[Congressional Record (Bound Edition), Volume 152 (2006), Part 7]
[Senate]
[Pages 8627-8636]
[From the U.S. Government Publishing Office, www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. LOTT (for himself and Mr. Pryor):
  S. 2830. A bill to amend the automobile fuel economy provisions of 
title 49, United States Code, to reform the setting and calculation of 
fuel economy standards for passenger automobiles, and for other 
purposes; to the Committee on Commerce, Science, and Transportation.
  Mr. LOTT. Mr. President, I rise today to introduce The Corporate 
Average Fuel Economy, CAFE, Program Reform Act of 2006. I am pleased to 
be joined in this effort by Senator Pryor, who serves on the Commerce 
Committee with me.
  Since being introduced in the 1970s, CAFE standards have been 
controversial. The effectiveness of these standards is often debated as 
is their effect on safety, consumer choice, and the automobile 
industry.
  CAFE became so controversial that it essentially was frozen for many 
years.
  The stand-off over CAFE finally eased a little bit when a 
Congressionally commissioned National Academy of Sciences review of the 
CAFE program was released in 2002. Although that study found that CAFE 
had in fact reduced energy consumption, the Academy was critical of how 
the program was structured and found that there was a negative impact 
on safety.
  Just this spring, the Department of Transportation issued new 
reformed CAFE rules for pickup trucks, vans, and SUVs. This rule is a 
radical departure from prior CAFE rules in that it applies different 
standards to different sized vehicles rather than a uniform standard 
across the whole fleet. The Department's approach addresses many of the 
criticisms in the academy's study.
  The recent rule did not, however, include new standards for cars. 
Those standards have been the same since 1984 and there is considerable 
legal ambiguity about the secretary's ability to increase the existing 
standards. It is clear, however, that the law does not allow the 
secretary to ``reform'' CAFE standards for cars, since that part of the 
statute is written differently than for light trucks.
  As chairman of the Subcommittee on Surface Transportation and 
Merchant Marine, I held a hearing on reforming CAFE standards last 
week. We heard from Secretary Mineta, as well as the automobile 
industry, safety advocates, and fuel economy experts. After listening 
to what our witnesses had to say, I am convinced that ``reform'' is a 
necessary approach.
  After that hearing, Secretary Mineta transmitted legislation to 
Congress asking for the authority to reform CAFE standards.
  The bill we are introducing today is very straightforward. The main 
feature of the legislation is that it gives the Secretary of 
Transportation the authority to reform the CAFE program in a manner 
similar to the rule that he issued for light trucks. The bill puts the 
responsibility of setting CAFE standards where it belongs--and that is 
with the scientists and technical experts at the Department of 
Transportation.
  The reformed CAFE program authorized by this legislation will address 
many of the past criticisms. For example, the legislation specifies 
that the Secretary must take motor vehicle safety into consideration 
when developing new CAFE standards. The legislation also allows the 
trading of CAFE credits between a manufacturer's passenger car and 
light truck fleets. This gives manufacturers the flexibility to 
increase CAFE where it is most cost effective to do so.
  Let me briefly address one issue that is potentially controversial. 
That is the issue of what is being called ``backsliding.'' The concern 
is that under a reformed CAFE program, manufacturers could simply stop 
manufacturing some of their smaller cars since these cars are no longer 
needed to ``average out'' the larger, less fuel efficient models. The 
manufacturer's overall fuel economy average could then end up being 
below where it is presently. Although this is very unlikely to happen 
and that isn't the intent of a ``reformed'' CAFE system, I understand 
the concern. Senator Pryor and I have included a provision in our 
legislation to address that problem. I know that there are many 
opinions on how to deal with this backsliding issue, and some people 
may not feel that our approach is strong enough. On the other hand, if 
the provision is too strict then the benefits of reform are potentially 
wiped out.
  In the past, many in Congress have played politics with CAFE--
offering bills that try to set unrealistically high or arbitrary CAFE 
standards. On the other side are those that have simply opposed doing 
anything. This has resulted in a stalemate and lots of finger pointing. 
I hope this doesn't happen again, because we really do need to get 
tougher standards in place as soon as we can.
  Senator Pryor and I are committed to improving the fuel economy of 
our vehicles without reducing safety and reliability or losing jobs. I 
urge my colleagues to support this legislation.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 2830

       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 ``Corporate Average Fuel 
     Economy Reform Act of 2006''.

     SEC. 2. CAFE STANDARDS FOR PASSENGER AUTOMOBILES.

       (a) Average Fuel Economy Standards for Automobiles.--
     Section 32902 of title 49, United States Code, is amended--

[[Page 8628]]

       (1) by striking subsections (b) and (c) and inserting the 
     following:
       ``(b) Passenger Automobiles.--
       ``(1) In general.--At least 18 months before the beginning 
     of each model year, the Secretary of Transportation shall 
     prescribe by regulation average fuel economy standards for 
     passenger automobiles manufactured by a manufacturer in that 
     model year. Each standard shall be the maximum feasible 
     average fuel economy level that the Secretary decides the 
     manufacturers can achieve in that model year. The Secretary 
     may prescribe separate standards for different classes of 
     passenger automobiles.
       ``(2) Minimum standard.--In prescribing a standard under 
     paragraph (1), the Secretary shall ensure that no 
     manufacturer's standard for a particular model year is less 
     than the greater of--
       ``(A) the standard in effect on the date of enactment of 
     the Corporate Average Fuel Economy Reform Act of 2006; or
       ``(B) a standard established in accordance with the 
     requirement of section 5(c)(2) of that Act.
       ``(c) Flexibility of Authority.--
       ``(1) In general.--The authority of the Secretary to 
     prescribe by regulation average fuel economy standards for 
     automobiles under this section includes the authority to 
     prescribe standards based on one or more vehicle attributes 
     that relate to fuel economy, and to express the standards in 
     the form of a mathematical function. The Secretary may issue 
     a regulation prescribing standards for one or more model 
     years.
       ``(2) Required lead-time.--When the Secretary prescribes an 
     amendment to a standard under this section that makes an 
     average fuel economy standard more stringent, the Secretary 
     shall prescribe the amendment at least 18 months before the 
     beginning of the model year to which the amendment applies.
       ``(3) No across-the-board increases.--When the Secretary 
     prescribes a standard, or prescribes an amendment under this 
     section that changes a standard, the standard may not be 
     expressed as a uniform percentage increase from the fuel-
     economy performance of automobile classes or categories 
     already achieved in a model year by a manufacturer.'';
       (2) by inserting ``motor vehicle safety, emissions,'' in 
     subsection (f) after ``economy,'';
       (3) by striking ``energy.'' in subsection (f) and inserting 
     ``energy and reduce its dependence on oil for 
     transportation.'';
       (4) by striking subsection (j) and inserting the following:
       ``(j) Comments from DOE and EPA.--
       ``(1) Notice of proposed rulemaking.--Before issuing a 
     notice proposing to prescribe or amend an average fuel 
     economy standard under subsection (a), (b), or (g), the 
     Secretary of Transportation shall give the Secretary of 
     Energy and the Administrator of the Environmental Protection 
     Agency at least 10 days to comment on the proposed standard 
     or amendment. If the Secretary of Energy or the Administrator 
     concludes that the proposed standard or amendment would 
     adversely affect the conservation goals of the Department of 
     Energy or the environmental protection goals of the 
     Environmental Protection Agency, respectively, the Secretary 
     or the Administrator may provide written comments to the 
     Secretary of Transportation about the impact of the proposed 
     standard or amendment on those goals. To the extent that the 
     Secretary of Transportation does not revise a proposed 
     standard or amendment to take into account the comments, if 
     any, the Secretary shall include the comments in the notice.
       ``(2) Notice of final rule.--Before taking final action on 
     a standard or an exemption from a standard under this 
     section, the Secretary of Transportation shall notify the 
     Secretary of Energy and the Administrator of the 
     Environmental Protection Agency and provide them a reasonable 
     time to comment on the standard or exemption.''; and
       (5) by adding at the end thereof the following:
       ``(k) Costs-Benefits.--The Secretary of Transportation may 
     not prescribe an average fuel economy standard under this 
     section that imposes marginal costs that exceed marginal 
     benefits, as determined at the time any change in the 
     standard is promulgated.''.
       (b) Exemption Criteria.--The first sentence of section 
     32904(b)(6)(B) of title 49, United States Code, is amended--
       (1) by striking ``exemption would result in reduced'' and 
     inserting ``manufacturer requesting the exemption will 
     transfer'';
       (2) by striking ``in the United States'' and inserting 
     ``from the United States''; and
       (3) by inserting ``because of the grant of the exemption'' 
     after ``manufacturing''.
       (c) Conforming Amendments.--
       (1) Section 32902 of title 49, United States Code, is 
     amended--
       (A) by striking ``or (c)'' in subsection (d)(1);
       (B) by striking ``(c),'' in subsection (e)(2);
       (C) by striking ``subsection (a) or (d)'' each place it 
     appears in subsection (g)(1) and inserting ``subsection (a), 
     (b), or (d)'';
       (D) by striking ``(1) The'' in subsection (g)(1) and 
     inserting ``The'';
       (E) by striking subsection (g)(2); and
       (F) by striking ``(c),'' in subsection (h) and inserting 
     ``(b),''.
       (2) Section 32903 of such title is amended by striking 
     ``section 32902(b)-(d)'' each place it appears and inserting 
     ``subsection (b) or (d) of section 32902''.
       (3) Section 32904(a)(1)(B) of such title is amended by 
     striking ``section 32902(b)-(d)'' and inserting ``subsection 
     (b) or (d) of section 32902''.
       (4) The first sentence of section 32909(b) of such title is 
     amended to read ``The petition must be filed not later than 
     59 days after the regulation is prescribed.''.
       (5) Section 32917(b)(1)(B) of such title is amended by 
     striking ``or (c)''.

     SEC. 3. USE OF EARNED CREDITS.

       Section 32903 of title 49, United States Code, is amended--
       (1) by striking ``3 consecutive model years'' in subsection 
     (a)(1) and subsection (a)(2) and inserting ``5 consecutive 
     model years'';
       (2) by striking ``3 model years'' in subsection (b)(2) and 
     inserting ``5 model years'';
       (3) by redesignating subsection (f) as subsection (g); and
       (4) by inserting after subsection (e) the following:
       ``(f) Credit Transfers.--The Secretary of Transportation 
     may permit by regulation, on such terms and conditions as the 
     Secretary may specify, a manufacturer of automobiles that 
     earns credits to transfer such credits attributable to one of 
     the following production segments in a model year to apply 
     those credits in that model year to the other production 
     segment:
       ``(1) Passenger-automobile production.
       ``(2) Non-passenger-automobile production.

     In promulgating such a regulation, the Secretary shall take 
     into consideration the potential effect of such transfers on 
     creating incentives for manufacturers to produce more 
     efficient vehicles and domestic automotive employment.''.

     SEC. 4. USE OF CIVIL PENALTIES FOR RESEARCH AND DEVELOPMENT.

       Section 32912 of title 49, United States Code, is amended 
     by adding at the end thereof the following:
       ``(e) Research and Development and Use of Civil 
     Penalties.--
       ``(1) All civil penalties assessed by the Secretary or by a 
     Court shall be credited to an account at the Department of 
     Transportation and shall be available to the Secretary to 
     carry out the research program described in paragraph (2).
       ``(2) The Secretary shall carry out a program of research 
     and development into fuel saving automotive technologies and 
     to support rulemaking related to the corporate average fuel 
     economy program.''.

     SEC. 5. EFFECTIVE DATE.

       (a) In General.--Except as provided in subsection (b), this 
     Act, and the amendments made by this Act, take effect on the 
     date of enactment of this Act.
       (b) Transition for Passenger Automobile Standard.--
     Notwithstanding subsection (a), and except as provided in 
     subsection (c)(2), until the effective date of a standard for 
     passenger automobiles that is issued under the authority of 
     section 32902(b) of title 49, United States Code, as amended 
     by this Act, the standard or standards in place for passenger 
     automobiles under the authority of section 32902 of that 
     title, as that section was in effect on the day before the 
     date of enactment of this Act, shall remain in effect.
       (c) Rulemaking.--
       (1) Initiation of rulemaking under amended law.--Within 60 
     days after the date of enactment of this Act, the Secretary 
     of Transportation shall initiate a rulemaking for passenger 
     automobiles under section 32902(b) of title 49, United States 
     Code, as amended by this Act.
       (2) Amendment of existing standard.--Until the Secretary 
     issues a final rule pursuant to the rulemaking initiated in 
     accordance with paragraph (1), the Secretary shall amend the 
     average fuel economy standard prescribed pursuant to section 
     32092(b) of title 49, United States Code, with respect to 
     passenger automobiles in model years to which the standard 
     adopted by such final rule does not apply.

  Mr. PRYOR. Mr. President, I rise today with my good friend and 
colleague from Mississippi, Senator Lott, to introduce legislation to 
reform and raise the corporate average fuel economy standard for the 
first time since its inception over 30 years ago.
  In 1975 this body passed, as a part of the Energy Policy and 
Conservation Act, the very first fuel economy standards for our 
passenger car fleet, setting a standard that all manufacturers must 
achieve 27.5 miles per gallon. This was done in response to the first 
oil embargo and the energy crisis of the early 1970s. Americans 
realized for the first time that we as a nation must set and achieve 
attainable goals for energy conservation, not only for our economic 
security but also for our national security.
  At that time, the fuel economy of passenger cars averaged around 14 
miles per gallon. Ten years after CAFE was enacted, the fuel economy of 
passenger cars had almost doubled, saving an estimated 2.8 million 
barrels of oil a day. There can be no doubts as to the

[[Page 8629]]

benefits of the original CAFE standard. Still 20 years after reaching 
this peak around 1985, the fuel economy of the Nation's passenger car 
fleet has stagnated. Some have even argued the fleet of vehicles 
entering the marketplace today gets less fuel economy than those models 
in 1985. While fuel efficient technology has improved over the years, 
the fuel economy of the Nation's passenger fleet has not. Also today, 
our dependence on oil is greater than ever before. This dependence has 
complicated decisions we make as a country, such as foreign policy 
decisions, and as individuals, such as whether or not to fill up your 
gas tank or buy groceries.
  I believe we must do better for families in Arkansas and around the 
Nation. We must protect our national security by reducing our 
dependence on foreign oil and uncomplicating our foreign policy 
decision-making in oil-rich regions. We must protect the environment by 
reducing greenhouse gas emissions. We must reduce the cost of 
transportation for consumers. We must begin implementing more stringent 
CAFE standards now before these problems worsen. Gasoline is over 70 
cents higher than this time last year, and the number of miles driven 
by every American over the age of 16 has risen over 60 percent since 
1970--and is continuing to climb at a rapid pace.
  This is why I have joined my colleague and worked in a bipartisan 
manner to introduce comprehensive CAFE reform. For over 30 years the 
original CAFE standard has remained in place while a rapidly advancing 
marketplace and rapidly advancing technology have left it behind. Each 
time fuel economy standards have been debated in this body, they have 
been mired in partisan politics resulting in nothing but stalemate.
  Senator Lott and I are choosing progress over politics with our 
common sense legislation, the Corporate Average Fuel Economy Reform Act 
of 2006. The bill will help accomplish our national security and energy 
conservation goals while preserving motor vehicle safety, American 
manufacturing jobs, and consumer choice for vehicles.
  Specifically, it will clarify the authority of the Secretary of 
Transportation to raise and reform CAFE standards. It requires the 
Secretary to begin the reform process within 60 days in addition to 
requiring the Secretary to complete an expedited rulemaking to 
immediately amend the current CAFE standard before a reformed standard 
takes effect.
  For the first time, it will require the Secretary to consider 
greenhouse gas emissions when promulgating a CAFE standard as well as 
require the Secretary to obtain comments from the Administrator of the 
Environmental Protection Agency on the impact of any new rule on the 
environment.
  Our legislation also gives automobile manufacturers more flexibility 
in the way they can apply CAFE credits in order to help them preserve 
American jobs. It preserves the 18-month lead time required before the 
Secretary can issue more stringent CAFE standards. It also allows the 
Secretary to use the fines collected for violations of the CAFE 
standard for research and development of fuel saving technologies and 
to conduct CAFE rulemakings. Finally, our bill provides a backstop fuel 
economy average which no manufacturer can go below, regardless of their 
fleet mix.
  There is no silver bullet in accomplishing our national security and 
energy goals, and we must seek short-term alternatives in addition to 
long-term solutions. CAFE reform is one part of a long-term solution to 
reduce our dependence on oil, but it is one that can have lasting 
impact. Still, I believe for the long-term security of our country, 
this is as good a place as any to start. We must start now.
  I thank my colleague from the Commerce Committee, Senator Lott, for 
his hard work on this bipartisan legislation. I look forward to working 
with him and the rest of my colleagues to ensure that this reform 
becomes law.
                                 ______
                                 
