and such other 
     additional personnel as may be necessary to enable the 
     Commission to perform its duties. The employment of an 
     executive director shall be subject to confirmation by the 
     Commission.
       (2) Compensation.--The Chairman of the Commission may fix 
     the compensation of the executive director and other 
     personnel without regard to chapter 51 and subchapter III of 
     chapter 53 of title 5, United States Code, relating to 
     classification of positions and General Schedule pay rates, 
     except that the rate of pay for the executive director and 
     other personnel may not exceed the rate payable for level V 
     of the Executive Schedule under section 5316 of such title.
       (d) Detail of Government Employees.--Any Federal Government 
     employee may be detailed to the Commission without 
     reimbursement, and such detail shall be without

[[Page 11769]]

     interruption or loss of civil service status or privilege.
       (e) Procurement of Temporary and Intermittent Services.--
     The Chairman of the Commission may procure temporary and 
     intermittent services under section 3109(b) of title 5, 
     United States Code, at rates for individuals which do not 
     exceed the daily equivalent of the annual rate of basic pay 
     prescribed for level V of the Executive Schedule under 
     section 5316 of such title.

     SEC. 6. TERMINATION OF THE COMMISSION.

       The Commission shall terminate 90 days after the date on 
     which the Commission submits its report under section 3.

     SEC. 7. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated such sums as are 
     necessary to the Commission to carry out this Act.

  Mr. VOINOVICH. Mr. President, I ask that the amendment, as modified, 
be accepted by voice vote.
  The PRESIDING OFFICER. Is there objection to vitiating the yeas and 
nays?
  The Senator from Montana.
  Mr. BAUCUS. Mr. President, might I ask the Senator from Ohio if the 
modification is the one that changes the ratio of the membership?
  Mr. VOINOVICH. It changes the ratio of the membership and increases 
more representation by minority. It takes off the head of the IRS, and 
it is more evenly balanced and meets the problems that we talked about 
last night.
  Mr. BAUCUS. I have no objection.
  The PRESIDING OFFICER. Without objection, it is so ordered. The yeas 
and nays are vitiated.
  The question is on agreeing to the amendment, as modified.
  The amendment (No. 592), as modified, was agreed to.
  Mr. BAUCUS. Mr. President, I move to reconsider the vote.
  Mr. REID. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. I understand the next amendment is the Graham of Florida 
amendment.
  The PRESIDING OFFICER. If the Warner amendment is once again set 
aside.
  Mr. BAUCUS. I ask unanimous consent that the Warner amendment and all 
relevant amendments be temporarily set aside so we can next proceed to 
the Graham of Florida amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 617

  The PRESIDING OFFICER. Who yields time on the Graham amendment?
  Mr. GRAHAM of Florida. I ask unanimous consent that Senators 
Rockefeller and Kerry be added as cosponsors to my amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. GRAHAM of Florida. Mr. President, we have more dismal news on the 
state of the economy in today's press; that the April sales in the 
United States declined .9 percent below those in March. This is what 
the chief economist of Wells Fargo had to say about this development: 
Consumers are tapped out. They have done a marvelous job of supporting 
the economy, but they are basically done. We need something else to 
pull up the slack.
  I suggest that what we need is this amendment which will place money 
in the hands of those Americans and institutions most likely to spend 
and therefore create demand. Those include payroll, small business. It 
includes those who have already lost their jobs and their unemployment 
benefits and State governments. This proposal would focus on the next 2 
years----
  The PRESIDING OFFICER. The Senator's time has expired.
  Mr. GRAHAM of Florida. The period of time in which we need to have a 
stimulus. Most importantly, this would not add to the national debt 
because it would be fully offset, therefore avoiding the potential that 
by adding to the deficit we will add to the economic problems that we 
will have in the future.
  Mr. President, I ask unanimous consent that an article from today's 
Washington Post on consumer spending be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                [From the Washington Post, May 15, 2003]

                  Consumers Trimmed Spending in April


              drop in gasoline sales was factor in decline

                 (By Dina ElBoghdady and Anitha Reddy)

       Consumer spending dipped in April as shoppers were more 
     concerned about their jobs than the easing of tensions with 
     Iraq, increasing prospects that economic growth will be tepid 
     at best in the second half of the year.
       The Commerce Department reported yesterday that April 
     retail sales fell 0.1 percent from March, when pent-up demand 
     created by February's snow storms helped boost sales 2.3 
     percent.
       Excluding auto purchases, April sales declined 0.9 percent, 
     the report showed.
       ``Consumers are tapped out,'' said Sung Won Sohn, chief 
     economic officer at Wells Fargo & Co. ``They've done a 
     marvelous job of supporting the economy, but they are 
     basically done . . . We need something else to pull up the 
     slack.''
       A large portion of the overall sales decline came from 
     consumers spending less on gasoline. Gas purchases fell 5.9 
     percent from late March to late April as gas prices slid by 
     about a dime on average.
       But shoppers also held back on their purchases of clothing, 
     furniture and garden supplies because of uncertainty about 
     holding on to their jobs, or finding new ones, if necessary. 
     The jobless rate is 6 percent today, compared with slightly 
     over 4 percent a year ago. Consumers' hesitancy was a big 
     factor preventing the postwar bounce that economists had 
     expected.
       ``It's not just that the unemployment rate is a problem, 
     it's that the people who are unemployed are unemployed for a 
     longer period of time,'' said John E. Silvia, chief 
     economicst at Wachovia. ``The job pool is stagnant.''
       A tax cut might prompt shoppers to increase spending and 
     help fuel a more robust recovery, said David A. Wyss, chief 
     economist at Standard & Poor's Corp.
       Wyss said the savings patterns of the average American 
     indicate that any extra money in after-tax pay would be spent 
     rather than saved.
       ``The saving rate is pretty much flat, which certainly 
     suggests that consumers are spending as much money as they 
     have,'' Wyss said. ``You can't expect them to do much more 
     than that.''
       Sales fell 3.2 percent at clothing and accessory stores, 
     1.4 percent at department stores and 0.5 percent at 
     restaurants and bars.
       ``I've just been going out a lot less,'' said Tonya Sawyer, 
     a claims adjustor shopping at the Fashion Centre at Pentagon 
     City. ``So I don't have the need for clothes or make-up.''
       Instead, the 30 year old said she relies on new books and 
     CDs, rental videos and her dog Bella to entertain herself in 
     her Arlington apartment. Sales at stores that sell sporting 
     goods, books, music and hobby materials increased 1.2 
     percent.
       Even the one demographic group that stores hoped might show 
     steadfast devotion to shopping--teenage girls during prom 
     season--was being wary.
       ``It's finding what you want at the right price'' that's so 
     hard, said Breona Cain, a high school senior from Largo who 
     was at Pentagon City with two friends yesterday, searching 
     for the perfect accessories for her dress.
       Auto sales rose 2.5 percent in April, thanks to widespread 
     no-interest financing offers.
       ``Consumers have shown they're opportunistic,'' said Frank 
     Badillo, senior economist at Retail Forward Inc., a market 
     research firm. ``So certain sectors are benefiting in what is 
     otherwise a weak environment.''
       Some economists say that in such an uncertain climate it's 
     too early to guage the outlook for the rest of the year.
       ``The April results should most properly be viewed as 
     transition from a war footing to a normal peacetime 
     footing,'' Ken Mayland, president of Clear View Economics, 
     said in a report. ``Consumers are betwixt and between a 
     `recession' mindset and a `recovery' mindset. They have not 
     bought in to either.''

  The PRESIDING OFFICER. The Senator's time has expired.
  Who yields time?
  Mr. KYL. Mr. President, speaking on behalf of Senator Grassley, this 
is a complete substitute and therefore, obviously, will have to be 
opposed. It strikes all of the good work from the committee bill 
regarding the child credit, marriage penalty, AMT, reduction of rates 
for individuals and small businesses, as well as the dividend relief.
  We certainly appreciate the Senator's concerns about unemployment 
insurance and relief for the States. Obviously, we are committed to 
addressing the unemployment insurance issue. As everyone now knows, we 
have $20 billion for State aid in the bill, and therefore we will have 
to make a point of order. The matter is not germane to the measure now 
before the Senate. Therefore, I make a point of order that

[[Page 11770]]

the pending amendment violates section 305(b)(2) of the Congressional 
Budget Act of 1974.
  Mr. GRAHAM of Florida. Pursuant to section 904 of the Budget Act I 
ask that the point of order against my amendment be waived.
  I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The question is on agreeing to the motion.
  The clerk will call the roll.
  The senior assistant bill clerk called the roll.
  The result was announced--yeas 35, nays 65, as follows:

                      [Rollcall Vote No. 160 Leg.]

                                YEAS--35

     Akaka
     Biden
     Bingaman
     Boxer
     Breaux
     Byrd
     Cantwell
     Clinton
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Feingold
     Feinstein
     Graham (FL)
     Harkin
     Hollings
     Inouye
     Jeffords
     Kennedy
     Kerry
     Landrieu
     Lautenberg
     Leahy
     Levin
     Mikulski
     Murray
     Nelson (FL)
     Reid
     Rockefeller
     Sarbanes
     Stabenow
     Wyden

                                NAYS--65

     Alexander
     Allard
     Allen
     Baucus
     Bayh
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Campbell
     Carper
     Chafee
     Chambliss
     Cochran
     Coleman
     Collins
     Conrad
     Cornyn
     Craig
     Crapo
     DeWine
     Dole
     Domenici
     Edwards
     Ensign
     Enzi
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Johnson
     Kohl
     Kyl
     Lieberman
     Lincoln
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nelson (NE)
     Nickles
     Pryor
     Reed
     Roberts
     Santorum
     Schumer
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner
  The PRESIDING OFFICER. On this question, the yeas are 35, the nays 
are 65. Three-fifths of the Senators duly chosen and sworn not having 
voted in the affirmative, the motion is rejected. The point of order is 
sustained, and the amendment falls.
  Mr. GRASSLEY. I move to reconsider the vote.
  Mr. BAUCUS. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                      Amendment No. 550 Withdrawn

  The PRESIDING OFFICER. Without objection, the pending Warner 
amendment is set aside.
  The Senator from Virginia.
  Mr. WARNER. Mr. President, I ask to have the amendment set aside.
  The PRESIDING OFFICER (Mr. Crapo). Without objection, it is so 
ordered.
  Mr. WARNER. My request is on behalf of Senator Collins, Senator 
Craig, Senator Allen, and Senator Murkowski. I do so because we have 
made a conscientious effort, together with the cooperation of the 
managers of this bill, to find the offset and we simply could not find 
the offset.
  The thrust of our amendment is for the teachers in America. The 
amendment is very simple. It compensates them through a tax deduction 
for each time they reach into their own pocketbooks or pockets to buy 
school supplies for their students. We need to increase that amount 
from $250 which is current law. We need to broaden it so they can use 
some of the deduction for purposes of continuing education. This is an 
amendment not for the rich; it is simply for those who serve America 
and ask very little by way of salary.
  We cannot move it at this time, but the managers very generously have 
acceded to this colloquy. The managers have agreed to look at this in 
future tax legislation and for the time being will agree to extend it 
so this current law of the $250 deduction will not expire at the end of 
this calendar year.
  I ask the question of my colleague.
  Mr. GRASSLEY. The Senator accurately stated what my intentions are, 
but let me say it for myself so the Senator knows I have said it.
  First of all, I need to thank the Senator for his cooperation in 
working with us on this amendment so we can expedite the bill. Also, I 
make clear I am a strong supporter of the Senator's legislation and the 
expansion of it and would agree to make sure we get this done before 
the end of the calendar year, so that would involve extending it and 
expanding these teacher provisions.
  This all deals--so everyone knows what we are talking about--with the 
extension of legislation passed within the last 2 years. It sunsets. We 
make these permanent, and there would be a significant increase in the 
above-the-line deduction for teachers.
  Mr. WARNER. Mr. President, I thank my distinguished colleague. 
Perhaps the ranking member may wish to address this issue. If the 
ranking member would care to make a comment about the withdrawal of the 
amendment of the Senator from Virginia?
  Mr. BAUCUS. Mr. President, I thank the Senator from Virginia for 
asking the question. All I can say at this point is we will do the very 
best we can.
  Mr. WARNER. I thank my colleague. I move to withdraw the amendment.
  The PRESIDING OFFICER. Without objection, the amendment is withdrawn.


                           Amendment No. 575

  The PRESIDING OFFICER. The business before the Senate is the Kyl 
amendment.
  The Senator from Arizona.
  Mr. KYL. Mr. President, is there an order for me to speak to the Kyl 
amendment at this point?
  The PRESIDING OFFICER. The Senator has the floor for 1 minute.
  Mr. KYL. Mr. President, this is the amendment that would return money 
to the States from the tobacco company payments to trial lawyers, money 
that exceeded reasonable fees as determined by a common standard in the 
courts and an IRS Code provision.
  What we have done in this amendment is to apply it only 
prospectively, not retroactively. The fee is a reasonable fee plus 500 
percent, and in any event the lawyers are guaranteed--and, colleagues, 
please note this--$20,000 per hour. That is what the lawyers are 
guaranteed in those cases, those 10 to 15 cases per year to which this 
would apply.
  Those fees were not set by contract. They were not set by courts. The 
money is going to be paid by the tobacco companies. The only question 
is, are these excess fees going to be paid to the tobacco lawyers or 
are they going to be paid to the States?
  I will have at both desks a chart which shows how much money each of 
the States would receive. It is between $6 billion and $9 billion in 
total. You can see the amount listed on this sheet. I ask you to 
consult that because that is money your States would receive if this 
amendment is adopted.
  The PRESIDING OFFICER. Who speaks in opposition? The Senator from 
Montana.
  Mr. BAUCUS. Mr. President, I yield to the Senator from Louisiana.
  The PRESIDING OFFICER. The Senator from Louisiana.
  Mr. BREAUX. Mr. President, this amendment was already offered in the 
Senate Finance Committee. It was defeated by a bipartisan vote of 
Republicans and Democrats in the Finance Committee.
  IRS should not be involved in setting the fees for CEOs in this 
country. They should not be involved in setting the fees for plumbers 
or electricians. And they should not be involved in setting the fees 
for attorneys who have had voluntary agreements between defendants and 
the plaintiffs about what they should be paid, which have been approved 
by the courts. All of these fees have been approved by the courts or by 
the arbitrator. They were voluntarily agreed to.
  Lawyers don't get paid by the hour in these cases; they get paid by 
the job. IRS should not determine what are correct payments for 
services.
  Mr. BIDEN. Will the Senator yield me 10 seconds?
  Mr. BREAUX. I yield it if I have any time remaining.
  Mr. BIDEN. I want to point out company lawyers were paid $700 million 
per year, per year, for 5 years. Plaintiffs' lawyers had to risk $100 
million of their own money.
  The PRESIDING OFFICER. All time has expired.

[[Page 11771]]


  Mr. BREAUX. Mr. President, the pending amendment is not germane. 
Therefore, I make a point of order the amendment violates section 
305(b)(2) of the Congressional Budget Act of 1974.
  Mr. KYL. Mr. President, I move to waive the provision. I ask for the 
yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second? There is a 
sufficient second.
  The question is on agreeing to the motion. The clerk will call the 
roll.
  The assistant legislative clerk called the roll.
  Mr. LOTT (when his name was called). Present.
  Mr. REID. I announce that the Senator from Hawaii (Mr. Inouye) is 
necessarily absent.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The yeas and nays resulted--yeas 37, nays 61, as follows:

                      [Rollcall Vote No. 161 Leg.]

                                YEAS--37

     Alexander
     Allard
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Campbell
     Collins
     Cornyn
     Craig
     Dole
     Domenici
     Ensign
     Enzi
     Fitzgerald
     Frist
     Grassley
     Gregg
     Hagel
     Hutchison
     Inhofe
     Kyl
     Lugar
     McCain
     McConnell
     Murkowski
     Nickles
     Roberts
     Santorum
     Sessions
     Snowe
     Stevens
     Sununu
     Talent
     Thomas
     Warner

                                NAYS--61

     Akaka
     Allen
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Breaux
     Byrd
     Cantwell
     Carper
     Chafee
     Chambliss
     Clinton
     Cochran
     Coleman
     Conrad
     Corzine
     Crapo
     Daschle
     Dayton
     DeWine
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham (FL)
     Graham (SC)
     Harkin
     Hatch
     Hollings
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Miller
     Murray
     Nelson (FL)
     Nelson (NE)
     Pryor
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Shelby
     Smith
     Specter
     Stabenow
     Voinovich
     Wyden

                        ANSWERED ``PRESENT''--1

       
       Lott
       

                             NOT VOTING--1

       
       Inouye
       
  The PRESIDING OFFICER. On this vote, the yeas are 37, the nays are 
61, and one Senator responded ``present.'' Three-fifths of the Senators 
duly chosen and sworn not having voted in the affirmative, the motion 
is rejected. The point of order is sustained, and the amendment falls.
  Mr. GRASSLEY. Mr. President, I move to reconsider the vote.
  Mr. BAUCUS. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                           Amendment No. 619

  The PRESIDING OFFICER. The next amendment is the Landrieu amendment. 
Each side has 1 minute.
  Who yields time?
  Mr. BAUCUS. Mr. President, I ask unanimous consent that relevant 
pending amendments be temporarily laid aside so that Senator Landrieu's 
amendment can be voted on.
  The PRESIDING OFFICER. The Landrieu amendment is now before the body.
  Mr. GRASSLEY. Mr. President, the Senate is not in order.
  The PRESIDING OFFICER. The Senator is correct. Senators will please 
take their conversations off the floor.
  The Senator from Louisiana.
  Ms. LANDRIEU. Thank you, Mr. President.
  Mr. President, this afternoon we are being asked to buy a pig in a 
poke. That is what we would say in Louisiana--a pig in a poke. Please 
colleagues, do not vote for the underlying bill. Senator Corzine and 
Senator Schumer and I offer an amendment which is a $350 billion 
alternative that is truly stimulative. It tries to work with the 
administration but takes out the nonstimulative portion and puts in a 
rebate on wages. If we want to create jobs, then let us stop taxing 
them.
  Our amendment also treats States as respected partners and not as 
charitable aid organizations, which they are not.
  It also says that tax cuts aren't the only way to stimulate the 
economy; that you can make strategic investments. As politicians, live 
up to your promises to children by funding education and health care.
  Don't buy a pig in a poke, and don't turn your back on the 2 million 
companies, 2 million farms, and 2 million partnerships that do not get 
a penny from the dividend tax cut.
  Mr. GRASSLEY. Mr. President, the way to make sure the American people 
are not buying a pig in a poke is to get more money in the pockets of 
the taxpayers so that there is less money around here for 535 Members 
of Congress to play with.
  I want to speak in regard to this amendment; that the complete 
substitute will cut back our efforts to reduce marginal rates for 
families and small businesses.
  In addition, the bill will make millions of taxpayers subject to the 
alternative minimum tax.
  I appreciate the Senator's efforts on the child tax, and we already 
have a $95 billion child tax credit.
  We also have significant State aid in the bill.
  We have a point of order, as we have had before on an amendment like 
this.
  I raise that point of order--that the language is not germane to the 
measure now before the Senate. The point of order is under section 
305(b)(2) of the Congressional Budget Act.
  Ms. LANDRIEU. Mr. President, pursuant to section 904 of the 
Congressional Budget Act, I move to waive the applicable sections of 
that act for the consideration of this amendment, and I ask for the 
yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The question is on agreeing to the motion. The clerk will call the 
roll.
  The legislative clerk called the roll.
  The yeas and nays resulted--yeas 47, nays 53, as follows:

                      [Rollcall Vote No. 162 Leg.]

