[Congressional Record (Bound Edition), Volume 153 (2007), Part 3]
[Senate]
[Pages 3247-3272]
[From the U.S. Government Publishing Office, www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

                                 ______
                                 
      By Mr. LUGAR:
  S. 494. A bill to endorse further enlargement of the North Atlantic 
Treaty Organization (NATO) and to facilitate the timely admission of 
new members to NATO, and for other purposes; to the Committee on 
Foreign Relations.
  Mr. LUGAR. Mr. President, I rise today to introduce the ``NATO 
Freedom Consolidation Act of 2007''. Last year this legislation passed 
the Senate by unanimous consent. Unfortunately, the House was unable to 
act prior to adjournment last year.
  I was pleased that thirteen of my colleagues, including Senators 
Biden, Chambliss, Coleman, Dodd, Hagel, Hutchison, Martinez, McCain, 
Smith, and Sununu, joined me in proposing this important legislation.
  The goal of this bill is to reaffirm United States support for 
continued enlargement of NATO to democracies that are able and willing 
to meet the responsibilities of membership. In particular, the 
legislation calls for the timely admission of Albania, Croatia, 
Georgia, Macedonia, and Ukraine to NATO and authorizes security 
assistance for these countries in Fiscal Year 2008. Each of these 
countries has clearly stated its desire to join NATO and is working 
hard to meet the specified requirements for membership.
  I believe that eventual NATO membership for these five countries 
would be a success for Europe, NATO, and the United States by 
continuing to extend the zone of peace and security. Albania, Croatia, 
and Macedonia have been making progress on reforms through their 
participation in the NATO Membership Action Plan since 2002. 
Unfortunately, Georgia and Ukraine have not yet been granted a 
Membership Action Plan but nevertheless have made remarkable progress. 
This legislation will provide important incentives and assistance to 
the countries to continue the implementation of democratic, defense, 
and economic reforms.
  Since the end of the Cold War, NATO has been evolving to meet the new 
security needs of the 21st century. In this era, the threats to NATO 
members are transnational and far from its geographic borders. There is 
strong support among members for NATO's operation in Afghanistan, and 
for its training mission in Iraq. NATO's viability as an effective 
defense and security alliance depends on flexible, creative leadership, 
as well as the willingness of members to improve capabilities and 
address common threats.
  If NATO is to continue to be the preeminent security Alliance and 
serve the defense interests of its membership, it must continue to 
evolve and that evolution must include enlargement. Potential NATO 
membership motivates emerging democracies to make important advances in 
areas such as the rule of law and civil society. A closer relationship 
with NATO will promote these values and contribute to our mutual 
security. Georgia is a young democracy that has made tremendous 
progress since the ``Rose Revolution.'' It is situated in a critical 
geo-strategic location and is host to a large portion of the Baku-
Tbilisi-Ceyhan pipeline that carries important energy resources to the 
West from Azerbaijan and, in the future, Kazakhstan. Georgia is 
resisting pressure from breakaway republics backed by Moscow. In the 
past, border disputes have been identified as reasons a country may not 
be invited to join NATO. But in this case, Russia's action, not 
Georgia's, are frustrating Tbilisi's NATO aspirations.

[[Page 3248]]

  Three years ago, the United States Senate unanimously voted to invite 
seven countries to join NATO. Today, Bulgaria, Estonia, Latvia, 
Lithuania, Romania, Slovakia, and Slovenia are making significant 
contributions to NATO and are among our closest allies in the global 
war on terrorism. It is time again for the United States to take the 
lead in urging its allies to bring in new members, and to offer timely 
admission of Albania, Croatia, Georgia, Macedonia, and Ukraine to NATO.
                                 ______
                                 
      By Mr. LEAHY (for himself, Mr. Specter, Mr. Feingold, Mr. 
        Schumer, and Mr. Sanders):
  S. 495. A bill to prevent and mitigate identity theft, to ensure 
privacy, to provide notice of security breaches, and to enhance 
criminal penalties, law enforcement assistance, and other protections 
against security breaches, fraudulent access, and misuse of personally 
identifiable information; to the Committee on the Judiciary.
  Mr. LEAHY. Mr. President, today I am pleased to join Senator Specter 
in reintroducing the Leahy-Specter Personal Data Privacy and Security 
Act. This is a comprehensive data privacy package aimed at better 
protecting Americans' privacy. Senator Specter has been a valuable 
partner on this, and I also thank Majority Leader Reid for his 
leadership and commitment to enacting data privacy legislation this 
year.
  When Senator Specter and I introduced this bill in 2005, we had high 
hopes of bringing urgently needed data privacy reforms to the American 
people. The Judiciary Committee reported this bill favorably in 
November of 2005, but with the last Congress, it simply sat on the 
calendar. The leadership would not bring it forward.
  The irony is while they refused to bring it forward, the problems of 
data breaches remained a persistent and pernicious threat to Americans' 
privacy. Yesterday we learned that the Department of Veterans Affairs 
has lost a portable hard drive containing the sensitive personal 
information on as many as 48,000 veterans. I can imagine what the 
veterans in my State feel about that. I can imagine what the veterans 
in Montana feel about that.
  Last week, there was a major data breach involving a State computer 
server in my home State of Vermont. It jeopardized the financial data 
of at least 69,000 Vermonters whose personal financial information had 
been stored on the computer used by the Vermont Agency of Human 
Services. Can you imagine 69,000 people, in a State of barely over 
600,000 people.
  This is not unique to Vermont. Last month mega retailer TJX disclosed 
that it suffered a major computer breach involving credit and debt card 
purchases involving possibly hundreds of thousands of American 
consumers. And, even as disturbing as that is, while they knew about 
the breach in mid-December, none of those customers were told about it 
until a month later. It is as if a thief had gone to each one of their 
houses and stolen their data.
  Of course, all of this comes on the heels of the theft of the 
personal data of 26.5 million of our veterans and active-duty personnel 
at the VA last year. Think about this: You are a man or a woman serving 
your country in Afghanistan or Iraq, and this information is stolen--
with data about where you live and what family members are left at home 
while you are overseas. How do you think that makes you feel?
  According to the Privacy Rights Clearinghouse, more than 100 million 
records containing sensitive personal information have been involved in 
data security breaches since 2005. We need strong Federal data privacy 
and security laws to protect Americans' personal data, and to address 
the ills of lax data security.
  Our bill requires that data brokers let consumers know what sensitive 
personal information they have about them and to allow individuals to 
correct this. It is a simple matter of fairness. There is a clear 
precedent for our approach in the credit reporting context. Our bill 
also requires that companies who have databases with sensitive personal 
information about Americans establish and implement data privacy and 
security programs. In the information age, any company that wants to be 
trusted by the public must earn that trust by vigilantly protecting the 
databases that they use and maintain. In addition, our bill requires 
notice when sensitive personal information has been compromised. The 
American people need to know when they may be exposed to a data breach. 
Whether it is a government agency or a private company, if they lose 
your sensitive information, your Social Security number, your address, 
or anything about you, you have a right to know. If they are holding 
that information about you, and they lose it, you have the right to 
know it has been lost.
  We also have tough criminal penalties for anyone who would 
intentionally or willfully conceal the fact that a data breach has 
occurred when that breach causes economic damage to consumers.
  Then finally, we address the important issue of the Government's use 
of personal data. This would require Federal agencies to notify 
affected individuals when Government data breaches occur.
  We should never have to worry about our Government having this 
information on us and losing it, but certainly in the last 2 or 3 
years, we have seen so many millions of files that have been lost or 
put in jeopardy. We live in a world in which our Government also is 
increasingly turning to the private sector to get personal data that 
they, in some instances, couldn't legally get on their own. To address 
this, our bill puts protecting Americans' privacy first and foremost: 
Government data has to be protected and we have to know if the 
Government falls down on the job.
  This is a comprehensive bill. It not only deals with the need to 
provide Americans notice when they have been victims of a data breach, 
it also deals with the underlying problems of lack of security and lack 
of accountability to prevent data breaches from occurring in the first 
place.
  Today, Americans live in a world where their most sensitive personal 
information can be accessed and sold to the highest bidder with a few 
keystrokes on their computer. Our privacy laws greatly lag behind both 
the capabilities of our technology and the cunning of identity thieves. 
This legislation closes that gap. I commend the leadership for being 
willing to bring up our data privacy bill. I wish that the leadership 
in the last Congress had brought this bill up last year. But, I am glad 
that the new leadership will do so this year.
  For the sake of all Americans, I urge all Senators to support this 
legislation and to act now to pass comprehensive data privacy and 
security 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. 495