      By Mr. LUGAR (for himself, Mr. Specter, Mr. Dodd, Mr. Graham, and 
        Mr. Schumer):
  S. 2831. A bill to guarantee the free flow of information to the 
public through a free and active press while protecting the right of 
the public to effective law enforcement and the fair administration of 
justice; to the Committee on the Judiciary.
  Mr. LUGAR. Mr. President, the bill at the desk is introduced on 
behalf of myself, Senators Specter, Dodd, Graham, and Schumer. I am 
pleased to join my good friends and colleagues, Senators Specter and 
Dodd, in introducing a revised version of the Free Flow of Information 
Act.
  I believe that the free flow of information essential element of 
democracy. In order for the United States to foster the spread of 
freedom and democracy globally, it is incumbent that we first support 
an open and free press nationally. The role of the media as a conduit 
between government and the citizens it serves must not be devalued.
  Unfortunately, the free flow of information to citizens of the United 
States is inhibited. Over 30 reporters were recently served or 
threatened with jail sentences in at least four different Federal 
jurisdictions for refusing to reveal confidential sources. I fear the 
end result of such actions is that many whistleblowers will refuse to 
come forward and reporters will be unable to provide our constituents 
with information they have a right to know.
  In 1972, the Supreme Court held in Branzburg v. Hayes, that reporters 
did not have an absolute privilege as third party witnesses to protect 
their sources from prosecutors. Since Branzburg, every State and the 
District of Columbia, excluding Wyoming has created a privilege for 
reporters not to reveal their confidential sources. My own State of 
Indiana provides qualified reporters an absolute protection from having 
to reveal any such information in court.
  The Federal courts of appeals, however, have an incongruent view of 
this matter. Each circuit has addressed the question of the privilege 
in a different manner. Some circuits allow the privilege in one 
category of cases, while others, have expressed skepticism about 
whether any privilege exists at all.
  Congress should clarify the extraordinary differences of opinion in 
the Federal courts of appeals and the effect they have on undermining 
the general policy of protection already in place among the States. 
Likewise, the ambiguity between official Department of Justice rules 
and unofficial criteria used to secure media subpoenas is unacceptable.
  There is an urgent need for Congress to state clear and concise 
policy guidance.
  Senators Specter, Dodd, and I have introduced legislation today that 
preserves the free flow of information to the public by providing the 
press the ability to obtain and protect confidential sources. It 
provides journalists with certain rights and abilities to sources and 
report appropriate information without fear of intimidation or 
imprisonment. This bill sets national standards, based on Department of 
Justice guidelines, for subpoenas issued to reporters by the Federal 
Government.
  Our legislation promotes greater transparency of government, 
maintains the ability of the courts to operate effectively, and 
protects the whistleblowers that identify government or corporate 
misdeeds and protect national security.
  It is also important to note what this legislation does not do. The 
legislation does not permit rule breaking, give reporters a license to 
break the law, or permit reporters to interfere with crimes prevention 
efforts. Furthermore, the Free Flow of Information Act does not weaken 
national security nor restrict law enforcement. Additional protections 
have been added to this bill to ensure that information will be 
disclosed in cases where the guilt or innocence of a criminal is in 
question, in cases where a reporter was an eye witness to a crime, and 
in cases where the information is critical to

[[Page 8630]]

prevent death or bodily harm. The national security exception and 
continued strict standards relating to classified information will 
ensure that reporters are protected while maintaining an avenue for 
prosecution and disclosure when considering the defense of our country.
  Reporters Without Borders has reported that more than 100 journalists 
are currently in jail around the world, with more than half in China, 
Cuba, and Burma. This is not good company for the United States of 
America. Global public opinion is always on the lookout to advertise 
perceived American double standards.
  I believe that passage of this bill would have positive diplomatic 
consequences. This legislation not only confirms America's 
constitutional commitment to press freedom, it also advances President 
Bush's American foreign policy initiatives to promote and protect 
democracy. When we support the development of free and independent 
press organizations worldwide, it is important to maintain these ideals 
at home.
  In conclusion, I thank, again, my colleagues, Senator Specter, the 
distinguished chairman of the Judiciary Committee, and Senator Dodd for 
their tireless work on this issue. With their assistance, I look 
forward to working with each of my colleagues to ensure that the free 
flow of information is unimpeded.
  The PRESIDING OFFICER. The Senator from Pennsylvania.
  Mr. SPECTER. Mr. President, I am pleased to join with Senator Lugar, 
the principal sponsor, and Senators Dodd, Graham, and Schumer on the 
introduction of legislation which will codify a reporter's privilege, 
something that is very necessary. The matter came into sharp focus 
recently with the contempt citation and the incarceration of New York 
Times reporter, Judith Miller, for some 85 days. The Judiciary 
Committee held two hearings on this subject. Senator Lugar, with 
Congressman Pence in the House, introduced legislation which has formed 
the nucleus of the bill we are introducing today.
  The Branzburg v. Hayes case, 33 years ago, which was a 5-to-4 
decision, with a concurring opinion by Justice Powell, has led to what 
is accurately called a ``crazy quilt'' situation in the circuits--five 
circuits going one way, four circuits going another way, and laws 
unsettled in some circuits. This bill, modeled significantly after the 
Department of Justice regulations, will codify this important issue.
  There is an exception on reporter's privilege for national security 
cases. Keeping in mind the incarceration of Judith Miller, this bill 
makes a sharp distinction between national security and an inquiry in 
the grand jury for obstruction of justice or perjury. As a prosecutor 
in the past, I have great appreciation for the offenses of obstruction 
of justice and perjury. But in my judgment, they do not rise to the 
level of importance as a national security case. When a special 
prosecutor's investigation shifts from the disclosure of a CIA agent, 
to a question of obstruction of justice, it is a very different 
situation. This bill would not permit, would not compel the disclosure 
of a source for obstruction of justice or perjury, but would compel the 
disclosure of a source for a national security case.
  This legislation has the endorsement of 39 of the major media 
organizations in the United States: The New York Times, the Washington 
Post, the Associated Press, Time, Hearst Corporation, Philadelphia 
Inquirer, Newspaper Association of America, ABC, NBC, and CBS. It goes 
a long way to protecting sources, but it also leaves latitude, in the 
form of a balancing test, for Federal prosecutors to gain information 
under limited circumstances for plaintiffs and defendants in civil 
cases to have access to sources. And, it does not have a shield if a 
reporter is a witness to some criminal incident.
  In recent months, there has been a growing consensus that we need to 
establish a Federal journalists' privilege to protect the integrity of 
the newsgathering process--a process that depends on the free flow of 
information between journalists and whistleblowers, as well as other 
confidential sources. I do not reach this conclusion lightly. The 
Judiciary Committee held two separate hearings in which it heard from 
sixteen witnesses. Included in this number were seven journalists, six 
attorneys, including current or former prosecutors and some of the 
Nation's most distinguished experts on the first amendment.
  These witnesses demonstrated that there are two vital, competing 
concerns at stake. On one hand, reporters cite the need to maintain 
confidentiality in order to ensure that sources will speak openly and 
freely with the news media. The renowned William Safire, former 
columnist for the New York Times, testified that ``the essence of news 
gathering is this: if you don't have sources you trust and who trust 
you, then you don't have a solid story--and the public suffers for 
it.'' Reporter Matthew Cooper of Time magazine said this to the 
Committee: ``As someone who relies on confidential sources all the 
time, I simply could not do my job reporting stories big and small 
without being able to speak with officials under varying degrees of 
anonymity.''
  On the other hand, the public has a right to effective law 
enforcement and fair trials. Our judicial system needs access to 
information in order to prosecute crime and to guarantee fair 
administration of the law for plaintiffs and defendants alike. As a 
Justice Department representative told the committee, prosecutors need 
to ``maintain the ability, in certain vitally important circumstances, 
to obtain information identifying a source when a paramount interest is 
at stake. For example, obtaining source information may be the only 
available means of preventing a murder, locating a kidnapped child, or 
identifying a serial arsonist.''
  As Federal courts considered such competing interests, they adopted 
rules that went in several different directions. Rather than a clear, 
uniform standard for deciding claims of journalist privilege, the 
Federal courts currently observe a ``crazy quilt'' of different 
judicial standards.
  The current confusion began 33 years ago, when the Supreme Court 
decided Branzburg v. Hayes. The Court held that the press's first 
amendment right to publish information does not include a right to keep 
information secret from a grand jury investigating a criminal matter. 
The Supreme Court also held that the common law did not exempt 
reporters from the duty of every citizen to provide information to a 
grand jury.
  The Court reasoned that just as newspapers and journalists are 
subject to the same laws and restrictions as other citizens, they are 
also subject to the same duty to provide information to a court as 
other citizens. However, Justice Powell, who joined the 5-4 majority, 
wrote a separate concurrence in which he explained that the Court's 
holding was not an invitation for the government to harass journalists. 
If a journalist could show that the grand jury investigation was being 
conducted in bad faith, the journalist could ask the court to quash the 
subpoena. Justice Powell indicated that courts might assess such claims 
on a case-by-case basis by balancing the freedom of the press against 
the obligation to give testimony relevant to criminal conduct.
  In attempting to apply Justice Powell's concurring opinion, Federal 
courts have split on the question of when a journalist is required to 
testify. In the 33 years since Branzburg, the Federal courts are split 
in at least three ways in their approaches to Federal criminal and 
civil cases.
  With respect to Federal criminal cases, five circuits--the first, 
fourth, fifth, sixth, and seventh circuits--have applied Branzburg so 
as to not allow journalists to withhold information absent governmental 
bad faith. Four other circuits--the second, third, ninth, and eleventh 
circuits--recognize a qualified privilege, which requires courts to 
balance the freedom of the press against the obligation to provide 
testimony on a case-by-case basis. The law in the District of Columbia 
Circuit is unsettled.
  With respect to Federal civil cases, nine of the twelve circuits 
apply a balancing test when deciding whether

[[Page 8631]]

journalists must disclose confidential sources. One circuit affords 
journalists no privilege in any context. Two other circuits have yet to 
decide whether journalists have any privilege in civil cases. 
Meanwhile, 49 States plus the District of Columbia have recognized a 
privilege within their own jurisdictions. Thirty-one States plus the 
District of Columbia have passed some form of reporter's shield 
statute, and 18 States have recognized a privilege at common law.
  There is little wonder that there is a growing consensus concerning 
the need for a uniform journalists' privilege in Federal courts. This 
system must be simplified.
  Today, we are taking the first step to resolving this problem by 
introducing the Free Flow of Information Act. This bill draws upon 33 
years of experience, as embodied in the Department of Justice's 
regulations, the law established by the Federal courts of appeals, 
State statutes, and existing national security provisions. The purpose 
of this bill is to guarantee the flow of information to the public 
through a free and active press, while protecting the public's right to 
effective law enforcement and individuals' rights to the fair 
administration of justice.
  This bill provides ample protection for the Nation's journalists, as 
demonstrated by the fact that it has been endorsed by 39 news 
organizations identified in a list I will include at the end of my 
remarks.
  This bill also provides ample protection to the public's interest in 
law enforcement and fair trials. In drafting this legislation, we 
started with what works. Both the Department of Justice and the vast 
majority of journalists with whom we have met--in individual meetings 
and over the course of two hearings--have generally voiced strong 
support for the regulations that the Department of Justice currently 
applies to all of its prosecutors. Moreover, time has proven that these 
regulations are workable. The Department of Justice has been 
effectively prosecuting cases under these regulations for 25 years and 
a majority of State prosecutors carry out their duties under similar 
statutes.
  I have two concerns with the Department's regulations, however. 
First, under current law, these regulations do not apply to special 
prosecutors. Special prosecutors are often called upon in cases that 
are politically sensitive, may potentially be embarrassing to senior 
government officials, and are high profile--those cases that seem to 
carry the greatest risk of an overzealous prosecutor needlessly 
subpoenaing journalists.
  Second, the Department regulations are presently enforced by the 
Attorney General, not a neutral court of law. This places the Attorney 
General in a difficult position; namely, the primary check on Federal 
prosecutors' ability to subpoena journalists is the nation's highest 
Federal prosecutor. Most Americans, I believe, would feel more 
comfortable having the competing interests weighed by a neutral judge 
instead of a political appointee who answers to the President. 
Accordingly, this bill, in large part, codifies the Department of 
Justice's regulations into law; applies them to all Federal 
prosecutors, including special prosecutors; and provides that the 
courts, not a political official, shall decide whether the public's 
need for information outweighs the interest in allowing a journalist to 
protect a confidential source.
  The Free Flow of Information Act addresses two additional areas of 
considerable confusion and concern. First, it addresses the situation 
of a criminal defendant who subpoenas a journalist. To ensure that 
every criminal defendant has a fair trial, a criminal defendant has 
less of a burden than a prosecutor does, to show that the journalist's 
privilege should be waived. This is consistent with our long standing 
belief as a nation that a criminal defendant must be given ample 
opportunity to defend himself.
  Second, it addresses private civil litigation. This bill provides 
that before a private party may subpoena a journalist in a civil suit, 
the court must find that the party is not trying to harass or punish 
the journalist, and that the public interest requires disclosure. 
Again, this should help clarify the existing law in federal courts.
  Finally, the Free Flow of Information Act adds layers of safeguards 
for the public. Reporters are not allowed to withhold information if a 
federal court concludes that the information is important to the 
defense of our Nation's security or is needed to prevent or stop a 
crime that could lead to death or physical injury. Also, the bill 
ensures that both crime victims and criminal defendants will have a 
fair hearing in court. Under this bill, a journalist who is an 
eyewitness to a crime or takes part in a crime may not withhold that 
information. Journalists should not be permitted to hide from the law 
by writing a story and then claiming a reporter's privilege.
  It is time to simplify the patchwork of court decisions and 
legislation that has grown over the last three decades. It is time for 
Congress to clear up the ambiguities journalists and the Federal 
judicial system face in balancing the protections journalists need in 
providing confidential information to the public with the ability of 
the courts to conduct fair and accurate trials. I urge my colleagues to 
support this legislation and help create a fair and efficient means to 
serve journalists and the news media, prosecutors and the courts, and 
most importantly the public interest on both ends of the spectrum.
  I ask unanimous consent to print the list of organizations and 
companies that support the legislation in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

 Organizations/Companies Supporting ``Free Flow of Information Act of 
                                 2006''

       ABC Inc.; Advance Publications, Inc.; American Business 
     Media; American Society of Newspaper Editors; Associated 
     Press; Association of American Publishers, Inc.; Association 
     of Capitol Reporters and Editors; Belo Corp.; CBS; CNN; 
     Coalition of Journalists for Open Government; The Copley 
     Press, Inc., Court TV; Cox Enterprises, Inc.; Freedom 
     Communication, Inc.; Gannett Co., Inc.; The Hearst 
     Corporation; Magazine Publishers of America; The McClatchy 
     Company; The McGraw-Hill Companies.
       Media Law Resources Center; National Newspaper Association; 
     Nation Press Photographers Association; National Public 
     Radio; NBC Universal; News Corporation; Newspaper Association 
     of America; Newsweek; The New York Times Company; Radio-
     Television News Directors Association; Raycom Media, Inc.; 
     The Reporters Committee for Freedom of the Press; E. W. 
     Scripps; Society of Professional Journalists; Time Inc.; Time 
     Warner; Tribune Company; The Washington Post; White House 
     Correspondents' Association.

  The PRESIDING OFFICER. The Senator from Connecticut.
  Mr. DODD. Mr. President, let me express my gratitude to my colleague 
from Indiana, Senator Lugar, and his colleague from Indiana, 
Congressman Pence, and his colleague, Congressman Boucher of Virginia, 
who are drafting similar legislation and propose similar legislation in 
the other body and, of course, Senator Specter, the chairman of the 
Judiciary Committee, my colleague from New York, Senator Schumer, and 
the Presiding Officer for their work on pulling together this bill 
which is a very sound proposal. As the Senator from Pennsylvania has 
explained, it deals with an issue that many were concerned about, and 
that is the national security question.
  The point I would like to make is that while this is about 
journalists and the collection of information and revealing stories 
that might otherwise not be told, the real winners of this proposal are 
not journalists or news media outlets, television stations, or the 
like. The real winners are the people we represent, our constituents, 
and the consumers of information. This is most important for them. It 
is really not that significant. If it were only about journalists, 
frankly, we might have second questions about it.
  Jefferson, of course, said it better than anyone many years ago when 
he said if he had to choose between a free country and a free press, he 
would select the latter. Madison, on the same subject, talking about 
freedom of information, freedom of the press, had this quote:

       Popular government without popular information or the means 
     of acquiring it is but a

[[Page 8632]]

     prologue to a farce, or tragedy, or perhaps both.

  Today, that fundamental principle--that a well-informed citizenry is 
the cornerstone of self-government--is at risk in a manner in which it 
has not been at risk previously.
  In the past year alone, some two dozen reporters have been subpoenaed 
or questioned about their confidential sources. Most of theme face 
fines or prison time. Seven have already been held in contempt. One has 
been jailed. Another was found guilty of criminal contempt for refusing 
to reveal a confidential source and served 6 months under house arrest. 
Why? Because they received information from confidential sources and 
pledged to protect the confidentiality of those sources. In other 
words, they have committed the ``offense'' of being journalists.
  These actions by our Government against journalists are having a 
profound impact on news gathering. For example, in testimony last 
summer before the Senate Judiciary Committee, Norman Pearlstine, the 
editor in chief of Time, Inc., said this about the fallout from the 
Justice Department's efforts to obtain confidential information from a 
Time reporter:

       Valuable sources have insisted that they no longer trusted 
     the magazine and that they would no longer cooperate on 
     stories. The chilling effect is obvious.