                                YEAS--47

     Akaka
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Breaux
     Byrd
     Cantwell
     Carper
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham (FL)
     Harkin
     Hollings
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Murray
     Nelson (FL)
     Pryor
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Stabenow
     Wyden

                                NAYS--53

     Alexander
     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Campbell
     Chafee
     Chambliss
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Kyl
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nelson (NE)
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner
  The PRESIDING OFFICER. On this vote, the yeas are 47, the nays are 
53. Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is rejected. The point of order is 
sustained, and the amendment falls.
  Mr. GRASSLEY. Mr. President, I move to reconsider the vote.
  Mr. BAUCUS. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. BAUCUS. Mr. President, my understanding is there are pending 
votes that require unanimous consent to be set aside. I make that 
request so that the next Landrieu amendment can be in order.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 620

  The PRESIDING OFFICER. The Landrieu amendment No. 620 is before the 
Senate.
  There are 2 minutes equally divided.
  Who yields time?
  The Senator from Louisiana.
  Ms. LANDRIEU. Mr. President, this amendment would go a long way to

[[Page 11772]]

send the right message to our guardsmen and reservists. Over 370,000 
have been activated since September 11 and the attack on this city and 
our Nation.
  As we know, it has been made painfully aware to us that many of these 
guardsmen and reservists who serve take a cut in pay because they leave 
their jobs, they close their businesses to temporarily serve us.
  This amendment will give their employers, and themselves if they are 
an employer, the opportunity to write off 50 percent of the cost of 
their salaries so those salaries can be maintained while they are 
protecting and serving us. It is the least we can do.
  The other side is going to say they will get to it later. Let's get 
to it today. Let's not let this tax bill pass without honoring the 
Guard and Reserves and giving them a chance to keep their businesses 
open while they keep us safe.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. Mr. President, this amendment proposes to offer a 50-
percent tax credit for employers of reservists to encourage 
differential pay.
  This amendment does not benefit those who are self-employed and 
provides little benefit to small businesses with little equity.
  In addition, nearly 80 percent of the cost of the military tax bill, 
which we have already passed in the Senate, is dedicated to reservists 
with the above-the-line deduction that was included because Senator 
DeWine pushed very hard for it.
  The amendment is paid for by reducing the dividend exclusion which is 
essential to our growth package; in other words, to keep a well 
balanced growth package.
  So the amendment I see as an attack on the jobs and growth bill, and 
I ask that it not be adopted.
  Mr. President, I raise a point of order on germaneness, that the 
amendment is not germane. The point of order comes under section 
305(b)(2) of the Congressional Budget Act.
  Ms. LANDRIEU. Mr. President, I ask unanimous consent that Senator 
Feingold, Senator Stabenow, and Senator Mikulski be added as cosponsors 
of the amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Ms. LANDRIEU. Mr. President, pursuant to section 904 of the 
Congressional Budget Act, I move to waive the applicable sections of 
that act for the consideration of the pending amendment, and I ask for 
the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The question is on agreeing to the motion.
  The clerk will call the roll.
  The bill clerk called the roll.
  The yeas and nays resulted--yeas 46, nays 54, as follows:

                      [Rollcall Vote No. 163 Leg.]

                                YEAS--46

     Akaka
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Breaux
     Byrd
     Cantwell
     Carper
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Graham (FL)
     Harkin
     Hollings
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Murray
     Nelson (FL)
     Pryor
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Stabenow
     Wyden

                                NAYS--54

     Alexander
     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Campbell
     Chafee
     Chambliss
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Feinstein
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Kyl
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nelson (NE)
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner
  The PRESIDING OFFICER (Mr. Smith). On this vote, the yeas are 46, the 
nays are 54. Three-fifths of the Senate duly chosen and sworn not 
having voted in the affirmative, the motion is rejected.
  The point of order is sustained and the amendment falls.
  Mr. KYL. Mr. President, I move to reconsider the vote.
  Mr. BAUCUS. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                      Amendment No. 621 Withdrawn

  Mr. BAUCUS. Mr. President, I ask unanimous consent that the votes on 
the various amendments next up be temporarily laid aside so we can 
proceed to the Landrieu amendment No. 621.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Louisiana.
  Ms. LANDRIEU. Mr. President, I thank my colleagues for their 
patience. Senator Sessions and I offered this amendment. We are not 
going to ask for a vote, but I would like to explain it in 1 minute. We 
offered this amendment to try to technically correct a glitch in the 
renewal community law. It only affects districts in Louisiana and 
Alabama now, but it could affect, in the near term, districts in 40 
other States.
  I am going to ask the chairman of the Finance Committee to consider 
this fix. It only costs $14 million a year and it will help create jobs 
in some of the poorest areas in our country. So if I could ask for 
their consideration, I will at this time withdraw the amendment.
  Mr. KYL. Mr. President, I have spoken to the Senator from Louisiana. 
I know the chairman is appreciative of her efforts along with the 
Senator from Alabama. He is anxious to continue to work with her on 
this matter. He appreciates their very strong interest in trying to 
rectify this situation. On behalf of the chairman, I can say he will be 
willing to work with her.
  Mr. BAUCUS. Mr. President, I, too, have spoken with the Senator and 
understand her concerns and will do my utmost to help resolve the 
issue.
  The PRESIDING OFFICER. Without objection, the amendment is withdrawn.
  Mr. BAUCUS. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 557

  Mr. BAUCUS. Mr. President, I ask unanimous consent that the votes on 
the earlier amendments be temporarily laid aside so we can now proceed 
to amendment No. 557 by the Senator from New York.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from New York is recognized.
  Mr. SCHUMER. Mr. President, this is a simple amendment. Two years 
ago, on the last tax bill, we took a historic step in this body. We 
said part of college tuition should be tax deductible. We required that 
the first $3,000 be deductible for a family making up to $160,000 a 
year. This will raise that. It goes up to $4,000 in the next fiscal 
year under the previous law, and then it expires in 2006. This law 
would make it permanent and raise the amount to $8,000 initially, next 
year, and then $12,000 in future years.
  It is very simple. It pays for itself, by the way, by reducing the 
top rate not by three points but by one point. The choice is simple. 
Middle-class people have an awfully difficult time paying for college. 
If you are rich, you can afford it. If you are poor, we help you, and 
we should. But the middle class gets stuck. Families are up late at 
night worrying about how they are going to pay the tuition bill.
  I ask my colleagues, which do they choose? Bring the top rate down 
but not as quickly and help middle-class families with the second 
greatest expense they face other than their home, or bring the rate 
down quickly? It is a simple choice. I hope the body will vote for the 
middle-class parents who are stuck with these huge tuition bills.

[[Page 11773]]


  Mr. KYL. Mr. President, we added the tuition provision in the bill 2 
years ago, and it is obviously supported by a broad number of people in 
the body. The problem is that this addition is way too expensive and 
comes out of the top rate reduction from the bill that is on the floor, 
the acceleration of the marginal income tax rate provision of the bill.
  Obviously, we have to oppose this particular amendment. This is a 
matter that could be dealt with in a different way but not by paying 
for it in the manner it is paid for. It is not germane. Therefore, I 
raise a point of order under 305(b)(2) of the Congressional Budget Act 
of 1974.
  Mr. SCHUMER. Mr. President, I ask that the point of order be waived, 
and I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The question is on agreeing to the motion.
  The clerk will call the roll.
  The legislative clerk called the roll.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The yeas and nays resulted--yeas 49, nays 51, as follows:

                      [Rollcall Vote No. 164 Leg.]

                                YEAS--49

     Akaka
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Breaux
     Byrd
     Cantwell
     Carper
     Clinton
     Collins
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham (FL)
     Harkin
     Hollings
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Murray
     Nelson (FL)
     Nelson (NE)
     Pryor
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Stabenow
     Wyden

                                NAYS--51

     Alexander
     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Campbell
     Chafee
     Chambliss
     Cochran
     Coleman
     Cornyn
     Craig
     Crapo
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Kyl
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner
  The PRESIDING OFFICER. On this vote, the yeas are 49, the yeas are 
51. Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is rejected. The point of order is 
sustained, and the amendment falls.
  Mr. BAUCUS. I move to reconsider the vote.
  Mr. REID. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                     Amendment No. 622, As Modified

  The PRESIDING OFFICER. The next amendment is the Ensign amendment No. 
622.
  The Senator from Nevada.
  Mr. ENSIGN. Mr. President, I have a technical modification to my 
amendment at the desk, and I ask unanimous consent that my amendment be 
so modified.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment, as modified, is as follows:

       On page 281, between lines 2 and 3, insert the following:

     SEC. __. TOLL TAX ON EXCESS QUALIFIED FOREIGN DISTRIBUTION 
                   AMOUNT.

       (a) In General.--Subpart F of part III of subchapter N of 
     chapter 1 is amended by adding at the end the following new 
     section:

     ``SEC. 965. TOLL TAX IMPOSED ON EXCESS QUALIFIED FOREIGN 
                   DISTRIBUTION AMOUNT.

       ``(a) Toll Tax Imposed on Excess Qualified Foreign 
     Distribution Amount.--If a corporation elects the application 
     of this section, a tax shall be imposed on the taxpayer in an 
     amount equal to 5.25 percent of--
       ``(1) the taxpayer's excess qualified foreign distribution 
     amount, and
       ``(2) the amount determined under section 78 which is 
     attributable to such excess qualified foreign distribution 
     amount.

     Such tax shall be imposed in lieu of the tax imposed under 
     section 11 or 55 on the amounts described in paragraphs (1) 
     and (2) for such taxable year.
       ``(b) Excess Qualified Foreign Distribution Amount.--For 
     purposes of this section--
       ``(1) In general.--The term `excess qualified foreign 
     distribution amount' means the excess (if any) of--
       ``(A) dividends received by the taxpayer during the taxable 
     year which are--
       ``(i) from 1 or more corporations which are controlled 
     foreign corporations in which the taxpayer is a United States 
     shareholder on the date such dividends are paid, and
       ``(ii) described in a domestic reinvestment plan approved 
     by the taxpayer's president, chief executive officer, or 
     comparable official before the payment of such dividends and 
     subsequently approved by the taxpayer's board of directors, 
     management committee, executive committee, or similar body, 
     which plan shall provide for the reinvestment of such 
     dividends in the United States, including as a source for the 
     funding of worker hiring and training; infrastructure; 
     research and development; capital investments; or the 
     financial stabilization of the corporation for the purposes 
     of job retention or creation, over
       ``(B) the base dividend amount.
       ``(2) Base dividend amount.--The term `base dividend 
     amount' means an amount designated under subsection (c)(7), 
     but not less than the average amount of dividends received 
     during the fixed base period from 1 or more corporations 
     which are controlled foreign corporations in which the 
     taxpayer is a United States shareholder on the date such 
     dividends are paid.
       ``(3) Fixed base period.--
       ``(A) In general.--The term `fixed base period' means each 
     of 3 taxable years which are among the 5 most recent taxable 
     years of the taxpayer ending on or before December 31, 2002, 
     determined by disregarding--
       ``(i) the 1 taxable year for which the taxpayer had the 
     highest amount of dividends from 1 or more corporations which 
     are controlled foreign corporations relative to the other 4 
     taxable years, and
       ``(ii) the 1 taxable year for which the taxpayer had the 
     lowest amount of dividends from such corporations relative to 
     the other 4 taxable years.
       ``(B) Shorter period.--If the taxpayer has fewer than 5 
     taxable years ending on or before December 31, 2002, then in 
     lieu of applying subparagraph (A), the fixed base period 
     shall mean such shorter period representing all of the 
     taxable years of the taxpayer ending on or before December 
     31, 2002.
       ``(c) Definitions and Special Rules.--For purposes of this 
     section--
       ``(1) Dividends.--The term `dividend' means a dividend as 
     defined in section 316, except that the term shall also 
     include amounts described in section 951(a)(1)(B), and shall 
     exclude amounts described in sections 78 and 959.
       ``(2) Controlled foreign corporations and united states 
     shareholders.--The term `controlled foreign corporation' 
     shall have the same meaning as under section 957(a) and the 
     term `United States shareholder' shall have the same meaning 
     as under section 951(b).
       ``(3) Foreign tax credits.--The amount of any income, war, 
     profits, or excess profit taxes paid (or deemed paid under 
     sections 902 and 960) or accrued by the taxpayer with respect 
     to the excess qualified foreign distribution amount for which 
     a credit would be allowable under section 901 in the absence 
     of this section, shall be reduced by 85 percent.
       ``(4) Foreign tax credit limitation.--For all purposes of 
     section 904, there shall be disregarded 85 percent of--
       ``(A) the excess qualified foreign distribution amount,
       ``(B) the amount determined under section 78 which is 
     attributable to such excess qualified foreign distribution 
     amount, and
       ``(C) the amounts (including assets, gross income, and 
     other relevant bases of apportionment) which are attributable 
     to the excess qualified foreign distribution amount which 
     would, determined without regard to this section, be used to 
     apportion the expenses, losses, and deductions of the 
     taxpayer under section 861 and 864 in determining its taxable 
     income from sources without the United States.

     For purposes of applying subparagraph (C), the principles of 
     section 864(e)(3)(A) shall apply.
       ``(5) Treatment of acquisitions and dispositions.--Rules 
     similar to the rules of section 41(f)(3) shall apply in the 
     case of acquisitions or dispositions of controlled foreign 
     corporations occurring on or after the first day of the 
     earliest taxable year taken into account in determining the 
     fixed base period.
       ``(6) Treatment of consolidated groups.--Members of an 
     affiliated group of corporations filing a consolidated return 
     under section 1501 shall be treated as a single taxpayer in 
     applying the rules of this section.
       ``(7) Designation of dividends.--Subject to subsection 
     (b)(2), the taxpayer shall designate the particular dividends 
     received during the taxable year from 1 or more corporations 
     which are controlled foreign corporations in which it is a 
     United States shareholder which are dividends excluded from 
     the excess qualified foreign distribution amount. The total 
     amount of such designated dividends shall equal the base 
     dividend amount.

[[Page 11774]]

       ``(8) Treatment of expenses, losses, and deductions.--Any 
     expenses, losses, or deductions of the taxpayer allowable 
     under subchapter B--
       ``(A) shall not be applied to reduce the amounts described 
     in subsection (a)(1), and
       ``(B) shall be applied to reduce other income of the 
     taxpayer (determined without regard to the amounts described 
     in subsection (a)(1)).
       ``(d) Election.--
       ``(1) In general.--An election under this section shall be 
     made on the taxpayer's timely filed income tax return for the 
     taxable year (determined by taking extensions into account) 
     ending 120 days or more after the date of the enactment of 
     this section, and, once made, may be revoked only with the 
     consent of the Secretary.
       ``(2) All controlled foreign corporations.--The election 
     shall apply to all corporations which are controlled foreign 
     corporations in which the taxpayer is a United States 
     shareholder during the taxable year.
       ``(3) Consolidated groups.--If a taxpayer is a member of an 
     affiliated group of corporations filing a consolidated return 
     under section 1501 for the taxable year, an election under 
     this section shall be made by the common parent of the 
     affiliated group which includes the taxpayer, and shall apply 
     to all members of the affiliated group.
       ``(e) Regulations.--The Secretary shall prescribe such 
     regulations as may be necessary and appropriate to carry out 
     the purposes of this section, including regulations under 
     section 55 and regulations addressing corporations which, 
     during the fixed base period or thereafter, join or leave an 
     affiliated group of corporations filing a consolidated 
     return.''.
       (b) Conforming Amendment.--The table of sections for 
     subpart F of part III of subchapter N of chapter 1 is amended 
     by adding at the end the following new item:

``Sec. 965. Toll tax imposed on excess qualified foreign distribution 
              amount.''.

       (c) Effective Date.--Except as otherwise provided, the 
     amendments made by this section, other than the amendment 
     made by subsection (d), shall apply only to the first taxable 
     year of the electing taxpayer ending 120 days or more after 
     the date of the enactment of this Act.
       (d) Termination of Rehabilitation Credit for Buildings 
     Other Than Certified Historic Structures.--Section 47 
     (relating to rehabilitation credit) is amended by adding at 
     the end the following new subsection:
       ``(e) Termination of Credit for Buildings Other Than 
     Certified Historic Structures.--No credit shall be allowed 
     under subsection (a)(1) with respect to expenditures incurred 
     after December 31, 2003.''.

  Mr. ENSIGN. Mr. President, the modification says the offset included 
in the amendment repeals the tax credit for refurbishing of nonhistoric 
structures only, not historic structures, with which people had 
concerns.
  If you believe the American economy needs a shot in the arm right 
now, then you should vote for this amendment. Our amendment allows 
companies that have made money overseas to bring it back right now. 
They are taxed at 35 percent. When faced with a choice of whether they 
keep it overseas or bring it back, they keep it overseas. We are going 
to allow a 1-year exemption. The tax will be lowered from 35 percent to 
5.25 percent. They have 1 year to invest the money to create jobs in 
this country. As with Senator Boxer's very fine amendment in our bill, 
it cannot go for executive pay. The money has to be invested in America 
to create jobs.
  I believe this will be a tremendous stimulus to our economy, and I 
urge its adoption.
  I yield 10 seconds to my friend from California.
  The PRESIDING OFFICER. The Senator's time has expired.
  Mrs. BOXER. I ask for 10 seconds.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mrs. BOXER. Mr. President, I hope my colleagues will vote for this 
one-time infusion of private sector dollars to create jobs and 
encourage business investment in plants and equipment. This infusion 
will happen immediately. I think it is what we need to fight for 
because our people are hurting out there.
  I thank the Chair.
  The PRESIDING OFFICER. The Senator's time has expired.