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Personal 
     Data Privacy and Security Act of 2007''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Findings.
Sec. 3. Definitions.

 TITLE I--ENHANCING PUNISHMENT FOR IDENTITY THEFT AND OTHER VIOLATIONS 
                      OF DATA PRIVACY AND SECURITY

Sec. 101. Organized criminal activity in connection with unauthorized 
              access to personally identifiable information.
Sec. 102. Concealment of security breaches involving sensitive 
              personally identifiable information.
Sec. 103. Review and amendment of Federal sentencing guidelines related 
              to fraudulent access to or misuse of digitized or 
              electronic personally identifiable information.

                         TITLE II--DATA BROKERS

Sec. 201. Transparency and accuracy of data collection.
Sec. 202. Enforcement.
Sec. 203. Relation to State laws.
Sec. 204. Effective date.

[[Page 3249]]

 TITLE III--PRIVACY AND SECURITY OF PERSONALLY IDENTIFIABLE INFORMATION

            Subtitle A--A Data Privacy and Security Program

Sec. 301. Purpose and applicability of data privacy and security 
              program.
Sec. 302. Requirements for a personal data privacy and security 
              program.
Sec. 303. Enforcement.
Sec. 304. Relation to other laws.

                Subtitle B--Security Breach Notification

Sec. 311. Notice to individuals.
Sec. 312. Exemptions.
Sec. 313. Methods of notice.
Sec. 314. Content of notification.
Sec. 315. Coordination of notification with credit reporting agencies.
Sec. 316. Notice to law enforcement.
Sec. 317. Enforcement.
Sec. 318. Enforcement by State attorneys general.
Sec. 319. Effect on Federal and State law.
Sec. 320. Authorization of appropriations.
Sec. 321. Reporting on risk assessment exemptions.
Sec. 322. Effective date.

       TITLE IV--GOVERNMENT ACCESS TO AND USE OF COMMERCIAL DATA

Sec. 401. General Services Administration review of contracts.
Sec. 402. Requirement to audit information security practices of 
              contractors and third party business entities.
Sec. 403. Privacy impact assessment of government use of commercial 
              information services containing personally identifiable 
              information.
Sec. 404. Implementation of chief privacy officer requirements.

     SEC. 2. FINDINGS.

       Congress finds that--
       (1) databases of personally identifiable information are 
     increasingly prime targets of hackers, identity thieves, 
     rogue employees, and other criminals, including organized and 
     sophisticated criminal operations;
       (2) identity theft is a serious threat to the nation's 
     economic stability, homeland security, the development of e-
     commerce, and the privacy rights of Americans;
       (3) over 9,300,000 individuals were victims of identity 
     theft in America last year;
       (4) security breaches are a serious threat to consumer 
     confidence, homeland security, e-commerce, and economic 
     stability;
       (5) it is important for business entities that own, use, or 
     license personally identifiable information to adopt 
     reasonable procedures to ensure the security, privacy, and 
     confidentiality of that personally identifiable information;
       (6) individuals whose personal information has been 
     compromised or who have been victims of identity theft should 
     receive the necessary information and assistance to mitigate 
     their damages and to restore the integrity of their personal 
     information and identities;
       (7) data brokers have assumed a significant role in 
     providing identification, authentication, and screening 
     services, and related data collection and analyses for 
     commercial, nonprofit, and government operations;
       (8) data misuse and use of inaccurate data have the 
     potential to cause serious or irreparable harm to an 
     individual's livelihood, privacy, and liberty and undermine 
     efficient and effective business and government operations;
       (9) there is a need to insure that data brokers conduct 
     their operations in a manner that prioritizes fairness, 
     transparency, accuracy, and respect for the privacy of 
     consumers;
       (10) government access to commercial data can potentially 
     improve safety, law enforcement, and national security; and
       (11) because government use of commercial data containing 
     personal information potentially affects individual privacy, 
     and law enforcement and national security operations, there 
     is a need for Congress to exercise oversight over government 
     use of commercial data.

     SEC. 3. DEFINITIONS.

       In this Act:
       (1) Agency.--The term ``agency'' has the same meaning given 
     such term in section 551 of title 5, United States Code.
       (2) Affiliate.--The term ``affiliate'' means persons 
     related by common ownership or by corporate control.
       (3) Business entity.--The term ``business entity'' means 
     any organization, corporation, trust, partnership, sole 
     proprietorship, unincorporated association, venture 
     established to make a profit, or nonprofit, and any 
     contractor, subcontractor, affiliate, or licensee thereof 
     engaged in interstate commerce.
       (4) Identity theft.--The term ``identity theft'' means a 
     violation of section 1028 of title 18, United States Code.
       (5) Data broker.--The term ``data broker'' means a business 
     entity which for monetary fees or dues regularly engages in 
     the practice of collecting, transmitting, or providing access 
     to sensitive personally identifiable information on more than 
     5,000 individuals who are not the customers or employees of 
     that business entity or affiliate primarily for the purposes 
     of providing such information to nonaffiliated third parties 
     on an interstate basis.
       (6) Data furnisher.--The term ``data furnisher'' means any 
     agency, organization, corporation, trust, partnership, sole 
     proprietorship, unincorporated association, or nonprofit that 
     serves as a source of information for a data broker.
       (7) Personal electronic record.--
       (A) In general.--The term ``personal electronic record'' 
     means data associated with an individual contained in a 
     database, networked or integrated databases, or other data 
     system that holds sensitive personally identifiable 
     information of that individual and is provided to 
     nonaffiliated third parties.
       (B) Exclusions.--The term ``personal electronic record'' 
     does not include--
       (i) any data related to an individual's past purchases of 
     consumer goods; or
       (ii) any proprietary assessment or evaluation of an 
     individual or any proprietary assessment or evaluation of 
     information about an individual.
       (8) Personally identifiable information.--The term 
     ``personally identifiable information'' means any 
     information, or compilation of information, in electronic or 
     digital form serving as a means of identification, as defined 
     by section 1028(d)(7) of title 18, United State Code.
       (9) Public record source.--The term ``public record 
     source'' means the Congress, any agency, any State or local 
     government agency, the government of the District of Columbia 
     and governments of the territories or possessions of the 
     United States, and Federal, State or local courts, courts 
     martial and military commissions, that maintain personally 
     identifiable information in records available to the public.
       (10) Security breach.--
       (A) In general.--The term ``security breach'' means 
     compromise of the security, confidentiality, or integrity of 
     computerized data through misrepresentation or actions that 
     result in, or there is a reasonable basis to conclude has 
     resulted in, acquisition of or access to sensitive personally 
     identifiable information that is unauthorized or in excess of 
     authorization.
       (B) Exclusion.--The term ``security breach'' does not 
     include--
       (i) a good faith acquisition of sensitive personally 
     identifiable information by a business entity or agency, or 
     an employee or agent of a business entity or agency, if the 
     sensitive personally identifiable information is not subject 
     to further unauthorized disclosure; or
       (ii) the release of a public record, or information derived 
     from a single public record, not otherwise subject to 
     confidentiality or nondisclosure requirement, or information 
     obtained from a news report or periodical.
       (11) Sensitive personally identifiable information.--The 
     term ``sensitive personally identifiable information'' means 
     any information or compilation of information, in electronic 
     or digital form that includes--
       (A) an individual's first and last name or first initial 
     and last name in combination with any 1 of the following data 
     elements:
       (i) A non-truncated social security number, driver's 
     license number, passport number, or alien registration 
     number.
       (ii) Any 2 of the following:

       (I) Home address or telephone number.
       (II) Mother's maiden name, if identified as such.
       (III) Month, day, and year of birth.

       (iii) Unique biometric data such as a finger print, voice 
     print, a retina or iris image, or any other unique physical 
     representation.
       (iv) A unique account identifier, electronic identification 
     number, user name, or routing code in combination with any 
     associated security code, access code, or password that is 
     required for an individual to obtain money, goods, services, 
     or any other thing of value; or
       (B) a financial account number or credit or debit card 
     number in combination with any security code, access code or 
     password that is required for an individual to obtain credit, 
     withdraw funds, or engage in a financial transaction.

 TITLE I--ENHANCING PUNISHMENT FOR IDENTITY THEFT AND OTHER VIOLATIONS 
                      OF DATA PRIVACY AND SECURITY

     SEC. 101. ORGANIZED CRIMINAL ACTIVITY IN CONNECTION WITH 
                   UNAUTHORIZED ACCESS TO PERSONALLY IDENTIFIABLE 
                   INFORMATION.

       Section 1961(1) of title 18, United States Code, is amended 
     by inserting ``section 1030(a)(2)(D) (relating to fraud and 
     related activity in connection with unauthorized access to 
     sensitive personally identifiable information as defined in 
     the Personal Data Privacy and Security Act of 2007,'' before 
     ``section 1084''.

     SEC. 102. CONCEALMENT OF SECURITY BREACHES INVOLVING 
                   SENSITIVE PERSONALLY IDENTIFIABLE INFORMATION.

       (a) In General.--Chapter 47 of title 18, United States 
     Code, is amended by adding at the end the following:

     ``Sec. 1040. Concealment of security breaches involving 
       sensitive personally identifiable information

       ``(a) Whoever, having knowledge of a security breach and of 
     the obligation to provide notice of such breach to 
     individuals under

[[Page 3250]]

     title III of the Personal Data Privacy and Security Act of 
     2007, and having not otherwise qualified for an exemption 
     from providing notice under section 312 of such Act, 
     intentionally and willfully conceals the fact of such 
     security breach and which breach causes economic damage to 1 
     or more persons, shall be fined under this title or 
     imprisoned not more than 5 years, or both.
       ``(b) For purposes of subsection (a), the term `person' has 
     the same meaning as in section 1030(e)(12) of title 18, 
     United States Code.
       ``(c) Any person seeking an exemption under section 312(b) 
     of the Personal Data Privacy and Security Act of 2007 shall 
     be immune from prosecution under this section if the United 
     States Secret Service does not indicate, in writing, that 
     such notice be given under section 312(b)(3) of such Act''.
       (b) Conforming and Technical Amendments.--The table of 
     sections for chapter 47 of title 18, United States Code, is 
     amended by adding at the end the following:

``1040. Concealment of security breaches involving personally 
              identifiable information.''.
       (c) Enforcement Authority.--
       (1) In general.--The United States Secret Service shall 
     have the authority to investigate offenses under this 
     section.
       (2) Non-exclusivity.--The authority granted in paragraph 
     (1) shall not be exclusive of any existing authority held by 
     any other Federal agency.

     SEC. 103. REVIEW AND AMENDMENT OF FEDERAL SENTENCING 
                   GUIDELINES RELATED TO FRAUDULENT ACCESS TO OR 
                   MISUSE OF DIGITIZED OR ELECTRONIC PERSONALLY 
                   IDENTIFIABLE INFORMATION.

       (a) Review and Amendment.--The United States Sentencing 
     Commission, pursuant to its authority under section 994 of 
     title 28, United States Code, and in accordance with this 
     section, shall review and, if appropriate, amend the Federal 
     sentencing guidelines (including its policy statements) 
     applicable to persons convicted of using fraud to access, or 
     misuse of, digitized or electronic personally identifiable 
     information, including identity theft or any offense under--
       (1) sections 1028, 1028A, 1030, 1030A, 2511, and 2701 of 
     title 18, United States Code; and
       (2) any other relevant provision.
       (b) Requirements.--In carrying out the requirements of this 
     section, the United States Sentencing Commission shall--
       (1) ensure that the Federal sentencing guidelines 
     (including its policy statements) reflect--
       (A) the serious nature of the offenses and penalties 
     referred to in this Act;
       (B) the growing incidences of theft and misuse of digitized 
     or electronic personally identifiable information, including 
     identity theft; and
       (C) the need to deter, prevent, and punish such offenses;
       (2) consider the extent to which the Federal sentencing 
     guidelines (including its policy statements) adequately 
     address violations of the sections amended by this Act to--
       (A) sufficiently deter and punish such offenses; and
       (B) adequately reflect the enhanced penalties established 
     under this Act;
       (3) maintain reasonable consistency with other relevant 
     directives and sentencing guidelines;
       (4) account for any additional aggravating or mitigating 
     circumstances that might justify exceptions to the generally 
     applicable sentencing ranges;
       (5) consider whether to provide a sentencing enhancement 
     for those convicted of the offenses described in subsection 
     (a), if the conduct involves--
       (A) the online sale of fraudulently obtained or stolen 
     personally identifiable information;
       (B) the sale of fraudulently obtained or stolen personally 
     identifiable information to an individual who is engaged in 
     terrorist activity or aiding other individuals engaged in 
     terrorist activity; or
       (C) the sale of fraudulently obtained or stolen personally 
     identifiable information to finance terrorist activity or 
     other criminal activities;
       (6) make any necessary conforming changes to the Federal 
     sentencing guidelines to ensure that such guidelines 
     (including its policy statements) as described in subsection 
     (a) are sufficiently stringent to deter, and adequately 
     reflect crimes related to fraudulent access to, or misuse of, 
     personally identifiable information; and
       (7) ensure that the Federal sentencing guidelines 
     adequately meet the purposes of sentencing under section 
     3553(a)(2) of title 18, United States Code.
       (c) Emergency Authority to Sentencing Commission.--The 
     United States Sentencing Commission may, as soon as 
     practicable, promulgate amendments under this section in 
     accordance with procedures established in section 21(a) of 
     the Sentencing Act of 1987 (28 U.S.C. 994 note) as though the 
     authority under that Act had not expired.

                         TITLE II--DATA BROKERS

     SEC. 201. TRANSPARENCY AND ACCURACY OF DATA COLLECTION.

       (a) In General.--Data brokers engaging in interstate 
     commerce are subject to the requirements of this title for 
     any product or service offered to third parties that allows 
     access or use of sensitive personally identifiable 
     information.
       (b) Limitation.--Notwithstanding any other provision of 
     this title, this section shall not apply to--
       (1) any product or service offered by a data broker 
     engaging in interstate commerce where such product or service 
     is currently subject to, and in compliance with, access and 
     accuracy protections similar to those under subsections (c) 
     through (f) of this section under the Fair Credit Reporting 
     Act (Public Law 91-508);
       (2) any data broker that is subject to regulation under the 
     Gramm-Leach-Bliley Act (Public Law 106-102);
       (3) any data broker currently subject to and in compliance 
     with the data security requirements for such entities under 
     the Health Insurance Portability and Accountability Act 
     (Public Law 104-191), and its implementing regulations;
       (4) information in a personal electronic record that--
       (A) the data broker has identified as inaccurate, but 
     maintains for the purpose of aiding the data broker in 
     preventing inaccurate information from entering an 
     individual's personal electronic record; and
       (B) is not maintained primarily for the purpose of 
     transmitting or otherwise providing that information, or 
     assessments based on that information, to non-affiliated 
     third parties; and
       (5) information concerning proprietary methodologies, 
     techniques, scores, or algorithms relating to fraud 
     prevention not normally provided to third parties in the 
     ordinary course of business.
       (c) Disclosures to Individuals.--
       (1) In general.--A data broker shall, upon the request of 
     an individual, disclose to such individual for a reasonable 
     fee all personal electronic records pertaining to that 
     individual maintained specifically for disclosure to third 
     parties that request information on that individual in the 
     ordinary course of business in the databases or systems of 
     the data broker at the time of such request.
       (2) Information on how to correct inaccuracies.--The 
     disclosures required under paragraph (1) shall also include 
     guidance to individuals on procedures for correcting 
     inaccuracies.
       (d) Accuracy Resolution Process.--
       (1) Information from a public record or licensor.--
       (A) In general.--If an individual notifies a data broker of 
     a dispute as to the completeness or accuracy of information 
     disclosed to such individual under subsection (c) that is 
     obtained from a public record source or a license agreement, 
     such data broker shall determine within 30 days whether the 
     information in its system accurately and completely records 
     the information available from the public record source or 
     licensor.
       (B) Data broker actions.--If a data broker determines under 
     subparagraph (A) that the information in its systems does not 
     accurately and completely record the information available 
     from a public record source or licensor, the data broker 
     shall--
       (i) correct any inaccuracies or incompleteness, and provide 
     to such individual written notice of such changes; and
       (ii) provide such individual with the contact information 
     of the public record or licensor.
       (2) Information not from a public record source or 
     licensor.--If an individual notifies a data broker of a 
     dispute as to the completeness or accuracy of information not 
     from a public record or licensor that was disclosed to the 
     individual under subsection (c), the data broker shall, 
     within 30 days of receiving notice of such dispute--
       (A) review and consider free of charge any information 
     submitted by such individual that is relevant to the 
     completeness or accuracy of the disputed information; and
       (B) correct any information found to be incomplete or 
     inaccurate and provide notice to such individual of whether 
     and what information was corrected, if any.
       (3) Extension of review period.--The 30-day period 
     described in paragraph (1) may be extended for not more than 
     30 additional days if a data broker receives information from 
     the individual during the initial 30-day period that is 
     relevant to the completeness or accuracy of any disputed 
     information.
       (4) Notice identifying the data furnisher.--If the 
     completeness or accuracy of any information not from a public 
     record source or licensor that was disclosed to an individual 
     under subsection (c) is disputed by such individual, the data 
     broker shall provide, upon the request of such individual, 
     the contact information of any data furnisher that provided 
     the disputed information.
       (5) Determination that dispute is frivolous or 
     irrelevant.--
       (A) In general.--Notwithstanding paragraphs (1) through 
     (3), a data broker may decline to investigate or terminate a 
     review of information disputed by an individual under those 
     paragraphs if the data broker reasonably determines that the 
     dispute by the individual is frivolous or intended to 
     perpetrate fraud.
       (B) Notice.--A data broker shall notify an individual of a 
     determination under subparagraph (A) within a reasonable time 
     by any means available to such data broker.

     SEC. 202. ENFORCEMENT.

       (a) Civil Penalties.--

[[Page 3251]]

       (1) Penalties.--Any data broker that violates the 
     provisions of section 201 shall be subject to civil penalties 
     of not more than $1,000 per violation per day while such 
     violations persist, up to a maximum of $250,000 per 
     violation.
       (2) Intentional or willful violation.--A data broker that 
     intentionally or willfully violates the provisions of section 
     201 shall be subject to additional penalties in the amount of 
     $1,000 per violation per day, to a maximum of an additional 
     $250,000 per violation, while such violations persist.
       (3) Equitable relief.--A data broker engaged in interstate 
     commerce that violates this section may be enjoined from 
     further violations by a court of competent jurisdiction.
       (4) Other rights and remedies.--The rights and remedies 
     available under this subsection are cumulative and shall not 
     affect any other rights and remedies available under law.
       (b) Federal Trade Commission Authority.--Any data broker 
     shall have the provisions of this title enforced against it 
     by the Federal Trade Commission.
       (c) State Enforcement.--
       (1) Civil actions.--In any case in which the attorney 
     general of a State or any State or local law enforcement 
     agency authorized by the State attorney general or by State 
     statute to prosecute violations of consumer protection law, 
     has reason to believe that an interest of the residents of 
     that State has been or is threatened or adversely affected by 
     the acts or practices of a data broker that violate this 
     title, the State may bring a civil action on behalf of the 
     residents of that State in a district court of the United 
     States of appropriate jurisdiction, or any other court of 
     competent jurisdiction, to--
       (A) enjoin that act or practice;
       (B) enforce compliance with this title; or
       (C) obtain civil penalties of not more than $1,000 per 
     violation per day while such violations persist, up to a 
     maximum of $250,000 per violation.
       (2) Notice.--
       (A) In general.--Before filing an action under this 
     subsection, the attorney general of the State involved shall 
     provide to the Federal Trade Commission--
       (i) a written notice of that action; and
       (ii) a copy of the complaint for that action.
       (B) Exception.--Subparagraph (A) shall not apply with 
     respect to the filing of an action by an attorney general of 
     a State under this subsection, if the attorney general of a 
     State determines that it is not feasible to provide the 
     notice described in subparagraph (A) before the filing of the 
     action.
       (C) Notification when practicable.--In an action described 
     under subparagraph (B), the attorney general of a State shall 
     provide the written notice and the copy of the complaint to 
     the Federal Trade Commission as soon after the filing of the 
     complaint as practicable.
       (3) Federal trade commission authority.--Upon receiving 
     notice under paragraph (2), the Federal Trade Commission 
     shall have the right to--
       (A) move to stay the action, pending the final disposition 
     of a pending Federal proceeding or action as described in 
     paragraph (4);
       (B) intervene in an action brought under paragraph (1); and
       (C) file petitions for appeal.
       (4) Pending proceedings.--If the Federal Trade Commission 
     has instituted a proceeding or civil action for a violation 
     of this title, no attorney general of a State may, during the 
     pendency of such proceeding or civil action, bring an action 
     under this subsection against any defendant named in such 
     civil action for any violation that is alleged in that civil 
     action.
       (5) Rule of construction.--For purposes of bringing any 
     civil action under paragraph (1), nothing in this title shall 
     be construed to prevent an attorney general of a State from 
     exercising the powers conferred on the attorney general by 
     the laws of that State to--
       (A) conduct investigations;
       (B) administer oaths and affirmations; or
       (C) compel the attendance of witnesses or the production of 
     documentary and other evidence.
       (6) Venue; service of process.--
       (A) Venue.--Any action brought under this subsection may be 
     brought in the district court of the United States that meets 
     applicable requirements relating to venue under section 1391 
     of title 28, United States Code.
       (B) Service of process.--In an action brought under this 
     subsection process may be served in any district in which the 
     defendant--
       (i) is an inhabitant; or
       (ii) may be found.
       (d) No Private Cause of Action.--Nothing in this title 
     establishes a private cause of action against a data broker 
     for violation of any provision of this title.

     SEC. 203. RELATION TO STATE LAWS.

       No requirement or prohibition may be imposed under the laws 
     of any State with respect to any subject matter regulated 
     under section 201, relating to individual access to, and 
     correction of, personal electronic records held by data 
     brokers.

     SEC. 204. EFFECTIVE DATE.

       This title shall take effect 180 days after the date of 
     enactment of this Act.

 TITLE III--PRIVACY AND SECURITY OF PERSONALLY IDENTIFIABLE INFORMATION

            Subtitle A--A Data Privacy and Security Program

     SEC. 301. PURPOSE AND APPLICABILITY OF DATA PRIVACY AND 
                   SECURITY PROGRAM.

       (a) Purpose.--The purpose of this subtitle is to ensure 
     standards for developing and implementing administrative, 
     technical, and physical safeguards to protect the security of 
     sensitive personally identifiable information.
       (b) In General.--A business entity engaging in interstate 
     commerce that involves collecting, accessing, transmitting, 
     using, storing, or disposing of sensitive personally 
     identifiable information in electronic or digital form on 
     10,000 or more United States persons is subject to the 
     requirements for a data privacy and security program under 
     section 302 for protecting sensitive personally identifiable 
     information.
       (c) Limitations.--Notwithstanding any other obligation 
     under this subtitle, this subtitle does not apply to:
       (1) Financial institutions.--Financial institutions--
       (A) subject to the data security requirements and 
     implementing regulations under the Gramm-Leach-Bliley Act (15 
     U.S.C. 6801 et seq.); and
       (B) subject to--
       (i) examinations for compliance with the requirements of 
     this Act by a Federal Functional Regulator or State Insurance 
     Authority (as those terms are defined in section 509 of the 
     Gramm-Leach-Bliley Act (15 U.S.C. 6809)); or
       (ii) compliance with part 314 of title 16, Code of Federal 
     Regulations.
       (2) HIPPA regulated entities.--
       (A) Covered entities.--Covered entities subject to the 
     Health Insurance Portability and Accountability Act of 1996 
     (42 U.S.C. 1301 et seq.), including the data security 
     requirements and implementing regulations of that Act.
       (B) Business entities.--A business entity shall be deemed 
     in compliance with the privacy and security program 
     requirements under section 302 if the business entity is 
     acting as a ``business associate'' as that term is defined in 
     the Health Insurance Portability and Accountability Act of 
     1996 (42 U.S.C. 1301 et. seq.) and is in compliance with 
     requirements imposed under that Act and its implementing 
     regulations.
       (3) Public records.--Public records not otherwise subject 
     to a confidentiality or nondisclosure requirement, or 
     information obtained from a news report or periodical.
       (d) Safe Harbors.--
       (1) In general.--A business entity shall be deemed in 
     compliance with the privacy and security program requirements 
     under section 302 if the business entity complies with or 
     provides protection equal to industry standards, as 
     identified by the Federal Trade Commission, that are 
     applicable to the type of sensitive personally identifiable 
     information involved in the ordinary course of business of 
     such business entity.
       (2) Limitation.--Nothing in this subsection shall be 
     construed to permit, and nothing does permit, the Federal 
     Trade Commission to issue regulations requiring, or according 
     greater legal status to, the implementation of or application 
     of a specific technology or technological specifications for 
     meeting the requirements of this title.

     SEC. 302. REQUIREMENTS FOR A PERSONAL DATA PRIVACY AND 
                   SECURITY PROGRAM.

       (a) Personal Data Privacy and Security Program.--A business 
     entity subject to this subtitle shall comply with the 
     following safeguards and any other administrative, technical, 
     or physical safeguards identified by the Federal Trade 
     Commission in a rulemaking process pursuant to section 553 of 
     title 5, United States Code, for the protection of sensitive 
     personally identifiable information:
       (1) Scope.--A business entity shall implement a 
     comprehensive personal data privacy and security program that 
     includes administrative, technical, and physical safeguards 
     appropriate to the size and complexity of the business entity 
     and the nature and scope of its activities.
       (2) Design.--The personal data privacy and security program 
     shall be designed to--
       (A) ensure the privacy, security, and confidentiality of 
     sensitive personally identifying information;
       (B) protect against any anticipated vulnerabilities to the 
     privacy, security, or integrity of sensitive personally 
     identifying information; and
       (C) protect against unauthorized access to use of sensitive 
     personally identifying information that could result in 
     substantial harm or inconvenience to any individual.
       (3) Risk assessment.--A business entity shall--
       (A) identify reasonably foreseeable internal and external 
     vulnerabilities that could result in unauthorized access, 
     disclosure, use, or alteration of sensitive personally 
     identifiable information or systems containing sensitive 
     personally identifiable information;

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       (B) assess the likelihood of and potential damage from 
     unauthorized access, disclosure, use, or alteration of 
     sensitive personally identifiable information;
       (C) assess the sufficiency of its policies, technologies, 
     and safeguards in place to control and minimize risks from 
     unauthorized access, disclosure, use, or alteration of 
     sensitive personally identifiable information; and
       (D) assess the vulnerability of sensitive personally 
     identifiable information during destruction and disposal of 
     such information, including through the disposal or 
     retirement of hardware.
       (4) Risk management and control.--Each business entity 
     shall--
       (A) design its personal data privacy and security program 
     to control the risks identified under paragraph (3); and
       (B) adopt measures commensurate with the sensitivity of the 
     data as well as the size, complexity, and scope of the 
     activities of the business entity that--
       (i) control access to systems and facilities containing 
     sensitive personally identifiable information, including 
     controls to authenticate and permit access only to authorized 
     individuals;
       (ii) detect actual and attempted fraudulent, unlawful, or 
     unauthorized access, disclosure, use, or alteration of 
     sensitive personally identifiable information, including by 
     employees and other individuals otherwise authorized to have 
     access;
       (iii) protect sensitive personally identifiable information 
     during use, transmission, storage, and disposal by encryption 
     or other reasonable means (including as directed for disposal 
     of records under section 628 of the Fair Credit Reporting Act 
     (15 U.S.C. 1681w) and the implementing regulations of such 
     Act as set forth in section 682 of title 16, Code of Federal 
     Regulations); and
       (iv) ensure that sensitive personally identifiable 
     information is properly destroyed and disposed of, including 
     during the destruction of computers, diskettes, and other 
     electronic media that contain sensitive personally 
     identifiable information.
       (b) Training.--Each business entity subject to this 
     subtitle shall take steps to ensure employee training and 
     supervision for implementation of the data security program 
     of the business entity.
       (c) Vulnerability Testing.--
       (1) In general.--Each business entity subject to this 
     subtitle shall take steps to ensure regular testing of key 
     controls, systems, and procedures of the personal data 
     privacy and security program to detect, prevent, and respond 
     to attacks or intrusions, or other system failures.
       (2) Frequency.--The frequency and nature of the tests 
     required under paragraph (1) shall be determined by the risk 
     assessment of the business entity under subsection (a)(3).
       (d) Relationship to Service Providers.--In the event a 
     business entity subject to this subtitle engages service 
     providers not subject to this subtitle, such business entity 
     shall--
       (1) exercise appropriate due diligence in selecting those 
     service providers for responsibilities related to sensitive 
     personally identifiable information, and take reasonable 
     steps to select and retain service providers that are capable 
     of maintaining appropriate safeguards for the security, 
     privacy, and integrity of the sensitive personally 
     identifiable information at issue; and
       (2) require those service providers by contract to 
     implement and maintain appropriate measures designed to meet 
     the objectives and requirements governing entities subject to 
     section 301, this section, and subtitle B.
       (e) Periodic Assessment and Personal Data Privacy and 
     Security Modernization.--Each business entity subject to this 
     subtitle shall on a regular basis monitor, evaluate, and 
     adjust, as appropriate its data privacy and security program 
     in light of any relevant changes in--
       (1) technology;
       (2) the sensitivity of personally identifiable information;
       (3) internal or external threats to personally identifiable 
     information; and
       (4) the changing business arrangements of the business 
     entity, such as--
       (A) mergers and acquisitions;
       (B) alliances and joint ventures;
       (C) outsourcing arrangements;
       (D) bankruptcy; and
       (E) changes to sensitive personally identifiable 
     information systems.
       (f) Implementation Time Line.--Not later than 1 year after 
     the date of enactment of this Act, a business entity subject 
     to the provisions of this subtitle shall implement a data 
     privacy and security program pursuant to this subtitle.

     SEC. 303. ENFORCEMENT.

       (a) Civil Penalties.--
       (1) In general.--Any business entity that violates the 
     provisions of sections 301 or 302 shall be subject to civil 
     penalties of not more than $5,000 per violation per day while 
     such a violation exists, with a maximum of $500,000 per 
     violation.
       (2) Intentional or willful violation.--A business entity 
     that intentionally or willfully violates the provisions of 
     sections 301 or 302 shall be subject to additional penalties 
     in the amount of $5,000 per violation per day while such a 
     violation exists, with a maximum of an additional $500,000 
     per violation.
       (3) Equitable relief.--A business entity engaged in 
     interstate commerce that violates this section may be 
     enjoined from further violations by a court of competent 
     jurisdiction.
       (4) Other rights and remedies.--The rights and remedies 
     available under this section are cumulative and shall not 
     affect any other rights and remedies available under law.
       (b) Federal Trade Commission Authority.--Any data broker 
     shall have the provisions of this subtitle enforced against 
     it by the Federal Trade Commission.
       (c) State Enforcement.--
       (1) Civil actions.--In any case in which the attorney 
     general of a State or any State or local law enforcement 
     agency authorized by the State attorney general or by State 
     statute to prosecute violations of consumer protection law, 
     has reason to believe that an interest of the residents of 
     that State has been or is threatened or adversely affected by 
     the acts or practices of a data broker that violate this 
     subtitle, the State may bring a civil action on behalf of the 
     residents of that State in a district court of the United 
     States of appropriate jurisdiction, or any other court of 
     competent jurisdiction, to--
       (A) enjoin that act or practice;
       (B) enforce compliance with this subtitle; or
       (C) obtain civil penalties of not more than $5,000 per 
     violation per day while such violations persist, up to a 
     maximum of $500,000 per violation.
       (2) Notice.--
       (A) In general.--Before filing an action under this 
     subsection, the attorney general of the State involved shall 
     provide to the Federal Trade Commission--
       (i) a written notice of that action; and
       (ii) a copy of the complaint for that action.
       (B) Exception.--Subparagraph (A) shall not apply with 
     respect to the filing of an action by an attorney general of 
     a State under this subsection, if the attorney general of a 
     State determines that it is not feasible to provide the 
     notice described in this subparagraph before the filing of 
     the action.
       (C) Notification when practicable.--In an action described 
     under subparagraph (B), the attorney general of a State shall 
     provide the written notice and the copy of the complaint to 
     the Federal Trade Commission as soon after the filing of the 
     complaint as practicable.
       (3) Federal trade commission authority.--Upon receiving 
     notice under paragraph (2), the Federal Trade Commission 
     shall have the right to--
       (A) move to stay the action, pending the final disposition 
     of a pending Federal proceeding or action as described in 
     paragraph (4);
       (B) intervene in an action brought under paragraph (1); and
       (C) file petitions for appeal.
       (4) Pending proceedings.--If the Federal Trade Commission 
     has instituted a proceeding or action for a violation of this 
     subtitle or any regulations thereunder, no attorney general 
     of a State may, during the pendency of such proceeding or 
     action, bring an action under this subsection against any 
     defendant named in such criminal proceeding or civil action 
     for any violation that is alleged in that proceeding or 
     action.
       (5) Rule of construction.--For purposes of bringing any 
     civil action under paragraph (1) nothing in this subtitle 
     shall be construed to prevent an attorney general of a State 
     from exercising the powers conferred on the attorney general 
     by the laws of that State to--
       (A) conduct investigations;
       (B) administer oaths and affirmations; or
       (C) compel the attendance of witnesses or the production of 
     documentary and other evidence.
       (6) Venue; service of process.--
       (A) Venue.--Any action brought under this subsection may be 
     brought in the district court of the United States that meets 
     applicable requirements relating to venue under section 1391 
     of title 28, United States Code.
       (B) Service of process.--In an action brought under this 
     subsection process may be served in any district in which the 
     defendant--
       (i) is an inhabitant; or
       (ii) may be found.
       (d) No Private Cause of Action.--Nothing in this subtitle 
     establishes a private cause of action against a business 
     entity for violation of any provision of this subtitle.

     SEC. 304. RELATION TO OTHER LAWS.

       (a) In General.--No State may require any business entity 
     subject to this subtitle to comply with any requirements with 
     respect to administrative, technical, and physical safeguards 
     for the protection of sensitive personally identifying 
     information.
       (b) Limitations.--Nothing in this subtitle shall be 
     construed to modify, limit, or supersede the operation of the 
     Gramm-Leach-Bliley Act or its implementing regulations, 
     including those adopted or enforced by States.

                Subtitle B--Security Breach Notification

     SEC. 311. NOTICE TO INDIVIDUALS.

       (a) In General.--Any agency, or business entity engaged in 
     interstate commerce, that uses, accesses, transmits, stores, 
     disposes of

[[Page 3253]]

     or collects sensitive personally identifiable information 
     shall, following the discovery of a security breach of the 
     systems or databases of such agency or business entity notify 
     any resident of the United States whose sensitive personally 
     identifiable information has been, or is reasonably believed 
     to have been, accessed, or acquired.
       (b) Obligation of Owner or Licensee.--
       (1) Notice to owner or licensee.--Any agency, or business 
     entity engaged in interstate commerce, that uses, accesses, 
     transmits, stores, disposes of, or collects sensitive 
     personally identifiable information that the agency or 
     business entity does not own or license shall notify the 
     owner or licensee of the information following the discovery 
     of a security breach involving such information.
       (2) Notice by owner, licensee or other designated third 
     party.--Nothing in this subtitle shall prevent or abrogate an 
     agreement between an agency or business entity required to 
     give notice under this section and a designated third party, 
     including an owner or licensee of the sensitive personally 
     identifiable information subject to the security breach, to 
     provide the notifications required under subsection (a).
       (3) Business entity relieved from giving notice.--A 
     business entity obligated to give notice under subsection (a) 
     shall be relieved of such obligation if an owner or licensee 
     of the sensitive personally identifiable information subject 
     to the security breach, or other designated third party, 
     provides such notification.
       (c) Timeliness of Notification.--
       (1) In general.--All notifications required under this 
     section shall be made without unreasonable delay following 
     the discovery by the agency or business entity of a security 
     breach.
       (2) Reasonable delay.--Reasonable delay under this 
     subsection may include any time necessary to determine the 
     scope of the security breach, prevent further disclosures, 
     and restore the reasonable integrity of the data system and 
     provide notice to law enforcement when required.
       (3) Burden of proof.--The agency, business entity, owner, 
     or licensee required to provide notification under this 
     section shall have the burden of demonstrating that all 
     notifications were made as required under this subtitle, 
     including evidence demonstrating the reasons for any delay.
       (d) Delay of Notification Authorized for Law Enforcement 
     Purposes.--
       (1) In general.--If a Federal law enforcement agency 
     determines that the notification required under this section 
     would impede a criminal investigation, such notification 
     shall be delayed upon written notice from such Federal law 
     enforcement agency to the agency or business entity that 
     experienced the breach.
       (2) Extended delay of notification.--If the notification 
     required under subsection (a) is delayed pursuant to 
     paragraph (1), an agency or business entity shall give notice 
     30 days after the day such law enforcement delay was invoked 
     unless a Federal law enforcement agency provides written 
     notification that further delay is necessary.
       (3) Law enforcement immunity.--No cause of action shall lie 
     in any court against any law enforcement agency for acts 
     relating to the delay of notification for law enforcement 
     purposes under this subtitle.

     SEC. 312. EXEMPTIONS.

       (a) Exemption for National Security and Law Enforcement.--
       (1) In general.--Section 311 shall not apply to an agency 
     or business entity if the agency or business entity 
     certifies, in writing, that notification of the security 
     breach as required by section 311 reasonably could be 
     expected to--
       (A) cause damage to the national security; or
       (B) hinder a law enforcement investigation or the ability 
     of the agency to conduct law enforcement investigations.
       (2) Limits on certifications.--An agency may not execute a 
     certification under paragraph (1) to--
       (A) conceal violations of law, inefficiency, or 
     administrative error;
       (B) prevent embarrassment to a business entity, 
     organization, or agency; or
       (C) restrain competition.
       (3) Notice.--In every case in which an agency issues a 
     certification under paragraph (1), the certification, 
     accompanied by a description of the factual basis for the 
     certification, shall be immediately provided to the United 
     States Secret Service.
       (b) Safe Harbor.--An agency or business entity will be 
     exempt from the notice requirements under section 311, if--
       (1) a risk assessment concludes that there is no 
     significant risk that the security breach has resulted in, or 
     will result in, harm to the individuals whose sensitive 
     personally identifiable information was subject to the 
     security breach;
       (2) without unreasonable delay, but not later than 45 days 
     after the discovery of a security breach, unless extended by 
     the United States Secret Service, the agency or business 
     entity notifies the United States Secret Service, in writing, 
     of--
       (A) the results of the risk assessment; and
       (B) its decision to invoke the risk assessment exemption; 
     and
       (3) the United States Secret Service does not indicate, in 
     writing, within 10 days from receipt of the decision, that 
     notice should be given.
       (c) Financial Fraud Prevention Exemption.--
       (1) In general.--A business entity will be exempt from the 
     notice requirement under section 311 if the business entity 
     utilizes or participates in a security program that--
       (A) is designed to block the use of the sensitive 
     personally identifiable information to initiate unauthorized 
     financial transactions before they are charged to the account 
     of the individual; and
       (B) provides for notice to affected individuals after a 
     security breach that has resulted in fraud or unauthorized 
     transactions.
       (2) Limitation.--The exemption by this subsection does not 
     apply if the information subject to the security breach 
     includes sensitive personally identifiable information in 
     addition to the sensitive personally identifiable information 
     identified in section 3.

     SEC. 313. METHODS OF NOTICE.

       An agency, or business entity shall be in compliance with 
     section 311 if it provides both:
       (1) