[Congressional Record (Bound Edition), Volume 151 (2005), Part 17]
[Senate]
[Pages 22849-22865]
[From the U.S. Government Publishing Office, www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mrs. FEINSTEIN:
  S. 1870. a bill to clarify the authorities for the use of certain 
National Park Services properties within Golden Gate National 
Recreation Area and San Francisco Maritime National Historical Park, 
and for other purposes; to the Committee on Energy and Natural 
Resources.
  Mrs. FEINSTEIN. Mr. President, I rise today to introduce a bill which 
will clarify certain National Park Service authorities for the Golden 
Gate National Recreation Area and San Francisco Maritime National 
Historic Park.
  I also want to thank Congresswoman Pelosi for introducing a similar 
bill in the house. As a San Francisco native and a former mayor, I know 
these parks are extremely popular tourist sites and I believe this bill 
will allow the National Park Service to restore and renovate these 
parks in order to maintain their status as top tourist destinations.
  The Golden Gate National Recreation Area is one of the largest urban 
national parks in the world--home to such renowned sites as the 
Presidio of San Francisco and Alcatraz Island. Additionally, the San 
Francisco Maritime National Historic Park, located at the west end of 
San Francisco's Fisherman's Wharf, includes a fleet of landmark vessels 
and a maritime museum.
  Presently, the revenue collected by these parks must be spent in the 
same fiscal year in which it is collected. Otherwise, any revenue that 
is not spent is deposited in the National Treasury. This current policy 
makes it difficult for these two parks to pursue long term, major 
restoration projects. This bill makes the necessary changes to allow 
these parks to undertake needed substantive restoration as opposed to 
smaller, less significant projects allowed under the current revenue 
system.
  The bill also calls for a modest boundary adjustment between the two 
adjacent parks in order to be consistent with the current 
administration of San Francisco's Municipal Pier.
  I am introducing this bill with the hope that it will allow these two 
parks to retain the revenue necessary for maintenance in order to 
continue to attract visitors from around the world to these historic 
sites of California.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1870

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

     SECTION 1. GOLDEN GATE NATIONAL RECREATION AREA.

       Section 4(f) of Public Law 92-589 (16 U.S.C. 460bb-3) is 
     amended by striking ``Haslett Warehouse, Cliff House 
     Properties and Louis' Restaurant,'' and all that follows and 
     inserting ``Cliff House Properties and Louis' Restaurant, the 
     Secretary may enter into a contract for the management 
     (including rental or lease) of the aforementioned properties 
     with such terms and conditions as will protect the 
     Government's interest. Any proceeds from the use of such 
     properties shall be available until expended, without further 
     appropriation, for the administration, maintenance, repair 
     and related expenses of the properties and for major 
     renovation and park rehabilitation of those buildings 
     included in the Fort Mason Foundation Agreement''.

     SEC. 2. SAN FRANCISCO MARITIME NATIONAL HISTORICAL PARK.

       Section 3 of Public Law 100-348 (16 U.S.C. 410nn-1) is 
     amended--
       (1) by amending the text of subsection (c) to read as 
     follows: ``Notwithstanding any other provision of law, in the 
     administration of any real or personal property (including 
     vessels and heavy marine equipment such as floating drydocks) 
     that is administered as part of the park, the Secretary may 
     enter into a contract for the management (including rental or 
     lease) of such property with such terms and conditions as 
     will protect the Government's interest. Any proceeds from the 
     use of such property shall be available until expended, 
     without further appropriation, for the administration, 
     maintenance, repair, and related expenses of the property.''; 
     and
       (2) in the second sentence of subsection (d) by striking 
     ``shall be credited'' and all that follows and by inserting 
     ``shall be available until expended, without further 
     appropriation, for use at the park for purposes of facility 
     maintenance and repair, interpretation, signage, habitat or 
     facility enhancement, resource preservation, annual 
     operations (including fee collection), and law 
     enforcement.''.

     SEC. 3. CONFORMING AMENDMENTS.

       (a) Section 2(b) of Public Law 100-348 (16 U.S.C. 410nn) is 
     amended--
       (1) by striking ``numbered 641/80,053 and dated April 7, 
     1987'' and inserting ``numbered 350/80,012 and dated June 
     2004''; and
       (2) by striking the third and fourth sentences and 
     inserting the following: ``The Secretary of the Interior'' 
     (hereinafter in this Act referred to as the ``Secretary'') 
     may make minor revisions to the boundary of the park in 
     accordance with section 7(c) of the Land and Water 
     Conservation Act of 1965 (16 U.S.C. 460l-9(c)).
       (b) Section 4(e) of Public Law 92-589 (16 U.S.C. 460bb-3) 
     is amended by striking ``and for admission to the sailing 
     vessel Balclutha and other historic vessels of the National 
     Maritime Museum''.
                                 ______
                                 
      By Mr. BURR (for himself, Mr. Enzi, Mr. Gregg, Mr. Frist, and Mr. 
        Alexander):
  S. 1873. A bill to prepare and strengthen the biodefenses of the 
United States against deliberate, accidental, and natural outbreaks of 
illness, and for other purposes; to the Committee on Health, Education, 
Labor, and Pensions.

  Mr. BURR. Mr. President, I ask unanimous consent that the text of the 
bill be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1873

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Biodefense and Pandemic 
     Vaccine and Drug Development Act of 2005''.

     SEC. 2. TABLE OF CONTENTS.

       The table of contents of this Act is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.
Sec. 3. Biomedical Advanced Research and Development Agency.
Sec. 4. Clarification of countermeasures covered by Project BioShield.
Sec. 5. Orphan drug market exclusivity for countermeasure products.
Sec. 6. Liability protections for pandemics, epidemics, and 
              countermeas-
              ures.
Sec. 7. Compensation.
Sec. 8. Rebates and grants for research development, and manufacturing 
              of vaccines, qualified countermeasures and pandemic or 
              epidemic products.
Sec. 9. Technical assistance.
Sec. 10. Animal models for certain diseases.
Sec. 11. Animal Model/Research Tool Scientific Advisory Committee.
Sec. 12. Collaboration and coordination.
Sec. 13. Procurement.
Sec. 14. National Pathology Center.

     SEC. 3. BIOMEDICAL ADVANCED RESEARCH AND DEVELOPMENT AGENCY.

       Title III of the Public Health Service Act (42 U.S.C. 241 
     et seq.) is amended by inserting after section 319K the 
     following:

     ``SEC. 319L. BIOMEDICAL ADVANCED RESEARCH AND DEVELOPMENT 
                   AGENCY.

       ``(a) Definitions.--In this section:
       ``(1) BARDA.--The term `BARDA' means the Biomedical 
     Advanced Research and Development Agency.
       ``(2) Fund.--The term `Fund' means the Biodefense Medical 
     Countermeasure Development Fund established under subsection 
     (d).
       ``(3) Other transactions.--The term `other transactions' 
     means transactions, other than procurement contracts, grants, 
     and cooperative agreements, including transactions for 
     prototypes, as provided to the Secretary of Defense under 
     section 2371 of title 10, United States Code.
       ``(4) Qualified countermeasure.--The term `qualified 
     countermeasure' has the meaning given such term in section 
     319F-1.

[[Page 22850]]

       ``(5) Qualified countermeasure and qualified pandemic or 
     epidemic product advanced research and development.--
       ``(A) In general.--The term `qualified countermeasure and 
     qualified pandemic or epidemic product advanced research and 
     development' means any applied research, testing, or 
     evaluation (including those conducted on humans or animals), 
     related to the safety or effectiveness, that is required for 
     approval, clearance, or licensing by the Secretary under this 
     Act or the Federal Food, Drug, and Cosmetic Act, of such 
     countermeasure or pandemic or epidemic product to diagnose, 
     mitigate, prevent, or treat harm from a deliberate, 
     accidental, or natural exposure to a chemical, biological, 
     radiological, or nuclear agent, particularly such exposure 
     resulting from an act of terrorism or potential pandemic 
     infectious disease.
       ``(B) Inclusion.--The term under subparagraph (A) includes 
     any investigation to improve the manufacturing, formulation, 
     finish, fill, delivery, or shelf-life of such qualified 
     countermeasures or qualified pandemic or epidemic products.
       ``(6) Qualified pandemic or epidemic product.--The term 
     `qualified pandemic or epidemic product' has the meaning 
     given the term in section 319F-3(c)(5).
       ``(7) Security countermeasure.--The term `security 
     countermeasure' has the meaning given such term in section 
     319F-2.
       ``(8) Person.--The term `person' includes an individual, 
     partnership, corporation, association, entity, or public or 
     private corporation, including a Federal, State, or local 
     agency or department.
       ``(b) Biomedical Advanced Research and Development 
     Agency.--
       ``(1) Establishment.--There is established within the 
     Department of Health and Human Services, the Biomedical 
     Advanced Research and Development Agency.
       ``(2) Purpose.--It shall be the purpose of the BARDA to 
     coordinate and oversee activities that support and accelerate 
     qualified countermeasure or qualified pandemic or epidemic 
     product (referred to in this section as `countermeasure or 
     product') advanced research and development by--
       ``(A) directing and coordinating collaboration among the 
     Department of Health and Human Services, other Federal 
     agencies, relevant industries, academia, and other persons, 
     with respect to such advanced research and development;
       ``(B) supporting countermeasure and product advanced 
     research and development;
       ``(C) recommending approaches to modernize and streamline 
     the countermeasure or product development process and reduce 
     regulatory burdens with respect to procurement of security 
     countermeasures and qualified pandemic or epidemic products; 
     and
       ``(D) supporting innovation to reduce the time and cost of 
     countermeasure and product advanced research and development.
       ``(3) Director.--The BARDA shall be headed by a Director 
     (referred to in this section as the `Director') who shall--
       ``(A) be appointed by the President, with the advice and 
     consent of the Senate;
       ``(B) report to the Secretary; and
       ``(C) serve as the principal advisor to the Secretary on 
     countermeasure and product advanced research and development.
       ``(4) Duties of Director.--
       ``(A) Collaboration.--To carry out the purpose described in 
     paragraph (2)(A), the Secretary, acting through the Director, 
     shall--
       ``(i) increase appropriate communication between the 
     Federal Government and relevant industries, academia, and 
     other interested persons with respect to countermeasure and 
     product advanced research and development by establishing 
     transparent, expeditious, and direct processes to--

       ``(I) facilitate regular, ongoing communication regarding 
     the processes established under subparagraph (C)(ii) and new 
     countermeasures or products of interest;
       ``(II) solicit research and associated data on potential 
     countermeasures and products and related technologies; and
       ``(III) provide technical assistance with respect to such 
     processes and the Food and Drug Administration approval 
     process;

       ``(ii) at least annually--

       ``(I) convene meetings with representatives from relevant 
     industries, academia, other Federal agencies, international 
     agencies, and other interested persons; and
       ``(II) sponsor relevant biodefense countermeasure 
     technology demonstrations;

       ``(iii) carry out the activities described in subsection 
     (g) of section 2 of the Clayton Act; and
       ``(iv) encourage and coordinate countermeasure or product 
     advanced research and development, including by convening 
     working groups as identified in paragraph (5).
       ``(B) Support advanced research and development.--To carry 
     out the purpose described in paragraph (2)(B), the Secretary, 
     acting through the Director, shall--
       ``(i) conduct continuous searches and support calls for 
     potential countermeasures or products for drugs, biological 
     products, devices, or research tools to diagnose, mitigate, 
     prevent, or treat harm from existing, emerging, or possible 
     chemical, biological, radiological, and nuclear agents or 
     potential pandemic infectious diseases that threaten public 
     health and national security, as identified by the Assistant 
     Secretary for Public Health Emergency Preparedness;
       ``(ii) direct the countermeasure and product advanced 
     research and development activities of the Department of 
     Health and Human Services, in consultation with the Assistant 
     Secretary for Public Health Emergency Preparedness, the 
     Director of the National Institutes of Health, the Director 
     of the Centers for the Disease Control and Prevention, and 
     the Commissioner of Food and Drugs; and
       ``(iii) award contracts, grants, cooperative agreements, 
     and enter into other transactions, to include use of 
     simplified acquisition authorities provided under sections 
     319F-1 and 319F-2(c)(7)(C)(iii), to public and private 
     persons, including for-profit and nonprofit persons, 
     federally funded research and development centers, and 
     universities, to--

       ``(I) support the cost of countermeasure and product 
     advanced research and development; and
       ``(II) ensure accelerated development of countermeasures 
     and products.

       ``(C) Streamline processes.--To carry out the purpose 
     described in paragraph (2)(C), the Secretary, acting through 
     the Director, shall--
       ``(i) receive from the Assistant Secretary for Public 
     Health Emergency Preparedness, requirements for national 
     civilian biodefense needs, particularly countermeasures or 
     products and other technologies, to diagnose, mitigate, 
     prevent, or treat harm from existing, emerging, or potential 
     chemical, biological, radiological, or nuclear agents or 
     potential pandemic infectious diseases;
       ``(ii) establish transparent, expeditious, and direct 
     processes for selecting promising countermeasures and 
     products, supporting them through advanced research and 
     development and recommending them for procurement;
       ``(iii) establish an office within the BARDA, in 
     consultation with the Commissioner of Food and Drugs, to--

       ``(I) facilitate regular and ongoing communication between 
     the BARDA and the Food and Drug Administration regarding the 
     status of BARDA advanced research and development activities;
       ``(II) ensure that such activities are coordinated with the 
     approval requirements of the Food and Drug Administration, 
     with the goal of expediting the development and approval of 
     countermeasures and products; and
       ``(III) connect interested persons with additional 
     technical assistance made available under section 565 of the 
     Federal Food, Drug, and Cosmetic Act;

       ``(iv) coordinate with the Food and Drug Administration to 
     facilitate regulatory review and approval of promising 
     classes of countermeasures or products through the 
     development of research tools; and
       ``(v) recommend to the Secretary, through the Assistant 
     Secretary for Public Health Emergency Preparedness, 
     procurement of the most promising eligible security 
     countermeasures or qualified pandemic or epidemic products 
     identified in clause (i).
       ``(D) Supporting Innovation.--To carry out the purpose 
     described in paragraph (2)(D), the Secretary, acting through 
     the Director, shall award contracts, grants, cooperative 
     agreements, or enter into other transactions, to include use 
     of simplified acquisition authorities provided under sections 
     319F-1 and 319F-2(c)(7)(C)(iii), to the entities described in 
     subparagraph (B)(iii), to promote innovation in technologies 
     supporting the advanced research and development and 
     production of qualified or security countermeasures or 
     qualified pandemic or epidemic products, such as research 
     tools, manufacturing, countermeasure administration, storage, 
     and bioinformatics and other devices.
       ``(E) Other duties.--
       ``(i) In general.--The Director may--

       ``(I) prepare and submit to the President and Congress, an 
     annual budget estimate for qualified countermeasure and 
     pandemic or epidemic product advanced research and 
     development and other BARDA activities, after opportunity for 
     comment by the Secretary; and
       ``(II) receive from the President and the Office of 
     Management and Budget directly all funds appropriated by 
     Congress for obligation and expenditure by the BARDA.

       ``(ii) Secretary duties.--The Secretary, acting through the 
     Director, may--

       ``(I) enter into such contracts, leases, cooperative 
     agreements, or other transactions, as may be necessary to 
     carry out the functions of BARDA, without regard to section 
     3648 and 3709 of the Revised Statutes of the United States 
     (31 U.S.C. 3324(a) and (b), (41 U.S.C. 5), with any public 
     agency, any firm, association, corporation, or educational 
     institution, or any other person;
       ``(II) support advanced research and development and 
     innovation of potential countermeasures or products by highly 
     qualified foreign nationals outside the United States that 
     may inure to the benefit of the American people and 
     collaborative research involving American and foreign 
     participants;
       ``(III) administer grants using milestone-based awards and 
     payments; and
       ``(IV) establish 1 or more federally funded research and 
     development centers or university affiliated research centers 
     in accordance with section 253(c)(3) of title 41, United 
     States Code.

[[Page 22851]]

       ``(5) Vulnerable populations.--In carrying out the 
     activities under this section, the Director, in consultation 
     with the Vulnerable Populations Working Group, may give 
     priority to supporting and facilitating advanced research and 
     development of countermeasures or products, and formulations 
     of countermeasures or products, that are likely to be safe 
     and effective for pediatric populations, pregnant women, and 
     other vulnerable populations.
       ``(6) Working groups.--
       ``(A) Identification of technologies.--
       ``(i) In general.--The Director may establish and convene, 
     or enter into a contract with a public or private research 
     institution to convene, one or more working groups that 
     consists of experts on countermeasure technology to identify 
     innovative technologies that have the potential to be 
     developed as countermeasures or products.
       ``(ii) Meetings.--A working group established under clause 
     (i) shall participate in regular meetings with sponsors of 
     countermeasures, products, or related technologies to--

       ``(I) review the scientific evidence or concept of such 
     countermeasures, products, or related technologies;
       ``(II) provide guidance on research protocols or studies; 
     and
       ``(III) provide guidance on the regulatory approval process 
     for countermeasures, products, and related technologies.