                        USE OF FUNDS REPATRIATED

  Mrs. BOXER. Mr. President, I rise to thank Senator Ensign for his 
leadership on the Invest in the USA Act. As we said earlier, this 
infusion of cash will provide an immediate and much needed boost to the 
economy. Over the next year, it is estimated that this legislation, 
which is included in this bill as an amendment, will bring $140 billion 
in foreign earnings back into the United States.
  As my friend is aware, under our amendment, which is the Invest in 
the USA Act of 2003, these funds are to be used as a source for worker 
hiring and training; infrastructure; research, and development; capital 
investments; or the financial stabilization of the corporation for the 
purposes of job retention or creation. Any attempt to use these funds 
to increase executive pay would be a violation of the intent of this 
legislation.
  Mr. ENSIGN. Mr. President, the Senator from California is absolutely 
correct. These funds are meant to stimulate the economy. I pledge to 
work with Senator Boxer and our colleagues in conference to ensure that 
these funds may not be used for executive pay.
  The Senator from Louisiana.
  Mr. BREAUX. Mr. President, I rise in opposition to the Senator's 
amendment. This amendment was offered in the Senate Finance Committee. 
Republicans and Democrats joined to defeat this amendment.
  There is no question that the international tax laws need to be 
assessed. We have agreed to do that in the Finance Committee. The 
Republican leadership said they would look at all international tax 
laws and consequences.
  This is a retroactive tax break. This bill is supposed to be 
stimulative in the future, not in the past. This amendment will reward 
companies for what they did a long time ago when we ought to be looking 
at the bill in a prospective nature.
  A retroactive tax cut is not what we need. We ought to examine 
international tax laws. We have an agreement to do it in a bipartisan 
fashion. This does not belong in the bill at this time.
  I make a point of order that the amendment is nongermane under 
section 305(b)(2) of the Congressional Budget Act of 1974.
  Mr. ENSIGN. Mr. President, I move to waive that section of the 
Congressional Budget Act. Also, I note that many of the people who 
voted against this amendment in the Finance Committee will be voting 
for it today.
  Pursuant to section 904 of the Congressional Budget Act of 1974, I 
move to waive the applicable sections of that act for the consideration 
of this amendment, and I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The question is on agreeing to the motion. The clerk will call the 
roll.
  The bill clerk called the roll.
  The yeas and nays resulted--yeas 75, nays 25, as follows:

                      [Rollcall Vote No. 165 Leg.]

                                YEAS--75

     Akaka
     Alexander
     Allard
     Allen
     Baucus
     Bayh
     Bennett
     Bond
     Boxer
     Brownback
     Bunning
     Burns
     Campbell
     Cantwell
     Carper
     Chafee
     Chambliss
     Cochran
     Coleman
     Collins
     Cornyn
     Corzine
     Craig
     Crapo
     DeWine
     Dodd
     Dole
     Domenici
     Ensign
     Enzi
     Feinstein
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hollings
     Hutchison
     Inhofe
     Jeffords
     Kyl
     Landrieu
     Lautenberg
     Leahy
     Lieberman
     Lincoln
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Murray
     Nelson (NE)
     Nickles
     Pryor
     Reid
     Roberts
     Santorum
     Schumer
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stabenow
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner
     Wyden

                                NAYS--25

     Biden
     Bingaman
     Breaux
     Byrd
     Clinton
     Conrad
     Daschle
     Dayton
     Dorgan
     Durbin
     Edwards
     Feingold
     Graham (FL)
     Harkin
     Inouye
     Johnson
     Kennedy
     Kerry
     Kohl
     Levin
     Mikulski
     Nelson (FL)
     Reed
     Rockefeller
     Sarbanes
  The PRESIDING OFFICER. On this question, the yeas are 75, the nays 
are 25. Three-fifths of the Senators duly chosen and sworn having voted 
in the affirmative, the motion is agreed to.
  The question now is on the amendment.

[[Page 11775]]


  Mr. GRASSLEY. I urge we now adopt the amendment by voice vote.
  The PRESIDING OFFICER. The question is on agreeing to the amendment.
  The amendment (No. 622), as modified, was agreed to.
  Mr. GRASSLEY. I move to reconsider the vote.
  Mr. BAUCUS. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                           Amendment No. 611

  Mr. BAUCUS. Mr. President, my understanding is the next amendment is 
the amendment offered by the Senator from North Dakota, Mr. Conrad.
  The PRESIDING OFFICER. The Senator is correct.
  The Senator from North Dakota.
  Mr. CONRAD. Mr. President, this bill increases the child tax credit 
from $600 to $1,000 effective back at the beginning of this year.
  My amendment simply takes it back another year to the beginning of 
2002. This is an efficient way of targeting money to those who are most 
likely to use it to give stimulus to the economy.
  I offset the additional cost by delaying part of the final reduction 
in the top marginal rate for a year and a half. This asks the top 1 
percent, actually less than 1 percent of the taxpayers, to take part of 
their reduction somewhat later. It gives a benefit to 27 million 
American families by asking less than a million American families to 
wait for the final part of their additional tax reduction for a year 
and a half.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. Mr. President, in opposition to this amendment, first, 
ask people at the IRS. This would be very difficult to handle 
mechanically.
  Regardless of that, repeating as I have often in opposition to other 
amendments along these same lines, we have $95 billion for children in 
the bill already. The amendment includes an acceleration for low-income 
families paid for by tax increases on small business owners. We need to 
balance incentives for spending and investments. We have a correct 
balance in this bill. This amendment breaks this balance.
  There also would be a budget point of order, and I make that, that 
the amendment increases spending and if adopted would cause the 
underlying bill to exceed the committee section 302(a) allocations. 
Therefore, a point of order ought to rise against it pursuant to 
section 302(f).
  Mr. CONRAD. Mr. President, pursuant to section 904 of the 
Congressional Budget Act of 1974, I move to waive the applicable 
section of the act for the purpose of the pending amendment and I ask 
for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The question is on agreeing to the motion.
  The yeas and nays have been ordered.
  The clerk will call the roll.
  The assistant legislative clerk called the roll.
  Mr. BAUCUS. Mr. President, I have two housekeeping matters that have 
to be cleared up.


                 Amendments Nos. 593 and 612 Withdrawn

  Mr. President, I ask unanimous consent that the pending McCain and 
Burns amendments be withdrawn.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.
  The yeas and nays resulted--yeas 49, nays 51, as follows:

                      [Rollcall Vote No. 166 Leg.]

                                YEAS--49

     Akaka
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Breaux
     Byrd
     Campbell
     Cantwell
     Carper
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham (FL)
     Harkin
     Hollings
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Murray
     Nelson (FL)
     Nelson (NE)
     Pryor
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Stabenow
     Wyden

                                NAYS--51

     Alexander
     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Chafee
     Chambliss
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Kyl
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner
  The PRESIDING OFFICER. On this vote, the yeas are 49, the nays are 
51. Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is rejected. The point of order is 
sustained, and the amendment falls.
  Mr. GRASSLEY. Mr. President, I move to reconsider the vote.
  Mr. REID. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. GRASSLEY. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The senior assistant bill clerk proceeded to call the roll.
  Mr. GRASSLEY. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. GRASSLEY. Mr. President, for our leader, I ask unanimous consent 
that the next amendments in order be the following in the order 
mentioned: Senator Daschle, substitute; Senator Nickles, on the subject 
of dividends; Senator Reid; then Senator Breaux, and Senator Breaux's 
deals with section 911; Senator Santorum, dealing with annuities; 
Senator Bingaman, small business pensions; Senator Mikulski, 
caregivers; Senator Sessions, sunset tax increase provisions; and 
Senator Dayton, a substitute.
  I further ask unanimous consent that there be 2 minutes equally 
divided prior to the vote in relationship to the amendments, that no 
amendments be in order to the amendments prior to the vote, and, 
finally, that this sequence of votes be limited to 10 minutes each.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.
  The Democratic leader.
  Mr. DASCHLE. Mr. President, I ask unanimous consent that the pending 
amendments be set aside.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 656

 (Purpose: To create jobs, provide opportunity, and restore prosperity)

  Mr. DASCHLE. Mr. President, I send an amendment to the desk.
  The PRESIDING OFFICER. The clerk will report.
  The senior assistant bill clerk read as follows:

       The Senator from South Dakota [Mr. Daschle] proposes an 
     amendment numbered 656.

  Mr. DASCHLE. Mr. President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The amendment is printed in today's Record under ``Amendments 
Submitted.'')
  Mr. DASCHLE. Mr. President, in this debate about creating jobs, we 
have a clear choice. The Republican bill, according to virtually all 
economic analyses, doesn't create jobs until the year 2004. What few 
jobs it does create this year are vastly outdone by the bill we have 
before us now. This bill creates 1 million jobs this year.
  If this bill is about fiscal responsibility, we have a choice. The 
Republican bill will use $422 billion of Social Security trust funds. 
Our legislation has been scored at $152 billion. There is a dramatic 
difference between this bill and our bill when it comes to fiscal 
responsibility.
  We are talking about providing meaningful help to the vast majority 
of American taxpayers who need help now, who can be spurred with 
economic incentive. This bill does it by providing a wage credit of 
$300 per person. A family of four would be entitled to $1,600 when the 
child tax credit and marriage penalty provisions are added.

[[Page 11776]]

  There is a clear choice. This bill is fiscally responsible. This bill 
provides the kind of broad-based relief we want. This bill provides the 
kind of jobs this country so badly needs.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. Mr. President, 1 minute does not give justice to saying 
what is wrong with this amendment, so I will just give two or three 
points.
  First, in regard to the marriage penalty relief, it provides for 
acceleration of the standard deduction of married couples but doesn't 
do anything regarding the expansion of the 15-percent individual income 
tax bracket. And that is a major part of marriage penalty relief. It 
doesn't help hard-working, middle-class families the way it should.
  Second, in regard to the child tax credit, this proposal only 
increases the child tax credit to $700 in 2003 and $800 in 2004. The 
mark accelerates it to the full $1,000 in 2003.
  Again, for real relief for working families, the wage credit is a key 
component of this proposal.
  This would send $300 checks to anyone, regardless of whether they 
paid any income tax, and even if they didn't file an income tax return.
  There is a point of order on this amendment. I raise that point of 
order: That it increases mandatory spending and, if agreed to, it would 
cause the underlying bill to exceed the committee's section 302(a) 
allocation. Therefore, a point of order lies against the amendment 
pursuant to 302(f) of the Congressional Budget Act.
  Mr. DASCHLE. Mr. President, pursuant to section 904 of the 
Congressional Budget Act, I move to waive the applicable sections of 
that act and budget resolution for consideration of the pending 
amendment and ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The question is on agreeing to the motion.
  The clerk will call the roll.
  The senior assistant bill clerk called the roll.
  The yeas and nays resulted--yeas 46, nays 54, as follows:

                      [Rollcall Vote No. 167 Leg.]

                                YEAS--46

     Akaka
     Bayh
     Biden
     Bingaman
     Boxer
     Byrd
     Cantwell
     Carper
     Chafee
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham (FL)
     Harkin
     Hollings
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Murray
     Nelson (FL)
     Pryor
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Stabenow
     Wyden

                                NAYS--54

     Alexander
     Allard
     Allen
     Baucus
     Bennett
     Bond
     Breaux
     Brownback
     Bunning
     Burns
     Campbell
     Chambliss
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Kyl
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nelson (NE)
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner
  The PRESIDING OFFICER. On this vote, the yeas are 46, the nays are 
54. Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is rejected. The point of order is 
sustained, and the amendment falls.
  Mr. NICKLES. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that the next 
amendment in order be that offered by the Senator from Minnesota, Mr. 
Dayton.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Under the order, the Senator from Minnesota is recognized.


                           Amendment No. 615

  Mr. DAYTON. Mr. President, I salute the Senator from Montana and the 
Senator from Iowa and their colleagues for their resolve in making the 
House legislation into a responsible bill.
  My amendment would make it a better bill. It would take the money 
that would go to millionaire taxpayers and give it, instead, to middle-
income taxpayers. We do so by tripling the amount of income that is 
taxed at the 10-percent rate.
  We keep the committee's increases in the child tax credit, its 
elimination of the marriage penalty and the alternative minimum tax, 
and its offsets would extend unemployment benefits for those who have 
currently run through them. It would also freeze the top rate at its 
present level.
  In my amendment, a family of four with an income of $40,000 a year 
would receive a $2,232 tax cut in 2003, which is more than double the 
amount in the committee bill. A single taxpayer with an annual income 
of $40,000 would receive a $600 tax cut compared with $282 under the 
tax bill. And that is with the same cost--$350 billion--over 10 years, 
with tax relief evenly distributed and a much better economic stimulus.
  I urge my colleagues to support this amendment.
  The PRESIDING OFFICER. The Senator's time has expired.
  Mr. GRASSLEY. Mr. President, once again, we have a substitute that 
would basically eliminate all the growth we have in our growth package. 
We have a well-balanced package before us between short-term 
investment, long-term investment, between consumer spending and 
investment.
  This amendment is not about investment; it is all about spending.
  I hope we will defeat the amendment. This language happens to not be 
germane to the measure now before us. Therefore, I raise a point of 
order under section 305(b)(2) of the Congressional Budget Act.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. On behalf of the Senator from Minnesota, pursuant to 
section 904 of the Congressional Budget Act, I move to waive the 
applicable sections of that act, and I ask for the yeas and nays.
  The PRESIDING OFFICER. The amendment has not been sent to the desk.
  The clerk will report the amendment.
  The senior assistant bill clerk read as follows:

       The Senator from Minnesota [Mr. Dayton] proposes an 
     amendment numbered 615.

  Mr. BAUCUS. Mr. President, I think the clerk should read the entire 
amendment. That is a pretty hefty amendment.
  Mr. GRASSLEY. Mr. President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The amendment is printed in the Record of May 14, 2003 under ``Text 
of Amendments.'')
  The PRESIDING OFFICER. A point of order has been raised against the 
amendment. A motion to waive has also been made.
  Is there a sufficient second?
  There appears to be. The question is on agreeing to the motion. The 
clerk will call the roll.
  The assistant legislative clerk called the roll.
  The yeas and nays resulted--yeas 44, nays 56, as follows:

                      [Rollcall Vote No. 168 Leg.]

                                YEAS--44

     Akaka
     Bayh
     Biden
     Bingaman
     Boxer
     Byrd
     Cantwell
     Carper
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham (FL)
     Harkin
     Hollings
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Mikulski
     Murray
     Nelson (FL)
     Pryor
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Stabenow
     Wyden

[[Page 11777]]



                                NAYS--56

     Alexander
     Allard
     Allen
     Baucus
     Bennett
     Bond
     Breaux
     Brownback
     Bunning
     Burns
     Campbell
     Chafee
     Chambliss
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Kyl
     Lincoln
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nelson (NE)
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner
  The PRESIDING OFFICER. On this vote, the yeas are 44, the nays are 
56. Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is rejected. The point of order is 
sustained, and the amendment falls.
  Mr. BAUCUS. Mr. President, as we await the scoring for the Nickles 
amendment, I ask unanimous consent that the Senator from Maryland be 
recognized for the purpose of offering her amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
Senator from Maryland is recognized.


                           Amendment No. 605

  Ms. MIKULSKI. Mr. President, I call up my amendment No. 605.
  The PRESIDING OFFICER. The clerk will report.
  The senior assistant bill clerk read as follows:

       The Senator from Maryland [Ms. Mikulski], for herself, Mr. 
     Kennedy, Mr. Sarbanes, Mr. Johnson, Mrs. Clinton, and Mr. 
     Durbin, proposes an amendment numbered 605.

  Ms. MIKULSKI. Mr. President, I ask unanimous consent that further 
reading of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The amendment is printed in the Record of May 14, 2003 under ``Text 
of Amendments.'')
  Ms. MIKULSKI. Mr. President, my amendment is the family caregiver 
relief amendment. It gives help to those who practice self-help. It 
will provide tax relief for family caregivers who face the crushing 
consequence of caring for a chronically ill family member.
  Some of our families are facing extraordinary challenges, such as 
caring for a loved one with special needs, a child with autism or 
cerebral palsy, a parent with Alzheimer's or Parkinson's, or a spouse 
with multiple sclerosis. I want to give help to those families who are 
practicing family responsibility.
  My amendment would provide a tax credit up to $5,000 for family 
caregivers. This tax credit would help people pay for prescription 
drugs, home health care, specialized daycare, and respite care. One in 
five Americans has a multiple chronic condition requiring some type of 
medical intervention. That means over 26 million people were supported 
by many organizations.
  I urge my colleagues to vote for my family caregiver relief tax 
amendment.
  Mr. GRASSLEY. Mr. President, once again, albeit good intentions on 
the part of people offering these amendments, what they are doing in 
the process of offering their very favorable new program--one on which 
I have legislation, in fact--they are destroying the growth in our 
growth package by taking money from the growth portions and the 
investment portions of our bill to do other good things.
  Right now, we are concerned about the economy. We have a balanced 
bill and want to keep it balanced. We don't want to destroy portions of 
our bill to create a new program. However, the Senator knows I am very 
interested in long-term care, and I hope she will work with me and the 
Senator from Florida, Mr. Graham, in the hopes that she can join us in 
advancing long-term care insurance for senior citizens but doing it in 
a context that doesn't destroy other very important pieces of 
legislation.
  This language is not germane to the measure before us. Therefore, I 
raise a point of order under section 305(b)(2) of the Budget Act.
  Ms. MIKULSKI. Mr. President, pursuant to section 904 of the 
Congressional Budget Act of 1974, I move to waive the applicable 
sections of that act for the consideration of the pending amendment, 
and I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The question is on agreeing to the motion.
  The yeas and nays are ordered and the clerk will call the roll.
  The senior assistant bill clerk called the roll.
  Mr. McCONNELL. I announce that the Senator from Alabama (Mr. Shelby) 
is necessarily absent.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The yeas and nays resulted--yeas 48, nays 51, as follows:

                      [Rollcall Vote No. 169 Leg.]

                                YEAS--48

     Akaka
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Breaux
     Byrd
     Cantwell
     Carper
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham (FL)
     Harkin
     Hollings
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Murray
     Nelson (FL)
     Nelson (NE)
     Pryor
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Stabenow
     Wyden

                                NAYS--51

     Alexander
     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Campbell
     Chafee
     Chambliss
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Kyl
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nickles
     Roberts
     Santorum
     Sessions
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner

                             NOT VOTING--1

       
     Shelby
       
  The PRESIDING OFFICER. On this vote, the yeas are 48, the nays are 
51. Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is rejected. The point of order is 
sustained, and the amendment falls.
  Mr. GRASSLEY. I move to reconsider the vote.
  Mr. CRAIG. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. The Senator from North Dakota.
  Mr. CONRAD. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. NICKLES. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  Mr. BAUCUS. Mr. President, I object.
  The PRESIDING OFFICER. Objection is heard.
  The assistant legislative clerk continued with the call of the roll.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BAUCUS. I ask unanimous consent that the next amendment be that 
from Senator Sessions.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.
  The Senator from Alabama.