  Confidential evidence may be just the tip of the iceberg. We have no 
way of knowing for certain the number of journalists who have been 
ordered or requested to reveal confidential sources. We can only 
speculate as to how many editors and publishers put the brakes on a 
story for fear that it could land one of their reporters in a spider 
web spun by the Federal prosecutors that could include prison. If 
citizens with knowledge of wrongdoing could not or would not come 
forward to share what they know in confidence with members of the 
press, serious journalism would cease to exist, in my view. Serious 
wrongs would remain unexposed. The scandals known as Watergate, the 
Enron failure, the Abu Ghraib prison photos--none of these would have 
been known to the public but for good journalists doing their work.
  That scenario is no longer purely hypothetical. It is, in some 
respects, already a reality. When journalists are hauled into court by 
prosecutors and threatened with fines and imprisonment if they don't 
divulge the sources of their information, we are entering a dangerous 
territory for a democracy. That is when not only journalists, but 
ordinary citizens, will fear prosecution simply for exposing 
wrongdoing. When that happens, the information our citizens need to 
remain sovereign will be degraded, making it more and more difficult to 
hold accountable those in power. When the public's right to know is 
threatened, then I suggest to you that all of the liberties we hold 
dear are threatened, as well.
  Again, I thank Senator Specter for working out this compromise, and I 
emphasize that the issue of national security, which was a very 
legitimate concern, has been handled by this proposal. The underlying 
issue is the right of citizens to have access to important information 
that might otherwise never become available were it not for the ability 
to have confidential sources share that information and the ability of 
these journalists to protect the confidentiality of those sources. 
Thirty-nine States have provisions dealing with the shield law. I think 
10 States have regulations regarding the same matter.
  I think it is long overdue that the Federal Government have a similar 
piece of legislation to protect the kind of information we seek. I 
commend my colleagues for their efforts in this regard. I am happy to 
join them.
  Mr. SESSIONS. Mr. President, I say with regard to what has just taken 
place, these are complex areas, and we need to be careful about 
protecting our free speech rights. Nobody denies that. But you have to 
be careful, too. I was thinking that if a spy comes into our country 
and gets secure information and gives it to our enemy, we put him in 
jail, and they can be convicted, I guess, of treason. If a reporter 
gets information and publishes it to our enemies and to the whole 
world, they get the Pulitzer prize.
  I think we have to be careful about how we word this. I am sure we 
will come up with a pretty good solution.
  Mr. SPECTER. Mr. President, I ask unanimous consent that Senator 
Schumer be recognized for 4 minutes to speak on the Lugar-Specter-Dodd 
bill.
  The PRESIDING OFFICER. The Senator from New York is recognized.
  Mr. SCHUMER. Mr. President, I join as a cosponsor of the bill just 
introduced because I think it really cuts the Gordian knot. There has 
been a deadlock on improving the shield law for the very reason that 
not all disclosures by Government officials to members of the press are 
equal. We certainly want to protect a whistleblower. We certainly want 
a person, if they work at the FDA and see that tests are being short-
circuited and they go to higher-ups and get nowhere, to be able to go 
to the press and expose it. It is a far different matter when something 
is prohibited by statute from being made public, such as with grand 
jury minutes. Frankly, that dealt with the Plame case. In both cases 
making that information public was a violation of law. There was a 
public policy against disclosure, which there is not in the typical 
whistleblower case.
  I believe the reason that the legislation my colleagues from Indiana 
and Connecticut put in didn't get as much support is that it failed to 
distinguish that difference. We need to protect the press, especially 
with a large Government that keeps things secret more and more. But we 
also have to have some respect for the fact that there are certain 
things that should not be made public by statute in open debate.
  As I said, this legislation cuts the Gordian knot. It protects those 
matters that should not be made public and doesn't put them under the 
shield of law but strengthens the protections for whistleblowers and 
others who might want to expose Government wrongdoing when there is no 
other way to expose it.
  This is a large step forward. It is legislation I am proud to 
cosponsor. I am very glad that the deadlock has been broken by this 
thoughtful legislation, which I now believe will garner enough support 
to become law. Whereas, the previous legislation, as sweeping as it 
was, would not.
  I compliment my colleagues from Indiana, Connecticut, Pennsylvania, 
and South Carolina, with whom I join as lead cosponsors because it is 
going to make our country a better place.
                                 ______
                                 
      By Mr. KOHL (for himself and Mr. DeWine):
  S. 2854. A bill to prevent anti-competitive mergers and acquisitions 
in the oil and gas industry; to the Committee on the Judiciary.
  Mr. KOHL. Mr. President, I rise today to introduce the Oil Industry 
Merger Antitrust Enforcement Act. This legislation will significantly 
strengthen the antitrust laws to prevent anticompetitive mergers and 
acquisitions in oil and gas industry.
  We have all seen the suffering felt by consumers and our national 
economy resulting from rising energy prices. Gasoline prices have now 
shattered the once unthinkable $3.00 a gallon level, have doubled in 
the last 5 years, and increased more than 30 percent in the last year 
alone. And prices for other crucial energy products--such as natural 
gas and home heating oil--have undergone similar sharp increases.
  Industry experts debate the causes of these extraordinarily high 
prices. Possible culprits are growing worldwide demand, supply 
disruptions, the actions of the OPEC oil cartel and limits on refinery 
capacity in the United States. But about one thing there can be no 
doubt--the substantial rise in concentration and consolidation in the 
oil industry. Since 1990, the Government Accountability Office has 
counted over 2,600 mergers, acquisitions and joint ventures in the oil 
industry. Led by gigantic mergers such as Exxon/Mobil, BP/Arco, Conoco/
Phillips and Chevron/Texaco, by 2004, the five largest U.S. oil 
refining companies controlled over 56 percent of domestic refining 
capacity, a greater market share than that controlled by the top 10 
companies a decade earlier.

[[Page 8633]]

  This merger wave has led to substantially less competition in the oil 
industry. In 2004, the GAO concluded that these mergers have directly 
caused increases in the price of gasoline. A study by the independent 
consumer watchdog Public Citizen found that in the 5 years between 1999 
and 2004, U.S. oil refiners increased their average profits on every 
gallon of gasoline refined from 22.8 cents to 40.8 cents, a 79 percent 
jump. And the grossly inflated profit numbers of the major oil 
companies--led by Exxon Mobil's $8.4 billion profit in the first 
quarter of 2006, which followed its $36 billion profit in 2005, the 
highest corporate profits ever achieved in U.S. history, are conclusive 
evidence--if any more was needed--of the lack of competition in the 
U.S. oil industry. While it is true that the world price of crude oil 
has substantially increased, the fact that the oil companies can so 
easily pass along all of these price increases to consumers of gasoline 
and other refined products--and greatly compound their profits along 
the way--confirms that that there is a failure of competition in our 
oil and gas markets.
  More than 90 years ago, one of our Nation's basic antitrust laws--the 
Clayton Act--was written to prevent just such industry concentration 
harming competition. It makes illegal any merger or acquisition the 
effect of which ``may be substantially to lessen competition.'' Despite 
the plain command of this law, the Federal Trade Commission--the 
Federal agency with responsibility for enforcing antitrust law in the 
oil and gas industry--has failed to take any effective action to 
prevent undue concentration in this industry. Instead, it permitted 
almost all of these 2,600 oil mergers and acquisitions to proceed 
without challenge. And where the FTC has ordered divestitures, they 
have been wholly ineffective to restore competition. Consumers have 
been at the mercy of an increasingly powerful oligopoly of a few giant 
oil companies, passing along price increases without remorse as the 
market becomes increasingly concentrated and competition diminishes. It 
is past time for us in Congress to take action to strengthen our 
antitrust law so that it will, as intended, stand as a bulwark to 
protect consumers and prevent any further loss of competition in this 
essential industry.
  Our bill will strengthen merger enforcement under the antitrust law 
in two respects. First, it will direct that the FTC, in conjunction 
with the Justice Department, revise its Merger Guidelines to take into 
account the special conditions prevailing in the oil industry. In 
reviewing a pending merger or acquisition to determine whether to 
approve it or take legal action to block it, the FTC follows what are 
known as ``Merger Guidelines.'' The Merger Guidelines set forth the 
factors that the agency must examine to determine if a merger or 
acquisition lessens competition, and sets forth the legal tests the FTC 
is to follow in deciding whether to approve or challenge a merger. As 
presently written, the Merger Guidelines fail to direct the FTC, when 
reviewing an oil industry merger, to pay any heed at all to the special 
economic conditions prevailing in that industry.
  Our bill will correct this deficiency. Many special conditions 
prevail in the oil and gas marketplace that warrant scrutiny, 
conditions that do not occur in other industries, and the Merger 
Guidelines should reflect these conditions. In most industries, when 
demand rises and existing producers earn ever-increasing profits, new 
producers enter the market and new supply expands, reducing the 
pressure on price. However, in the oil industry, there are severe 
limitations on supply and environmental and regulatory difficulty in 
opening new refineries, so this normal market mechanism cannot work. 
Additionally, in most industries, consumers shift to alternative 
products in the face of sharp price increases, leading to a reduction 
in demand and a corresponding reduction in the pressure to increase 
prices. But for such an essential commodity as gasoline, consumers have 
no such option--they must continue to consume gasoline to get to work, 
to go to school, and to shop. These factors all mean that antitrust 
enforcers should be especially cautious about permitting increases in 
concentration in the oil industry.
  Accordingly, our bill directs the FTC and Justice Department to 
revise its Merger Guidelines to take into account the special 
conditions prevailing in the oil industry--including the high 
inelasticity of demand for oil and petroleum-related products; the ease 
of gaining market power; supply and refining capacity limits; 
difficulties of market entry; and unique regulatory requirements 
applying to the oil industry. This revision of the Merger Guidelines 
must be completed within 6 months of enactment of this legislation.
  The second manner in which this legislation will strengthen antitrust 
enforcement will be to shift the burden of proof in Clayton Act 
challenges to oil industry mergers and acquisitions. In such cases, the 
burden will be placed on the merging parties to establish, by a 
preponderance of evidence, that their transaction does not 
substantially lessen competition. This provision would reverse the 
usual rule that the government or private plaintiff challenging the 
merger must prove that the transaction harms competition. As the 
parties seeking to effect a merger with a competitor in an already 
concentrated industry, and possessing all the relevant data regarding 
the transaction, it is entirely appropriate that the merging parties 
bear this burden. This provision does not forbid all mergers in the oil 
industry if the merging parties can establish that their merger does 
not substantially harm competition, it may proceed. However, shifting 
the burden of proof in this manner will undoubtedly make it more 
difficult for oil mergers and acquisition to survive court challenge, 
thereby enhancing the law's ability to block truly anticompetitive 
transactions and deterring companies from even attempting such 
transactions. In today's concentrated oil industry and with consumers 
suffering record high prices, mergers and acquisitions that even the 
merging parties cannot justify should not be tolerated.
  As ranking member on the Senate Antitrust Subcommittee, I believe 
that this bill is a crucial step to ending this unprecedented move 
towards industry concentration and to begin to restore competitive 
balance to the oil and gas industry. Since the days of the break-up of 
the Standard Oil trust 100 years ago, antitrust enforcement has been 
essential to prevent undue concentration in this industry. This bill is 
an essential step to ensure that our antitrust laws are sufficiently 
strong to ensure a competitive oil industry in the 21st century. I urge 
my colleagues to support the Oil Industry Merger Antitrust Enforcement 
Act.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 2854