       ``(iii) Recommendations.--Not later than 30 days after each 
     meeting with a sponsor of a countermeasure, product, or 
     related technology, the working group shall make 
     recommendations to the Director concerning such 
     countermeasure, product, or related technology.
       ``(iv) Confidentiality.--Any commercial confidential or 
     proprietary information that is disclosed to the working 
     group in a meeting under this section shall remain 
     confidential and shall not be disclosed other than to the 
     Secretary or the Director, or their designees.
       ``(v) Construction.--Nothing in this subparagraph shall be 
     construed to prohibit a sponsor from meeting with the 
     Director to discuss potential countermeasures, products, or 
     related technologies.
       ``(B) Public working group.--The Director may establish and 
     convene one or more working groups composed of private 
     citizens and officials of Federal, State, and local 
     governments to advise such Director with respect to the 
     functions of the BARDA and the Director.
       ``(C) Vulnerable populations working group.--The Director 
     shall establish and convene a Vulnerable Populations Working 
     Group composed of experts on pediatric populations, pregnant 
     women, and other vulnerable populations to advise such 
     Director with respect to--
       ``(i) supporting and facilitating advanced research and 
     development of countermeasures, and formulations of 
     countermeasures, that are safe and effective for such 
     populations; and
       ``(ii) other activities of the BARDA that effect such 
     populations.
       ``(7) Personnel authorities.--
       ``(A) Specially qualified scientific and professional 
     personnel.--In hiring personnel for the BARDA, the Director 
     shall have the hiring and management authorities described in 
     section 1101 of the Strom Thurmond National Defense 
     Authorization Act for Fiscal Year 1999 (5 U.S.C. 3104 note; 
     Public Law 105-261). With respect to the personnel of the 
     BARDA, the term of appointments for employees referred to 
     under subsection (c)(1) of that section may not exceed 5 
     years before the granting of any extension under subsection 
     (c)(2) of that section.
       ``(B) Special consultants.--The Director may accept special 
     consultants as personnel for the BARDA under section 207(f).
       ``(C) Intergovernmental personnel act.--The Director may 
     accept as personnel for the BARDA, employees under subchapter 
     VI of chapter 33 of subpart B of part III of title 5, United 
     States Code.
       ``(D) Other services.--The Director may accept voluntary 
     and uncompensated services.
       ``(c) National Biodefense Advisory Board.--
       ``(1) In general.--
       ``(A) Purpose.--The National Biodefense Advisory Board 
     shall provide expert advice and guidance to the Secretary on 
     the threats, challenges, and opportunities presented by 
     advances in biological and life sciences and the threat from 
     natural infectious diseases and chemical, biological, 
     radiological, and nuclear threats.
       ``(B) Membership.--There is established the National 
     Biodefense Advisory Board (hereinafter in this section 
     referred to as the `Board') to be composed of 23 members who 
     represent the Nation's preeminent scientific, public health, 
     and medical experts on the subject of biological, chemical, 
     nuclear, and radiological threats, whether naturally 
     occurring, accidental, or deliberate, as follows:
       ``(i) Ex officio.--The following members shall serve on the 
     Board ex officio:

       ``(I) The Assistant to the President for Homeland Security 
     and Counterterrorism.
       ``(II) The Director of the Office of Science and Technology 
     Policy.
       ``(III) The Assistant Secretary for Public Health Emergency 
     Preparedness.
       ``(IV) The Director of the National Institutes of Health.
       ``(V) The Director of the Centers for Disease Control and 
     Prevention.
       ``(VI) The Commissioner of Food and Drugs.
       ``(VII) The Director of BARDA.
       ``(VIII) The Assistant Secretary of Defense for Health 
     Affairs.
       ``(IX) The Assistant Secretary of Homeland Security for 
     Science and Technology.
       ``(X) The Secretary of Agriculture (or a designee).

       ``(ii) Appointed members.--The following individuals, as 
     appointed by the Secretary:

       ``(I) Four representatives of the pharmaceutical and 
     biotechnology industries.
       ``(II) Four representatives of academia.
       ``(III) Five other members as determined appropriate by the 
     Secretary.

       ``(C) Term of appointment.--A member of the Board described 
     in subparagraph (B)(ii) shall serve for a term of 3 years, 
     except that the Secretary may adjust the terms of the initial 
     Board appointees in order to provide for a staggered term of 
     appointment for all members.
       ``(D) Consecutive appointments; maximum terms.--A member 
     may be appointed to serve not more than 3 terms on the Board 
     and may serve not more than 2 consecutive terms.
       ``(2) Duties.--The Board shall--
       ``(A) advise the Secretary on major biodefense initiatives 
     and review ongoing and proposed biodefense programs, which 
     may include potential activities of the BARDA; and
       ``(B) in consultation with the Director of BARDA, and in 
     coordination with the Director of National Institute of 
     Allergy and Infectious Diseases, provide to the Secretary, 
     recommendations and findings for an expanded, intensified, 
     and coordinated biodefense research program encompassing the 
     programs of the BARDA and other Federal agencies and related 
     programs of the other research institutes.
       ``(3) Meetings.--The Board shall meet at the call of the 
     Secretary, but in no case less than twice annually to provide 
     to the Secretary updated assessments, findings, and 
     recommendations of the current trends, challenges, and 
     opportunities posed in biotechnology and genetic engineering.
       ``(4) Vacancies.--Any vacancy in the Board shall not affect 
     its powers, but shall be filled in the same manner as the 
     original appointment.
       ``(5) Chairperson.--The Secretary shall appoint a 
     chairperson from among the members of the Board.
       ``(6) Powers.--
       ``(A) Hearings.--The Board may hold such hearings, sit and 
     act at such times and places, take such testimony, and 
     receive such evidence as the Board considers advisable to 
     carry out this subsection.
       ``(B) Postal services.--The Board may use the United States 
     mails in the same manner and under the same conditions as 
     other departments and agencies of the Federal Government.
       ``(7) Personnel.--
       ``(A) Officers of the federal government.--A member of the 
     Board that is an employee of the Federal Government may not 
     receive additional pay, allowances, or benefits by reason of 
     the member's service on the Board.
       ``(B) Other members.--A member of the Board that is not an 
     employee of the Federal Government shall be compensated at a 
     rate equivalent 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 the member is 
     engaged in the actual performance of duties as a member of 
     the Board.
       ``(C) Travel expenses.--Each member of the Board shall 
     receive travel expenses, including per diem in lieu of 
     subsistence, in accordance with applicable provisions under 
     subchapter I of chapter 57 of title 5, United States Code.
       ``(D) Detail of government employees.--Any Federal 
     Government employee may be detailed to the Board without 
     reimbursement, and such detail shall be without interruption 
     or loss of civil service status or privilege.
       ``(d) Fund.--
       ``(1) Establishment.--There is established the Biodefense 
     Medical Countermeasure Development Fund, which shall be 
     administered by the Director of the BARDA.
       ``(2) Funds.--
       ``(A) First fiscal year.--Of the amounts appropriated to 
     carry out the Project BioShield Act of 2004 (Public Law 108-
     276) and not obligated, $1,000,000,000 shall be available to 
     the Fund to carry out this section for fiscal year 2006. Such 
     amounts shall remain available until expended.
       ``(B) Subsequent fiscal years.--There are authorized to be 
     appropriated such sums as may be necessary to carry out this 
     section for fiscal year 2007 and each subsequent fiscal year. 
     Such sums shall remain available until expended.
       ``(e) Effect of Section.--Nothing in this section shall be 
     construed to limit any authority of the Department of Health 
     and Human Services, including those authorities provided 
     under the Project BioShield Act of 2004 (Public Law 108-276).

[[Page 22852]]

       ``(f) Inapplicability of Certain Acts.--
       ``(1) FACA.--The Federal Advisory Committee Act (5 U.S.C. 
     App.) shall not apply to the duties, activities, working 
     groups, and advisory boards of the BARDA.
       ``(2) FOIA.--Information that relates to the activities, 
     working groups, and advisory boards of the BARDA shall not be 
     subject to disclosure under section 552 of title 5, United 
     States Code, unless the Secretary or Director determines that 
     such disclosure would pose no threat to national security. 
     Such a determination shall not be subject to judicial review.
       ``(3) Certain cost principles and cost accounting 
     standards.--Notwithstanding any other provision of law, the 
     cost principles set forth under part 31 of title 48, Code of 
     Federal Regulations, the cost accounting standards set forth 
     under chapter 99 of title 48, Code of Federal Regulations, 
     and the requirement for the submission of certified cost and 
     pricing information under section 304A of the Federal 
     Property and Administrative Services Act of 1949 (41 U.S.C. 
     254b), shall not apply to any contract, grant, cooperative 
     agreement, or other transaction entered into under the 
     Project BioShield Act of 2004 (Public Law 108-276).''.

     SEC. 4. CLARIFICATION OF COUNTERMEASURES COVERED BY PROJECT 
                   BIOSHIELD.

       (a) Qualified countermeasure.--Section 319F-1(a) of the 
     Public Health Service Act (42 U.S.C. 247d-6a(a)) is amended 
     by striking paragraph (2) and inserting the following:
       ``(2) Definitions.--In this section:
       ``(A) Qualified countermeasure.--The term `qualified 
     countermeasure' means a drug (as that term is defined by 
     section 201(g)(1) of the Federal Food, Drug, and Cosmetic Act 
     (21 U.S.C. 321(g)(1))), biological product (as that term is 
     defined by section 351(i) of this Act (42 U.S.C. 262(i))), 
     device (as that term is defined by section 201(h) of the 
     Federal Food, Drug, and Cosmetic Act (21 U.S.C. 321(h))), or 
     research tool (as that term is defined in section 201(rr) of 
     the Federal Food, Drug, and Cosmetic Act) that the Secretary 
     determines to be a priority (consistent with sections 302(2) 
     and 304(a) of the Homeland Security Act of 2002) to--
       ``(i) diagnose, mitigate, prevent, or treat harm from any 
     biological agent (including organisms that cause an 
     infectious disease) or toxins, chemical, radiological, or 
     nuclear agent that may cause a public health emergency 
     affecting national security;
       ``(ii) diagnose, mitigate, prevent, or treat harm from a 
     condition that may result in adverse health consequences or 
     death and may be caused by administering a drug, biological 
     product, or device that is used as described in this 
     subparagraph; or
       ``(iii) in the case of a research tool, enable the rapid 
     and effective identification, assessment, or development of a 
     drug, biological product, or device to diagnose, mitigate, 
     prevent, or treat harm, as described in clause (i) or (ii).
       ``(B) Infectious disease.--The term `infectious disease' 
     means a disease potentially caused by a pathogenic organism 
     (including a bacteria, virus, fungus, or parasite) that is 
     acquired by a person and that reproduces in that person.''.
       (b) Security countermeasure.--Section 319F-2(c)(1)(B) is 
     amended by--
       (A) striking ``treat, identify, or prevent'' each place it 
     appears and inserting ``diagnose, mitigate, prevent, or 
     treat''; and
       (B) inserting ``agent (including organisms that cause an 
     infectious disease) or toxin'' after ``any biological''.
       (c) Research tool.--Section 201 of the Federal Food, Drug, 
     and Cosmetic Act (21 U.S.C. 321) is amended by adding at the 
     end the following:
       ``(rr) Research tool.--The term `research tool' includes 
     the full range of tools and systems that assist in the 
     discovery, development, or manufacture of drugs, biological 
     products (as defined in section 351 of the Public Health 
     Service Act), or devices.''.

     SEC. 5. ORPHAN DRUG MARKET EXCLUSIVITY FOR COUNTERMEASURE 
                   PRODUCTS.

       (a) Market Exclusivity.--Subchapter A of chapter V of the 
     Federal Food, Drug, and Cosmetic Act (21 U.S.C. 351 et seq.) 
     is amended by inserting after section 505B the following:

     ``SEC. 505C. ORPHAN DRUG MARKET EXCLUSIVITY FOR 
                   COUNTERMEASURE PRODUCTS.

       ``(a) In General.--With respect to countermeasure products 
     (as such term is defined in this section), if a 
     countermeasure product is designated under section 526 for a 
     rare disease or condition, the period referred to in section 
     527(a) shall be 10 years instead of 7 years.
       ``(b) Definition.--For the purpose of this section, the 
     term `countermeasure' means a drug or biological product (as 
     such term is defined by section 351(i) of the Public Health 
     Service Act) that the Secretary determines to be a priority 
     (consistent with sections 302(2) and 304(a) of the Homeland 
     Security Act of 2002) to diagnose, mitigate, prevent, or 
     treat harm from any biological, chemical, radiological, or 
     nuclear agent (including organisms that cause an infectious 
     disease) or toxin identified as a material threat under 
     subsection (c)(2)(A)(ii) of section 319F-2 of the Public 
     Health Service Act.''.
       (b) Orphan Drugs.--For purposes of section 526 of the 
     Federal Food, Drug, and Cosmetic Act (21 U.S.C. 360bb) a 
     biological, chemical, radiological, or nuclear agent 
     (including organisms that cause an infectious disease) or 
     toxin identified as a material threat under subsection 
     (c)(2)(A)(ii) of section 319F-2 of the Public Health Service 
     Act shall be considered to be a ``rare disease or condition'' 
     within the meaning of such term in such section 526. The 
     Secretary may designate antibiotics and anti-infective 
     products that treat infectious diseases as designated drugs 
     or biological products under such section 526.
       (c) Effect of Section.--This section, and the amendments 
     made by this section, shall apply to new drug applications 
     and biological product licenses approved under the Federal 
     Food, Drug, and Cosmetic Act or the Public Health Service Act 
     after the date of enactment of this Act.

     SEC. 6. LIABILITY PROTECTIONS FOR PAN-
                   DEMICS, EPIDEMICS, AND COUNTERMEASURES.

       Part B of title III of the Public Health Service Act is 
     amended by inserting after section 319F-2 (42 U.S.C. 247d-6b) 
     the following:

     ``SEC. 319F-3. LIABILITY PROTECTIONS FOR PANDEMIC AND 
                   EPIDEMIC PRODUCTS AND SECURITY COUNTERMEASURES.

       ``(a) Authority.--As provided in subsection (b), and 
     subject to subsection (b)(1)(C), a manufacturer, distibutor, 
     or administrator of a security countermeasure, or a qualified 
     pandemic and epidemic product, described in subsection 
     (b)(1)(A) or a health care provider shall be immune from suit 
     or liability caused by or arising out of the design, 
     development, clinical testing and investigation, manufacture, 
     labeling, distribution, sale, purchase, donation, dispensing, 
     prescribing, administration, or use of a security 
     countermeasure, or a qualified pandemic and epidemic product, 
     described in subsection (b)(1)(A).
       ``(b) Litigation Management.--
       ``(1) Limitation on cause of action.--
       ``(A) In general.--
       ``(i) In general.--No cause of action shall exist against a 
     person described in subsection (a) for claims for loss of 
     property, personal injury, or death arising out of, 
     reasonably relating to, or resulting from the design, 
     development, clinical testing and investigation, manufacture, 
     labeling, distribution, sale, purchase, donation, dispensing, 
     prescribing, administration, or use of a security 
     countermeasure or qualified pandemic or epidemic product 
     distributed, sold, purchased, donated, dispensed, prescribed, 
     administered, or used in anticipation of and preparation for, 
     in defense against, or in response to, or recovery from an 
     actual or potential public health emergency that is a 
     designated security countermeasure or a qualified pandemic or 
     epidemic product by the Secretary in a declaration described 
     in paragraph (2).
       ``(ii) Rule of construction.--For purposes of this section, 
     the phrase `arising out of, reasonably relating to, or 
     resulting from' shall not be construed to apply to loss of 
     property, personal injury, or death that has no alleged or 
     potential causal relationship with the design, development, 
     clinical testing and investigation, manufacture, labeling, 
     distribution, sale, purchase, donation, dispensing, 
     prescribing, administration, or use of a product described in 
     clause (i).
       ``(B) Rule.--
       ``(i) Subsequent injury.--The protections set forth in 
     subsection (a) and subparagraph (A) shall apply to all claims 
     identified in subparagraph (A) that involve products 
     distributed, sold, purchased, donated, dispensed, prescribed, 
     administered, or used during the effective period set forth 
     in the designation provided for in paragraph (2), regardless 
     of the date of alleged injury.
       ``(ii) Private donation or sale.--The protections set forth 
     in subsection (a) and subparagraph (A) shall apply to all 
     claims identified in subparagraph (A) that involve security 
     countermeasures or qualified pandemic or epidemic products 
     distributed, sold, purchased, donated, dispensed, prescribed, 
     administered, or used during the effective period set forth 
     in the designation provided for in paragraph (2) by a 
     manufacturer through the commercial market, provided that the 
     security countermeasures or the qualified pandemic or 
     epidemic product are the security countermeasure or qualified 
     pandemic or epidemic product described in a declaration 
     described in paragraph (2) and the Secretary does not 
     specifically prohibit such private donation or sale in such 
     declaration.
       ``(C) Potential liability upon determination.--
       ``(i) In general.--A manufacturer, distributor, 
     administrator, or health care provider shall not be immune 
     under subsection (a) or exempted from a cause of action under 
     subparagraph (A) if the Secretary makes a determination as 
     provided for in subparagraph (D).
       ``(ii) Investigation by secretary.--A party seeking a 
     determination under subparagraph (D) may petition the 
     Secretary to investigate allegations against a manufacturer, 
     distributor, administrator, or health care provider arising 
     out of, relating to, or resulting from the design, 
     development, clinical testing and investigation, manufacture, 
     labeling, distribution, sale, purchase, donation, dispensing, 
     prescribing, administration, or use of products as provided 
     for in subparagraph (A)(i). The decision to undertake such 
     investigation shall be within the Secretary's

[[Page 22853]]

     discretion and shall not be subject to judicial review.
       ``(iii) Rule of construction.--Nothing in this section 
     shall be construed to abrogate or limit the application of 
     subtitle II of chapter 5 and chapter 7 of title 5, United 
     States Code (commonly known as the Administrative Procedure 
     Act).
       ``(D) Determination by secretary.--
       ``(i) In general.--In making a determination under this 
     subparagraph, the Secretary, acting through an administrative 
     law judge, must find clear and convincing evidence that--

       ``(I) the manufacturer, distributor, administrator, or 
     health care provider violated a provision of the Federal 
     Food, Drug, and Cosmetic Act (21 U.S.C. 301 et seq.) or this 
     Act; and
       ``(II) in violating such Act, such manufacturer, 
     distributor, administrator, or health care provider acted 
     with willful misconduct.