                           Amendment No. 639

  Mr. SESSIONS. Mr. President, I call up amendment No. 639.
  The PRESIDING OFFICER. The clerk will report.
  The senior assistant bill clerk read as follows:

       The Senator from Alabama [Mr. Sessions] proposes an 
     amendment numbered 639.

  Mr. SESSIONS. Mr. President, I ask unanimous consent that the reading 
of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

    (Purpose: To apply the sunset provision to the revenue increase 
                              provisions)

       Strike subsection (b) of section 601 and insert the 
     following:

[[Page 11778]]

       (b) Exceptions.--(1) Subsection (a) shall not apply to the 
     provisions of, and amendments made by, title I (other than 
     section 107).
       (2) Subsection (a) shall not apply to Title III (other than 
     section 362) however the provisions within Title III shall 
     not apply to taxable years beginning after December 31, 2015.

  The PRESIDING OFFICER. The Senator from Alabama.
  Mr. SESSIONS. Under the agreed framework of this legislation, the tax 
reduction part of the growth package, those tax reductions will 
terminate in 2012. As an attempt to build the kind of growth package 
this Congress wanted to do, I believe a majority wants to do, we have 
added some tax increases. Those tax increases are permanent. In order 
not to affect the agreement and impact the budget in any way, I have 
proposed that those tax increases be terminated on 12-31-2015. It would 
have absolutely no budgetary impact in any way.
  So I believe we made an agreement to bring this package together. The 
tax growth package will terminate in 2012. So should the tax increases 
in 2015.
  The PRESIDING OFFICER. The time of the Senator has expired. Who seeks 
time in opposition?
  The Senator from Montana.
  Mr. BAUCUS. Mr. President, this amendment sunsets offsets not in this 
decade but in the next decade. Many of the provisions in this bill 
should be permanent; that is, corporate inversion legislation, 
shelters, provisions that should change the law. That is good public 
policy. Not all of the provisions in this bill are offsets just to make 
the budget numbers work. Rather, they are provisions which make good 
public policy and should continue.
  Also, it violates the Byrd rule because it raises an extraneous 
matter in a reconciliation bill.
  I make a point of order that the amendment violates section 313 of 
the Budget Act.
  The PRESIDING OFFICER. The Senator from Alabama.
  Mr. SESSIONS. Pursuant to section 904(c) of the Congressional Budget 
Act of 1974, I move to waive the entire Budget Act, and I ask for the 
yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The yeas and nays were ordered.
  The PRESIDING OFFICER. The majority leader.


                  Unanimous Consent Agreement--S. 1050

  Mr. FRIST. Mr. President, I ask unanimous consent that at 2:30 on 
Monday, May 19, the Senate proceed to the consideration of Calendar No. 
96, S. 1050, the Department of Defense authorization bill; provided 
that all first-degree amendments be relevant; that any second-degree 
amendments be relevant to the first-degree to which it is offered; 
finally, provided that on Monday there be debate only on the bill until 
5:30 p.m., with the time equally divided until 5:30.
  The PRESIDING OFFICER. Is there objection?
  Mr. REID. Mr. President, we have conferred with the ranking member, 
Senator Levin. We have no objection to the unanimous consent request.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The majority leader.
  Mr. FRIST. Mr. President, we are making progress on the underlying 
bill. Again, we are going to keep the votes at 10 minutes, but we are 
going to cut them off at 15 minutes sharp. So, again, everybody stay in 
the Chamber.
  The PRESIDING OFFICER. The question is on agreeing to the motion. The 
yeas and nays have been ordered. The clerk will call the roll.
  The assistant legislative clerk called the roll.
  The yeas and nays resulted--yeas 51, nays 49, as follows:

                      [Rollcall Vote No. 170 Leg.]

                                YEAS--51

     Alexander
     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Campbell
     Chambliss
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Kyl
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nelson (NE)
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner

                                NAYS--49

     Akaka
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Breaux
     Byrd
     Cantwell
     Carper
     Chafee
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham (FL)
     Harkin
     Hollings
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Murray
     Nelson (FL)
     Pryor
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Snowe
     Stabenow
     Wyden
  The PRESIDING OFFICER. On this question, the yeas are 51, the nays 
are 49. Three-fifths of the Senators not having voted in the 
affirmative, the motion is rejected. The point of order is sustained. 
The amendment falls.
  Mr. GRASSLEY. I move to reconsider the vote.
  Mr. BAUCUS. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. SESSIONS. I ask that Senator Allen be made a cosponsor to that 
amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 664

  Mr. NICKLES. I send an amendment to the desk and ask for its 
immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Oklahoma [Mr. Nickles], for himself and 
     Mr. Miller, Mr. Kyl, Mr. Lott, Mr. Bunning, Mr. Crapo, Mr. 
     Graham of South Carolina, Mr. Bennett, Mr. Frist, Mr. 
     McConnell, Mr. Santorum, Mr. Ensign, Mr. Smith, and Mr. 
     Thomas, proposes an amendment numbered 664.

  Mr. NICKLES. Mr. President, I ask unanimous consent that the reading 
of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

  (Purpose: To modify the dividend exclusion provision, and for other 
                               purposes)

       Beginning on page 9, line 16, strike all through page 12, 
     line 9, and insert:

     SEC. 104. ACCELERATION OF INCREASE IN STANDARD DEDUCTION FOR 
                   MARRIED TAXPAYERS FILING JOINT RETURNS.

       (a) In General.--Paragraph (7) of section 63(c) (relating 
     to standard deduction) is amended to read as follows:
       ``(7) Applicable percentage.--For purposes of paragraph 
     (2), the applicable percentage shall be determined in 
     accordance with the following table:

``For taxable years beginning in calendar year--         The applicable
                                                        percentage is--
  2003.............................................................195 
  2004.............................................................200 
  2005.............................................................174 
  2006.............................................................184 
  2007.............................................................187 
  2008.............................................................190 
  2009 and thereafter...........................................200.''.
       (b) Conforming Amendment.--Section 301(d) of the Economic 
     Growth and Tax Relief Reconciliation Act of 2001 is amended 
     by striking ``2004'' and inserting ``2002''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2002.

     SEC. 105. ACCELERATION OF 15-PERCENT INDIVIDUAL INCOME TAX 
                   RATE BRACKET EXPANSION FOR MARRIED TAXPAYERS 
                   FILING JOINT RETURNS.

       (a) In General.--Subparagraph (B) of section 1(f )(8) 
     (relating to phaseout of marriage penalty in 15-percent 
     bracket) is amended to read as follows:
       ``(B) Applicable percentage.--For purposes of subparagraph 
     (A), the applicable percentage shall be determined in 
     accordance with the following table:

``For taxable years beginning in calendar year--         The applicable
                                                        percentage is--
  2003.............................................................195 
  2004.............................................................200 
  2005.............................................................180 
  2006.............................................................187 
  2007.............................................................193 
  2008 and thereafter...........................................200.''.
       (b) Conforming Amendment.--Section 302(c) of the Economic 
     Growth and Tax Relief Reconciliation Act of 2001 is amended 
     by striking ``2004'' and inserting ``2002''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2002.
       Beginning on page 15, line 12, strike all through page 18, 
     line 11, and insert:

[[Page 11779]]

     SEC. 107. INCREASED EXPENSING FOR SMALL BUSINESS.

       (a) In General.--Paragraph (1) of section 179(b) (relating 
     to dollar limitation) is amended to read as follows:
       ``(1) Dollar limitation.--The aggregate cost which may be 
     taken into account under subsection (a) for any taxable year 
     shall not exceed $25,000 ($100,000 in the case of taxable 
     years beginning after 2002 and before 2008).''.
       (b) Increase in Qualifying Investment at Which Phaseout 
     Begins.--Paragraph (2) of section 179(b) (relating to 
     reduction in limitation) is amended by inserting ``($400,000 
     in the case of taxable years beginning after 2002 and before 
     2008)'' after ``$200,000''.
       (c) Off-the-Shelf Computer Software.--Paragraph (1) of 
     section 179(d) (defining section 179 property) is amended to 
     read as follows:
       ``(1) Section 179 property.--For purposes of this section, 
     the term `section 179 property' means property--
       ``(A) which is--
       ``(i) tangible property (to which section 168 applies), or
       ``(ii) computer software (as defined in section 
     197(e)(3)(B)) which is described in section 197(e)(3)(A)(i), 
     to which section 167 applies, and which is placed in service 
     in a taxable year beginning after 2002 and before 2008,
       ``(B) which is section 1245 property (as defined in section 
     1245(a)(3)), and
       ``(C) which is acquired by purchase for use in the active 
     conduct of a trade or business.

     Such term shall not include any property described in section 
     50(b) and shall not include air conditioning or heating 
     units.''.
       (d) Adjustment of Dollar Limit and Phaseout Threshold for 
     Inflation.--Subsection (b) of section 179 (relating to 
     limitations) is amended by adding at the end the following 
     new paragraph:
       ``(5) Inflation adjustments.--
       ``(A) In general.--In the case of any taxable year 
     beginning in a calendar year after 2003 and before 2008, the 
     $100,000 and $400,000 amounts in paragraphs (1) and (2) shall 
     each be increased by an amount equal to--
       ``(i) such dollar amount, multiplied by
       ``(ii) the cost-of-living adjustment determined under 
     section 1(f)(3) for the calendar year in which the taxable 
     year begins, by substituting `calendar year 2002' for 
     `calendar year 1992' in subparagraph (B) thereof.
       ``(B) Rounding.--
       ``(i) Dollar limitation.--If the amount in paragraph (1) as 
     increased under subparagraph (A) is not a multiple of $1,000, 
     such amount shall be rounded to the nearest multiple of 
     $1,000.
       ``(ii) Phaseout amount.--If the amount in paragraph (2) as 
     increased under subparagraph (A) is not a multiple of 
     $10,000, such amount shall be rounded to the nearest multiple 
     of $10,000.''.
       (e) Revocation of Election.--Paragraph (2) of section 
     179(c) (relating to election irrevocable) is amended to read 
     as follows:
       ``(2) Revocation of election.--An election under paragraph 
     (1) with respect to any taxable year beginning after 2002 and 
     before 2008, and any specification contained in any such 
     election, may be revoked by the taxpayer with respect to any 
     property. Such revocation, once made, shall be 
     irrevocable.''.
       (f) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2002.
       On page 19, line 5, insert ``the applicable percentage of'' 
     before ``qualified''.
       On page 19, strike lines 7 through 15, and insert:
       ``(2) Applicable percentage.--For purposes of this 
     subsection, the applicable percentage is--
       ``(A) 50 percent in the case of taxable years beginning in 
     2003,
       ``(B) 100 percent in the case of taxable years beginning in 
     2004, 2005, and 2006, and
       ``(C) zero percent in the case of any other taxable year.
       On page 21, beginning with line 21, strike all through page 
     22, line 2, and redesignate accordingly.
       On page 26, strike lines 17 through 22, and insert:
       (4) Section 531 is amended--
       (A) by inserting ``the taxable percentage of'' after 
     ``equal to'', and
       (B) by adding at the end the following: ``For purposes of 
     this section, the taxable percentage is 100 percent minus the 
     applicable percentage (as defined in section 116(a)(2)).''
       (5) Section 541 is amended--
       (A) by inserting ``the taxable percentage of'' after 
     ``equal to'', and
       (B) by adding at the end the following: ``For purposes of 
     this section, the taxable percentage is 100 percent minus the 
     applicable percentage (as defined in section 116(a)(2)).''
       On page 27, between lines 16 and 17, insert:
       (9)(A) Section 1059(a) is amended by striking 
     ``corporation'' each place it appears and inserting 
     ``taxpayer''.
       (B)(i) The heading for section 1059 is amended by striking 
     ``CORPORATE''.
       (ii) The item relating to section 1059 in the table of 
     sections for part IV of subchapter O of chapter 1 is amended 
     by striking ``Corporate shareholder's'' and inserting 
     ``Shareholder's''.
       On page 27, line 19, strike ``2003'' and insert ``2002''.

  Mr. BAUCUS. If the Senator will yield, this is probably the most 
important amendment of the night. I ask consent each side be allowed 2 
minutes instead of the customary 1 minute.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Oklahoma is recognized for 2 minutes.
  Mr. NICKLES. The amendment I sent to the desk on behalf of myself, 
Senator Miller from Georgia, Senator Kyl, Senator Lott, Senator Frist, 
and others, would do several things. It would make this dividend 
package and make the growth package a lot more robust. It would 
accomplish the President's objective of eliminating double taxation of 
dividends. We tax dividends higher than any other country in the world. 
We are tied with Japan. We would eliminate double taxing.
  We would have 50-percent exclusion on dividend income in 2003, and 
100 percent in 2004, 2005, and 2006. This would have a very 
significant, positive impact on the stock market, on individuals' 
401(k)'s, on people who have teacher retirement accounts, and others. 
It would help them dramatically. Some estimate 5 percent, some say 10 
percent, some say 20 percent, some say more. I encourage my colleagues 
to vote for it.
  We also would adopt the House provision dealing with expensing. This 
is a much more accelerated and more upfront accelerated expensing 
provision than what we had in the Senate bill and certainly over 
present law. Current law is $25,000. This goes to $100,000 of expensing 
and would last for 5 years. The Senate bill we have before the Senate 
has $75,000 and goes over 10 years. This encourages a lot of companies, 
and bigger companies, companies that have an annual investment of 
$400,000, would get to be able to deduct in 1 year $100,000. It is more 
robust in the expensing provision and more robust in the dividend 
provision.
  It would encourage investment; it would encourage jobs; it would 
encourage growth. I encourage our colleagues to vote in favor of this 
amendment.
  I reserve the remainder of my time.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. Mr. President, let me read a quote of American Enterprise 
Institute, conservative economist, commenting on this amendment:

       Clearly, this proposal is one of the most patently absurd 
     tax policies ever proposed.

  That is AEI, Republican economist, commenting on this amendment. Why 
say that? First, this amendment goes far beyond any other attempt to 
eliminate double taxation of dividends. What is the effect of this 
amendment? The effect of this amendment is in many cases to not only 
eliminate double taxation of dividends but to also eliminate single 
taxation of dividends.
  In many cases, as a consequence of the way this amendment is 
written--which we saw just for the first time half an hour ago--is to 
say there is no taxation on many dividends offered by corporation 
shareholders, not the shareholder paying any tax, and not the 
corporation paying any tax.
  Second, who subsidizes this if that is the nontaxation of dividends 
under this proposal? Americans are subsidizing this. Who? Americans 
today who otherwise would receive the relief under the marriage penalty 
contained in this bill are going to be subsidizing and paying for, in 
effect, these tax-free dividends. That is because that is the pay-for 
in this bill.
  In addition, this bill increases the budget deficit so our children 
will be paying for many of those tax-free dividends contained in this 
bill.
  Next, this is a huge yo-yo tax provision. Now you see it, now you 
don't; 50 percent 1 year, 100 percent the next year, 100 percent 
another year, then zero. Tell me if any corporation will be able to 
plan on whether or not to pay dividends with a tax policy like that. 
Clearly, they will wait for the 100 percent and they will not know if 
it will be continued in law.
  This is absurd and irresponsible to enact tax legislation like this. 
I strongly urge Senators to consider what they are doing tonight if 
they support this amendment. This is an outrage.
  Mr. NICKLES. Mr. President, I urge our colleagues to vote in favor of 
this

[[Page 11780]]

amendment. It is much more robust than in the underlying bill, and it 
is what the President wants. I think it will grow the economy and 
create jobs. I urge my colleagues to vote in favor of the amendment.
  The PRESIDING OFFICER. Time is expired.
  Mr. NICKLES. I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The question is on agreeing to the amendment.
  The clerk will call the roll.
  The legislative clerk called the roll.
  The yeas and nays resulted--yeas 50, nays 50, as follows:

                      [Rollcall Vote No. 171 Leg.]

                                YEAS--50

     Alexander
     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Campbell
     Chambliss
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Kyl
     Lott
     Lugar
     McConnell
     Miller
     Murkowski
     Nelson (NE)
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner

                                NAYS--50

     Akaka
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Breaux
     Byrd
     Cantwell
     Carper
     Chafee
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham (FL)
     Harkin
     Hollings
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     McCain
     Mikulski
     Murray
     Nelson (FL)
     Pryor
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Snowe
     Stabenow
     Wyden
  The VICE PRESIDENT. The Senate will be in order, please.
  On this vote, the yeas are 50, the nays are 50. The Senate being 
equally divided, the Vice President votes in the affirmative.
  The amendment of the Senator from Oklahoma is agreed to.
  Mr. McCONNELL. Mr. President, I move to reconsider the vote.
  Mr. CRAIG. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. NICKLES. I ask unanimous consent to add Senator Domenici and 
Senator Allard as original cosponsors.
  The VICE PRESIDENT. Without objection, it is so ordered.
  Mr. BAUCUS. Mr. President, I ask unanimous consent the Reid amendment 
be temporarily laid aside to occur after the Santorum amendment. Is the 
next amendment in order the Breaux amendment? Is that the next 
amendment?
  The VICE PRESIDENT. The Senator is correct.
  Mr. BAUCUS. I ask 4 minutes total, 2 minutes on each side, on the 
Breaux amendment.
  The VICE PRESIDENT. Without objection, it is so ordered.
  The Senator from Louisiana.


                           Amendment No. 663

  Mr. BREAUX. Mr. President, I ask my amendment No. 663, which is at 
the desk, be reported.
  The VICE PRESIDENT. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Louisiana [Mr. Breaux] proposes an 
     amendment numbered 663.

  Mr. BREAUX. I ask unanimous consent the reading of the amendment be 
dispensed with.
  The VICE PRESIDENT. Without objection, it is so ordered.
  The amendment is as follows:

       Strike Sec. 350.
       On page 19, line 11, strike ``100'' and insert ``65.''