       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 ``Oil Industry Merger 
     Antitrust Enforcement Act''.

     SEC. 2. STATEMENT OF FINDINGS AND DECLARATIONS OF PURPOSES.

       (a) Findings.--Congress finds the following:
       (1) American consumers are suffering from excessively high 
     prices for gasoline, natural gas, heating oil, and other 
     energy products.
       (2) These excessively high energy prices have been caused, 
     at least in substantial part, by undue concentration among 
     companies involved in the production, refining, distribution, 
     and retail sale of oil, gasoline, natural gas, heating oil, 
     and other petroleum-related products.
       (3) There has been a sharp consolidation caused by mergers 
     and acquisitions among oil companies over the last decade, 
     and the antitrust enforcement agencies (the Federal Trade 
     Commission and the Department of Justice Antitrust Division) 
     have failed to employ the antitrust laws to prevent this 
     consolidation, to the detriment of consumers and competition. 
     This consolidation has caused substantial injury to 
     competition and has enabled the remaining oil companies to 
     gain market power over the sale, refining, and distribution 
     of petroleum-related products.
       (4) The demand for oil, gasoline, and other petroleum-based 
     products is highly inelastic

[[Page 8634]]

     so that oil companies can easily utilize market power to 
     raise prices.
       (5) Maintaining competitive markets for oil, gasoline, 
     natural gas, and other petroleum-related products is in the 
     highest national interest.
       (b) Purposes.--The purposes of this Act are to--
       (1) ensure vigorous enforcement of the antitrust laws in 
     the oil industry;
       (2) restore competition to the oil industry and to the 
     production, refining, distribution, and marketing of gasoline 
     and other petroleum-related products; and
       (3) prevent the accumulation and exercise of market power 
     by oil companies.

     SEC. 3. BURDEN OF PROOF.

       Section 7 of the Clayton Act (15 U.S.C. 18) is amended by 
     adding at the end the following:
       ``In any civil action brought against any person for 
     violating this section in which the plaintiff--
       ``(1) alleges that the effect of a merger, acquisition, or 
     other transaction affecting commerce may be to substantially 
     lessen competition, or to tend to create a monopoly, in the 
     business of exploring for, producing, refining, or otherwise 
     processing, storing, marketing, selling, or otherwise making 
     available petroleum, oil, or natural gas, or products derived 
     from petroleum, oil, or natural gas; and
       ``(2) establishes that a merger, acquisition, or 
     transaction is between or involves persons competing in the 
     business of exploring for, producing, refining, or otherwise 
     processing, storing, marketing, selling, or otherwise making 
     available petroleum, oil, or natural gas, or products derived 
     from petroleum, oil, or natural gas;

     the burden of proof shall be on the defendant or defendants 
     to establish by a preponderance of the evidence that the 
     merger, acquisition, or transaction at issue will not 
     substantially lessen competition or tend to create a 
     monopoly.''.

     SEC. 4. ENSURING FULL AND FREE COMPETITION.

       (a) Review.--The Federal Trade Commission and the Antitrust 
     Division of the Department of Justice shall jointly review 
     and revise all enforcement guidelines and policies, including 
     the Horizontal Merger Guidelines issued April 2, 1992 and 
     revised April 8, 1997, and the Non-Horizontal Merger 
     Guidelines issued June 14, 1984, and modify those guidelines 
     in order to--
       (1) specifically address mergers and acquisitions in oil 
     companies and among companies involved in the production, 
     refining, distribution, or marketing of oil, gasoline, 
     natural gas, heating oil, or other petroleum-related 
     products; and
       (2) ensure that the application of these guidelines will 
     prevent any merger and acquisition in the oil industry, when 
     the effect of such a merger or acquisition may be to 
     substantially lessen competition, or to tend to create a 
     monopoly, and reflect the special conditions prevailing in 
     the oil industry described in subsection (b).
       (b) Special Conditions.--The guidelines described in 
     subsection (a) shall be revised to take into account the 
     special conditions prevailing in the oil industry, 
     including--
       (1) the high inelasticity of demand for oil and petroleum-
     related products;
       (2) the ease of gaining market power in the oil industry;
       (3) supply and refining capacity limits in the oil 
     industry;
       (4) difficulties of market entry in the oil industry; and
       (5) unique regulatory requirements applying to the oil 
     industry.
       (c) Competition.--The review and revision of the 
     enforcement guidelines required by this section shall be 
     completed not later than 6 months after the date of enactment 
     of this Act.
       (d) Report.--Not later than 6 months after the date of 
     enactment of this Act, the Federal Trade Commission and the 
     Antitrust Division of the Department of Justice shall jointly 
     report to the Committee on the Judiciary of the Senate and 
     the Committee on the Judiciary of the House of 
     Representatives regarding the review and revision of the 
     enforcement guidelines mandated by this section.

     SEC. 5. DEFINITIONS.

       In this Act:
       (1) Oil industry.--The term ``oil industry'' means 
     companies and persons involved in the production, refining, 
     distribution, or marketing of oil or petroleum-based 
     products.
       (2) Petroleum-based product.--The term ``petroleum-based 
     product'' means gasoline, diesel fuel, jet fuel, home heating 
     oil, natural gas, or other products derived from the refining 
     of oil or petroleum.
                                 ______
                                 
      By Mr. BIDEN (for himself and Mr. Jeffords):
  S. 2855. A bill to amend the Safe Drinking Water Act to eliminate 
security risks by replacing the use of extremely hazardous gaseous 
chemicals with inherently safer technologies; to the Committee on 
Environment and Public Works.
  Mr. BIDEN. Mr. President, I rise today to introduce the Community 
Water Treatment Hazards Reduction Act of 2006. This legislation would 
completely eliminate a known security risk to millions of Americans 
across the United States by facilitating the transfer to safer 
technologies from deadly toxic chemicals at our Nation's water 
treatment facilities.
  Across our Nation, there are thousands of water treatment facilities 
that utilize gaseous toxic chemicals to treat drinking and wastewater. 
Approximately 2,850 facilities are currently regulated under the Clean 
Air Act because they store large quantities of these dangerous 
chemicals. In fact, 98 of these facilities threaten over 100,000 
citizens. For example, the Fiveash Water Treatment Plant in Fort 
Lauderdale, FL, threatens 1,526,000 citizens. The Bachman Water 
Treatment in Dallas, TX, threatens up to 2 million citizens. And there 
are similar examples in communities throughout the Nation. If these 
facilities--and the 95 other facilities that threaten over 100,000 
citizens--switched from the use of toxic chemicals to safer 
technologies that are widely used within the industry we could 
completely eliminate a known threat to nearly 50 million Americans.
  Many facilities have already made the prudent decision to switch 
without intervention by the government. The Middlesex County Utilities 
Authority in Sayreville, NJ, switched to safer technologies and 
eliminated the risk to 10.7 million people. The Nottingham Water 
Treatment Plant in Cleveland, OH, switched and eliminated the risk to 
1.1 million citizens. The Blue Plains Wastewater Treatment Plant 
switched and eliminated the risk to 1.7 million people. In my hometown 
of Wilmington, DE, the Wilmington Water Pollution Control Facility 
switched from using chlorine gas to liquid bleach. This commendable 
decision has eliminated the risk to 560,000 citizens, including the 
entire city of Wilmington. In fact, this facility no longer has to 
submit risk management plans to the Environmental Protection Agency 
required by the Clean Air Act because the threat has been completely 
eliminated. There are many other examples of facilities that have done 
the right thing and eliminated the use of these dangerous, gaseous 
chemicals.
  The bottom line is that if we can eliminate a known risk, we should. 
The legislation I am introducing today will do just that. It will 
require the Administrator of the Environmental Protection Agency, in 
consultation with the Secretary of Homeland Security, to do a few 
simple things. First, water facilities will be prioritized based upon 
the risk that they pose to citizens and critical infrastructure. These 
facilities--beginning with the most dangerous ones--will be required to 
submit a report on the feasibility of utilizing safer technologies and 
the anticipated costs to transition. If grant funding is available, the 
Administrator will issue a grant and order the facility to transition 
to the safer technology chosen by the owner of the facility. I believe 
that this approach will allow us to use Federal funds responsibly while 
reducing risk to our citizens.
  Once the transition is complete, the facility will be required to 
track all cost-savings related to the switch, such as decreased 
security costs, costs saving by eliminating administrative requirements 
under the EPA risk management plan, lower insurance premiums, and 
others. If savings are ultimately realized by the facility, it will be 
required to return one half of these savings, not to exceed the grant 
amount, back to the EPA. In turn, the EPA will utilize any returned 
savings to help facilitate the transition of more water facilities.
  A 2005 report by the Government Accountability Office found that 
providing grants to assist water facilities to transition to safer 
technologies was an appropriate use of Federal funds. The costs for an 
individual facility to transition will vary, but the cost is very cheap 
when you consider the security benefits. For example, the Wilmington 
facility invested approximately $160,000 to transition and eliminated 
the risk to nearly 600,000 people. Similarly, the Blue Plains facility 
spent $500,000 to transition after 9-11 and eliminated the risk to 1.2 
million

[[Page 8635]]

citizens immediately. This, in my view, is a sound use of funds. And, 
this legislation will provide sufficient funding to transition all of 
our high-priority facilities throughout Nation.
  Finally, I would like to point out that facilities making the 
decision to transition after 9-11, but before the enactment date of 
this legislation will be eligible to participate in the program 
authorized by this legislation. I have included this provision because 
I believe that the Federal Government should acknowledge--and promote--
local decisions that enhance our homeland security. In addition, we 
don't want to create a situation where water facilities wait for 
Federal funding, before doing the right thing and eliminating those 
dangerous gaseous chemicals.
  Last December the 9-11 Discourse Project released its report card for 
the administration and Congress on efforts to implement the 9-11 
Commission recommendations. It was replete with D's and F's 
demonstrating that we have been going in the wrong direction with 
respect to homeland security. One of the most troubling findings made 
by the 9-11 Commission is that with respect to our Nation's critical 
infrastructure that ``no risk and vulnerability assessments actually 
made; no national priorities established; no recommendations made on 
allocations of scarce resources. All key decisions are at least a year 
away. It is time that we stop talking about priorities and actually set 
some.'' While much remains to be done, the Community Water Treatment 
Hazards Reduction Act of 2006 sets an important priority for our 
homeland security and it affirmatively addresses it. I urge my 
colleagues to support this important legislation.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 2855

       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 ``Community Water Treatment 
     Hazards Reduction Act of 2006''.

     SEC. 2. USE OF INHERENTLY SAFER TECHNOLOGIES AT WATER 
                   FACILITIES.

       Part F of the Safe Drinking Water Act (42 U.S.C. 300j-21 et 
     seq.) is amended by adding at the end the following:

     ``SEC. 1466. USE OF INHERENTLY SAFER TECHNOLOGIES AT WATER 
                   FACILITIES.

       ``(a) Definitions.--In this section:
       ``(1) Harmful intentional act.--The term `harmful 
     intentional act' means a terrorist attack or other 
     intentional act carried out upon a water facility that is 
     intended--
       ``(A) to substantially disrupt the ability of the water 
     facility to provide safe and reliable--
       ``(i) conveyance and treatment of wastewater or drinking 
     water;
       ``(ii) disposal of effluent; or
       ``(iii) storage of a potentially hazardous chemical used to 
     treat wastewater or drinking water;
       ``(B) to damage critical infrastructure;
       ``(C) to have an adverse effect on the environment; or
       ``(D) to otherwise pose a significant threat to public 
     health or safety.
       ``(2) Inherently safer technology.--The term `inherently 
     safer technology' means a technology, product, raw material, 
     or practice the use of which, as compared to the current use 
     of technologies, products, raw materials, or practices, 
     significantly reduces or eliminates--
       ``(A) the possibility of release of a substance of concern; 
     and
       ``(B) the hazards to public health and safety and the 
     environment associated with the release or potential release 
     of a substance of concern.
       ``(3) Secretary.--The term `Secretary' means the Secretary 
     of Homeland Security (or a designee).
       ``(4) Substance of concern.--
       ``(A) In general.--The term `substance of concern' means 
     any chemical, toxin, or other substance that, if transported 
     or stored in a sufficient quantity, would have a high 
     likelihood of causing casualties and economic damage if 
     released or otherwise successfully targeted by a harmful 
     intentional act, as determined by the Administrator, in 
     consultation with the Secretary.
       ``(B) Inclusions.--The term `substance of concern' 
     includes--
       ``(i) any substance included in Table 1 or 2 contained in 
     section 68.130 of title 40, Code of Federal Regulations (or a 
     successor regulation), published in accordance with section 
     112(r)(3) of the Clean Air Act (42 U.S.C. 7412(r)(3)); and
       ``(ii) any other highly hazardous gaseous toxic material or 
     substance that, if transported or stored in a sufficient 
     quantity, could cause casualties or economic damage if 
     released or otherwise successfully targeted by a harmful 
     intentional act, as determined by the Administrator, in 
     consultation with the Secretary.
       ``(5) Treatment works.--The term `treatment works' has the 
     meaning given the term in section 212 of the Federal Water 
     Pollution Control Act (33 U.S.C. 1292).
       ``(6) Vulnerability zone.--The term `vulnerability zone' 
     means, with respect to a substance of concern, the geographic 
     area that would be affected by a worst-case release of the 
     substance of concern, as determined by the Administrator on 
     the basis of--
       ``(A) an assessment that includes the information described 
     in section 112(r)(7)(B)(ii)(I) of the Clean Air Act (42 
     U.S.C. 7412(r)(7)(B)(ii)(I)); or
       ``(B) such other assessment or criteria as the 
     Administrator determines to be appropriate.
       ``(7) Water facility.--The term `water facility' means a 
     treatment works or public water system owned or operated by 
     any person.
       ``(b) Regulations.--
       ``(1) In general.--Not later than 90 days after the date of 
     enactment of this section, the Administrator, in consultation 
     with the Secretary and other Federal, State, and local 
     governmental entities, security experts, owners and operators 
     of water facilities, and other interested persons shall--
       ``(A) compile a list of all high-consequence water 
     facilities, as determined in accordance with paragraph (2); 
     and
       ``(B) notify each owner and operator of a water facility 
     that is included on the list.
       ``(2) Identification of high-consequence water 
     facilities.--
       ``(A) In general.--Subject to subparagraph (B), in 
     determining whether a water facility is a high-consequence 
     water facility, the Administrator shall consider--
       ``(i) the number of people located in the vulnerability 
     zone of each substance of concern that could be released at 
     the water facility;
       ``(ii) the critical infrastructure (such as health care, 
     governmental, or industrial facilities or centers) served by 
     the water facility;
       ``(iii) any use by the water facility of large quantities 
     of 1 or more substances of concern; and
       ``(iv) the quantity and volume of annual shipments of 
     substances of concern to or from the water facility.
       ``(B) Tiers of facilities.--
       ``(i) In general.--Except as provided in clauses (ii) 
     through (iv), the Administrator shall classify high-
     consequence water facilities designated under this paragraph 
     into 3 tiers, and give priority to orders issued for, actions 
     taken by, and other matters relating to the security of, 
     high-consequence water facilities based on the tier 
     classification of the high-consequence water facilities, as 
     follows:

       ``(I) Tier 1 facilities.--A Tier 1 high-consequence water 
     facility shall have a vulnerability zone that covers more 
     than 100,000 individuals and shall be given the highest 
     priority by the Administrator.
       ``(II) Tier 2 facilities.--A Tier 2 high-consequence water 
     facility shall have a vulnerability zone that covers more 
     than 25,000, but not more than 100,000, individuals and shall 
     be given the second-highest priority by the Administrator.
       ``(III) Tier 3 facilities.--A Tier 3 high-consequence water 
     facility shall have a vulnerability zone that covers more 
     than 10,000, but not more than 25,000, individuals and shall 
     be given the third-highest priority by the Administrator.

       ``(ii) Mandatory designation.--If the vulnerability zone 
     for a substance of concern at a water facility contains more 
     than 10,000 individuals, the water facility shall be--

       ``(I) considered to be a high-consequence water facility; 
     and
       ``(II) classified by the Administrator to an appropriate 
     tier under clause (i).

       ``(iii) Discretionary classification.--A water facility 
     with a vulnerability zone that covers 10,000 or fewer 
     individuals may be designated as a high consequence facility, 
     on the request of the owner or operator of a water facility, 
     and classified into a tier described in clause (i), at the 
     discretion of the Administrator.
       ``(iv) Reclassification.--The Administrator--

       ``(I) may reclassify a high-consequence water facility into 
     a tier with higher priority, as described in clause (i), 
     based on an increase of population covered by the 
     vulnerability zone or any other appropriate factor, as 
     determined by the Administrator; but
       ``(II) may not reclassify a high-consequence water facility 
     into a tier with a lower priority, as described in clause 
     (i), for any reason.

       ``(3) Options feasibility assessment on use of inherently 
     safer technology.--
       ``(A) In general.--Not later than 90 days after the date on 
     which the owner or operator of a high-consequence water 
     facility receives notice under paragraph (1)(B), the owner or 
     operator shall submit to the Administrator an options 
     feasibility assessment that describes--

[[Page 8636]]

       ``(i) an estimate of the costs that would be directly 
     incurred by the high-consequence water facility in 
     transitioning from the use of the current technology used for 
     1 or more substances of concern to inherently safer 
     technologies; and
       ``(ii) comparisons of the costs and benefits to 
     transitioning between different inherently safer 
     technologies, including the use of--

       ``(I) sodium hypochlorite;
       ``(II) ultraviolet light;
       ``(III) other inherently safer technologies that are in use 
     within the applicable industry; or
       ``(IV) any combination of the technologies described in 
     subclauses (I) through (III).

       ``(B) Considerations in determining estimated costs.--In 
     estimating the transition costs described in subparagraph 
     (A)(i), an owner or operator of a high-consequence water 
     facility shall consider--
       ``(i) the costs of capital upgrades to transition to the 
     use of inherently safer technologies;
       ``(ii) anticipated increases in operating costs of the 
     high-consequence water facility;
       ``(iii) offsets that may be available to reduce or 
     eliminate the transition costs, such as the savings that may 
     be achieved by--

       ``(I) eliminating security needs (such as personnel and 
     fencing);
       ``(II) complying with safety regulations;
       ``(III) complying with environmental regulations and 
     permits;
       ``(IV) complying with fire code requirements;
       ``(V) providing personal protective equipment;
       ``(VI) installing safety devices (such as alarms and 
     scrubbers);
       ``(VII) purchasing and maintaining insurance coverage;
       ``(VIII) conducting appropriate emergency response and 
     contingency planning;
       ``(IX) conducting employee background checks; and
       ``(X) potential liability for personal injury and damage to 
     property; and

       ``(iv) the efficacy of each technology in treating or 
     neutralizing biological or chemical agents that could be 
     introduced into a drinking water supply by a terrorist or act 
     of terrorism.
       ``(C) Use of inherently safer technologies.--
       ``(i) In general.--Subject to clause (ii), not later than 
     90 days after the date of submission of the options 
     feasibility assessment required under this paragraph, the 
     owner or operator of a high-consequence water facility, in 
     consultation with the Administrator, the Secretary, the 
     United States Chemical Safety and Hazard Investigation Board, 
     local officials, and other interested parties, shall 
     determine which inherently safer technologies are to be used 
     by the high-consequence water facility.
       ``(ii) Considerations.--In making the determination under 
     clause (i), an owner or operator--

       ``(I) may consider transition costs estimated in the 
     options feasibility assessment of the owner or operator 
     (except that those transition costs shall not be the sole 
     basis for the determination of the owner or operator);
       ``(II) shall consider long-term security enhancement of the 
     high-consequence water facility;
       ``(III) shall consider comparable water facilities that 
     have transitioned to inherently safer technologies; and
       ``(IV) shall consider the overall security impact of the 
     determination, including on the production, processing, and 
     transportation of substances of concern at other facilities.

       ``(c) Enforcement.--
       ``(1) In general.--In accordance with the tiers and 
     priority system established under subsection (b)(2)(B), 
     subject to paragraph (2), the Administrator--
       ``(A) shall prioritize the use of inherently safer 
     technologies at high-consequence facilities listed under 
     subsection (b)(1);
       ``(B) subject to the availability of grant funds under this 
     section, not later than 90 days after the date on which the 
     Administrator receives an options feasibility assessment from 
     an owner or operator of a high-consequence water facility 
     under subsection (b)(3)(A), shall issue an order requiring 
     the high-consequence water facility to eliminate the use of 1 
     or more substances of concern and adopt 1 or more inherently 
     safer technologies; and
       ``(C) may seek enforcement of an order issued under 
     paragraph (2) in the appropriate United States district 
     court.
       ``(2) De minimis use.--Nothing in this section prohibits 
     the de minimis use of a substance of concern as a residual 
     disinfectant.
       ``(d) Grants.--
       ``(1) In general.--In accordance with the tiers and 
     priority system established under subsection (b)(2)(B), the 
     Administrator shall provide grants to high-consequence 
     facilities (including high-consequence facilities subject to 
     an order issued under subsection (c)(1)(C) and water 
     facilities described in paragraph (6)) for use in paying 
     capital expenditures directly required to complete the 
     transition of the high-consequence water facility to the use 
     of 1 or more inherently safer technologies.
       ``(2) Application.--A high-consequence water facility that 
     seeks to receive a grant under this subsection shall submit 
     to the Administrator an application by such date, in such 
     form, and containing such information as the Administrator 
     shall require, including information relating to the transfer 
     to inherently safer technologies, and the proposed date of 
     such a transfer, described in subsection (b)(3)(B).
       ``(3) Deadline for transition.--An owner or operator of a 
     high-consequence water facility that is subject to an order 
     under subsection (c)(1)(C) and that receives a grant under 
     this subsection shall begin the transition to inherently 
     safer technologies described in paragraph (1) not later than 
     90 days after the date of issuance of the order under 
     subsection (c)(1)(C).
       ``(4) Facility upgrades.--An owner or operator of a high-
     consequence water facility--
       ``(A) may complete the transition to inherently safer 
     technologies described in paragraph (1) within the scope of a 
     greater facility upgrade; but
       ``(B) shall use amounts from a grant received under this 
     subsection only for the capital expenditures directly 
     relating to the transition to inherently safer technologies.
       ``(5) Operational costs.--An owner or operator of a high-
     consequence water facility that receives a grant under this 
     subsection may not use funds from the grant to pay or offset 
     any ongoing operational cost of the high-consequence water 
     facility.
       ``(6) Other requirements.--As a condition of receiving a 
     grant under this subsection, the owner or operator of a high-
     consequence water facility shall--
       ``(A) upon receipt of a grant, track all cost savings 
     resulting from the transition to inherently safer 
     technologies, including those savings identified in 
     subsection (b)(4)(B)(iii); and
       ``(B) for each fiscal year for which grant funds are 
     received, return an amount to the Administrator equal to 50 
     percent of the savings achieved by the high-consequence water 
     facility (but not to exceed the amount of grant funds 
     received for the fiscal year) for use by the Administrator in 
     facilitating the future transition of other high-consequence 
     water facilities to the use of inherently safer technologies.
       ``(7) Interim transitions.--A water facility that 
     transitioned to the use of 1 or more inherently safer 
     technologies after September 11, 2001, but before the date of 
     enactment of this section, and that qualifies as a high-
     consequence facility under subsection (b)(2), in accordance 
     with any previous report submitted by the water facility 
     under section 112(r) of the Clean Air Act (42 U.S.C. 7412(r)) 
     and as determined by the Administrator, shall be eligible to 
     receive a grant under this subsection.
       ``(e) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $125,000,000 for 
     each of fiscal years 2007 through 2011.''.

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