       ``(ii) Effect of determination.--If the Secretary finds 
     such clear and convincing evidence under clause (i), the 
     Secretary shall examine whether such willful misconduct to 
     violate an Act under such clause--

       ``(I) caused the product to present a significant or 
     unreasonable risk to human health; and
       ``(II) proximately caused the injury alleged by the party.

       ``(ii) Notice and hearing.--Prior to the Secretary's making 
     a determination under clause (i), the manufacturer, 
     distributor, administrator, or health care provider shall 
     have notice and a right to a formal hearing in accordance 
     with section 556 of title 5, United States Code.
       ``(iii) Effect of determination.--Subject to subsection 
     (c), the sole exception to the immunity from suit and 
     liability of manufacturers, distributors, administrators, or 
     healthcare providers set forth in subsection (a) and 
     subparagraph (A) shall be for actions against a manufacturer, 
     distributor, administrator, or healthcare provider as 
     provided in subparagraph (A).
       ``(iv) Judicial review.--At any time prior to the 90th day 
     following a determination by the Secretary under clause (i), 
     any manufacturer, distributor, administrator, or health care 
     provider named in such determination may file a petition with 
     the United States Court District Court for the District of 
     Columbia, for a judicial review of such determination. A copy 
     of the petition shall be forthwith transmitted by the clerk 
     of the court to the Secretary or other officer designated by 
     the Secretary for that purpose. The Secretary thereupon shall 
     file in the court the record of the findings on which the 
     Secretary based his or her determination. The filing of a 
     petition under this clause shall automatically stay the 
     Secretary's determination for the duration of the judicial 
     proceeding. The sole parties to the judicial proceeding shall 
     be the Secretary and the petitioner. Intervention by third 
     parties in the judicial proceeding shall not be permitted. No 
     subpoenas shall be issued nor shall other compulsory process 
     apply. The court's review of a determination by the Secretary 
     under this clause shall conform to the procedures for 
     judicial review of administrative orders set forth in 
     paragraphs (2) through (6) of section 701(f) of the Federal 
     Food, Drug, and Cosmetic Act (21 U.S.C. 371(f)) to the extent 
     consistent with this section.
       ``(v) Tolling of statute of limitations.--The computation 
     of the statute of limitations for any action against a 
     manufacturer, distributor, administrator, or health care 
     provider described under this subparagraph shall not include 
     any time occurring before the determination by the Secretary 
     under this subparagraph.
       ``(vi) Regulatory authority.--The Secretary, in 
     consultation with the Attorney General, shall promulgate 
     regulations defining what actions by a manufacturer, 
     distributor, administrator, or healthcare provider of a 
     security countermeasure or a qualified pandemic and epidemic 
     product shall be deemed to constitute `willful misconduct' 
     for purposes of clause (i). In promulgating such regulations, 
     the Secretary shall consider the nature of the actual or 
     potential public health emergency, the timing and extent of 
     any vaccination or countermeasure program, and any other 
     circumstances they deem significant, so that any civil 
     actions permitted under this subsection will not adversely 
     affect the public health. The Secretary may specify the 
     period of time for which such regulations apply.
       ``(vii) Evidence required.--The Secretary, in consultation 
     with the Attorney General, shall promulgate regulations that 
     require, in order to be a party under this section, that an 
     individual present evidence that reasonably demonstrates 
     that--

       ``(I) such individual has suffered a loss as a direct 
     result of the design, development, clinical testing and 
     investigation, manufacture, labeling, distribution, sale, 
     purchase, donation, dispensing, prescribing, or 
     administration of a security countermeasure or qualified 
     epidemic or pandemic product; and
       ``(II) the loss as described in subclause (I) was a direct 
     result of the willful misconduct of the manufacturer, 
     distributor, administrator, or health care provider in 
     violating the Federal Food, Drug, and Cosmetic Act or this 
     Act.

       ``(E) Scope.--Subparagraph (C) shall apply regardless of 
     whether the suit or liability described in subsection (a) or 
     the claim described in subparagraph (A) arises from the 
     design, development, clinical testing and investigation, 
     manufacture, labeling, distribution, sale, purchase, 
     donation, dispensing, prescribing, administration, or use by 
     the Federal Government or by any person.
       ``(2) Declaration by secretary.--
       ``(A) In general.--The Secretary may issue a declaration, 
     pursuant to this paragraph, that an actual or potential 
     public health emergency makes advisable the distribution, 
     administration, or use of a security countermeasure or 
     qualified pandemic or epidemic product.
       ``(B) Security countermeasure or qualified pandemic or 
     epidemic product.--The Secretary shall specify in such 
     declaration the security countermeasures or qualified 
     pandemic or epidemic products to be sold by, purchased from, 
     or donated by a manufacturer or drawn from the Strategic 
     National Stockpile.
       ``(C) Effective period.--The Secretary shall specify in 
     such declaration the beginning and the ending dates of the 
     effective period of the declaration, which shall be not 
     longer than 6 months. The Secretary may subsequently amend 
     such declaration to shorten or extend such effective period, 
     provided that the new ending data is after the date on which 
     the declaration is amended.
       ``(D) Publication.--The Secretary shall promptly publish 
     each such declaration and amendment in the Federal Register.
       ``(c) Actions by the United States.--Nothing in this 
     section shall be construed to abrogate or limit any right, 
     remedy, or authority that the United States or any agency 
     thereof may possess under any other provision of law.
       ``(d) Definitions.--In this section:
       ``(1) Administrator.--The term `administrator' means a 
     person employed by the State or local government, or their 
     designee, who supervised or administered a program with 
     respect to the administration, dispensing, distribution, or 
     provision of a security countermeasure or a qualified 
     pandemic or epidemic product, including a person who has 
     established requirements, provided policy guidance, supplied 
     technical or scientific advice or assistance.
       ``(2) Health care provider.--The term `health care 
     provider' means a person, including a volunteer, who 
     distributes, prescribes, administers, dispenses, provides a 
     facility to administer, or supervises or oversees the 
     administration of a security countermeasure or a qualified 
     pandemic or epidemic product, including persons who 
     distribute, prescribe, administer, dispense, or provide a 
     facility to administer in accordance with a designation under 
     subsection (b)(2).
       ``(3) Loss.--The term `loss' means death, physical injury, 
     or loss of or damage to property, including business 
     interruption loss.
       ``(4) Manufacturer.--The term `manufacturer' includes--
       ``(A) a contractor or subcontractor of a manufacturer;
       ``(B) a supplier of any product or service, research tool, 
     or component to the manufacturer; and
       ``(C) any or all of the parents, subsidiaries, affiliates, 
     successors, and assigns of a manufacturer.
       ``(5) Qualified pandemic or epidemic product.--The term 
     `qualified pandemic or epidemic product' means a drug (as 
     such term is defined in section 201(g)(1) of the Federal 
     Food, Drug, and Cosmetic Act (21 U.S.C. 321(g)(1))), 
     biological product (as such term is defined by section 351(i) 
     of this Act) or device (as such term is defined by section 
     201(h) of the Federal Food, Drug and Cosmetic Act (21 U.S.C. 
     321(h))) designed, developed, modified, or procured to 
     diagnose, mitigate, prevent, treat, or cure a pandemic or 
     epidemic or limit the harm such pandemic or epidemic might 
     otherwise cause or a serious or life-threatening disease or 
     condition caused by such a product, that--
       ``(A) is approved or cleared under chapter V of the Federal 
     Food, Drug, and Cosmetic Act or licensed under section 351 of 
     this Act;
       ``(B) is a product for which the Secretary determines that 
     sufficient and satisfactory clinical experience or research 
     data (including data, if available, from pre-clinical and 
     clinical trials) support a reasonable conclusion that the 
     product will qualify for approval or licensing within 8 years 
     after the date the Secretary makes a declaration under 
     paragraph (2); or
       ``(C) is authorized for emergency use section 564 of the 
     Federal Food, Drug, and Cosmetic Act, except that subsection 
     (b) of such section shall not apply.
       ``(6) Party.-- The term `party' means an individual who can 
     reasonably demonstrate to the Secretary that such individual 
     has suffered a loss (as defined in paragraph (3)) as a direct 
     result of the willful misconduct of a manufacturer, 
     distributor, administrator, or health care provider.
       ``(7) Person.--The term `person' includes an individual, 
     partnership, corporation, association, entity, or public or 
     private corporation, including a Federal, State, or local 
     agency or department.
       ``(8) Security countermeasure.--The term `security 
     countermeasure' has the meaning given such term in section 
     319F-2(c)(1)(B).''.

[[Page 22854]]



     SEC. 7. COMPENSATION.

       Title II of the Public Health Service Act (42 U.S.C. 202 et 
     seq.) is amended by adding at the end the following:

                 ``PART D--OTHER COMPENSATION PROGRAMS

     ``SEC. 271. COVERED COUNTERMEASURES PROGRAM.

       ``(a) In General.--If the Secretary issues a Proclamation 
     stating that there is a critical public health need for a 
     covered individual to receive a covered countermeasure during 
     the effective period of the Proclamation, the Secretary shall 
     establish a process to provide compensation to such covered 
     individuals for a covered injury, consistent with the 
     Smallpox Emergency Personnel Protection program under part C.
       ``(b) Definition.--For purposes of this section:
       ``(1) Covered countermeasure.--The term `covered 
     countermeasure' means a qualified pandemic or epidemic (as 
     defined in section 319F-3(c)(5)) or a security countermeasure 
     (as defined in section 319F-2(c)(1)(B)) specified in the 
     Proclamation.
       ``(2) Covered individual.--The term `covered individual' 
     means an individual--
       ``(A) who is a health care worker, law enforcement officer, 
     firefighter, security personnel, emergency medical personnel, 
     other public health or safety personnel, or support personnel 
     for such occupational specialties;
       ``(B) who is or will be functioning in a role identified in 
     a State, local, or Department of Health and Human Services 
     emergency response plan approved by the Secretary;
       ``(C) who has volunteered and been selected to be a member 
     of an emergency response plan; and
       ``(D) to whom a covered countermeasure is administered 
     pursuant to such approved plan during the effective period of 
     the Proclamation and prior to the time at which the Secretary 
     declares a public health emergency pursuant to section 319 
     related to a covered countermeasure specified in the 
     Proclamation.
       ``(3) Covered injury.--The term `covered injury' means an 
     injury, disability, illness, condition, or death (other than 
     a minor injury such as minor scarring or minor local 
     reaction) determined by the Secretary to have been sustained 
     by a covered individual as the direct result of 
     administration to the individual of a covered countermeasure.
       ``(4) Effective period of the proclamation.--The term 
     `effective period of the Proclamation' means the effective 
     period specified in the Proclamation, unless extended by the 
     Secretary.
       ``(5) Emergency response plan.--The term `emergency 
     response plan' or `plan' means a response plan detailing 
     actions to be taken in preparation for a pandemic, epidemic, 
     or biological, chemical, nuclear agent or toxin that 
     presents, or may present, a public health emergency.
       ``(6) Proclamation.--The term `Proclamation' means a 
     Proclamation regarding the critical public health need for 
     the administration of a covered countermeasure issued by the 
     Secretary and published in the Federal Register. Such 
     Proclamation shall specify the specific covered 
     countermeasure recommended for administration.
       ``(c) Rule of Construction.--Nothing in this section shall 
     be construed to require the creation of a compensation 
     program if the covered injuries are only minor injuries 
     consistent with section (b)(3).''.

     SEC. 8. REBATES AND GRANTS FOR RESEARCH DEVELOPMENT, AND 
                   MANUFACTURING OF VACCINES, QUALIFIED 
                   COUNTERMEASURES AND PANDEMIC OR EPIDEMIC 
                   PRODUCTS.

       (a) In General.--The Secretary of Health and Human Services 
     (referred to in this section as the ``Secretary'') may award 
     to a person with respect to an investment described in this 
     section (or an amendment made by this section)--
       (1) a rebate pursuant to subsection (b); or
       (2) a grant pursuant to section 319M of the Public Health 
     Service Act (as added by subsection (c)).
       (b) Surge Capacity and Research Rebates.--
       (1) In general.--The Secretary may award rebates out of any 
     money in the Treasury not otherwise appropriated to persons 
     for the expansion of surge capacity for manufacturing 
     vaccines, qualified countermeasures (as defined in 319F-1 of 
     the Public Health Service Act, as amended by this Act) or 
     qualified pandemic or epidemic products (as defined in 319F-
     3(c)(5) of such Act, as added by this Act) (referred to in 
     this section as ``vaccines, countermeasures or products'') 
     and for vaccines, countermeasures, or products research.
       (2) Vaccines, countermeasures or products manufacturing 
     facilities investment rebate.--
       (A) In general.--For purposes of this section, vaccines, 
     countermeasures or products manufacturing facilities 
     investment rebate for any taxable year for a person (as 
     defined with respect to such person for purposes of the 
     Internal Revenue Code of 1986) shall be an amount equal to 20 
     percent of the qualified investment for such taxable year.
       (B) Vaccines, countermeasures or products manufacturing 
     facilities investment.--For purposes of subparagraph (A), the 
     qualified investment for any taxable year for a person is the 
     basis of each vaccines, countermeasures or products 
     manufacturing facilities property placed in service by the 
     person during the taxable year involved.
       (C) Vaccines, countermeasures and products manufacturing 
     facilities property.--For purposes of this subsection, the 
     term ``vaccines, countermeasures and products manufacturing 
     facilities property'' means real and tangible personal 
     property--
       (i)(I) the original use of which commences with the person 
     applying for the rebate; or
       (II) which is acquired through purchase (as defined by 
     section 179(d)(2) of the Internal Revenue Code of 1986);
       (ii) which is depreciable under section 167 of the Internal 
     Revenue Code of 1986;
       (iii) which is physically located in a State;
       (iv) which is used for the manufacture, distribution, or 
     research and development of vaccines, countermeasures, or 
     products; and
       (v) which is in compliance with applicable good 
     manufacturing practice and with any other applicable 
     requirements which are promulgated by the Secretary, the 
     Occupational Safety and Health Administration, or the 
     Environmental Protection Agency, and which are applicable to 
     such property.
       (D) Denial of double benefit for manufacturing facilities 
     expenses.--If any portion of the vaccines, countermeasures, 
     and products manufacturing facilities property investment 
     expenses is otherwise allowable as a deduction for the 
     taxable year involved, the Secretary shall only provide a 
     rebate under this section for the portion of such expenses 
     not covered by the rebate determined by such deduction.
       (E) Eligibility.--To be eligible to receive a rebate under 
     this subsection, a manufacturer shall submit to the Secretary 
     an application at such time, in such manner, and containing 
     such information as the Secretary may require, including--
       (i) a detailed description and intended use of the 
     facilities that is the basis of application;
       (ii) a detailed description of the vaccine, countermeasure, 
     or product being produced or that may be produced at the 
     facility;
       (iii) a detailed accounting of qualified manufacturing 
     facilities investment of the person;
       (iv) a certification as to the compliance of the person 
     with clauses (i) through (iv) of subparagraph (C); and
       (v) copies of tax returns for the taxable year involved.
       (F) Effective date.--This paragraph shall apply to property 
     placed in service after December 31, 2005.
       (G) Termination.--This paragraph shall not apply to any 
     property placed in service after December 31, 2010.
       (3) Medical research related to developing vaccines, 
     countermeasures or qualified pandemic or epidemic products 
     rebate.--
       (A) In general.--For purposes of this subsection, the 
     research rebate determined under this section for the taxable 
     year involved (as determined as provided for in paragraph 
     (2)(A)) is an amount equal to 35 percent of the vaccines, 
     qualified countermeasures, or qualified pandemic or epidemic 
     products (referred to in this section as ``vaccine, 
     countermeasure, or product'') research expenses for the 
     taxable year.
       (B) Vaccines, countermeasures, or products research 
     expenses.--Except as otherwise provided in this paragraph, 
     the term ``vaccines, countermeasures, or products research 
     expenses'' means the amounts which are paid or incurred by 
     the researcher or manufacturer during the taxable year with 
     respect to any research and development of vaccines, 
     countermeasures, or products. Qualified research and 
     development expenses include expenses related to 
     reformulating existing vaccines, countermeasures, or 
     products.
       (C) Determining research expenses.--Any vaccines, 
     countermeasures, or products research expenses for any 
     taxable year which are qualified research expenses (within 
     the meaning of this subsection) shall be taken into account 
     in determining base period research expenses for purposes of 
     applying this paragraph to subsequent taxable years.
       (D) Denial of double benefit for vaccines, countermeasures, 
     or products research expenses.--If any portion of the 
     vaccines, countermeasures, or products research expenses is 
     otherwise allowable as a deduction for the taxable year 
     involved, the Secretary shall only provide a rebate under 
     this section for the portion of such expenses not covered by 
     any rebate determined by such deduction.
       (E) Eligibility.--To be eligible to receive a rebate under 
     this paragraph, a manufacturer or researcher shall submit to 
     the Secretary an application at such time, in such manner, 
     and containing such information as the Secretary may require, 
     including--
       (i) a detailed description of the vaccine, countermeasure, 
     or product being researched or developed;
       (ii) a detailed description of the research that is the 
     subject of the rebate;
       (iii) a detailed accounting of the qualified research 
     expenses involved;
       (iv) an assurance that the researcher or manufacturer is 
     following good laboratory

[[Page 22855]]

     practice, as required by the Secretary pursuant to the 
     Federal Food, Drug, and Cosmetic Act (21 U.S.C. 301 et seq.) 
     and the Public Health Service Act (42 U.S.C. 201 et seq.); 
     and
       (v) copies of tax returns for the taxable year involved.
       (F) Effective date.--This paragraph shall apply to expenses 
     for taxable years beginning after December 31, 2005.
       (4) Exclusion for amounts funded by grants, etc.--The terms 
     ``vaccines, countermeasures, or products manufacturing 
     investment'' and ``qualified research expenses'' shall not 
     include any amount to the extent such amount is funded by any 
     grant, contract, or otherwise funded by another person (or 
     any governmental entity).
       (c) Grants to Expand and Improve Research and Development 
     and Manufacturing of Vaccines, Countermeasures or Products.--
     Part B of title III of the Public Health Service Act is 
     amended by inserting after section 319L, as added by this 
     Act, the following:

     ``SEC. 319M. GRANTS TO EXPAND AND IMPROVE RESEARCH AND 
                   DEVELOPMENT AND MANUFACTURING OF VACCINES, 
                   QUALIFIED COUNTERMEASURES OR QUALIFIED PANDEMIC 
                   OR EPIDEMIC PRODUCTS.

       ``(a) In General.--The Secretary may award grants to a 
     manufacturer to purchase or improve real property and 
     tangible personal property used in the research and 
     development, manufacture, or distribution of a vaccine, 
     qualified countermeasure (as defined in section 319F-1) or 
     qualified pandemic or epidemic product (as defined in section 
     319F-3(c)(5)).
       ``(b) Eligibility.--To be eligible to receive a grant under 
     subsection (a), a manufacturer shall submit to the Secretary 
     an application at such time, in such manner, and containing 
     such information as the Secretary may require, including--
       ``(1) a detailed description of the planned expansion;
       ``(2) a detailed description of the equipment, facility, or 
     property involved;
       ``(3) a certification that such facility or property is 
     physically located in a State;
       ``(4) a detailed description of the vaccine, qualified 
     countermeasure or qualified pandemic or epidemic product 
     involved;
       ``(5) a detailed description of the research and 
     development, manufacturer, or distribution involved;
       ``(6) a description of how such equipment, facility, or 
     property is to be used;
       ``(7) a description of whether such equipment, facility, or 
     property can be used for the research and development, 
     manufacture, or distribution of a drug, biological product, 
     device or other countermeasure not described in paragraph 
     (4); and
       ``(8) a certification that the equipment, facility, or 
     property involved complies with all applicable Federal, 
     State, and local laws.
       ``(c) Recapture.--
       ``(1) In general.--If, at any time prior to the expiration 
     of the 20-year period beginning on the date on which a grant 
     is awarded under this section, the facility or property 
     involved ceases to be used for the purpose for which the 
     grant was awarded, the United States shall be entitled to 
     recover from the manufacturer an amount bearing the same 
     ratio to the value of the facility or property at such time 
     as the amount of the grant bore to the total cost of the 
     purchase or improvement involved. The value of the facility 
     or property at such time may be determined by agreement of 
     the manufacturer and the Secretary, or by order of the United 
     States District Court for the district in which such facility 
     or property is situated.
       ``(2) Limitation.--The Secretary may not recapture the 
     facility or property under this subsection if the Secretary 
     determines, in accordance with regulations promulgated by the 
     Secretary, that there is good cause for the failure of proper 
     use.
       ``(d) Authorization of Appropriations.--There is authorized 
     to be appropriated such sums as may be necessary to carry out 
     this section.''.

     SEC. 9. TECHNICAL ASSISTANCE.

       Subchapter E of chapter V of the Federal Food, Drug, and 
     Cosmetic Act (21 U.S.C. 360bbb et seq.) is amended by adding 
     at the end the following:

     ``SEC. 565. TECHNICAL ASSISTANCE.

       ``The Secretary, in consultation with the Commissioner of 
     Food and Drugs, shall establish within the Food and Drug 
     Administration a team of experts on manufacturing and 
     regulatory activities (including compliance with current Good 
     Manufacturing Practices) to provide both off-site and on-site 
     technical assistance to the manufacturers of qualified 
     countermeasures (as defined in section 319F-1 of the Public 
     Health Service Act), security countermeasures (as defined in 
     section 319F-2 of such Act), or vaccines, at the request of 
     such a manufacturer and at the discretion of the Secretary, 
     if the Secretary determines that a shortage or potential 
     shortage may occur in the United States in the supply of such 
     vaccines or products and that the provision of such 
     assistance would be beneficial in helping alleviate or avert 
     such shortage.''.

     SEC. 10. ANIMAL MODELS FOR CERTAIN DISEASES.

       Part B of title IV of the Public Health Service Act (42 
     U.S.C. 284 et seq.) is amended by adding at the end the 
     following:

     ``SEC. 409J. ANIMAL MODELS FOR CERTAIN DISEASES.

       ``(a) In General.--The Secretary, acting through the 
     Director of NIH, in coordination with the Director of the 
     Biomedical Advanced Research and Development Agency, the 
     Director of the Centers for Disease Control and Prevention, 
     and the Commissioner of Food and Drugs, shall establish and 
     award grants under this section to eligible entities, 
     including other Federal agencies, to study the physiological 
     responses of certain animal species and, where appropriate, 
     juvenile models, to chemical, biological, radiological, or 
     nuclear agents or toxins or potential pandemic infectious 
     disease, and to develop and validate such animal models.
       ``(b) Eligibility.--To be eligible to receive a grant under 
     this section, an entity shall--
       ``(1) provide assurances to the Secretary that the entity--
       ``(A) has access to an appropriate biosafety laboratory or 
     facility, as determined by the Secretary; and
       ``(B) will follow good laboratory practices;
       ``(2) submit to the Secretary an application at such time, 
     in such manner, and containing such information as the 
     Secretary may require, including--
       ``(A) a detailed description of the animal model involved;
       ``(B) a detailed description of the chemical, biological, 
     radiological, nuclear, or other infectious agents involved;
       ``(C) a detailed description of how the animal model will 
     be used for the development of a drug, biological product, or 
     device for use as a countermeasure;
       ``(D) a detailed description of validation methods; and
       ``(E) an assurance that the entity will follow good 
     laboratory practices; and
       ``(3) agree to submit the results of the research funded 
     under the grant to the Director of the Biomedical Advanced 
     Research and Development Agency and the Director of NIH.
       ``(c) Authorization of Appropriations.--There are 
     authorized to be appropriated such sums as may be necessary 
     to carry out this section.''.

     SEC. 11. ANIMAL MODEL/RESEARCH TOOL SCIENTIFIC ADVISORY 
                   COMMITTEE.

       Subchapter E of chapter V of the Federal Food, Drug, and 
     Cosmetic Act (21 U.S.C. 360bbb et seq.), as amended by this 
     Act, is amended by adding at the end the following:

     ``SEC. 566. ANIMAL MODEL/RESEARCH TOOL SCIENTIFIC ADVISORY 
                   COMMITTEE.

       ``(a) Establishment.--Not later than 6 months after the 
     date of enactment of this section, the Secretary shall 
     establish an 11-member advisory committee to be known as the 
     `Animal Model/Research Tool Scientific Advisory Committee' 
     (referred to in this section as the `Advisory Committee').
       ``(b) Membership.--
       ``(1) In general.--The Secretary shall appoint as members 
     of the Advisory Committee individuals who are technically 
     qualified by training and experience, including in medicine, 
     veterinarian medicine, biology, technology involving the 
     manufacture, evaluation, or use of research tools, who are of 
     appropriately diversified professional backgrounds to 
     evaluate the priority animal models and research tools.
       ``(2) Ex officio members.--The Secretary may appoint 
     Federal officials, including at least 1 representative of the 
     Biomedical Advanced Research and Development Agency, to serve 
     as ex officio members of the Advisory Committee.
       ``(3) Chairperson.--The Secretary shall designate 1 of the 
     members of the Advisory Committee to serve as the 
     chairperson.
       ``(c) Duties.--The Advisory Committee shall provide advice, 
     information, and recommendations to the Secretary on--
       ``(1) accepted animal models for diseases and conditions 
     associated with any biological (including organisms that 
     cause infectious diseases), chemical, radiological, or 
     nuclear agent or toxin or potential pandemic infectious 
     disease;
       ``(2) strategies to accelerate animal model and research 
     tool development and validation; and
       ``(3) scientific issues raised in applications as requested 
     by the Secretary.
       ``(d) Priorities.--Priorities for animal models and 
     research tools shall be established by the Secretary.
       ``(e) Compensation; Support; FACA.--
       ``(1) Compensation and travel.--Members of the Advisory 
     Committee who are not officers or employees of the United 
     States, while attending conferences or meetings of the 
     committee or otherwise engaged in its business, shall be 
     entitled to receive compensation at rates to be fixed by the 
     Secretary, which may not exceed daily equivalent of the rate 
     in effect for level 4 of the Senior Executive Schedule under 
     section 5382 of title 5, United States Code, for each day 
     (including travel time) they are so engaged, and while so 
     serving away from their homes or regular places of business 
     each member may be allowed travel expenses, including per 
     diem in lieu of subsistence, as authorized by section 5703 of 
     title 5, United States Code, for persons in the Federal 
     Government service employed intermittently.
       ``(2) Administrative support.--The Secretary shall furnish 
     the Advisory Committee clerical and other assistance.
       ``(3) Nonapplication of faca.--Section 14 of the Federal 
     Advisory Committee Act (5

[[Page 22856]]

     U.S.C. App.) shall not apply to the Advisory Committee.
       ``(f) Proceedings.--The Advisory Committee shall make and 
     maintain a transcript of any proceeding of the Committee. The 
     Committee shall delete from any transcript made under this 
     subsection information, which is exempt from disclosure under 
     section 552(b) of title 5, United States Code.''.

     SEC. 12. COLLABORATION AND COORDINATION.

       Section 2 of the Clayton Act (15 U.S.C. 13) is amended by 
     adding at the end the following:
       ``(g) Limited Antitrust Exemption.--
       ``(1) Security countermeasures, qualified countermeasures 
     and qualified pandemic or epidemic product development 
     meetings.--
       ``(A) Countermeasures and products development meetings and 
     consultations.--The Secretary of Health and Human Services 
     (referred to in this subsection as the `Secretary') or the 
     Director of the Biomedical Advanced Research and Development 
     Agency (referred to in this subsection as the `Director'), in 
     coordination with the Attorney General and the Secretary of 
     Homeland Security, may conduct meetings and consultations 
     with parties involved in the development of security 
     countermeasures (as defined in section 319F-2 of the Public 
     Health Service Act) qualified countermeasures (as defined in 
     section 319F-1 of the Public Health Service Act) or qualified 
     pandemic or epidemic products (as defined in section 319F-
     3(c)(5) of the Public Health Service Act) (referred to in 
     this section as ``countermeasures or products'') for the 
     purpose of the development, manufacture, distribution, 
     purchase, sale, or storage of countermeasures or products 
     consistent with the purposes of this title. The Secretary or 
     Director may convene such meeting or consultation at the 
     request of any person, the Secretary of Homeland Security, 
     the Attorney General, the Chairperson of the Federal Trade 
     Commission, an industry representative or member, or upon 
     initiation by such Secretary. The Secretary or Director shall 
     give notice of such meetings and consultations to the 
     Chairperson of the Federal Trade Commission (referred to in 
     this subsection as the `Chairperson') and the Attorney 
     General.
       ``(B) Meeting and consultation conditions.--A meeting or 
     consultation conducted under subparagraph (A) shall--
       ``(i) be chaired or, in the case of a consultation, 
     facilitated by the Secretary or Director;
       ``(ii) be open to parties involved in the development, 
     manufacture, distribution, purchase, or sale of 
     countermeasures or products, as determined by the Secretary 
     or Director;
       ``(iii) be open to the Attorney General, the Secretary of 
     Homeland Security, and the Chairperson;
       ``(iv) be limited to discussions involving the development, 
     manufacture, distribution, or sale of countermeasures or 
     products, consistent with the purposes of this title; and
       ``(v) be conducted in such manner as to ensure that 
     national security, confidential, and proprietary information 
     is not disclosed outside the meeting or consultation.
       ``(C) Limitation.--The Secretary or Director may not 
     require the disclosure of confidential commercial or 
     proprietary information.
       ``(D) Minutes.--The Secretary or Director shall maintain 
     minutes of meetings and consultations under this subsection, 
     which shall not be disclosed under section 552 of title 5, 
     United States Code, unless such Secretary or Director, in 
     consultation with the Attorney General, determines that 
     disclosure would pose no threat to national security. Such 
     determination shall not be subject to judicial review.
       ``(E) Exemption.--
       ``(i) In general.--The antitrust laws shall not apply to 
     meetings and consultations under this paragraph.
       ``(ii) Limitation.--Clause (i) shall not apply to any 
     agreement or conduct that results from a meeting or 
     consultation and that does not receive an exemption pursuant 
     to this subsection.
       ``(2) Written agreements.--The Secretary or the Director 
     shall file a written agreement regarding covered activities, 
     made pursuant to meetings or consultations conducted under 
     paragraph (1) and that is consistent with this paragraph, 
     with the Attorney General and the Chairperson for a 
     determination of the compliance of such agreement with 
     antitrust laws. In addition to the proposed agreement itself, 
     any such filing shall include--
       ``(A) an explanation of the intended purpose of the 
     agreement;
       ``(B) a specific statement of the substance of the 
     agreement;
       ``(C) a description of the methods that will be utilized to 
     achieve the objectives of the agreement;
       ``(D) an explanation of the necessity of a cooperative 
     effort among the particular participating parties to achieve 
     the objectives of the agreement; and
       ``(E) any other relevant information determined necessary 
     by the Secretary or Director in consultation with the 
     Attorney General and the Chairperson.
       ``(3) Determination.--The Attorney General, in consultation 
     with the Chairperson, shall determine whether an agreement 
     regarding covered activities referred to in paragraph (2) 
     would likely--
       ``(A) be in compliance with the antitrust laws, and so 
     inform the Secretary or Director and the participating 
     parties; or
       ``(B) violate the antitrust laws, in which case, the filing 
     shall be deemed to be a request for an exemption from the 
     antitrust laws, limited to the performance of the agreement 
     consistent with the purposes of this title.
       ``(4) Action on request for exemption.--
       ``(A) In general.--The Attorney General, in consultation 
     with the Chairperson, shall grant, deny, grant in part and 
     deny in part, or propose modifications to a request for 
     exemption from the antitrust laws under paragraph (3) within 
     15 business days of the receipt of such request.
       ``(B) Extension.--The Attorney General may extend the 15-
     day period referred to in subparagraph (A) for an additional 
     period of not to exceed 10 days. Such additional period may 
     be further extended only by the United States district court, 
     upon an application by the Attorney General after notice to 
     the Secretary or Director and the parties involved.
       ``(C) Determination.--In granting an exemption under this 
     paragraph, the Attorney General, in consultation with the 
     Chairperson and the Secretary or Director--
       ``(i) shall find--