  Mr. BREAUX. Mr. President, may we have order in the Senate?
  The VICE PRESIDENT. The Senate will be in order, please.
  The Senator from Louisiana.
  Mr. BREAUX. Mr. President, most people think we are debating a tax 
cut bill. There are some tax cuts in the bill. But there is also a $35 
billion tax increase--a $35 billion tax increase on schoolteachers who 
work overseas, ministers who work overseas, Catholic relief workers, 
charitable workers, and technicians who work overseas, earn income 
overseas, and pay taxes overseas. We are now changing the law to 
eliminate the exemption they have always traditionally enjoyed. They do 
not live in this country and don't get the benefits of living in this 
country, and therefore we give them a tax exemption. That has been 
eliminated in the amendment that has been offered by the Senator from 
Oklahoma. It is a $35 billion tax increase to pay for the dividend 
provisions of the legislation.
  We just voted, incidentally, for overseas corporations, if they bring 
their profits back to the United States--guess what we did. We voted to 
tax them at 5 percent for 1 year. But if an individual works overseas 
and makes money, we are now saying that your tax exemption has been 
eliminated; you will pay taxes in the country where you are getting a 
credit against your income tax, but you will pay taxes as if you 
lived--resided--and worked in United States. It is a $35 billion tax 
increase on people making $50,000 to $75,000 a year in order to pay for 
a dividend tax cut from which most people are not going to benefit.
  My amendment is paid for by reducing 3 years of the dividend 
reduction from 100 percent down to 65 percent elimination of the 
dividend tax. That is substantially more than we passed in the Finance 
Committee. You still get a major dividend tax cut, much larger than the 
Finance Committee passed and eliminate the taxes on individuals working 
overseas--middle-income and moderate-income people. We are robbing 
Peter to pay for Paul. Unfortunately, we are taking it from middle-
income people.
  Mr. GRASSLEY. Mr. President, let us set the record straight. This is 
not a tax increase. This is a loophole closure for people who live 
overseas. Taxpayer dollars should, in fact, not be subsidizing an 
employer's cost of sending an employee overseas. This subsidy equals 
$98,000 of taxes for each employee each year. Repeal will not cause 
people to be double taxed because of the fact that the foreign tax 
credit can be used against American taxes owed. A vote for the Breaux 
amendment will in fact gut the dividend exclusion we just passed.
  The bottom line is, let us weight the advantage of the dividend 
exclusion of the 234 million people who will benefit from that against 
only 358,000 people who benefit from section 911.
  I think it is pretty clear that this amendment should be defeated. It 
will destroy the well-balanced provisions we put together between 
investment and consumer spending, a well-balanced bill between helping 
investment and helping people of lower income with the refundables that 
are in the bill.
  I yield the floor.
  The VICE PRESIDENT. All time has expired. The question is on agreeing 
to the amendment.
  Mr. BREAUX. I ask for the yeas and nays.
  The VICE PRESIDENT. Is there a sufficient second?
  There is a sufficient second.
  The question is on agreeing to the amendment. The clerk will call the 
roll.
  The assistant legislative clerk called the roll.
  The result was announced--yeas 49, nays 51, as follows:

                      [Rollcall Vote No. 172 Leg.]

                                YEAS--49

     Akaka
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Breaux
     Byrd
     Cantwell
     Carper
     Chafee
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham (FL)
     Harkin
     Hollings
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Lott
     Mikulski
     Murray
     Nelson (FL)
     Pryor
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Stabenow
     Wyden

                                NAYS--51

     Alexander
     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Campbell
     Chambliss
     Cochran
     Coleman
     Collins
     Cornyn
     Craig

[[Page 11781]]


     Crapo
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Kyl
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nelson (NE)
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner
  Mr. CRAIG. I move to reconsider the vote.
  Mr. BENNETT. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The VICE PRESIDENT. The Senator from Montana.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that it now be in 
order to go to the amendment offered by the Senator from California, 
Mrs. Boxer.
  The VICE PRESIDENT. Without objection, it is so ordered.
  The Senator from California.


                           Amendment No. 667

  Mrs. BOXER. Mr. President, I send an amendment to the desk and ask 
for its immediate consideration.
  The VICE PRESIDENT. The clerk will report the amendment.
  The legislative clerk read as follows:

       The Senator from California [Mrs. Boxer] proposes an 
     amendment numbered 667.

  Mrs. BOXER. Mr. President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The VICE PRESIDENT. Without objection, it is so ordered.
  The amendment is as follows:

 (Purpose: To require a parent who is chronically delinquent in child 
support to include the amount of the unpaid obligation in gross income)

       At the end of subtitle C of title V, add the following:

     SEC. __. CHILD SUPPORT ENFORCEMENT.

       (a) Inclusion in Income of Amount of Unpaid Child 
     Support.--Section 108 (relating to discharge of indebtedness 
     income) is amended by adding at the end the following new 
     subsection:
       ``(h) Unpaid Child Support.--
       ``(1) In general.--For purposes of this chapter, any unpaid 
     child support of a delinquent debtor for any taxable year 
     shall be treated as amounts includible in gross income of the 
     delinquent debtor for the taxable year.
       ``(2) Definitions.--For the purposes of this subsection--
       ``(A) Child support.--The term `child support' means--
       ``(i) any periodic payment of a fixed amount, or
       ``(ii) any payment of a medical expense, education expense, 
     insurance premium, or other similar item,

     which is required to be paid to a custodial parent by an 
     individual under a support instrument for the support of any 
     qualifying child of such individual. `Child support' does not 
     include any amount which is described in section 408(a)(3) of 
     the Social Security Act and which has been assigned to a 
     State.
       ``(B) Custodial parent.--The term `custodial parent' means 
     an individual who is entitled to receive child support and 
     who has registered with the appropriate State office of child 
     support enforcement charged with implementing section 454 of 
     the Social Security Act.
       ``(C) Delinquent debtor.--The term `delinquent debtor' 
     means a taxpayer who owes unpaid child support to a custodial 
     parent.
       ``(D) Qualifying child.--The term `qualifying child' means 
     a child of a custodial parent with respect to whom a 
     dependent deduction is allowable under section 151 for the 
     taxable year (or would be so allowable but for paragraph (2) 
     or (4) of section 152(e)).
       ``(E) Support instrument.--The term `support instrument' 
     means--
       ``(i) a decree of divorce or separate maintenance or a 
     written instrument incident to such a decree,
       ``(ii) a written separation agreement, or
       ``(iii) a decree (not described in clause (i)) of a court 
     or administrative agency requiring a parent to make payments 
     for the support or maintenance of 1 or more children of such 
     parent.
       ``(F) Unpaid child support.--The term `unpaid child 
     support' means child support that is payable for months 
     during a custodial parent's taxable year and unpaid as of the 
     last day of such taxable year, provided that such unpaid 
     amount as of such day equals or exceeds one-half of the total 
     amount of child support due to the custodial parent for such 
     year.
       ``(3) Coordination with other laws.--Amounts treated as 
     income by paragraph (1) shall not be treated as income by 
     reason of paragraph (1) for the purposes of any provision of 
     law which is not an internal revenue law.''.
       (b) Effective Date; Implementation.--The amendments made by 
     this section shall apply to taxable years beginning after 
     December 31, 2002. The Secretary of the Treasury shall 
     publish Form 1099-CS (or such other form that may be 
     prescribed to comply with the amendment made by subsection 
     (b)(1)) and regulations, if any, that may be deemed necessary 
     to carry out the purposes of this Act, not later than 90 days 
     after the date of enactment of this Act.

  Mrs. BOXER. Mr. President, I will only take about a minute of the 
Senate's time to explain this amendment, which I am very happy has been 
cleared on both sides.
  This amendment is based on a bill that Congressman Chris Cox and I 
wrote, and it is a money raiser. It actually raises, over the 10-year 
period, in excess of $400 million.
  What it does, in essence, is say this: If a parent who is ordered to 
pay child support fails to pay that child support, and fails to pay at 
least 50 percent of that child support then that delinquent parent 
would have to add the amount that he or she was supposed to pay to 
child support to his or her gross income.
  Each year, nearly 60 percent of the 20 million children who are owed 
child support receive less than the amount they are due, and more than 
30 percent receive no payment at all.
  This amendment will bring much-needed relief to the millions of 
families who are not receiving the child support they desperately need.
  The PRESIDING OFFICER (Mr. Chambliss). The Senator's time has 
expired.
  Mrs. BOXER. I thank the Chair.
  I am very pleased this amendment has been signed off on by both 
sides.
  Mr. REID. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. REID. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. REID. Mr. President, before the majority leader addresses the 
Senate, could we dispose of the Boxer amendment?
  Mrs. BOXER. Just by voice vote.
  The PRESIDING OFFICER. If time is yielded back in opposition, the 
Senate can dispose of the amendment.
  Mr. THOMAS. We have no objection to the amendment.
  The PRESIDING OFFICER. Without objection, the amendment is agreed to.
  The amendment (No. 667) was agreed to.
  The PRESIDING OFFICER. The majority leader.
  Mr. FRIST. Mr. President, we have had tremendous progress. It has 
been a long day. Most of us have been actually here on the floor for 
almost 11 hours. We have made great progress. We have completed 25 
votes. Yet in conversations with the assistant Democratic leader, it is 
very clear we have a number of other amendments that people have 
expressed an interest in. We have dealt with most of the major 
amendments that have been discussed over today and yesterday and the 
day before. I know there are a number of other amendments people would 
like to talk about, would like to vote on, but I encourage Senators, 
due to the late hour, that we try to get that list as small as 
possible, and that Members talk to the chairman and ranking member and 
condense that list as narrowly as possible.
  So our colleagues will know, as I said 2 days ago, and as I said 
yesterday, and as I said today, we are going to finish this bill 
tonight, and we are going to go to the global HIV/AIDS bill with the 
intention of completing that tonight. And that means if it is 10 
o'clock, if it is 11 o'clock, if it is 12 o'clock, if it is 1 o'clock, 
we will be having rollcall votes.
  Thus, I encourage everybody to focus, to use common sense, to be 
reasonable in terms of the amendments they put on the floor at this 
juncture. But I repeat, we will continue having rollcall votes until we 
finish the jobs and growth bill, as well as the global HIV/AIDS bill, 
tonight.
  The PRESIDING OFFICER. The Senator from Nevada.

[[Page 11782]]


  Mr. REID. Mr. President, the Democratic leader has asked me to 
announce that he has joined with the majority leader in recognizing 
this bill needs to be finished tonight. As the majority leader has 
indicated, following this bill, we are going to complete the global 
HIV/AIDS bill, which has a number of amendments we will have to dispose 
of.
  Right now I have here about 14 amendments. There are a couple on the 
other side. The rest of them are on this side. We know how strongly 
people feel about their issues, but I would like to say Senator Dorgan 
and I have been waiting for a long time to offer an amendment on 
concurrent receipts. We are not going to offer that amendment tonight 
because we have an opportunity to offer that at a later time on another 
piece of legislation. When the defense bill comes through here--both 
the defense bill and the defense appropriations bill--we can do that. I 
know I will find another place at a later time to offer the notch-baby 
amendment.
  I feel strongly about both of these issues, but I had one amendment 
yesterday. It was a good debate. I would hope that people who have the 
opportunity to offer an amendment--and we recognize that--would look to 
see if we have debated these issues before. We have voted on some 
issues several times already, and if they must offer an amendment, 
maybe we could dispose of it by voice vote. Although I have not agreed 
with most of the votes that have occurred here in the last couple days, 
I have a pretty good indication how the votes are going to turn out 
tonight on the rest of these amendments. So I would rather that we were 
not finishing the bill tonight. The two leaders have said we are 
finishing the bill tonight or in the morning--and that does not mean we 
are going to have a break before morning comes.
  So I hope everyone will work with us and do what they can to get rid 
of these amendments in a way that they feel is appropriate.
  Several Senators addressed the Chair.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. DOMENICI. Mr. President, I have a question.
  Mr. BAUCUS. Mr. President, I think sometimes discretion is the better 
part of valor. We have been on this bill for 2 full days. I have 
amendments which I would like to offer. I am willing to forego those 
amendments.
  As the Senator from Nevada said, there are about 14 amendments left. 
That means in 5 more hours we will be here on this bill, before we get 
to the global HIV/AIDS bill.
  I urge Senators on both sides of the aisle--and I guess I 
particularly appeal to Senators on my side of the aisle--that there are 
a couple here that probably could and should be voted on but some of 
them probably not.
  There will be another day. There will be another tax bill. There will 
be other opportunities for us to offer amendments. I think, frankly, 
after a couple, three or four or five more amendments, it is about time 
to wrap up this bill. We know what the conclusion is going to be on all 
the amendments. As the Senator has said, some of the subjects have 
already been addressed. Some have not, but some of the subjects already 
have been addressed. I have been working with the chairman of the 
committee throughout this bill to try to work out a good process. My 
judgment is that we should whittle down the list.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Have we already agreed on a list or are people still 
able to add to it?
  Mr. BAUCUS. The answer to the question is, we have not agreed to a 
list. Technically people are still able to add.
  Mr. DOMENICI. Do you have a list?
  Mr. BAUCUS. We do have a list. We have 14--12 on our side at least.
  Mr. DOMENICI. I ask unanimous consent that no other amendments be in 
order this evening on this bill.
  The PRESIDING OFFICER. Is there objection?
  Mr. REID. Mr. President, I think in fairness to everyone I should 
read what the amendments are. We have a Kennedy amendment on drugs; 
Gregg amendment on pension interest rates; Dodd amendment on higher 
education; Dorgan amendment on debt collection, with Senator Byrd; 
Dorgan, to protect Social Security, on which he will take a voice vote; 
Hollings has an amendment on striking out the tax cuts--he will take a 
voice vote on that; Senator Levin, on inversion; Senator Rockefeller, 
school construction; Senator Durbin, on health coverage for caregivers; 
Senator Kennedy, on No Child Left Behind; in addition to the managers' 
amendment; and those on the previous list which we have three on the 
previous list; and an Edwards amendment.
  The PRESIDING OFFICER. The Senator from Wyoming.
  Mr. THOMAS. Mr. President, on our side we have just three, a Gregg 
amendment, and possibly two Santorum amendments.
  Mr. DOMENICI. I ask unanimous consent that there be no further 
amendments in order.
  Mr. REID. Mr. President, on the Santorum amendments, we would like to 
know the subject of them.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. BINGAMAN. Mr. President, am I on the list? I was not read off.
  Mr. REID. You are on the previous list.
  Mr. BINGAMAN. I have no objection.
  The PRESIDING OFFICER. Who seeks time?
  Mr. DOMENICI. I renew my request.
  The PRESIDING OFFICER. Is the Senator from New Mexico making a 
unanimous consent request?
  Mr. DOMENICI. I renew my request.
  The PRESIDING OFFICER. Is there objection?
  Mr. SARBANES. Reserving the right to object, have Members been given 
notice that a motion of this sort was to be offered? Have Members been 
given notice that a motion of this sort is to be offered?
  Mr. DOMENICI. You have had it in mind most of the day. But, no, they 
have not. I am just kidding the Senator.
  Mr. BAUCUS. If I might respond, the answer is no, not formally. I 
suggest that after about 15 minutes or so, we put the request again. At 
least we can go through a couple amendments now, then renew the request 
in 15 minutes.
  The PRESIDING OFFICER. The Senator from New Mexico has made a 
request. Is there objection?
  Mr. REID. Mr. President, Senator Harkin wishes to be added to that 
list. I would add to the request of the Senator from New Mexico, that 
we handle second-degree amendments as we have handled amendments on the 
bill up to this point.
  Mr. DOMENICI. I have no objection.
  The PRESIDING OFFICER. The Senator from New York.
  Mr. SCHUMER. Reserving the right to object, I have an amendment that 
I believe is technical, although important, with no revenues. It was 
approved by this side and is awaiting approval by the other side. I ask 
that it be added to the list, and I don't think we will have to debate 
it. But I can't forgo the opportunity to bring it up.
  The PRESIDING OFFICER. The Senator from Wyoming.
  Mr. THOMAS. While we are coming to an agreement, could we move 
forward. Senator Gregg is prepared with his amendment.
  Mr. SARBANES. Mr. President, I object to the request. I think it 
should be worked out with the chairman.
  The PRESIDING OFFICER. Objection is heard.
  Mr. DOMENICI. I withdraw the request.
  Mr. SARBANES. So everyone can have a fair opportunity.
  Mr. THOMAS. I yield to Senator Gregg.
  The PRESIDING OFFICER. The Senator from New Hampshire is recognized.
  Mr. GREGG. Mr. President, I am not going to call up the amendment. I 
will withdraw the amendment. I do wish to speak for 1 minute on the 
amendment.
  The PRESIDING OFFICER. The Senator is recognized.
  Mr. GREGG. My amendment addresses a problem that faces a large number 
of our largest employers in the country and that's the funding of 
pension plans.

[[Page 11783]]

Because there is no longer a 30-year Treasury bond issued in this 
country, the values of pension plans are being artificially 
underaccounted. As a result, many companies are going to have to take 
money which they might spend on employees or money they might spend on 
plants and equipment and put it into funding in order to cover what is 
an artificial shortfall.
  This amendment is supported by the AFL-CIO and by the business 
community. This includes the U.S. Chamber of Commerce, the Business 
Roundtable, the National Association of Manufacturers, the ERISA 
Industry Committee, the American Benefits Council, the American Society 
of Pension Actuaries, the Committee on Investment of Employment Benefit 
Assets, and Financial Executives International, and other major 
business groups.
  My amendment is an attempt to address what we all understand to be a 
problem that is created through the fact that there is no longer a 30-
year Treasury bond being issued. The amendment extends a fix put in 
place last year and uses a composite of high quality corporate bonds as 
a new standard during that extension period. Then the amendment sets up 
a commission, the purpose of which is to come up with a new standard 
for the purpose of valuing what the pension funding mechanism should be 
and how much should be put into pension plans.
  So it is an appropriate action. The problem is it has to be taken 
before the middle of the summer.
  I will withdraw the amendment at this time in order to move the 
process along.
  The PRESIDING OFFICER. Who seeks time?
  Mr. BAUCUS. I ask unanimous consent that the next amendment in order 
be the amendment offered by the Senator from Massachusetts, Mr. 
Kennedy.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
Senator from Massachusetts.


                           Amendment No. 545

  Mr. KENNEDY. Mr. President, I call up amendment 545 and ask for its 
immediate consideration.
  The PRESIDING OFFICER. The clerk will report the amendment.
  The legislative clerk read as follows:

       The Senator from Massachusetts [Mr. Kennedy] proposes an 
     amendment numbered 545.

  Mr. KENNEDY. I ask unanimous consent that reading of the amendment be 
dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

 (Purpose: To eliminate the dividend and upper bracket tax cuts, which 
    primarily benefit the wealthy, to provide the additional funds 
necessary for an adequate medicare prescription drug benefit, including 
 assuring that the benefit is comprehensive, with no gaps or excessive 
cost-sharing, covers all medicare beneficiaries, provides special help 
  for beneficiaries with low income, and does not undermine employer 
                          retirement coverage)

       At the end of subtitle C of title V, add the following:

     SEC. __. REPEAL OF PARTIAL EXCLUSION OF DIVIDENDS AND 
                   ELIMINATION OF ACCELERATION OF TOP RATE 
                   REDUCTION IN INDIVIDUAL INCOME TAX RATES.