       ``(I) that the agreement involved is necessary to ensure 
     the availability of countermeasures or products;
       ``(II) that the exemption from the antitrust laws would 
     promote the public interest; and
       ``(III) that there is no substantial competitive impact to 
     areas not directly related to the purposes of the agreement; 
     and

       ``(ii) may consider any other factors determined relevant 
     by the Attorney General and the Chairperson.
       ``(5) Limitation on and renewal of exemptions.--An 
     exemption granted under paragraph (4) shall be limited to 
     covered activities, and shall be renewed (with modifications, 
     as appropriate) on the date that is 3 years after the date on 
     which the exemption becomes effective (and at 3-year 
     intervals thereafter, if renewed) unless the Attorney General 
     in consultation with the Chairperson determines that the 
     exemption should not be renewed (with modifications, as 
     appropriate) considering the factors described in paragraph 
     (4).
       ``(6) Limitation on parties.--The use of any information 
     acquired under an exempted agreement by the parties to such 
     an agreement for any purposes other than those specified in 
     the antitrust exemption granted by the Attorney General shall 
     be subject to the antitrust laws and any other applicable 
     laws.
       ``(7) Guidelines.--The Attorney General and the Chairperson 
     may develop and issue guidelines to implement this 
     subsection.
       ``(8) Report.--Not later than 1 year after the date of 
     enactment of the Biodefense and Pandemic Vaccine and Drug 
     Development Act of 2005, and annually thereafter, the 
     Attorney General and the Chairperson shall report to Congress 
     on the use and continuing need for the exemption from the 
     antitrust laws provided by this subsection.
       ``(9) Status of memorandums.--Minutes maintained by the 
     Secretary or Director pursuant to paragraph (1)(D) shall not 
     be disclosed under section 552 of title 5, United States 
     Code, if the exemption is not renewed under paragraph (5), or 
     if meetings are no longer conducted, unless the Secretary or 
     Director, in consultation with the Attorney General, 
     determines that the disclosure would pose no threat to 
     national security. Such determination shall not be subject to 
     judicial review.
       ``(h) Sunset.--The authority of the Attorney General to 
     grant or renew a limited antitrust exemption under this 
     section shall expire at the end of the 6-year period that 
     begins on the date of enactment of the Biodefense and 
     Pandemic Vaccine and Drug Development Act of 2005.
       ``(i) Definitions.--In this section:
       ``(1) Antitrust laws.--The term `antitrust laws'--
       ``(A) has the meaning given such term in subsection (a) of 
     the first section of this Act, except that such term includes 
     the Act of June 19, 1936 (15 U.S.C. 13 et seq.) (commonly 
     known as the Robinson-Patman Act), and section 5 of the 
     Federal Trade Commission Act (15 U.S.C. 45) to the extent 
     such section 5 applies to unfair methods of competition; and
       ``(B) includes any State law similar to the laws referred 
     to in subparagraph (A).
       ``(2) Covered activities.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     the term `covered activities' means any group of activities 
     or conduct, including attempting to make, making, or 
     performing a contract or agreement or engaging in other 
     conduct, for the purpose of--
       ``(i) theoretical analysis, experimentation, or the 
     systematic study of phenomena or observable facts necessary 
     to the development of countermeasures or products;
       ``(ii) the development or testing of basic engineering 
     techniques necessary to the development of countermeasures or 
     products;

[[Page 22857]]

       ``(iii) the extension of investigative findings or theory 
     of a scientific or technical nature into practical 
     application for experimental and demonstration purposes, 
     including the experimental production and testing of models, 
     prototypes, equipment, materials, and processes necessary to 
     the development of countermeasures or products;
       ``(iv) the production, distribution, or marketing of a 
     product, process, or service that is a countermeasures or 
     products;
       ``(v) the testing in connection with the production of a 
     product, process, or services necessary to the development of 
     countermeasures or products;
       ``(vi) the collection, exchange, and analysis of research 
     or production information necessary to the development of 
     countermeasures or products; or
       ``(vii) any combination of the purposes described in 
     clauses (i) through (vi);

     and such term may include the establishment and operation of 
     facilities for the conduct of covered activities described in 
     clauses (i) through (vi), the conduct of such covered 
     activities on a protracted and proprietary basis, and the 
     processing of applications for patents and the granting of 
     licenses for the results of such covered activities.
       ``(B) Exception.--The term `covered activities' shall not 
     include the following activities involving 2 or more persons:
       ``(i) Exchanging information among competitors relating to 
     costs, profitability, marketing, or distribution of any 
     product, process, or service if such information is not 
     reasonably necessary to carry out the purposes of covered 
     activities.
       ``(ii) Entering into any agreement or engaging in any other 
     conduct--

       ``(I) to restrict or require the sale, licensing, or 
     sharing of inventions, developments, products, processes, or 
     services not developed through, produced by, or distributed 
     or sold through such covered activities; or
       ``(II) to restrict or require participation by any person 
     who is a party to such covered activities in other research 
     and development activities, that is not reasonably necessary 
     to prevent the misappropriation of proprietary information 
     contributed by any person who is a party to such covered 
     activities or of the results of such covered activities.

       ``(iii) Entering into any agreement or engaging in any 
     other conduct allocating a market with a competitor that is 
     not expressly exempted from the antitrust laws by a 
     determination under subsection (g)(4).
       ``(iv) Exchanging information among competitors relating to 
     production (other than production by such covered activities) 
     of a product, process, or service if such information is not 
     reasonably necessary to carry out the purpose of such covered 
     activities.
       ``(v) Entering into any agreement or engaging in any other 
     conduct restricting, requiring, or otherwise involving the 
     production of a product, process, or service that is not so 
     expressly exempted from the antitrust laws by a determination 
     under subsection (g)(4).
       ``(vi) Except as otherwise provided in this subsection, 
     entering into any agreement or engaging in any other conduct 
     to restrict or require participation by any person who is a 
     party to such activities, in any unilateral or joint activity 
     that is not reasonably necessary to carry out the purpose of 
     such covered activities.
       ``(vii) Entering into any agreement or engaging in any 
     other conduct restricting or setting the price at which a 
     product is offered for sale, whether by bid or otherwise.
       ``(4) Development.--The term `development' includes the 
     identification of suitable compounds or biological materials, 
     the conduct of preclinical and clinical studies, the 
     preparation of an application for marketing approval, and any 
     other actions related to preparation of a countermeasure or 
     product.''.

     SEC. 13. PROCUREMENT.

       Section 319F-2 of the Public Health Service Act (42 U.S.C. 
     247d-6b) is amended--
       (1) in the section heading, by inserting ``AND SECURITY 
     COUNTERMEASURE PROCUREMENTS'' before the period; and
       (2) in subsection (c)--
       (A) in the subsection heading, by striking ``Biomedical'';
       (B) in paragraph (5)(B)(i), by striking ``to meet the needs 
     of the stockpile'' and inserting ``to meet the stockpile 
     needs'';
       (C) in paragraph (7)(C)(ii)--
       (i) by amending clause (I) to read as follows:

       ``(I) Payment conditioned on delivery.--The contract shall 
     provide that no payment may be made until delivery of a 
     portion, acceptable to the Secretary, of the total number of 
     units contracted for, except that, notwithstanding any other 
     provision of law, the contract may provide that, if the 
     Secretary determines (as the Secretary's discretion) that an 
     advance payment, partial payment for significant milestones, 
     or payment to increase manufacturing capacity is necessary to 
     ensure success of a project, the Secretary shall pay an 
     amount, not to exceed 10 percent of the contract amount, in 
     advance of delivery. The contract shall provide that such 
     advance payment is required to be repaid if there is a 
     failure to perform by the vendor under the contract. The 
     contract may also provide for up to 3 additional advance 
     payments of 5 percent each for meeting the milestones 
     specified in such contract. Provided that the specified 
     milestones are reached, these advanced payments of 5 percent 
     shall not be required to be repaid. Nothing in this subclause 
     shall be construed as affecting the rights of vendors under 
     provisions of law or regulation (including the Federal 
     Acquisition Regulation) relating to the termination of 
     contracts for the convenience of the Government.''; and

       (ii) by adding at the end the following:

       ``(VII) Sales exclusivity.--The contract may provide that 
     the vendor is the sole and exclusive supplier of the product 
     to the Federal Government for a specified period of time, not 
     to exceed 15 years, on the condition that the vendor is able 
     to satisfy the needs of the Government. During the agreed 
     period of sales exclusivity, the vendor shall not assign its 
     rights of sales exclusivity to another entity or entities 
     without approval by the Secretary.
       ``(VIII) Surge capacity.--The contract may provide that the 
     vendor establish domestic manufacturing capacity of the 
     product to ensure that additional production of the product 
     is available in the event that the Secretary determines that 
     there is a need to quickly purchase additional quantities of 
     the product. Such contract may provide a fee to the vendor 
     for establishing and maintaining such capacity in excess of 
     the initial requirement for the purchase of the product. 
     Additionally, the cost of maintaining the domestic 
     manufacturing capacity shall be an allowable and allocable 
     direct cost of the contract.
       ``(IX) Contract terms.--The Secretary, in any contract for 
     procurement under this section, may specify--

       ``(aa) the dosing and administration requirements for 
     countermeasures to be developed and procured;
       ``(bb) the amount of funding that will be dedicated by the 
     Secretary for research and development of the countermeasure; 
     and
       ``(cc) the specifications the countermeasure must meet to 
     qualify for procurement under a contract under this 
     section.''; and
       (D) in paragraph (8)(A), by adding at the end the 
     following: ``Such agreements may allow other executive 
     agencies to order qualified and security countermeasures 
     under procurement contracts or other agreements established 
     by the Secretary. Such ordering process (including transfers 
     of appropriated funds between an agency and the Department of 
     Health and Human Services as reimbursements for such orders 
     for countermeasures) may be conducted under the authority of 
     section 1535 of title 31, United States Code, except that all 
     such orders shall be processed under the terms established 
     under the Biodefense and Pandemic Vaccine and Drug 
     Development Act of 2005 and the Project BioShield Act of 
     2004, for the procurement of countermeasures under section 
     319F-1 or 319F-2.''

     SEC. 14. NATIONAL PATHOLOGY CENTER.

       (a) In General.--Title IV of the Public Health Service Act 
     (42 U.S.C. 281 et seq.) is amended--
       (1) in section 401(b)(2), by adding at the end the 
     following:
       ``(H) The National Pathology Center.''; and
       (2) by adding at the end of part E (42 U.S.C. 287 et seq.) 
     the following:

                 ``Subpart 7--National Pathology Center

     ``SEC. 485A. ESTABLISHMENT OF NATIONAL PATHOLOGY CENTER.

       ``In order to provide pathology consultation for civilian 
     and military health professionals (including Department of 
     Veterans Affairs health professionals) there is established 
     the National Pathology Center (in this subpart referred to as 
     the `Center'). The Center shall be headed by a director, who 
     shall be appointed by the Secretary. The Director of the 
     Center shall report directly to the Director of NIH.

     ``SEC. 485B. PURPOSES AND FUNCTIONS OF THE CENTER.

       ``(a) Purposes of the Center.--The general purposes of the 
     Center are to--
       ``(1) conduct and support research, education, training, 
     and other programs with respect to the science and clinical 
     practice of pathology;
       ``(2) maintain and improve a pathology tissue repository; 
     and
       ``(3) provide pathology consultation services.
       ``(b) Activities of the Director.--In order to carry out 
     the purposes of the Center described in subsection (a), the 
     Director of the Center--
       ``(1) shall--
       ``(A) maintain and improve a comprehensive repository of 
     pathological specimens;
       ``(B) provide consultations on request regarding clinical 
     cases;
       ``(C) conduct educational programs and publish educational 
     materials on the science and clinical practice of pathology;
       ``(D) maintain and improve registries on such clinical 
     conditions as the Director of the Center determines 
     appropriate; and
       ``(E) conduct and support research on pathology; and
       ``(2) may--
       ``(A) collect reasonable and appropriate fees for the 
     activities described in paragraph (1)(B); and

[[Page 22858]]

       ``(B) conduct such other activities as the Director of the 
     Center determines appropriate to carry out the purposes 
     described in subsection (a).
       ``(c) Authority for Expert Opinions.--The Director of the 
     Center may enter into memoranda of understanding with 
     officials at the Department of Veterans Affairs and the 
     Department of Defense to provide expert second opinion 
     pathology consultations and pathology education or training 
     if the Secretary of either such Department determines that 
     such provision would be in the best interest of either of 
     their respective departments.

     ``SEC. 485C. BOARD OF REGENTS.

       ``(a) Membership.--
       ``(1) In general.--There is established a Board of Regents 
     of the Center (in this subpart referred to as the `Board') 
     consisting of--
       ``(A) the Surgeons General of--
       ``(i) the Public Health Service;
       ``(ii) the Army;
       ``(iii) the Navy; and
       ``(iv) the Air Force;
       ``(B) the Chief Medical Director of the Department of 
     Medicine and Surgery of the Department of Veterans Affairs;
       ``(C) the Deputy Director of the National Library of 
     Medicine;
       ``(D) the Assistant Secretary of Health of the Department 
     of Defense;
       ``(E) the Dean of the Uniformed Services University of the 
     Health Sciences; and
       ``(F) 11 members to be appointed by the Secretary from 
     among leaders in pathology research, education and clinical 
     practice.
       ``(2) Ex officio members.--The members of the Board 
     described in subparagraphs (A) through (E) of paragraph (1) 
     shall serve as ex officio members of the Board.
       ``(3) Chairperson.--The members of the Board appointed 
     under paragraph (1)(F) shall annually elect one of such 
     members to serve as the Chairperson of the Board until the 
     next election.
       ``(b) Duties of the Board.--It shall be the duty of the 
     Board to advise, consult with, and make recommendations to 
     the Director of NIH on important matters of policy in regard 
     to the Center, including such matters as the scope, content 
     and organization of the research, education and consultative 
     services provided by the Center. The Board shall make 
     recommendations to the Director of NIH regarding the rules 
     under which specimens from the tissue repository will be used 
     and under which it's publications, facilities and services 
     will be made available to various kinds of users.
       ``(c) Terms of Office.--Each appointed member of the Board 
     shall hold office for a term of 4 years, except that any 
     member appointed to fill a vacancy occurring prior to the 
     expiration of the term for which the predecessor of such 
     member was appointed shall be appointed for the remainder of 
     such term. None of the appointed members shall be eligible 
     for reappointment within 1 year after the end of the 
     preceding term of such member.
       ``(d) Compensation.--Appointed members of the Board who are 
     not otherwise in the employ of the United States, while 
     attending conferences of the Board or otherwise serving at 
     the request of the Secretary in connection with the 
     administration of the Board, shall be entitled to receive 
     compensation, per diem in lieu of subsistence, and travel 
     expenses in the same manner and under the same conditions as 
     that prescribed under section 208(c).

     ``SEC. 485D. GIFTS TO THE CENTER.

       ``Section 231 shall be applicable to the acceptance and 
     administration of gifts made for the benefit of the Center or 
     for carrying out any of its functions.

     ``SEC. 485E. CENTER FACILITIES.

       ``There are authorized to be appropriated amounts 
     sufficient for the erection and equipment of suitable and 
     adequate buildings and facilities for use of the Center. The 
     Administrator of General Services may acquire, by purchase, 
     condemnation, donation, or otherwise, a suitable site or 
     sites, selected by the Secretary in accordance with the 
     direction of the Board, for such buildings and facilities and 
     to erect thereon, furnish, and equip such buildings and 
     facilities. The amounts authorized to be appropriated by this 
     section include the cost of preparation of drawings and 
     specifications, supervision of construction, and other 
     administrative expenses incident to the work. The 
     Administrator of General Services shall prepare the plans and 
     specifications, make all necessary contracts, and supervise 
     construction.''.
       (b) Report.--Not later than 12 months after the date of 
     enactment of this Act, the Secretary of Health and Human 
     Services shall submit a report to the appropriate committees 
     of Congress that contains--
       (1) a review of all functions and duties of the National 
     Pathology Center under subpart 7 of part E of title IV of the 
     Public Health Service Act,as established by subsection (a);
       (2) areas where such functions and duties overlap with the 
     functions and duties of the National Institutes of Health; 
     and
       (3) recommendations concerning necessary modifications to 
     the National Pathology Center.
       (c) Transfer of the Armed Forces Institute of Pathology.--
       (1) In general.--
       (A) In general.--Except as provided in subparagraph (B), 
     there are transferred to the National Pathology Center 
     established under subpart 7 of part E of title IV of the 
     Public Health Service Act all functions, duties, personnel, 
     assets, liabilities, contracts, property, records, and 
     unexpended balances of appropriations of the Armed Forces 
     Institute of Pathology. The preceding sentence shall not 
     affect any proceedings, pending applications, suits, or other 
     actions pending on the date of enactment of this Act.
       (B) Exceptions.--The following components of the Armed 
     Forces Institute of Pathology shall not be transferred from 
     the Department of Defense pursuant to subparagraph (A):
       (i) The Armed Forces Medical Examiner.
       (ii) The Department of Defense DNA registry.
       (iii) Accident Investigation Program.
       (iv) The histopathology training program.
       (v) The patient safety center.
       (vi) Department of Legal Medicine.
       (vii) Center for Clinical Laboratory Medicine.
       (viii) Drug Testing and Quality Assurance Program.
       (ix) Subject to the discretion of the Secretary of Defense, 
     medical research programs on the following:

       (I) Body armor.
       (II) Environmental sarcoidosis.
       (III) Depleted uranium.
       (IV) Military working dogs.
       (V) Such other areas of research related to pathology as 
     the Secretary of Defense shall choose to conduct.

       (2) References.--Any reference in any Federal law, 
     Executive order, rule, regulation, or delegation of 
     authority, or any document of or relating to the Armed Forces 
     Institute of Pathology shall be deemed to be a reference to 
     the National Pathology Center established under subpart 7 of 
     part E of title IV of the Public Health Service Act.
                                 ______
                                 
      By Mrs. FEINSTEIN:
  S. 1874. A bill to amend title 28, United States Code, to clarify 
jurisdiction of Federal Courts over a tort action brought by an alien, 
and for other purposes; to the Committee on the Judiciary.
  Mrs. FEINSTEIN. Mr. President, I am pleased to introduce legislation 
that clarifies the meaning and scope of the Alien Tort Statute.
  This 200-year-old law has spawned dozens of legal cases involving 
U.S. multinational companies, human rights groups, foreign plaintiffs, 
the State Department, and millions of dollars in litigation costs. 
Numerous companies in California are in the midst of these lawsuits as 
defendants and it is my view that legislation can help refine and 
improve the law.
  Judges have grappled in interpreting and applying the statute for 
years now without a consensus view emerging. I think it would be fair 
to say that confusion reigns supreme when it comes to alien tort suits.
  Given this opaque legal picture, last summer the Supreme Court ruled 
on a case, Sosa v. Alvarez Machain, in an attempt to reconcile 
conflicting decisions from judges across the country.
  The Court's June 2004 ruling was notable, for embracing certain 
principles that will help guide the Judiciary branch on alien tort 
claim issues but for leaving many questions unanswered as well.
  It held that a substantive, legal basis exists for foreigners to sue 
U.S. individuals and corporations over alleged human rights violations 
occurring in overseas locations. The Court essentially affirmed that a 
limited, implicit sanction for courts exists to decide certain alien 
tort claims.
  At the same time, the opinion provided a wide berth for what the 
claims might actually be. The Court hedged on key issues, without 
clearly demarcating what suits ought to go forward under the statute 
and which ones should be summarily dismissed.
  In particular the ruling did not address: which international law 
claims by foreigners should be heard in a U.S. district court, and the 
standard of liability for U.S. companies facing these human rights 
charges.
  To clarify these areas, the Justices wrote that they would welcome 
``any congressional guidance'' on the breadth of the statute. During 
oral arguments a number of the Justices appeared to concur that a 
legislative approach would make sense. One Justice even commented that 
``I just wonder if it isn't wise to . . . let Congress have a look at 
this thing.''
  Those views were echoed by a Washington Post editorial that followed 
soon after. The paper stated that the

[[Page 22859]]

alien tort law has ``formed the basis for litigation against U.S. 
companies involved with nefarious regimes abroad. And while horrid 
conduct by an American company ought to be, where proven, grounds for 
action in American courts, the parameters of such litigation are surely 
a legislative question, not one for the freewheeling discretion of 
judges. . . . But the court left open the possibility that at least 
some of these suits can proceed in the absence of further congressional 
action.''
  The Court's perspective, along with the Post commentary, indicates, 
at least to me, a sense of caution about imposing by judicial fiat 
action that is better left to consideration and refinement by the 
Congress.
  The Court's hesitation to legislate from the bench shifts the 
responsibility to this body, I believe, to pass legislation that 
settles on a reasonable legal means that plaintiffs and defendants 
alike can rely on to litigate their differences.
  I believe the measure we are introducing today accomplishes this 
basic and important goal.
  Right now, courts are essentially adrift in terms of being able to 
pinpoint the underlying meaning, scope and intent of this 200-year-old 
statute. In its entirety, it reads: ``The district courts shall have 
original jurisdiction of any civil action by an alien for a tort only, 
committed in violation of the law of nations or a treaty of the United 
States.''
  The economy of words makes the law abstruse and subject to varying 
interpretation. And complex, lengthy and unnecessary litigation has 
burdened the courts as a result.
  This new bill will establish a fair, legal basis for filing suit 
under the Alien Tort Statute (ATS). And it will have the added benefit 
of explicating the law's dual jurisdictional and substantive nature.
  The measure: specifies a legal standard convicting defendants of 
wrongdoing if they directly participate with specific intent to commit 
the alleged tort; codifies international claims under the Alien Tort 
law to include genocide, torture, slavery and slave trade, 
extrajudicial killing, and piracy; expands on existing statutory law, 
the Torture Victim Protection Act; states that Federal courts shall not 
proceed with tort claims when the President adequately certifies that 
such exercise of jurisdiction will have a negative impact on the 
foreign policy interests of the U.S.; maintains that every effort 
should be made to try these cases in the country of origin before 
granting jurisdiction in U.S. courts; invokes a 10-year statute of 
limitations on ATS charges filed against U.S. multinational companies; 
and disallows contingency fee arrangements for legal representatives of 
plaintiffs or defendants.
  The Supreme Court's delineation that the Alien Tort law is 
jurisdictional in one sense, but recognizes a restricted category of 
substantive claims encompassed by the law of nations, leaves many 
unresolved questions.
  The historical origins of the ATS, passed by the First Congress as 
part of the Judiciary Act of 1789, suggest that certain offenses 
relevant to that period in American history--piracy, infringing the 
rights of ambassadors, and prevention of safe travel abroad--were meant 
to be prosecutable. But Justice Souter's Alvarez-Machain opinion notes 
that a slim legislative history of the statute makes it difficult to 
surmise the law's true intent.
  At the same time, Justice Souter opined: ``Still, the history does 
tend to support two propositions. First, there is every reason to 
suppose that the First Congress did not pass the ATS as a 
jurisdictional convenience to be placed on the shelf for use by a 
future Congress or state legislature that might, some day, authorize 
the creation of causes of action or itself decide to make some element 
of the law of nations actionable for the benefit of foreigners. The 
anxieties of the preconstitutional period cannot be ignored easily 
enough to think that the statute was not meant to have a practical 
effect. . . . The second inference to be drawn from the history is that 
Congress intended the ATS to furnish jurisdiction for a relatively 
modest set of actions alleging violations of the law of nations.''
  The opinion ranges further, that, such a ``modest set of actions'' 
indeed applies to current times, not merely offenses grounded in law 
two hundred years ago. The critical portion reads: ``Accordingly, we 
think courts should require any claim based on the present-day law of 
nations to rest on a norm of international character accepted by the 
civilized world and defined with specificity comparable to the features 
of the 18th century paradigms we have recognized.''
  I am uncomfortable with such a nebulous, open-ended legal approach 
permitting courts to entertain suits based on a ``norm of international 
character'' and ``specificity'' consistent with crimes of early 
American history. Adjudicating cases based on these broad historical 
and legal precepts is admirable. In practical terms it remains very 
difficult.
  The Congress ought to weigh in and play a constructive role. Without 
legislation, judges will continue to reach markedly different 
conclusions under the law, based on arbitrary interpretations of case-
specific facts and other considerations.
  Let's take the legal mystery out of the statute and what qualifies as 
an alien tort and replace it with something that is concrete and 
appropriate for the times.
  At the heart of this legislation is codifying a class of violations 
of international law that will discourage defendant companies from 
consorting with human rights violators in any respect. They will be 
held liable if they do so by a specific standard that judges whether 
they intentionally and directly caused certain violations of human 
rights.
  A plaintiff victim will be able to vindicate their rights by filing 
an express statutory cause of action based on a half dozen egregious 
wrongs. Regardless of the foreign policy and trade implications, 
defendant U.S. companies will be held fully accountable under the bill 
for bad corporate behavior in their overseas business operations.
  That is as it should be. Certain alien torts in violation of the law 
of nations ought to be cognizable and this legislation ensures that 
result. Moreover, the fact that specific crimes are made actionable and 
enforceable will aid human rights organizations in their fight to 
strengthen the deterrent effect of the law for potential violators.
  Regarding the defendant perspective, in one friend of the court brief 
submitted in the Alvarez Machain case, the argument was made that ``. . 
. companies face enormous uncertainty regarding the scope of potential 
claims under the statute. . . . Because ATS cases are based upon an 
implied cause of action without any clear standards of liability, there 
may be little companies can do to protect themselves against potential 
claims, short of simply ceasing to do business in the many nations 
whose human rights practices come up short against evolving Western 
ideals.''
  The business community ought to embrace this legislation precisely 
because it wipes away this uncertainty. The best way to encourage U.S. 
multinationals to invest abroad is: 1. by specifying a universe of the 
most egregious human rights violations that they may be held liable for 
and 2. offering a clear, understandable legal standard that judges 
their actions accordingly. This legislative measure tackles both issues 
head on.
  There are estimates that dozens of existing alien tort suits claim 
damages--collectively--in excess of $200 billion dollars. That's an 
extraordinary sum that rightly concerns the U.S. business community, 
particularly given numerous inconsistent federal courts verdicts handed 
down in the past two decades.
  This legislation deters private plaintiffs from filing sweeping and 
specious claims simply because a corporation has a U.S. legal nexus and 
deep pockets. Yet, it expands the basis for foreign plaintiffs pursuing 
certain international law causes of action in federal court by 
codifying their rights in a judicious way.
  While some in the U.S. business community would prefer that the Alien

[[Page 22860]]

Tort statute be deleted from the U.S. Code altogether, I would 
respectfully disagree. A fair compromise that balances the interests of 
U.S. companies and human rights organizations is what this legislation 
seeks to accomplish.
  The Congress has waded into this debate before, passing the Torture 
Victim Protection Act in 1991, and this new legislation contains many 
similar elements: a statute of limitations, a statutory exhaustion 
provision, and specifying torture and extrajudicial killing as within 
the adjudicatory discretion of a district court.
  There is precedent, then, for the Legislative branch acting to 
provide civil redress for victims of torture. Asserting 
extraterritorial jurisdiction under the ATS, for torture and other jus 
cogen violations, has a firm footing in American jurisprudence.
  The legislative history of the TVPA is important because it spells 
out the constitutional grounds justifying that statutory law and this 
new legislation as well.
  The Senate Judiciary Committee report on the TVPA states as follows: 
``Under article III of the Constitution, the Federal judiciary has the 
power to adjudicate cases `arising under' the `law of the United 
States.' The Supreme Court has held that the law of the United States 
includes international law. . . . Congress's ability to enact this 
legislation also derives from article I, section 8 of the Constitution 
which authorizes Congress `to define and punish . . . Offenses against 
the Law of Nations.'''
  Existing case law confirms the point that Congress has given the 
federal courts the power to interpret and apply international human 
rights law. The notable Paquete Habana decision states, in part, that 
``international law is part of our law, and must be ascertained and 
administered by the courts of justice of appropriate jurisdiction, as 
often as questions of right depending upon it are duly presented for 
their determination. . .  Congress, however, has not only expressed no 
disagreement with our view of the proper exercise of the judicial 
power, but has responded to its most notable instance by enacting 
legislation [the Torture Victim Protection Act] supplementing the 
judicial determination in some detail.''
  The view expressed in the Alvarez Machain case last year was much the 
same, that no development in the last two centuries has ``categorically 
precluded federal courts from recognizing a claim under the law of 
nations as an element of common law.''
  Different precedent, Tel Oren v. Libyan Arab Republic, also posits 
that civil liability should ensue from certain violations of 
international law, suggesting that the ``limits of section 1350's [the 
ATS] reach'' be defined by ``a handful of heinous actions--each of 
which violates definable, universal and obligatory norms.''
  This legislation fills that legal vessel with the most egregious 
crimes: genocide, torture, slavery and slave trading, extrajudicial 
killing, and piracy. These jus cogen offenses are singled out through 
1. stare decisis, 2. the Restatement (Third) of Foreign Relations Law, 
3. academic writings, 4. official annual human rights assessments from 
the State Department and 5. among the writings and publications of many 
human rights and international law advocacy groups.
  Congress is in the best position to make the determination of what 
falls within the ambit of the statute, not judges across America who 
lack expertise, time, and resources to assess what constitutes 
definable, specific, universal, and obligatory norms of international 
law. The bill, I would submit, represents a good faith effort in 
permitting these tortious acts, all firmly established and well defined 
in international law norms, to be prosecuted in U.S. district courts.
  I was interested to read the views last year of the head of the 
National Foreign Trade Council, William Reinsch, that ``these cases are 
going to end up in the Supreme Court . . . and the Court will over time 
end up defining what in its judgment constitutes the law of nations and 
what does not. But that seems to us a fairly circuitous way of doing 
things.'' I would concur, particularly since the Supreme Court's 
decision last year in the Alvarez Machain case did not clear up the 
inherent vagaries in the law.
  A significant provision in this legislation creates a standard of 
liability that requires plaintiffs to show that a defendant directly 
participated with specific intent in carrying out the alleged tort. In 
my view, we need to deter legal fishing expeditions, whereby plaintiffs 
come to the bar with flinty facts backing weak charges. Their real 
intent, it seems, is to rely on an extensive legal discovery process to 
uncover matters that embarrass companies and delay their business 
plans.
  In the groundbreaking 1980 Filartiga v. Pena-Irala case, for example, 
the threshold requirement laid out was that the offense needed to be 
``clear and unambiguous'' to be viable under the statute. Succeeding 
cases have affirmed a standard essentially requiring proof of a 
defendant aiding and abetting the worst human rights violations. This 
bill replaces the current aiding and liability standard for good 
reason: these foreign-based claims demand a particularity of facts that 
is both strong and specific.
  I would submit that the existing ambiguous grant of jurisdiction 
needs more refinement to provide judges legal bright lines for deciding 
these cases. My bill offers precise, and fair, treatment for which 
cases get standing in a U.S. court.
  A common theme in dozens of cases alien tort cases is whether the 
facts and law combine to present a nonjusticiable political question. 
Each cause of action is obviously different, and whether the matter 
ought to be under the province of a different branch of government 
requires careful analysis.
  I would certainly agree that certain prudential doctrines, act of 
state, political question, foreign sovereign immunity, forum non 
conveniens, and considerations of comity among nations, at times can be 
appropriately invoked to limit jurisdiction.
  Part of that consideration can usefully come from statements of 
interest and certifications submitted by the Executive branch; for that 
reason, the legislation I'm offering preserves a suitable role for the 
Executive branch to weigh in. If a judge determines that a 
certification offered by the State Department adequately justifies that 
harm will come to U.S. foreign policy interests if an alien tort suit 
proceeds, then dismissal is warranted.
  In regards to restricting the statute of limitations to ten years, 
equitable tolling considerations should be explicitly considered in 
interpreting provisions in the legislation. There are numerous factors 
that give rise to equitable tolling and long-established judge-made 
doctrine in this area is not inconsistent with the goals of my bill.
  Complementary legislation which I raised earlier, the Torture Victim 
Protection Act, upholds the principle of equitable tolling. The 
Judiciary Committee report on that measure notes some common examples:
  ``The statute of limitation should be tolled during the time the 
defendant was absent from the United States or from any jurisdiction in 
which the same or a similar action arising from the same facts may be 
maintained by the plaintiff, provided that the remedy in that 
jurisdiction is adequate and available. Excluded also from calculation 
of the statute of limitations would be the period when a defendant has 
immunity from suit. The statute of limitations should also be tolled 
for the period of time in which the plaintiff is imprisoned or 
otherwise incapacitated.''
  I would submit that all of these listed circumstances, and others, 
are sufficient to suspend the running of the time under my legislation.
  Let me conclude by referring back to one of the Supreme Court's 
founda-
tional points in the Alvarez-Machain case that ``despite considerable 
scholarly attention, it is fair to say that a consensus understanding 
of what Congress intended has proven elusive.''
  The 33 words contained in the law remain a ``legal Lohengrin'' since 
``no one seems to know whence it came''

[[Page 22861]]

added a judge hearing a different case some years ago. As a result, 
costly, complex litigation proceeds forward across the country.
  Courts deserve guidance from Congress about how to treat and 
interpret the statute, particularly in light of the growing importance 
of international trade and commerce. In a major address Supreme Court 
Justice O'Connor recently observed that ``international law has emerged 
in ways that affect all courts, both here and abroad. The reason is 
globalization. Its importance should not be underestimated. Thirty 
percent or more of our gross domestic product is internationally 
derived.'' Yet these particular suits, brought by foreigners for 
massive monetary damages, threaten the international economic 
activities that are important to sustaining the American economy.
  The suits should be able to go forward, but judges need better legal 
tools to make heads or tails of the cases that come before them hence 
the motivation for introducing the Alien Tort Statute Reform Act.
  With full understanding of the Supreme Court's admonition to act with 
judicial caution in framing the alien tort statute, I believe it is 
time for Congress to bring clarity to the law and this proposed 
legislation does so.
  I look forward to working with colleagues on the Judiciary Committee, 
through the hearing process and other means, to give this matter 
serious consideration by the Legislative branch.
  I ask unanimous consent that the text of the legislation be printed 
in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1874

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Alien Tort Statute Reform 
     Act''.

     SEC. 2. SUITS BY ALIENS.

       Section 1350 of title 28, United States Code, is amended to 
     read as follows:

     ``Sec. 1350. Alien's action for tort

       ``(a) Jurisdiction of District Courts.--The district courts 
     shall have original and exclusive jurisdiction of any civil 
     action brought by an alien asserting a claim of torture, 
     extrajudicial killing, genocide, piracy, slavery, or slave 
     trading if a defendant is a direct participant acting with 
     specific intent to commit the alleged tort. The district 
     courts shall not have jurisdiction over such civil suits 
     brought by an alien if a foreign state is responsible for 
     committing the tort in question within its sovereign 
     territory.
       ``(b) Definitions.--For the purposes of this section:
       ``(1) Defendant.--The term `defendant' means any person 
     subject to the jurisdiction of the district courts of the 
     United States, including--
       ``(A) a United States citizen;
       ``(B) a natural person who is a permanent resident of the 
     United States;
       ``(C) a natural person who resides in the United States; or
       ``(D) a partnership, corporation, or other legal entity 
     organized under the laws of the United States or of a foreign 
     state.
       ``(2) Foreign state.--The term `foreign state' has the 
     meaning given that term in section 1603 of title 28, United 
     States Code.
       ``(3) Extrajudicial killing.--The term `extrajudicial 
     killing'--
       ``(A) means a deliberated killing, which--
       ``(i) notwithstanding the jurisdictional limitations 
     referred to in subsection (a), is carried out by an 
     individual under actual or apparent authority, or color of 
     law, of any foreign state;
       ``(ii) is directed against another individual in the 
     offender's custody or physical control; and
       ``(iii) is not authorized by a previous judgment pronounced 
     by a regularly constituted court affording all the judicial 
     guarantees which are recognized as indispensable by civilized 
     peoples; and
       ``(B) does not include any such killing that, under 
     international law, is lawfully carried out under the 
     authority of a foreign state.
       ``(4) Genocide.--The term `genocide' means, whether in time 
     of peace or in time of war, an act carried out, or an attempt 
     to carry out an act, with the specific intent to destroy, in 
     whole or in substantial part, a national, ethnic, racial, or 
     religious group as such, which--
       ``(A) kills members of that group;
       ``(B) causes serious bodily injury to members of that 
     group;
       ``(C) causes the permanent impairment of the mental 
     faculties of members of the group through drugs, torture, or 
     similar techniques;
       ``(D) subjects the group to conditions of life that are 
     intended to cause the physical destruction of the group in 
     whole or in part;
       ``(E) imposes measures intended to prevent births within 
     the group; or
       ``(F) transfers by force children of the group to another 
     group.
       ``(5) Piracy.--The term `piracy' means--
       ``(A) any illegal acts of violence or detention, or any act 
     of depredation, committed for private ends by the crew or the 
     passengers of a private ship or a private aircraft, and 
     directed--
       ``(i) on the high seas, against another ship or aircraft, 
     or against persons or property on board such ship or 
     aircraft; or
       ``(ii) against a ship, aircraft, persons, or property in a 
     place outside the jurisdiction of any country;
       ``(B) any act of voluntary participation in the operations 
     of a ship or of an aircraft with knowledge of facts making it 
     a pirate ship or aircraft; or
       ``(C) any act of inciting or of intentionally facilitating 
     an act described in subparagraph (A) or (B).
       ``(6) Slave trading.--The term `slave trading' includes--
       ``(A) all acts involved in the capture, acquisition, or 
     disposal of a person with intent to reduce such person to 
     slavery;
       ``(B) all acts involved in the acquisition of a slave with 
     a view to selling or exchanging such slave;
       ``(C) all acts of disposal by sale or exchange of a slave 
     acquired with a view to being sold or exchanged; and
       ``(D) in general, every act of trade or transport of 
     slaves.
       ``(7) Slavery.--The term `slavery' means the status or 
     condition of a person over whom any or all of the powers 
     attaching to the right of ownership are exercised.
       ``(8) Torture.--
       ``(A) In general.--Notwithstanding the jurisdictional 
     limitations referred to in subsection (a), the term `torture' 
     means any act, carried out by an individual under actual or 
     apparent authority, or color of law, of any foreign state, 
     directed against another individual in the offender's custody 
     or physical control, by which severe pain or suffering (other 
     than pain or suffering arising only from or inherent in, or 
     incidental to, lawful sanctions), whether physical or mental, 
     is intentionally inflicted on that individual for such 
     purposes as obtaining from that individual or a third person 
     information or a confession, punishing that individual for an 
     act that individual or a third person has committed or is 
     suspected of having committed, intimidating or coercing that 
     individual or a third person, or for any reason based on 
     discrimination of any kind.
       ``(B) Mental pain or suffering.--In subparagraph (A), 
     mental pain or suffering refers to prolonged mental harm 
     caused by or resulting from--
       ``(i) the intentional infliction or threatened infliction 
     of severe physical pain or suffering;
       ``(ii) the administration or application, or threatened 
     administration or application, of mind altering substances, 
     or other procedures calculated to disrupt profoundly the 
     senses or the personality;
       ``(iii) the threat of imminent death; or
       ``(iv) the threat that another individual will imminently 
     be subjected to death, severe physical pain or suffering, or 
     the administration or application of mind altering substances 
     or other procedures calculated to disrupt profoundly the 
     senses or personality.
       ``(c) Liability for Damages.--Any defendant who is a direct 
     participant acting with specific intent to commit a tort 
     referred to in subsection (a) against an alien shall be 
     liable for damages to that alien or to any person who may be 
     a claimant in an action for the wrongful death of that alien.
       ``(d) Exhaustion of Remedies.--A district court shall 
     abstain from the exercise of jurisdiction over a civil action 
     described in subsection (a) if the claimant has not exhausted 
     adequate and available remedies in the place in which the 
     injury occurred. Adequate and available remedies include 
     those available through local courts, claims tribunals, and 
     similar legal processes.
       ``(e) Foreign Policy Interests of the United States.--No 
     court in the United States shall proceed in considering the 
     merits of a claim under subsection (a) if the President, or a 
     designee of the President, adequately certifies to the court 
     in writing that such exercise of jurisdiction will have a 
     negative impact on the foreign policy interests of the United 
     States.
       ``(f) Procedural Requirements.--
       ``(1) Specificity.--In any action brought under this 
     section, the complaint shall state with particularity 
     specific facts that--
       ``(A) describe each tort alleged to have been committed and 
     demonstrate the reason or reasons why the tort action may be 
     brought under this section, provided that if an allegation is 
     made on information and belief, the complaint shall state 
     with particularity all facts on which that belief is formed; 
     and
       ``(B) demonstrate that the defendant had the specific 
     intent to commit the tort alleged to have been committed.
       ``(2) Motion to dismiss.--In any action brought under this 
     section, the court shall, on the motion of any defendant, 
     dismiss the

[[Page 22862]]

     complaint if the requirements of subparagraphs (A) and (B) of 
     paragraph (1) are not met.
       ``(3) Stay of discovery.--In any action brought under this 
     section, all discovery related to the merits of the claim and 
     other proceedings shall be stayed during the pendency of any 
     motion to dismiss, unless the court finds upon the motion of 
     any party that particularized discovery is necessary to 
     preserve evidence or to prevent undue prejudice to that 
     party.
       ``(4) Plaintiff identity.--
       ``(A) Requirement.--Subject to subparagraph (B), in any 
     action brought under this section, the first and last names 
     of all plaintiffs shall be disclosed in the complaint filed 
     with the court.
       ``(B) Exception.--A court may permit an anonymous filing of 
     a complaint if a plaintiff's life or safety would be 
     endangered by publicly disclosing the plaintiff's identity.
       ``(g) Fees.--Contingency fee arrangements are prohibited in 
     any action brought under the jurisdiction provided in this 
     section.
       ``(h) Statute of Limitations.--No action shall be 
     maintained under this section unless it is commenced not 
     later than 10 years from the date the injury occurred.
       ``(i) Application of Other Laws.--Nothing in this section 
     may be construed to waive or modify the application of any 
     provision of the Class Action Fairness Act of 2005 (Public 
     Law 109-2; 119 Stat. 4) and any amendment made by that Act, 
     or of title 28, United States Code, to any class action law 
     suit brought under this section.''.
                                 ______
                                 
      By Mr. BINGAMAN:
  S. 1875. A bill to provide financial aid to local law enforcement 
officials along the Nation's borders, and for other purposes; to the 
Committee on the Judiciary.
  Mr. BINGAMAN. Mr. President, I rise today to introduce the Border Law 
Enforcement Relief Act of 2005. This bill will provide local law 
enforcement in border communities with much needed assistance in 
combating border-related criminal activity. For far too long, law 
enforcement agencies operating along the border have had to incur 
significant costs due to the inability of the Federal Government to 
secure our Nation's borders. It is time that the Federal Government 
recognizes that border communities should not have to bear this burden 
alone.
  The bill I am introducing today is aimed at enhancing security in the 
border region by giving law enforcement agencies the manpower and 
resources they need to combat border-related crimes. Specifically, the 
bill would establish a competitive grant program within the Department 
of Homeland Security to help local law enforcement situated along the 
border cover some of the costs they incur as a result of dealing with 
illegal immigration, drug trafficking, stolen vehicles, and other 
border-related crimes, and authorizes $30 million a year to carry out 
the program. Funds allocated under the grant program could be used to 
hire additional personnel, obtain necessary equipment, upgrade law 
enforcement technology, and cover overtime and transportations costs.
  Law enforcement agencies serving communities within 100 miles of the 
U.S. border with Mexico or Canada, as well as any other agencies 
located outside of this geographical limit located in an area which has 
been designated by the Secretary of Homeland Security as a ``High 
Impact Area,'' would be eligible to apply for the grants. Priority in 
awarding grants would go to law enforcement agencies serving 
communities with populations under 50,000. Two-thirds of the funds 
would be set aside for the six states with the highest alien 
apprehension rates and one-third for areas designated as ``High Impact 
Areas.''
  It is the responsibility of the Federal Government to adequately 
secure the Nation's borders and prevent the flow of undocumented 
persons and illegal drugs into the country. Despite the fact that the 
Border Patrol apprehends over 1 million people each year trying to 
illegally enter the United States, the number of illegal aliens in the 
United States continues to rise as thousands of individuals enter the 
country through our porous borders. The border region is also a major 
corridor for the shipment of drugs--according to the El Paso 
Intelligence Center, 65 percent of the narcotics that are sold in the 
United States enter the country through the Southwest border.
  By virtue of their proximity to an international border, many of 
adverse consequences of the failure of the Federal Government to 
adequately secure the border fall on the border communities. In 
traveling around the New Mexico-Mexico border region, I have heard 
repeatedly how drug trafficking, kidnappings, human smuggling, and the 
destruction of private property, such as the tearing down ranchers' 
cattle fences, are impacting our communities.
  The United States shares 5,525 miles of border with Canada and 1,989 
miles with Mexico. Many of the local law enforcement agencies located 
along the border are small, rural departments charged with patrolling 
large areas of land with few officers and very limited resources. 
Counties along the Southwest border are some of the poorest in the 
country and are not in the position to cover the additional costs 
associated with illegal immigration, drug trafficking, and other 
border-related crimes.
  According to a 2001 study by the United States-Mexico Border Counties 
Coalition, local law enforcement and criminal justice costs associated 
with illegal immigration exceed $89 million every year. The States of 
Arizona and New Mexico have declared states of emergency in order to 
provide local law enforcement with immediate assistance in addressing 
criminal activity along the border. It is time that the Federal 
Government step up and share some of this burden.
  We are making some headway in terms of increasing the number of 
Border Patrol agents along the border. Despite the fact that the 
administration only requested funding to hire an additional 210 Border 
Patrol agents in its 2006 Budget Request, Congress has appropriated 
enough funding to hire and train an additional 1,500 agents. We are 
making some progress, and I am pleased that additional agents have been 
sent to New Mexico, but we must face the reality that much more needs 
to be done and we are a long way off from securing our borders and 
preventing the illegal flow of drugs and undocumented person into this 
country. I believe that this is an area that Congress can, and should, 
be doing more.
  We need more Border Patrol agents, better technology, and a 
comprehensive strategy to meet our security needs. We also need to 
reform our broken immigration system so we are able to more effectively 
target those who pose a threat to our country. However, we must also 
remember the role local law enforcement play in responding to criminal 
activity that occurs in the border region. Increasing funding for local 
law enforcement will help border communities alleviate some of these 
problems and enhance security in the border region.
  Federal assistance is desperately needed to help border law 
enforcement agencies address the unique challenges that arise from 
being situated along an international border and the lack of overall 
border security. I urge my colleagues to lend their support to this 
important bill and give law enforcement the resources they need to meet 
these challenges.
                                 ______
                                 
      By Mr. AKAKA:
  S. 1878. A bill to prohibit predatory payday loans, and for other 
purposes; to the Committee on Banking, Housing, and Urban Affairs.
                                 ______
                                 
      By Mr. AKAKA:
  S. 1879. A bill to amend title 11, United States Code, to limit 
claims in bankruptcy by certain unsecured creditors; to the Committee 
on the Judiciary.