       (a) Repeal of Partial Exclusion of Dividends.--Section 201 
     of this Act, and the amendments made by such section, are 
     repealed.
       (b) Elimination of Acceleration of Top Rate Reduction in 
     Individual Income Tax Rates.--Notwithstanding the amendment 
     made by section 102(a) of this Act, in lieu of the percent 
     specified in the last column of the table in paragraph (2) of 
     section 1(i) of the Internal Revenue Code of 1986, as amended 
     by such section 102(a), for taxable years beginning during 
     calendar years 2003, 2004, and 2005, the following 
     percentages shall be substituted for such years:
       (1) For 2003, 38.6%.
       (2) For 2004 and 2005, 37.6%.
       (c) Effective Date.--Subsection (a) and (b) shall take 
     effect on the date of enactment of this Act.

  Mr. KENNEDY. Mr. President, this amendment substitutes the funds that 
have been allocated for the dividend tax, the $120 million, plus the 
accelerated funds that come from accelerating the lowering of the upper 
tax rates, which is another $30 billion, which is $150 billion, and 
adds that into a prescription drug benefit program. That is effectively 
what this amendment does.
  Effectively we are making judgments. We are making decisions and 
priorities this evening. It does seem to me that there is a greater 
need to make sure we are going to have a solid prescription drug 
program that is going to be the third leg of the Medicare system. The 
Medicare system provides for hospitalization and physician services. It 
does not provide for a prescription drug program. This will ensure that 
we have adequate funds for a prescription drug program that hopefully 
we will enact by the end of this session.
  The PRESIDING OFFICER. Who seeks time in opposition? The Senator from 
Wyoming.
  Mr. THOMAS. Mr. President, on behalf of the chairman, I oppose this 
amendment. It is not germane to the underlying bill. It takes money 
away from our job creation package, and it is premature. The amendment 
is premature because the Finance Committee will shortly take up a 
comprehensive Medicare prescription drug and Medicare improvement bill. 
We are on target to do so before the Fourth of July recess. The 
committee has been working to reach out to both Democrats and 
Republicans on a policy that makes sense and can work, and most of all 
we are here to help seniors get access to prescription drugs. The 
budget resolution contains the reserve fund of $400 billion that we 
intend to spend in a bipartisan way on behalf of seniors who have 
lacked affordable drug coverage for too long.
  The President deserves credit for kick-starting the debate on 
Medicare this year by dedicating $400 billion in this budget to make 
Medicare stronger. We have come a long way toward accomplishing that 
goal. The chairman continues to work with colleagues on both sides of 
the aisle.
  The PRESIDING OFFICER. Time has expired.
  Mr. THOMAS. Mr. President, this amendment is not germane and I raise 
a point of order.
  Mr. KENNEDY. Parliamentary inquiry: Since the amendment only changes 
the figures, is it not then germane? Since it only adjusts and changes 
the figures that are in the underlying bill, therefore is it not 
germane?
  Mr. THOMAS. I raise the point that it is not germane.
  The PRESIDING OFFICER. If it deals with figures that are not 
contained in the underlying bill, it would not be germane.
  Mr. KENNEDY. They are included. They are included, Mr. President. 
They are changing the figures which are in the underlying bill and, 
therefore, this amendment is germane just for these provisions in the 
bill.
  Mr. THOMAS. Mr. President, after looking at it, it is our opinion 
that these numbers have nothing to do with it. It just guts the numbers 
and, therefore, it is not germane, and we raise the point of order.
  Mr. KENNEDY. Mr. President, it is germane. It is a simple striking. 
It conforms to the rules of the Senate.
  Mr. THOMAS. It has nothing to do with prescription drugs.
  Mr. KENNEDY. We are talking about relevancy of the amendment, and it 
does just strike the relevant provisions. It is germane. The text of 
the amendment does not speak to prescription drugs.
  The PRESIDING OFFICER. It is the opinion of the Chair that the 
amendment does address numbers which are addressed in the underlying 
bill and, therefore, the amendment is germane.
  Mr. KENNEDY. I ask for the yeas and nays, Mr. President.
  The PRESIDING OFFICER. Is there a sufficient second?
  Mr. THOMAS. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll to ascertain the 
presence of a quorum.
  Mr. KENNEDY. Mr. President, point of order, I make a point of order, 
there is obviously a quorum present. I ask for the yeas and nays.

[[Page 11784]]

  The PRESIDING OFFICER. The Chair has no authority to note the 
presence of a quorum. The quorum call is appropriate. The clerk will 
call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. KENNEDY. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. THOMAS. Mr. President, we believe it is legitimate and we want to 
move forward. All this does is do away with dividends. Therefore, we 
are agreeable to having an up-or-down vote.
  Mr. KENNEDY. Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second? There is a 
sufficient second.
  The yeas and nays are ordered, and the clerk will call the roll.
  The legislative clerk called the roll.
  The result was announced--yeas 48, nays 52, as follows:

                      [Rollcall Vote No. 173 Leg.]

                                YEAS--48

     Akaka
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Breaux
     Byrd
     Cantwell
     Carper
     Chafee
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham (FL)
     Harkin
     Hollings
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Murray
     Nelson (FL)
     Pryor
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Stabenow
     Wyden

                                NAYS--52

     Alexander
     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Campbell
     Chambliss
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Kyl
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nelson (NE)
     Nickles
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner
  The amendment (No. 545) was rejected.
  The Senator from Montana.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that we now 
proceed to the amendment offered by the Senator from Connecticut.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
Senator from Connecticut is recognized.


                           Amendment No. 572

  Mr. DODD. Mr. President, the purpose of this amendment is to improve 
access to higher education for middle- and low-income families by 
expanding the HOPE and lifetime learning tax credits and Pell grants, 
as well as deficit reduction. This is done by eliminating the 10 
percent dividend exclusion for amounts greater than $500 and 
eliminating acceleration of the top tax rate reduction.
  I have outlined in the amendment the purpose of this proposal. I do 
not think any of us would disagree that the long-term economic strength 
of our Nation will depend upon whether or not the next generation 
receives the higher education necessary to provide our Nation with the 
benefits of learning so the country can grow.
  I am simply asking the question, as many Americans are, as we are 
talking about reducing Pell grants and doing nothing to expand the HOPE 
and lifetime learning proposals which are directly designed to assist 
middle-income families, can we not, on an evening when we are about to 
adopt a massive tax cut for the wealthiest Americans, set aside some of 
these funds to adequately provide for educational opportunities for 
people who would not otherwise be able to afford them? That is the 
purpose of the amendment.
  The PRESIDING OFFICER. Will the Senator please send his amendment to 
the desk?
  Mr. DODD. Mr. President, it is amendment No. 572. It is at the desk.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Connecticut [Mr. Dodd], for himself, Mr. 
     Kennedy, Mr. Bingaman, and Mr. Biden, proposes an amendment 
     numbered 572.

  The PRESIDING OFFICER. Without objection, the reading of the 
amendment is dispensed with.
  The amendment is as follows:

   (Purpose: To improve access to higher education for middle income 
families by making resources available to expand the Hope and Lifetime 
 Learning Scholarship Credits and for lower-income families by making 
resources available to increase the maximum Pell Grant to $4500 and to 
  provide an equal amount for deficit reduction by eliminating the 10 
 percent dividend tax exclusion for amounts above $500 and eliminating 
      acceleration of the 38.6 percent income tax rate reduction)

       On page 19, line 9, strike ``sum of'' and all that follows 
     through line 15 and insert ``$500 ($250 in the case of a 
     married individual filing a separate return).''.
       On page 18, after line 17, insert the following:

     SEC. 109. ELIMINATION OF ACCELERATION OF TOP RATE REDUCTION 
                   IN INDIVIDUAL INCOME TAX.

       Notwithstanding the amendment made by section 102(a) of 
     this Act, in lieu of the percent specified in the last column 
     of the table in paragraph (2) of section 1(i) of the Internal 
     Revenue Code of 1986, as amended by such section 102(a), for 
     taxable years beginning during calendar years 2003, 2004, and 
     2005, the following percentages shall be substituted for such 
     years:
       (1) For 2003, 38.6%
       (2) For 2004 and 2005, 37.6%

  Mr. THOMAS. Mr. President, this amendment, like the last one, ought 
to be verified and categorized as violating the truth-in-advertising 
law. This amendment has nothing to do with education. It does not 
mention education other than in the title. All it does is eliminate the 
top rate reduction which hurts small businesses. It cuts the dividend 
provision. This is an amendment that will actually increase taxes. It 
has nothing to do with education, and it should be defeated.
  Mr. DODD. Mr. President, if I may, the purpose I have outlined in the 
amendment says what it is for. Some may want to interpret it otherwise, 
but this is a vote on whether we value higher education enough to 
ensure that all Americans have access to it.
  Mr. THOMAS. If we are going to debate this, it says nothing about it 
in the text of the bill.
  Mr. DODD. The purpose states it clearly.
  The PRESIDING OFFICER. Does anyone seek the yeas and nays?
  Mr. DODD. Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The question is on agreeing to amendment No. 572. The clerk will call 
the roll.
  The assistant legislative clerk called the roll.
  Mr. McCONNELL. I announce that the Senator from Alabama (Mr. Shelby) 
is necessarily absent.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 49, nays 50, as follows:

                      [Rollcall Vote No. 174 Leg.]

                                YEAS--49

     Akaka
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Breaux
     Byrd
     Cantwell
     Carper
     Chafee
     Clinton
     Conrad
     Corzine
     Daschle
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham (FL)
     Harkin
     Hollings
     Inouye
     Jeffords
     Johnson
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Murray
     Nelson (FL)
     Nelson (NE)
     Pryor
     Reed
     Reid
     Rockefeller
     Sarbanes
     Schumer
     Stabenow
     Wyden

                                NAYS--50

     Alexander
     Allard
     Allen
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Campbell
     Chambliss
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Kyl
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nickles
     Roberts
     Santorum
     Sessions
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner

[[Page 11785]]



                             NOT VOTING--1

       
     Shelby
       
  The amendment (No. 572) was rejected.
  The PRESIDING OFFICER. Who seeks recognition? The Senator from 
Montana.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that the pending 
amendments be set aside so we can consider the Hollings amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 607

  Mr. HOLLINGS. Mr. President, I call up my amendment 607 on behalf of 
myself and Senator Chafee and ask for its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from South Carolina [Mr. Hollings], for himself 
     and Mr. Chafee, proposes an amendment numbered 607.

  Mr. HOLLINGS. Mr. President, I ask unanimous consent that the reading 
of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

       Strike titles I, II, IV, and V.
       Strike section 601 and insert the following:

     SEC. 601. SUNSET

       Except as otherwise provided, the provisions of, and 
     amendments made, by section 362 shall not apply to taxable 
     years, beginning after December 31, 2012, and the Internal 
     Revenue Code of 1986 shall be applied and administered to 
     such years as if such amendments had never been enacted.
  The PRESIDING OFFICER. The Senator from South Carolina is recognized 
for 1 minute.
  Mr. HOLLINGS. Mr. President, the distinguished majority leader 
admonished that we act with common sense and be reasonable. So in 
acting with common sense and being reasonable, this amendment 
eliminates the tax cuts from this measure because the country cannot 
afford it.
  At the very moment we are running at a $500 billion or more deficit--
which is a $500 billion stimulus, incidentally--we have just adopted a 
budget that calls for a $600 billion deficit stimulus each year for 10 
years. What we are really engaged in is a pollster charade whereby the 
pollsters admonish tax cuts have to be voted for in order to get 
reelected.
  This country cannot afford the tax cuts, and it is time we looked 
upon the needs of the country rather than the needs of the campaign.
  I yield what time I have remaining to my distinguished colleague, 
Senator Chafee.
  The PRESIDING OFFICER. The Senator from Rhode Island.
  Mr. CHAFEE. Mr. President, we are debating a bill called the Jobs and 
Growth Tax Relief Reconciliation Tax Act of 2003. Two years ago this 
same month, we debated and passed a bill called the Economic Growth and 
Tax Relief Reconciliation Act of 2001. Whatever these bills are called, 
they add to the deficits.
  The PRESIDING OFFICER. The time of the Senator has expired.
  Mr. CHAFEE. There is not an elected official in the United States who 
does not want to cut taxes. The good ones only do it responsibly.
  The PRESIDING OFFICER. The Senator from Arizona.
  Mr. KYL. Mr. President, I at least want to compliment the sponsors of 
this amendment for not having a gimmicky amendment. This is a flat out, 
straight assault. It simply abolishes all the tax cuts in the bill. So 
I do compliment my colleagues on their very straightforward approach. 
However, that makes the vote pretty easy. I urge my colleagues to vote 
this amendment down.
  The PRESIDING OFFICER. Is there further debate?
  The question is on agreeing to the amendment.
  The amendment (No. 607) was rejected.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that the pending 
amendments be set aside so we can consider the Dorgan amendment that 
Senator Reid of Nevada will call up.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Nevada.


                           Amendment No. 668

  Mr. REID. I call up amendment No. 668.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Nevada [Mr. Reid], for Mr. Dorgan, 
     proposes an amendment numbered 668.

  Mr. REID. Mr. President, I ask unanimous consent that the reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

       At the appropriate place, insert the following:

     SEC. __. ENSURING DEFICIT REDUCTION.

       (a) Trigger.--Notwithstanding any other provision of this 
     Act, the provisions as described in subsection (b) shall take 
     effect only as provided in subsection (c).
       (b) Provision Described.--A provision of this Act described 
     in this subsection is--
       (1) a provision of this Act that accelerates the scheduled 
     phase down of the top tax rate of 38.6 percent to 37.6 
     percent in 2004 and to 35 percent in 2006; and
       (2) a provision of this Act that provides a 50 percent 
     dividends exclusion between December 31, 2002, and December 
     31, 2003, and a 100 percent dividends exclusion between 
     December 31, 2003 and December 31, 2006.
       (c) Delay.--
       (1) In general.--Each year when the final monthly Treasury 
     report for the most recently ended fiscal year is released, 
     the Secretary of the Treasury shall certify whether the on-
     budget deficit exceeds $300,000,000,000 for such year.
       (2) Effective date.--The provisions described in subsection 
     (b) shall become effective on January 1 in the calendar year 
     following the issuance of the final Treasury report only if 
     the Secretary has determined that the on-budget deficit is 
     $300,000,000,000 or less for the recently ended fiscal year.
       (d) Discretionary Spending Limitation.--
       (1) In general.--Notwithstanding any other provision of 
     law, in any fiscal year subject to the delay provisions of 
     subsection (c)--
       (A) the amount of budget authority for discretionary 
     spending for Federal agency administrative overhead expenses 
     shall be limited to the level in the preceding fiscal year 
     minus 5 percent; and
       (B) with respect to a second or subsequent consecutive 
     fiscal year subject to this subsection, the amount of budget 
     authority for discretionary spending for Federal agency 
     administrative overhead expenses shall be limited to the 
     level in the preceding fiscal year.
       (2) Definition.--In this subsection, the term 
     ``administrative overhead expenses'' mean costs of resources 
     that are jointly or commonly used to produce 2 or more types 
     of outputs but are not specifically identifiable with any of 
     the outputs. Administrative overhead expenses include general 
     administrative services, general research and technology 
     support, rent, employee health and recreation facilities, and 
     operating and maintenance costs for buildings, equipment, and 
     utilities.

  Mr. REID. Mr. President, this amendment would cut Federal agency 
administrative overhead expenses by 5 percent and delay the 
acceleration of the top income tax rate reduction and availability of 
the dividend tax exclusion relief in the reconciliation bill if the 
Secretary of the Treasury certifies that the on-budget deficit, 
excluding Social Security surpluses, for the most recently ended fiscal 
year is over $300 billion.
  The PRESIDING OFFICER. Is there anyone in opposition to the 
amendment?
  The Senator from Arizona.
  Mr. KYL. Mr. President, this is another amendment where we 
essentially voted on this concept several times, of taking money from 
the reduction in the tax package, in this case the top rate. Again, I 
would urge my colleagues to vote no.
  The PRESIDING OFFICER. Is there any further debate on the amendment?
  If not, the question is on agreeing to the amendment.
  The amendment (No. 668) was rejected.
  The PRESIDING OFFICER. Who seeks recognition?
  The Senator from Montana.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that the pending 
amendments be set aside so we can consider the Durbin amendment.
  The PRESIDING OFFICER. The Senator from Illinois is recognized for 1 
minute to introduce his amendment.

[[Page 11786]]




                           Amendment No. 669

  (Purpose: To provide health care coverage for qualified caregivers)

  Mr. DURBIN. Mr. President, I ask the clerk to read amendment No. 669.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Illinois [Mr. Durbin] proposes an 
     amendment numbered 669.

  Mr. DURBIN. Mr. President, I ask unanimous consent that the reading 
of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The text of the amendment is printed in today's Record under ``Text 
of Amendments.'')
  The PRESIDING OFFICER. The Senator from Illinois is recognized for 1 
minute.
  Mr. DURBIN. Mr. President, we live in a nation that pays people more 
to watch its pets than it pays to watch its parents in nursing homes. 
We live in a nation where we pay more to parking lot attendants than to 
those who attend our children in daycare centers. These underpaid 
caregivers of America have no health insurance.
  This amendment provides resources to States to provide health 
insurance to caregivers, such as child care workers, personal 
attendants for the disabled, nursing home aides, and home health aides.
  This amendment will give us a choice between helping a limited group 
of wealthy people or helping those who care for our children, our 
grandchildren, our parents, and our grandparents.
  I urge my colleagues to adopt this amendment.
  The PRESIDING OFFICER. Who seeks recognition?
  Mr. KYL. Mr. President, again, this is another amendment which 
eliminates the reduction of the top income tax bracket acceleration. 
Therefore, I urge my colleagues to vote no.
  The PRESIDING OFFICER. The question is on agreeing to the amendment.
  The amendment (No. 669) was rejected.


                     Amendment No. 618, as Modified

(Purpose: To expand the incentives for the construction and renovation 
                           of public schools)

  Mr. BAUCUS. Mr. President, I ask consent that the pending amendments 
be set aside so we can consider the Rockefeller amendment.
  The PRESIDING OFFICER. The Senator from West Virginia.
  Mr. ROCKEFELLER. Mr. President, I call up my amendment numbered 618, 
which is the modification at the desk. Senators Reid, Mikulski, 
Bingaman, and others are cosponsoring it.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from West Virginia [Mr. Rockefeller] for 
     himself and Mr. Daschle, Mr. Bingaman, Mr. Harkin, Mr. 
     Kennedy, Mr. Pryor, Mrs. Murray, Mr. Kerry, Mr. Reid, Mr. 
     Johnson, and Mr. Levin, proposes an amendment numbered 618, 
     as modified.

  Mr. ROCKEFELLER. I ask unanimous consent the reading of the amendment 
be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The amendment is printed in Today's Record under ``Text of 
Amendments.'')
  Mr. ROCKEFELLER. The average public school in this country is 42 
years old. Last week, I visited two in West Virginia; one was 88 years 
old, and the other was built the year the Titanic was sunk. It is a 
disgrace.
  This amendment will provide $25 billion which, because of interest-
free payments, would actually only cost the Federal Treasury less than 
$8 billion over a period of 2 years and create 500,000 jobs, build new 
schools, and create opportunities for our young people.
  I hope my amendment will pass. I ask for a vote on my amendment. A 
voice vote is acceptable.
  Mr. KYL. For my colleagues, this is another amendment which takes tax 
cuts from the tax cut bill; therefore, I urge my colleagues to vote no.
  The PRESIDING OFFICER. Does the Senator from West Virginia ask for 
the yeas and nays?
  Mr. ROCKEFELLER. No.
  The PRESIDING OFFICER. The question is on agreeing to the amendment.
  The amendment (No. 618), as modified, was rejected.
  Mr. REID. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. BAUCUS. I ask unanimous consent that the order for the quorum 
call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BAUCUS. I ask unanimous consent that the pending amendments be 
set aside so the Senator from Michigan and I can enter into a 
colloquy----
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BAUCUS. Concerning the amendment he might otherwise have.
  Mr. LEVIN. Mr. President, I thank my good friend from Montana. Some 
U.S. companies have opened sham offices in Bermuda and pretended that 
the sham offices are the parent corporation, and thereby avoided taxes 
which the rest of us have to pay and which, indeed, their competitors 
have to pay. It is called inversion. It is not only a sham, it is 
shameful.
  This bill takes some steps in addressing future inversions, but in 
terms of people who have already inverted, there is a lot of additional 
work to do. The ill-gotten gains which some companies have obtained 
through these sham moves to Bermuda should be confronted. It is not 
only unpatriotic, it is costing American taxpayers about $2 billion 
over the next 10 years.
  My amendment would have addressed the future tax avoidance of people 
who have already gone through these sham moves to Bermuda.
  Rather than offering the amendment at this time--it is a somewhat 
complicated amendment--I ask the Senator from Montana whether he might 
be able to support an effort along this line in the future.
  Mr. BAUCUS. Mr. President, the Senator from Michigan raised a very 
good point. There are provisions in the bill which address corporations 
that invert--that is, 100 percent invert--in tax shelters in Bermuda or 
other tax havens. That was shut down in March of this year. The next 
category is of companies with 50-percent or 80-percent ownership that 
also are inverted overseas. The Senator from Michigan makes a very good 
point that this, too, should be addressed.
  I will work with the Senator in the committee to address this 
windfall that these companies get from existing inversions. I will work 
with the Senator to try to shut that down.
  Mr. LEVIN. I thank my friend and I will not be calling up my 
amendment.


                           Amendment No. 616

  Mr. BAUCUS. I ask unanimous consent the pending amendment be set 
aside to consider the Dayton amendment.
  The PRESIDING OFFICER. The Senator from Minnesota is recognized.
  Mr. DAYTON. I call up amendment numbered 616.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Minnesota [Mr. Dayton] proposes an 
     amendment numbered 616.

  The PRESIDING OFFICER. The Senator is recognized for 1 minute.
  Mr. DAYTON. This amendment would end the phony practice of making tax 
cuts phase in, phase out, appear, and reappear like popups on a 
computer screen and say any new tax provision must take full effect 1 
year after enactment and remain in effect until changed by a subsequent 
Congress.
  The revolving sunset makes a mockery of tax policy and of the Senate. 
Businesses and individual taxpayers cannot make prudent decisions when 
the Tax Code changes with every new year or new budget resolution.
  This gimmickry is fictional and farcical, and it makes the Senate 
look foolish and foolhardy. We owe the American people and we owe this 
great institution something better than that.
  I urge my colleagues to support the amendment. I yield the floor.
  Mr. KYL. We would all like to accomplish what the distinguished 
Senator

[[Page 11787]]

proposed, but under the reconciliation procedures and the balanced 
budget amendment we do have sunsets that we have to contend with. 
Whether it is 10 years or 5 years or 3 years, it is not possible to 
permanently adopt many of these changes we are considering. It would be 
nice if we could, but under our rules, obviously, we cannot.
  Secondly, there are times when it is important to be able to phase a 
program in because you cannot accomplish all of the changes within the 
very short period of time allotted for the first year. For example, the 
dividends proposal we approved earlier this evening falls into that 
category.
  While what the Senator says is laudable, as a practical matter it 
cannot be accomplished.
  I urge my colleagues to vote against his amendment.
  The PRESIDING OFFICER. The question is on agreeing to the amendment.
  The amendment (No. 616) was rejected.


                           Amendment No. 670

 (Purpose: To provide a dividend exclusion which eliminates the double 
                    taxation of corporate dividends)

  Mr. BAUCUS. Mr. President, I ask unanimous consent that the pending 
amendments be set aside to consider the Santorum amendment.
  The PRESIDING OFFICER. The Senator from Pennsylvania is recognized.
  Mr. SANTORUM. I send an amendment to the desk.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Pennsylvania [Mr. Santorum] for himself 
     and Mr. Nelson of Nebraska, proposes an amendment numbered 
     670.

  Mr. SANTORUM. Mr. President, I ask unanimous consent that the reading 
of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The amendment is printed in Today's Record under ``Text of 
Amendments.'')
  Mr. SANTORUM. Mr. President, I offer this amendment which deals with 
the issue of variable annuities and how they are dealt with under the 
dividend proposal which disadvantages long-term savings annuities, 
retirement annuities, and as a result puts them in a competitive 
disadvantage vis-a-vis other savings vehicles. This amendment is 
offered to correct that.
  My understanding is the amendment as drafted, because it deals with 
variable annuities, is outside the window of the Byrd rule and outside 
of reconciliation and subject to the Byrd rule.


                      Amendment No. 670 Withdrawn

  Therefore, I withdraw my amendment, but this is an issue that needs 
to be addressed. We need to encourage this, not disadvantage them. I 
hope the conferees consider this measure.
  The PRESIDING OFFICER. The amendment is withdrawn.
  Mr. BAUCUS. Mr. President, the next amendment is that of the Senator 
from New Mexico.


                      Amendment No. 603 Withdrawn

  Mr. BINGAMAN. Mr. President, I have amendment No. 603, which was a 
follow-on to the amendment Senator Santorum of Pennsylvania was 
intending to offer. If we had extended the tax exclusion we are 
providing here for dividends to annuities as well, this would put small 
business retirement plans at a disadvantage. My amendment was trying to 
ensure that that not happen.
  Since he has chosen to withdraw his amendment, I will not offer this 
amendment, No. 603. I withdraw it as well.
  The PRESIDING OFFICER. The amendment, without objection, is 
withdrawn.


                           Amendment No. 662

  Mr. BAUCUS. Mr. President, I ask unanimous consent that we now 
proceed to the Edwards amendment.
  The PRESIDING OFFICER (Mr. Cornyn). The Senator from North Carolina 
is recognized.
  Mr. EDWARDS. I call up amendment No. 662.
  Mr. KYL. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. EDWARDS. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. EDWARDS. Mr. President, I call up my amendment.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from North Carolina [Mr. Edwards], for himself, 
     Mr. McCain, and Mr. Graham of South Carolina, proposes an 
     amendment numbered 662.

  Mr. EDWARDS. I ask unanimous consent that the reading of the 
amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

   (Purpose: To amend the Internal Revenue Code of 1986 to close the 
                  ``janitors insurance'' tax loophole)

       At the end of subtitle C of title V, insert the following:

     SEC. __. REPEAL OF TAX BENEFITS RELATING TO COMPANY-OWNED 
                   LIFE INSURANCE.

       Repeal of Tax Benefits Relating to Company-Owned Life 
     Insurance.--
       (1) Inclusion of life insurance investment gains.--Section 
     72 (relating to annuities; certain proceeds of endowment and 
     life insurance contracts) is amended by inserting after 
     subsection (j) the following new subsection:
       ``(k) Treatment of Certain Company-Owned Life Insurance 
     Contracts.--In the case of a company-owned life insurance 
     contract, the income on the contract (as determined under 
     section 7702(g)) for any taxable year shall be includible in 
     gross income for such year unless the contract covers the 
     life solely of individuals who are key persons (as defined in 
     section 264(e)(3)).''.
       (2) Repeal of exclusion for death benefits.--Section 101 
     (relating to certain death benefits) is amended by adding at 
     the end the following new subsection:
       ``(j) Proceeds of Certain Company-Owned Life Insurance.--
     Notwithstanding any other provision of this section, there 
     shall be included in gross income of the beneficiary of a 
     company-owned life insurance contract (unless the contract 
     covers the life solely of individuals who are key persons (as 
     defined in section 264(e)(3)))--
       ``(1) amounts received during the taxable year under such 
     contract, less
       ``(2) the sum of amounts which the beneficiary establishes 
     as investment in the contract plus premiums paid under the 
     contract.

     Amounts included in gross income under the preceding sentence 
     shall be so included under section 72.''.
       (3) Effective date.--The amendments made by this subsection 
     shall apply to contracts entered into after the date of 
     enactment of this section.

  Mr. EDWARDS. Mr. President, this is a simple proposal from Senator 
McCain, Senator Graham of South Carolina, and myself. What we are 
trying to do is eliminate one of the worst tax scams in the Tax Code 
today. What we have is companies getting billions of dollars in tax 
breaks for buying life insurance policies on janitors, secretaries, and 
other working people. The companies get billions for this. They are 
also the beneficiaries of the policies when these working people die. 
So the janitors themselves, the secretaries themselves, the workers 
themselves get absolutely nothing--not a dime.
  Officials in the Reagan administration tried to eliminate this tax 
scam. Officials in the Clinton administration tried to eliminate it. It 
is time for us to bring it to an end.
  We have specifically excluded key employees from this amendment, so 
this amendment just eliminates the fraudulent portion of this tax 
break. I ask my colleagues to support it.
  I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  At the moment there is not a sufficient second.
  There is a sufficient second.
  The yeas and nays were ordered.
  Mr. KYL. Mr. President, let me speak in opposition to this amendment. 
There are some problems, as the distinguished Senator from North 
Carolina has pointed out. But this is a very big deal that affects a 
lot of people. It is not something we should be dealing with without 
the proper debate that should attend it. As a result, in addition to 
the fact that it is not germane, I urge my colleagues to vote against 
it.
  I make a point of order that under section 305(b)(2) of the 
Congressional

[[Page 11788]]

Budget Act of 1974, the measure is not germane.
  The PRESIDING OFFICER. The Senator from North Carolina.
  Mr. EDWARDS. Pursuant to section 904 of the Congressional Budget Act 
of 1974, I move to waive the applicable sections of that act and the 
budget resolution for purposes of the pending amendment. I ask for the 
yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The question is on agreeing to the motion. The clerk will call the 
roll.
  The yeas and nays resulted--yeas 37, nays 63, as follows:

                      [Rollcall Vote No. 175 Leg.]

                                YEAS--37

     Akaka
     Biden
     Bingaman
     Boxer
     Byrd
     Cantwell
     Clinton
     Corzine
     Daschle
     Dayton
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham (FL)
     Graham (SC)
     Hollings
     Inouye
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lincoln
     McCain
     Mikulski
     Murray
     Nelson (FL)
     Pryor
     Reed
     Rockefeller
     Sarbanes
     Schumer
     Stabenow
     Wyden

                                NAYS--63

     Alexander
     Allard
     Allen
     Baucus
     Bayh
     Bennett
     Bond
     Breaux
     Brownback
     Bunning
     Burns
     Campbell
     Carper
     Chafee
     Chambliss
     Cochran
     Coleman
     Collins
     Conrad
     Cornyn
     Craig
     Crapo
     DeWine
     Dodd
     Dole
     Domenici
     Dorgan
     Ensign
     Enzi
     Fitzgerald
     Frist
     Grassley
     Gregg
     Hagel
     Harkin
     Hatch
     Hutchison
     Inhofe
     Jeffords
     Johnson
     Kyl
     Lieberman
     Lott
     Lugar
     McConnell
     Miller
     Murkowski
     Nelson (NE)
     Nickles
     Reid
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner
  The PRESIDING OFFICER. On this vote, the yeas are 37, the nays are 
63. Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is rejected. The point of order is 
sustained, and the amendment falls.
  The Senator from Nevada.
  Mr. REID. Mr. President, I have conferred with the two leaders and 
the two managers of the bill. We have one amendment by Senator Reed of 
Rhode Island that will be offered. That will be handled with no 
rollcall vote. We have a Dorgan-Byrd amendment which will require a 
rollcall vote, and we also have a Santorum amendment which will also be 
handled by voice. The other amendment that is pending is the Schumer 
amendment. We hope that will be resolved. Then there will be final 
passage.
  Also, there is a Kerry colloquy that I failed to mention, for the 
information of Members.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that we now go to 
the amendment of the Senator from Rhode Island.


                           Amendment No. 672

  Mr. REED. Mr. President, I send an amendment to the desk.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Rhode Island [Mr. Reed], for himself and 
     Mr. Corzine, Mr. Kerry, Ms. Mikulski, and Mr. Rockefeller, 
     proposes an amendment numbered 672.

  Mr. REED. Mr. President, I ask unanimous consent that reading of the 
amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

 (Purpose: To preserve the value of the low-income housing tax credit)

       At the end of subtitle C of title V add the following:

     SEC. __. LOW-INCOME HOUSING TAX CREDIT.

       (a) Findings.--The Senate finds the following:
       (1) The low-income housing tax credit is the Nation's 
     primary program for producing affordable rental housing.
       (2) Each year, the low-income housing tax credit produces 
     over 115,000 affordable apartments.
       (3) Since Congress created the low-income housing tax 
     credit in 1986, the credit has created 1,500,000 units of 
     affordable housing for about 3,500,000 Americans.
       (4) Analyses have found that certain approaches to reducing 
     or eliminating the taxation of dividends have the potential 
     to reduce the value of the low-income housing tax credit and 
     so reduce the amount of affordable housing available.
       (5) As of 2001, over 7,000,000 American renter families (1 
     in 5) suffer severe housing affordability problems, meaning 
     that the family spends more than half of its income on rent 
     or lives in substandard housing.
       (6) More than 150,000 apartments in the low-cost rental 
     housing inventory are lost each year due to rent increases, 
     abandonment, and deterioration.
       (b) Sense of the Senate.--It is the sense of the Senate 
     that any reduction or elimination of the taxation on 
     dividends should include provisions to preserve the success 
     of the low-income housing tax credit.

  Mr. REED. Mr. President, I offer this amendment along with Senators 
Corzine, Mikulski, Kerry, and Rockefeller. It is a sense-of-the-Senate 
amendment.
  It addresses the potential detrimental effect on the low-income 
housing tax credit by proposing to reduce or eliminate taxes on 
dividends. If those proposals with respect to dividends are passed, 
they could provide a disincentive for corporations to invest in the 
low-income tax credit, which is the major form of support for low-
income and moderate-income housing, and rental housing in particular, 
in the United States.
  I understand this amendment is acceptable to the other side. I urge 
its adoption.
  The PRESIDING OFFICER. Who yields time?
  Mr. GRASSLEY. Mr. President, we support the amendment and urge its 
adoption.
  The PRESIDING OFFICER. Is there further debate on the amendment?
  Mr. REED. Mr. President, I ask unanimous consent to include Senators 
Landrieu and Sarbanes as cosponsors.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The PRESIDING OFFICER. Is there further debate on the amendment?
  If not, the question is on agreeing to the amendment.
  The amendment (No. 672) was agreed to.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. Mr. President, I ask unanimous consent that we now go to 
the amendment by the Senator from Pennsylvania, Mr. Santorum.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 648

  Mr. SANTORUM. Mr. President, I send an amendment to the desk.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Pennsylvania [Mr. Santorum] proposes an 
     amendment numbered 648.

  Mr. SANTORUM. Mr. President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

(Purpose: To clarify the treatment of net operating loss in calculating 
 tax attributes under section 108 of the Internal Revenue Code of 1986)

       On page 281, between lines 2 and 3, insert the following:

     SEC. __. CLARIFICATION OF THE TREATMENT OF NET OPERATING 
                   LOSSES.

       (a) In General.--Subparagraph (A) of section 108(b)(2) 
     (relating to tax attributes affected; order of reduction) is 
     amended to read as follows:
       ``(A) NOL.--Any net operating loss (in the case of a 
     taxpayer which is a member of an affiliated group of 
     corporations which files a consolidated return under section 
     1501, any consolidated net operating loss, as defined in 
     regulations prescribed by the Secretary) for the taxable year 
     of the discharge, and any net operating loss carryover to 
     such taxable year.''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to discharges of indebtedness occurring after May 
     8, 2003, except that discharges of indebtedness under any 
     plan of reorganization in a case under title 11, United 
     States Code, shall be deemed to occur on the date such plan 
     is confirmed.

  Mr. SANTORUM. Mr. President, I ask unanimous consent to have this 
article written by David Henry in Business Week magazine printed in the 
Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

[[Page 11789]]

              Why This Tax Loophole for Losers Should End

       Is there no end to the ugly superlatives that fallen 
     telecom giant WorldCom Inc., is amassing? First, its top 
     execs reigned over the greatest alleged accounting fraud in 
     history. Then, the company filed the largest corporate 
     bankruptcy. Now, it is lining up to collect what could be one 
     of the biggest single corporate tax breaks of all time.
       To the fury of its competitors, WorldCom is angling to 
     share a $2.5 billion benefit from Uncle Sam. How? By 
     exploiting a provision in the Internal Revenue Service code 
     so it can hang onto previous losses of at least $6.6 billion 
     and enjoy years of tax-free earnings. What's more, the ploy 
     would protect new management against any takeover for at 
     least two years. And, WorldCom could use the losses to offset 
     even income it picks up by taking over other companies. 
     ``WorldCom is in an enviable, position,'' says Robert 
     Willens, tax accounting analyst at Lehman Brothers Inc. ``It 
     will have copious tax losses and can be a powerful 
     acquirer.''
       WorldCom's new owners--the holders of its $41 billion of 
     bad debt--are driving a truck through a loophole that needs 
     to be closed pronto. It was left open by Congress when the 
     lawmakers overhauled IRS rules to stamp out a notorious trade 
     in corporate tax losses. At one time, owners of loss-making 
     businesses could see their companies along with their 
     accumulated tax loss--often their only asset--to profitable 
     companies. Now, tax losses are snuffed out when company 
     ownership changes hands.
       So, WorldCom is going through hoops to avoid that fate. 
     Pending a final vote by creditors later this year, the 
     company is changing its bylaws to prohibit anyone from 
     building a stake of more than 4.75% in the company. They have 
     to keep bidders at bay for at least two years, otherwise the 
     IRS would argue that control of WorldCom has changed hands 
     and that the tax losses--which, assuming a 38% tax rate, 
     could give a $2.5 billion boost to earnings--should be wiped 
     out. ``It is the perfect poison pill,'' says Carl M. Jenks, 
     tax expert at law firm Jones Day.
       The perverse tactic is increasingly popular. The former 
     Williams Communications Group put a similar 5% ownership 
     limit in place last fall when it became WilTel Communications 
     Group Inc. after a bankruptcy reorganization. The bankruptcy 
     judge overseeing UAL Corp. agreed on Feb. 24 to similar 
     restriction on UAL securities in order to preserve its $4 
     billion of tax losses. ``We will generally recommend that any 
     company with net operating losses worth anything adopt these 
     restrictions,'' says Douglas W. Killip, a tax lawyer at Akin 
     Group Strauss Hauer & Feld.
       For WorldCom's rivals, the tax break is salt on a wound. 
     William P. Barr, a former U.S. attorney general and now 
     general counsel of Verizon Communications, fumes that World-
     Com is trying to ``compound its fraud by escaping the payment 
     of taxes.'' WorldCom's bankruptcy reorganization will 
     eliminate the cost of servicing some $30 billion of debt. 
     That, the company projects, will help it to make $2 billion 
     before taxes next year. By using the tax losses, it will be 
     able to keep about $780 million in cash it would otherwise 
     owe the government. In fact, it won't be liable for any tax 
     at least until the accumulated losses are worked through. 
     And, because it racked up the $6.6 billion in losses just 
     through 2001, WorldCom could have billions more to play with 
     once the numbers for 2002 are finally worked out.
       What's more, the poison pill is likely to deter any company 
     from buying WorldCom and dumping some of the obsolete assets 
     still clogging the telecom industry. That will slow any 
     recovery in capital spending and hurt WorldCom's competitors. 
     ``It is bad when business decisions are motivated by tax 
     reasons and not based on sound economics,'' says Anthony 
     Sabino, bankruptcy law professor at St. John's University.
       Rivals are likely to push the IRS to find a way to stop 
     WorldCom from utilizing the losses, observers say. But their 
     chances of success are slim because the IRS never issued 
     regulations that could have nullified the ploy. And the 
     courts generally rule against the agency when it attempts to 
     write rules retroactively, Willens says.
       Still, it's time to close the stable door before any more 
     horses bolt. Besides, Uncle Sam could use the money right 
     now.
  Mr. SANTORUM. Mr. President, this is an amendment that attempts to 
close a big loophole that may get huge. This is an amendment that deals 
with the problem that was identified in this Business Week article 
having to do with MCI-WorldCom now coming out of bankruptcy. When you 
are coming out of bankruptcy, your debts are taken off but they are 
offset. By the way, you aren't taxed on the forgiveness of that debt 
but you offset that tax forgiveness, if you will, against attributes 
like net operating losses.
  MCI has figured out a way to restructure coming out of bankruptcy so 
they can cheat these operating losses and will probably not pay taxes 
for the next 10 years.
  This is a huge loophole. You have the biggest stock scandal in 
history. MCI comes out of bankruptcy, and they are setting a new 
accounting standard which is as scandalous as the first one.
  This is something we need to deal with. I will not force a vote 
because I know this is a new thing and we have not had a hearing. But 
this is major problem that we need to address because other companies 
are going to take this loophole and run with it.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. Mr. President, I hope the Senator from Pennsylvania 
will withdraw his amendment. I have had a lot of discussion with him 
tonight on it. He makes a very strong case about something which I have 
not studied, nor am I convinced he is wrong. But based upon how I 
approach bankruptcy--that is, I see bankruptcy as an impartial person, 
a judge making a decision on whether a business ought to continue or go 
out of business or how it ought to be restructured--we are talking 
about tax legislation that has been on the books for an awfully long 
time.
  But we are also aware, as the Senator has told me, of crafty people 
giving advice to corporations on how they can maybe restructure and 
become strong and avoid taxation such that other corporate entities 
that are competitors maybe would have a disadvantage. But I am not 
convinced of it. I would probably have to fight the amendment if it 
were offered tonight.
  I can promise the Senator, first of all, we will go into depth on 
this matter with Treasury, with my own Finance Committee staff, and 
with the Joint Committee on Taxation staff, and it probably will lead 
to a hearing. I hate to promise with the workload of the committee on 
taxes, on welfare, and on prescription drugs this summer that we are 
going be able to have a hearing tomorrow. But I will give very serious 
consideration to the very strong position that the Senator from 
Pennsylvania has made.
  The Senator is a member of my committee. He is a strong advocate for 
his position. I don't think it is going to get lost in the dust. I will 
do what I can to keep it paramount in my mind because I want to make 
sure we don't have crafty people advising people who are in bankruptcy 
any more than we have crafty people advising about corporate tax 
shelters who are not in bankruptcy. We will look into it with the same 
vigor that I pursued other corporate tax shelters and as I pursued 
other inversions and other attempts of corporations to avoid taxation.


                      Amendment No. 648 Withdrawn

  Mr. SANTORUM. Mr. President, I withdraw the amendment.
  The PRESIDING OFFICER. The amendment is withdrawn.
  The amendment (No. 648) was withdrawn.
  Mr. BAUCUS. Mr. President, we will next turn to the amendment of the 
Senator from North Dakota, Mr. Dorgan.


                           amendment No. 666

  Mr. DORGAN. Mr. President, I send an amendment to the desk.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from North Dakota [Mr. Dorgan], for himself and 
     Mr. Byrd, Mr. Baucus, Ms. Mikulski, and Mr. Sarbanes, 
     proposes an amendment numbered 666.

  Mr. DORGAN. Mr. President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

 (Purpose: To strike the section relating to qualified tax collection 
                               contracts)

       On page 8, strike the matter preceding line 1, and insert:


------------------------------------------------------------------------
                                 The corresponding percentages shall be
``In the case of taxable years        substituted for the following
   beginning during calendar                  percentages:
             year:             -----------------------------------------
                                    28%        31%      36%       39.6
------------------------------------------------------------------------
2001..........................        27.5%    30.5%    35.5%      39.1%
2002..........................        27.0%    30.0%    35.0%      38.6%
2003..........................        25.0%    28.0%    33.0%      35.4%
2004 and thereafter...........        25.0%    28.0%    33.0%   35.0%''.
------------------------------------------------------------------------


       Strike section 357.

[[Page 11790]]


  Mr. DORGAN. Mr. President, very briefly, deep in this reconciliation 
bill is a provision that would eliminate the longstanding rule 
preventing the IRS from using private collection companies to collect 
IRS debt.
  First of all, this provision has never had a hearing in the Senate. 
There was one hearing in the House last week, and it raised far more 
questions than it answered.
  Let me make a point that we had a test of this some years ago--in 
1996. This small test showed that we had people getting calls at 4 
o'clock in the morning from private collection agencies.
  The former IRS Commissioner said if Congress were to appropriate $296 
million to hire additional IRS compliance employees to work on these 
accounts, the IRS would collect $9 billion.
  This bill puts in more money than that and says it will collect $900 
million, which is only one-tenth of the amount.
  I don't think we ought to decide that we ought to provide private 
collection agencies the responsibility to collect this debt. This is a 
responsibility of the Federal Government. In any event, why would you 
want to spend money for something that is one-tenth as effective as 
what the Commissioner says can be done with the IRS?
  I ask for a favorable vote on this amendment.
  The amendment is cosponsored by Senators Byrd, Baucus, Mikulski, and 
Sarbanes.
  The PRESIDING OFFICER. The Senator's time has expired.
  The Senator from Arizona.
  Mr. KYL. Mr. President, this amendment will undermine our efforts to 
ensure that those who owe taxes will pay them. There is over $250 
billion in uncollected debt. The IRS, obviously, has the primary 
responsibility. But over 40 States and the Department of Education use 
private collectors, and they must abide by the various rules that 
apply, including the Taxpayers' Bill of Rights and the Fair Debt 
Collections Act. Therefore, there is an opportunity to collect money 
that is owed the Treasury as a result of this provision.
  So striking this provision would not only be bad policy but also 
would, unfortunately, lose about $1 billion in revenue from the 
underlying bill. As a result, the reduction in revenues in excess of 
the levels set out in section 202 of H. Con. Res. 95, the fiscal year 
2004 concurrent resolution on the budget, would raise a point of order, 
and I do raise a point of order under section 202 of that resolution.
  Mr. DORGAN. Mr. President, there should be no point of order. But let 
me say, pursuant to section 904 of the Congressional Budget Act of 
1974, I move to waive the applicable sections of that act and the 
budget resolution for the consideration of the pending amendment, and I 
ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The question is on agreeing to the motion.
  The clerk will call the roll.
  The legislative clerk called the roll.
  The yeas and nays resulted--yeas 43, nays 57, as follows:

                      [Rollcall Vote No. 176 Leg.]

                                YEAS--43

     Akaka
     Baucus
     Biden
     Bingaman
     Boxer
     Breaux
     Byrd
     Cantwell
     Clinton
     Conrad
     Corzine
     Dayton
     Dodd
     Dorgan
     Durbin
     Edwards
     Feingold
     Feinstein
     Graham (FL)
     Harkin
     Hollings
     Inouye
     Jeffords
     Kennedy
     Kerry
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     Mikulski
     Murray
     Nelson (FL)
     Nelson (NE)
     Pryor
     Reed
     Rockefeller
     Sarbanes
     Schumer
     Stabenow
     Wyden

                                NAYS--57

     Alexander
     Allard
     Allen
     Bayh
     Bennett
     Bond
     Brownback
     Bunning
     Burns
     Campbell
     Carper
     Chafee
     Chambliss
     Cochran
     Coleman
     Collins
     Cornyn
     Craig
     Crapo
     Daschle
     DeWine
     Dole
     Domenici
     Ensign
     Enzi
     Fitzgerald
     Frist
     Graham (SC)
     Grassley
     Gregg
     Hagel
     Hatch
     Hutchison
     Inhofe
     Johnson
     Kyl
     Lott
     Lugar
     McCain
     McConnell
     Miller
     Murkowski
     Nickles
     Reid
     Roberts
     Santorum
     Sessions
     Shelby
     Smith
     Snowe
     Specter
     Stevens
     Sununu
     Talent
     Thomas
     Voinovich
     Warner
  The PRESIDING OFFICER. On this vote, the yeas are 43, the nays are 
57. Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is not agreed to. The point of order is 
sustained, and the amendment falls. The point of order is not 
sustained, and the amendment does not fall.
  Mr. GRASSLEY. Mr. President, I move to reconsider the vote.
  Mr. REID. I move to lay that motion on the table.
  The PRESIDING OFFICER. The Chair will clarify: The point of order was 
not sustained. The amendment is pending.
  The Senator from Montana.
  Mr. BAUCUS. Mr. President, I suggest that the Senate now vote by 
voice on this amendment.
  The PRESIDING OFFICER. The question is on agreeing to amendment No. 
666.
  In the opinion of the Chair, the noes have it.
  Mr. BAUCUS. Mr. President, I suggest that the Chair put the question 
a second time.
  The PRESIDING OFFICER. The question is on agreeing to amendment No. 
666.
  The amendment was rejected.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. Mr. President, I now urge the Chair to recognize the 
Senator from Massachusetts for the purpose of a colloquy.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
Senator from Massachusetts.
  Mr. KERRY. Mr. President, I have an amendment which I am not going to 
ask to vote on, after discussing it with both the chairman and the 
ranking member, and other colleagues. I thank Senator Grassley and 
Senator Baucus and particularly Senator Kennedy and Senator Clinton, 
Senator Schumer, Senator Graham, and Senator Feinstein. This is an 
amendment that would have affected positively 37 States in the country. 
Among the top 10 States that would have been helped in a completely 
nonpartisan way would have been Mississippi, Georgia, North Carolina, 
Ohio, Louisiana, Pennsylvania, Texas, California, New York, and many 
others. This refers to the safety net hospitals in our country that are 
picking up the costs of those who are the most disadvantaged who need 
health care.
  Unfortunately, in this amendment the funding under the Children's 
Health Insurance Program has been cut as an offset in this legislation 
by some $800 million. There are 2 million additional uninsured in this 
country. None of them have the ability to be able to get care unless we 
are providing the so-called disproportionate share allocation to those 
hospitals. I ask the chairman and the ranking member if they would 
agree that when the Medicare bill comes up in about a month that at 
that time it would be appropriate for the Finance Committee to try to 
rectify what is happening here because the increasing numbers of 
uninsured are literally flooding the hospitals and urban centers and 
rural communities where they don't have the capacity to be able to 
provide the care. It seems extraordinary that we can find the money for 
those who earn more than $315,000 a year at the expense of those who 
are the most vulnerable in our society.
  I hope we will rectify it.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. Mr. President, I appreciate very much what Senator 
Kerry has stated to us. I want everybody to know that I share their 
concerns. I think I expressed and shared that in legislation on which I 
joined with Senator Baucus last fall, not reintroduced this year. But 
Senator Baucus and I reflected on this and accommodated this as one of 
many factors in a Medicare bill that we put together. The 
disproportionate share program, of course, is a primary source of 
support for safety net hospitals which serve vulnerable patients. I 
agree that the safety net hospitals are also under considerable 
financial strain and that the

[[Page 11791]]

disproportionate share hospital cuts now in effect make it even harder. 
That has been compounded by a weaker economy. The number of uninsured 
has gone up.
  Nationally, the 2003 disproportionate share hospital cliff represents 
an estimated reduction of $1.1 billion to total State allotments for 
fiscal year 2002 to 2003. I supported fixing this in the past, as I 
have stated.
  In June, we will in fact be considering Medicare prescription drug 
legislation. I think it is very appropriate to deal with that at that 
particular time. I am committed to working with my colleagues on this 
important issue in the context of our work on the Medicare prescription 
drug bill.
  Mr. KERRY. I thank the chairman.
  The PRESIDING OFFICER. The Senator from Montana.
  Mr. BAUCUS. Mr. President, I, too, pledge to work with the Senator 
from Massachusetts. Last year the Senator from Ohio and myself 
introduced legislation in the Medicare providers bill to address this 
very issue. It is called the DSH cliff, essentially. The Medicaid 
payments are scheduled to go off a cliff--that is, dramatically 
lowered--and we had extended the level of payments for a couple years 
last year to avoid the cliff, the point being that we are very 
cognizant of the problem facing the large public hospitals, 
particularly in urban areas that serve a disproportionate number of 
low-income people.
  We will certainly work very hard to deal with this when we take up 
the Medicare legislation in the next couple of months.
  Mr. KERRY. Mr. President, I thank the chairman and the ranking 
member. I know they will both work in good faith to try to address this 
issue.
  I know the Senator from California wanted a moment to say something.
  The PRESIDING OFFICER. The Senator from California.
  Mrs. FEINSTEIN. I thank the Senator from Massachusetts.
  Mr. President, this is a very important issue to virtually every 
urban community. For California, the cuts to Medicaid DSH payments 
means a loss of over $184 million a year. At Fresno Valley Hospital 
alone this cut is worth $6 million a year. We have had a number of our 
hospitals close, due in part to cuts to disproportionate share 
payments.
  I want to particularly thank the Senator from Massachusetts, and the 
manager of the bill, the chairman of the committee, and the ranking 
member for their commitment to take this matter up on the Medicare 
bill. I look forward to working with them to fix this important 
program.
  The PRESIDING OFFICER. The Senator from Nevada.
  Mr. REID. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. FRIST. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. FRIST. Mr. President, we are quite late at night and, just for 
clarification, we will put forth a unanimous consent, but we are 
waiting for final passage. We are waiting for the managers' package to 
be completed. That will take about 20 to 25 minutes or so. What we will 
do is set the bill aside and go ahead with the global HIV/AIDS bill and 
plan on going straight to the first amendment. The plan is to spend 
approximately 10 minutes equally divided and then go directly to a 
vote, after which the managers' package will be ready, and we will go 
to final passage on the jobs and growth bill.
  Let me turn to the Democratic leader to see if that is satisfactory, 
to make the best use of the time. We can't have final passage until we 
have the managers' package. That is going to be about 20 minutes. We 
will be able to dispense with the first amendment on the AIDS bill.
  Mr. DASCHLE. Mr. President, we have been discussing this matter for 
the last hour or so. We understand there are no more amendments to be 
offered on the tax bill, so we are prepared now to go to the managers' 
amendment. In order to make the most efficient use of the time, we felt 
it might be helpful to go to the first amendment. In fact, there will 
be additional amendments on that. We wanted to finish the bill tonight.
  This is in keeping with our discussions. I would hope we could go 
ahead and offer the first amendment.
  Mr. BIDEN. Will the minority leader yield?
  Mr. DASCHLE. I am happy to yield.
  Mr. BIDEN. We have a number of amendments on this side. And when I 
say ``a number,'' we have more than one. We are getting time agreements 
on all the amendments. For the benefit of the Senate, I might tell you 
quickly of the major amendments that we have and the time agreements: 
The Durbin-Kerry, et cetera, amendment on global AIDS funding is 10 
minutes equally divided. Senator Feinstein has an amendment; it is up 
to 30 minutes equally divided. Senator Dorgan has an amendment and has 
agreed to 10 minutes equally divided. Senator Kennedy has an amendment, 
30 minutes equally divided. Senator Dodd has one, 20 minutes equally 
divided; Senator Boxer, 10 minutes equally divided.
  The reason I bothered to tell you that is I think we can do this. I 
think we can meet the objective of the majority leader to get this bill 
passed. People are being very cooperative. If we move like this, I 
think we should do it quickly.
  Mr. DASCHLE. I thank the Senator from Delaware.
  I yield the floor.
  Mr. FRIST. Mr. President, I ask unanimous consent that no other 
amendments be in order, other than a managers' amendment, which must be 
agreed to by both managers and the two leaders, and that the bill now 
be temporarily set aside and the Senate resume consideration of the 
global AIDS bill as under the previous order, and that the other 
provisions of the order with respect to S. 1054 remain in effect.
  The PRESIDING OFFICER. Is there objection?
  Mr. CORZINE. Reserving the right to object, I am in the midst of a 
negotiation on a colloquy we will put in so we can withdraw an 
amendment. I want to make sure that has been accepted.
  Mr. FRIST. The Senator would be able to do that, Mr. President.
  Mr. CORZINE. If there is no guarantee that we are going to have 
acceptance of the colloquy, then I cannot offer my amendment.
  Mr. DASCHLE. Mr. President, I ask unanimous consent that the request 
be amended to accommodate the colloquy offered by the Senator from New 
Jersey or an amendment.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.
  Ms. LANDRIEU. Mr. President, reserving the right to object, I also 
have an amendment being submitted that I would like to be included on 
the list.
  Mr. FRIST. Is that request for the global HIV/AIDS bill? Just to 
clarify, on the global HIV/AIDS bill, people will still be able to 
propose amendments. The unanimous consent was for the underlying jobs 
and growth bill.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.

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