                    Bankruptcy Reform Implementation

  Mr. AKAKA. Mr. President, I opposed the bankruptcy reform bill 
because it was an outdated bill that failed to include adequate 
consumer protections. We saw a record number of consumer bankruptcy 
filing prior to the October 17 implementation deadline for the harsh 
new bankruptcy. Not enough was included in the legislation to protect 
consumers from predatory lenders or to make credit counseling a viable 
alternative to bankruptcy or to better inform over extended consumers 
about the true costs of their debts. I was disappointed that the Senate 
failed to effectively address these issues in a

[[Page 22863]]

meaningful way, and instead, passed an outdated bill that forces 
working families into more costly and difficult bankruptcy proceedings. 
I am committed to making improvements in this flawed law.
  Today, I am introducing two bills that address flaws in the 
bankruptcy reform law. The first bill is the Predatory Payday Loan 
Prohibition Act. This bill would prevent federally-insured financial 
institutions from originating predatory payday loans. Payday loans are 
small cash loans repaid by borrowers' postdated checks or borrowers' 
authorizations to make electronic debits against existing financial 
accounts. Payday loan amounts are usually in the range of $100 to $500 
with full payment due in 2 weeks. Finance charges on payday loans are 
typically in the range of $15 to $30 per $100 borrowed, which 
translates into triple digit interest rates in the range of 390 percent 
to 780 percent when expressed as an annual percentage rate. Loan 
flipping, which is a common practice, is the renewing of loans at 
maturity by paying additional fees without any principal reduction. 
Loan flipping often leads to instances where the fees paid for a payday 
loan well exceed the principal borrowed. This situation often creates a 
cycle of debt that is hard to break.
  Industry analysts conservatively estimate that more than 15,000 
payday advance locations across America extend about $25 billion in 
short-term credit to millions of households experiencing cash-flow 
shortfalls. Too many of its customers are low-income, working families. 
More and more customers are the financially stretched middle class, 
including people who have maxed out their credit cards, people perhaps 
who have lost a job, or people with no savings to fall back on during a 
situation that causes a cash-flow shortfall, such as a medical 
emergency.
  Payday lending is also rampant in the military. One in five 
servicemembers have used payday lenders in the last year, according to 
the report, ``Payday Lenders Target the Military,'' by the Center for 
Responsible Lending. Payday lenders exploit people in financial need 
and profit enormously from these loans. We must act to protect 
vulnerable consumers from these predatory lenders.
  In addition, I previously introduced S. 1347, the Low-Cost 
Alternatives to Payday Loans Act. This bill would authorize award 
demonstration project grants for eligible entities to provide consumers 
with low-cost, small loan alternatives to more costly and predatory 
payday loans. Loan alternatives that meet the needs of consumers and 
are at a fair price must be developed.
  Today, I am also introducing the Bankruptcy Prevention Credit 
Counseling Act. The new bankruptcy reform law does not allow consumers 
to declare personal bankruptcy in either chapter 7 or chapter 13, 
unless they receive a briefing from an approved nonprofit credit 
counseling agency within 6 months of filing. The credit counseling 
instructional course requirement is intended to provide financial 
education to consumers who declare bankruptcy so they can attempt to 
avoid future financial problems.
  About one in three consumers in credit counseling enter a debt 
management plan. In exchange, creditors may agree to concessions so 
that consumers pay off as much of their outstanding debt as possible. 
Examples of concessions can include a reduced interest rate on the 
amount they owe and the elimination of fees. Unfortunately, most credit 
card companies have become increasingly unwilling to significantly 
reduce interest rates for consumers in credit counseling.
  The Bankruptcy Prevention Credit Counseling Act would prevent 
unsecured creditors, primarily credit card issuers, from attempting to 
collect accruing interest and additional fees from consumers in 
bankruptcy, if the creditor does not have a policy of waiving interest 
and fees for debtors who enter a consolidated payment plan at a credit 
counseling agency. Since the new bankruptcy law requires that consumers 
enter credit counseling before filing for bankruptcy, we must ensure 
that consumers are given a fair chance at reducing their debt burden.
  I also offered the text of the amendment of my bill, S. 393, the 
Credit Card Minimum Payment Warning Act, as an amendment to the 
bankruptcy bill. My amendment, intended to provide consumers with 
adequate, timely, and meaningful disclosures, was unfortunately 
defeated. As the bankruptcy reform law makes it more difficult for 
consumers to discharge their debts in bankruptcy, we have a 
responsibility to provide meaningful additional information so that 
consumers can make better informed debt management decisions. The 
bankruptcy reform law includes a requirement that credit card issuers 
provide a generic warning about the consequences of only making the 
minimum payment. This requirement fails to provide consumers the 
detailed information that my amendment would have provided, which means 
detailed, personalized information necessary for them to make better 
informed choices about their credit card use and repayment. My 
amendment would have required companies to inform consumers of how many 
years and months it would take to repay their entire balance, and the 
total cost in interest and principal, if the consumer makes only the 
minimum payment. My legislation would also have required consumers to 
be provided with the amount they would need to pay to eliminate their 
outstanding balance in 36 months. Finally, my legislation would have 
required that creditors establish a toll-free number so that consumers 
can access trustworthy credit counselors. In response to criticisms 
that my amendment was not feasible, I, along with Senator Sarbanes, 
requested that the Government Accountability Office study the issue. I 
am hopeful the report will provide helpful information as we must 
continue to improve meaningful and understandable disclosures that will 
help Americans better manage their credit card debts.
  I want to take a moment to thank Senator Sarbanes, and his Banking 
Committee staff, for working with me on this and many other financial 
literacy related issues. In addition, I also want to thank Senator 
Leahy and the staff of the Judiciary Committee for all of their efforts 
to try and improve the flawed bankruptcy legislation.
  I fear that the bankruptcy reform law will significantly harm 
families who have suffered financially due to illnesses, the loss of a 
job, or the death of a loved one. I remain committed to working with 
all of my colleagues to better protect and inform consumers and to hold 
the credit card industry accountable for its aggressive marketing of 
credit to our debt burdened society.
  Mr. AKAKA. Mr. President, I rise to introduce the Predatory Payday 
Loan Prohibition Act of 2005. Currently, federal law authorizes insured 
depository institutions to export interest rates, as provided under the 
laws of the state where the bank or credit union is located, to out-of-
state borrowers. My bill would effectively eliminate the ability of 
financial institutions to do this by prohibiting federally-insured 
financial institutions from originating predatory payday loans.
  What constitutes a payday loan? These are small cash loans repaid by 
borrowers' postdated checks or borrowers' authorizations to make 
electronic debits against existing financial accounts. Payday loan 
amounts are usually in the range of $100 to $500 with payment in full 
due in two weeks. Finance charges on payday loans are typically in the 
range of $15 to $30 per $100 borrowed, which translates into triple 
digit interest rates in the range of 390 percent to 780 percent when 
expressed as an annual percentage rate. Loan flipping, which is a 
common practice, is the renewing of loans at maturity by paying 
additional fees without any principal reduction. Loan flipping often 
leads to instances where the fees paid for a payday loan well exceed 
the principal borrowed. This situation often creates a cycle of debt 
that is hard to break. Today, industry analysts conservatively estimate 
that more than 15,000 payday advance locations across America extend 
about $25 billion in short-term credit to millions of households 
experiencing cash-flow shortfalls.

[[Page 22864]]

  I am appalled that the payday lending industry is portrayed as a 
legitimate business. Too many of its customers are low-income, working 
families. More and more customers are the financially stretched middle 
class including people who have maxed out their credit cards, people 
perhaps who have lost a job, or people with no savings to fall back on 
during a situation that causes a cash-flow shortfall, such as a medical 
emergency. Payday lending is also rampant in the military. One in five 
servicemembers have used payday lenders in the last year, according to 
the report, ``Payday Lenders Target the Military,'' by the Center for 
Responsible Lending. Payday lenders are concentrated around military 
bases, such as the Navy bases in Norfolk, Virginia, the Army's Fort 
Lewis in Washington State, and the Marine Corps base at Camp Pendleton 
in California. The Department of Defense confirms the Center's report 
by listing payday lending as one of the top 10 priority issues facing 
military families, according to Dr. David Chu, the Under Secretary of 
Defense for Personnel and Readiness. To the predatory lenders, our 
military personnel's government paychecks represent a reliable source 
of fees. Also, payday lenders can be relatively confident that 
borrowers will continue to pay, because military personnel face harsh 
consequences, such as court martial or dishonorable discharge, for not 
repaying their debts. I am pleased that in my home state a local credit 
union, Windward Community Federal Credit Union, Kailua, Hawaii, has 
developed an affordable, alternative product to offer the many Marines 
who live in its service area. Earlier this year I introduced another 
bill to encourage replication of such practices. S. 1347, the Low-Cost 
Alternatives to Payday Loans Act, would authorize demonstration project 
grants to eligible entities to provide low-cost, small loans to 
consumers that would provide alternatives to more costly, predatory 
payday loans so that more people could have access to payday loan 
alternatives.
  Payday loan providers claim that they are offering a simple financial 
product that addresses an emergency or temporary credit need that 
usually cannot be met by traditional financial institutions. An 
analysis of payday lending statistics by the Center for Responsible 
Lending indicates that the majority of payday loan borrowers have 
multiple loans each year with two thirds having five or more payday 
loans annually and half of these borrowers having 12 or more payday 
loans annually. Some borrowers seek loans from two or more payday 
lenders, multiplying the potential for getting trapped in debt. 
Research by the Community Financial Services Association of America, 
the payday loan industry's national trade association, found that 40 
percent of payday loan customers renew their payday loans a staggering 
five times or more.
  The payday loan industry exploits people that are in financial need. 
Congress has failed to act to prevent the exploitation of working 
families that are short on cash due to unexpected medical expenses or 
other needs. We must act to protect consumers from these unscrupulous 
lenders. I remain committed to restricting all forms of predatory 
lending, including payday loans, and I encourage my colleagues to 
support this legislation.
  Mr. President, I ask unanimous consent that the text of the bill and 
a letter of support be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                S. 1878

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Predatory Payday Loan 
     Prohibition Act of 2005''.

     SEC. 2. PROHIBITION ON CREDITORS MAKING PAYDAY LOANS.

       The Truth in Lending Act (15 U.S.C. 1601 et seq.) is 
     amended by inserting after section 109 the following:

     ``SEC. 110. PROHIBITION ON PAYDAY LOANS.

       ``(a) In General.--A creditor may not make a payday loan to 
     any person, if the creditor knows or has reasonable cause to 
     believe that--
       ``(1) the personal check or share draft that the creditor 
     receives from the person in exchange for the loan is drawn on 
     an insured depository institution or an insured credit union; 
     or
       ``(2) the account that will be debited in exchange for the 
     loan is a transaction account or share draft account at an 
     insured depository institution or an insured credit union.
       ``(b) Definitions.--In this section, the following 
     definitions shall apply:
       ``(1) Insured institutions.--The terms `insured depository 
     institution' and `insured credit union' have the meanings 
     given those terms in section 3 of the Federal Deposit 
     Insurance Act and section 101 of the Federal Credit Union 
     Act, respectively.
       ``(2) Payday loan.--The term `payday loan' means any 
     transaction in which a short-term cash advance is made to a 
     consumer in exchange for--
       ``(A) the personal check or share draft of the consumer, in 
     the amount of the advance plus a fee, where presentment or 
     negotiation of such check or share draft is deferred by 
     agreement of the parties until a designated future date; or
       ``(B) the authorization of a consumer to debit the 
     transaction account or share draft account of the consumer, 
     in the amount of the advance plus a fee, where such account 
     will be debited on or after a designated future date.''.

     SEC. 3. PROHIBITION ON INSURED DEPOSITORY INSTITUTIONS MAKING 
                   PAYDAY LOANS.

       Section 18 of the Federal Deposit Insurance Act (12 U.S.C. 
     1828) is amended by adding at the end the following:
       ``(x) Prohibition on Certain Unsafe and Unsound Banking 
     Practices.--
       ``(1) In general.--An insured depository institution may 
     not--
       ``(A) make any payday loan, either directly or indirectly; 
     or
       ``(B) make any loan to any other lender for purposes of 
     financing a payday loan or refinancing or extending any 
     payday loan.
       ``(2) Payday loan defined.--For purposes of this 
     subsection, the term `payday loan' means any transaction in 
     which a short-term cash advance is made to a consumer in 
     exchange for--
       ``(A) the personal check or share draft of the consumer, in 
     the amount of the advance plus a fee, where presentment or 
     negotiation of such check or share draft is deferred by 
     agreement of the parties until a designated future date; or
       ``(B) the authorization of the consumer to debit the 
     transaction account or share draft account of the consumer, 
     in the amount of the advance plus a fee, where such account 
     will be debited on or after a designated future date.''.
                                  ____

                                                  October 6, 2005.
     Hon. Daniel K. Akaka,
     U.S. Senate,
     Washington, DC.
       Dear Senator Akaka: Consumer Federation of America, 
     Community Reinvestment Association of NC, Consumer Action, 
     Consumers Union, National Community Reinvestment Coalition, 
     National Consumer Law Center and U.S. PIRG applaud you for 
     sponsoring legislation to prohibit lending based on checks or 
     debits drawn on federally insured depository institutions. 
     You have recognized that it is an unsafe banking practice for 
     consumers to be enticed by payday lenders to write checks or 
     authorize debits when there is no money on deposit to cover 
     these cash advances. We are also pleased that your bill would 
     prohibit banks from partnering with payday lenders, a tactic 
     used by storefront lenders to evade state small loan and 
     usury laws.
       The ``Predatory Payday Loan Prohibition Act of 2005'' 
     prohibits the relatively new practice of holding a check as 
     security for a loan. Using the check as security for the 
     payment of a payday loan is the key to the coercive 
     collection tactics used by the lenders. As the lender holds 
     the check, at the end of the short term loan, the consumer is 
     generally forced to choose among three untenable options: 1) 
     allowing the check to be debited from their bank account 
     where it will deplete money needed for food and other living 
     necessities, 2) allowing the check to bounce, exposing the 
     borrower to coercive collection tactics when lenders threaten 
     civil or criminal liability for unpaid checks, and from the 
     risk of losing their bank account or checkwriting privileges, 
     or 3) renewing the loan at the original high cost. Loans 
     based on personal checks drawn on the borrower's bank account 
     that will be deposited to repay the loan on the next payday 
     is the modern version of lending secured by wage assignments, 
     a credit practice long recognized as inherently unfair which 
     violates FTC rules.
       Your legislation also stops payday lenders from partnering 
     with federally insured depository institutions to evade state 
     usury or small loan rate caps. A few federally insured state 
     chartered banks persist in ``renting'' their charters to 
     payday lenders, a practice curtailed by most federal bank 
     regulators, to make loans in states that enforce their usury 
     or small loan laws.
       Although payday lender-bank charter renting has been 
     curtailed by regulatory action,

[[Page 22865]]

     only legislation will create a clear prohibition to stop this 
     practice that undermines state small loan regulation.
           Sincerely,
     Jean Ann Fox,
       Director of Consumer Protection, Consumer Federation of 
     America.
     Peter Skillern,
       Executive Director, Community Reinvestment Association of 
     NC.
     Linda Sherry,
       Director, National Priorities, Consumer Action.
     Susanna Montezemolo,
       Policy Analyst, Consumers Union.
     Monica Gonzales,
       Vice President of Legislation and Regulatory Affairs, 
     National Community Reinvestment Coalition.
     Margot Saunders,
       Of Counsel, National Consumer Law Center.
     Ed Mierzwinski,
       Consumer Program Director, U.S. Public Interest Research 
     Group (U.S. PIRG).

  Mr. AKAKA. Mr. President, I rise to introduce the Bankruptcy 
Prevention Credit Counseling Act. The new bankruptcy reform law does 
not allow consumers to declare personal bankruptcy in either Chapter 7 
or Chapter 13, unless they receive a briefing from an approved 
nonprofit credit counseling agency within 6 months of filing. The 
credit counseling instructional course requirement is intended to 
provide financial education to consumers who declare bankruptcy so they 
can attempt to avoid future financial problems.
  About one in three consumers in credit counseling enter a debt 
management plan. In exchange, creditors may agree to concessions so 
that consumers pay off as much of their outstanding debt as possible. 
Concessions can include a reduced interest rate on the amount they owe 
and the elimination of fees. Unfortunately, most credit card companies 
have become increasingly unwilling to significantly reduce interest 
rates for consumers in credit counseling. A study by the National 
Consumer Law Center and the Consumer Federation of America revealed 
that 5 of 13 credit card issuers increased the interest rates they 
offered to consumers in credit counseling between 1999 and 2003. 
American Express and Wells Fargo completely waive all interest for 
consumers in credit counseling. However, the majority of credit card 
issuers charge interest rates above 9 percent for account holders that 
enter into credit counseling, with several charging more than 15 
percent.
  My bill would prevent unsecured creditors, primarily credit card 
issuers, from attempting to collect accruing interest and additional 
fees from consumers in bankruptcy, if the creditor does not have a 
policy of waiving interest and fees for debtors who enter a 
consolidated payment plan at a credit counseling agency.
  Since the new bankruptcy law requires that consumers enter credit 
counseling before filing for bankruptcy, we must ensure that credit 
counseling is truly effective and a viable alternative to bankruptcy. 
Credit card issuers undermine the good intentions of those consumers. 
They have sharply curtailed the concessions they offer to consumers in 
credit counseling, contributing to increased bankruptcy filings. 
According to a survey by VISA USA, 33 percent of consumers who failed 
to complete a debt management plan in credit counseling said they would 
have stayed on the plan if creditors had lowered interest rates or 
waived fees. Credit card companies have an obligation to ensure that 
effective alternatives are readily available to the consumers they 
aggressively pursue.
  We must make sure that credit counseling is an effective tool to help 
consumers avoid bankruptcy. In order to do this, credit card issuers 
should waive the amount owed in interest and fees for consumers who 
enter a consolidated payment plan. Successful completion of a debt 
management plan benefits both creditors and consumers. Mr. President, 
for many consumers, paying off their debt is not easy. My bill will 
help people who are struggling to repay their obligations. I encourage 
all of my colleagues to support this legislation to help consumers 
enrolled in debt management plans to successfully repay their 
creditors, free themselves from debt, and avoid bankruptcy.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1879

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Bankruptcy Prevention Credit 
     Counseling Act of 2005''.

     SEC. 2. REDUCTION OF UNSECURED CLAIMS.

       Section 502(b) of title 11, United States Code, is 
     amended--
       (1) in paragraph (8), by striking ``or'' at the end;
       (2) in paragraph (9), by striking the period at the end and 
     inserting ``; or''; and
       (3) by adding at the end the following:
       ``(10) such consumer debt is an unsecured claim arising 
     from a debt to a creditor that does not have, as of the date 
     of the order for relief, a policy of waiving additional 
     interest for all debtors who participate in a debt management 
     plan administered by a nonprofit budget and credit counseling 
     agency described in section 111(a).''.

                          ____________________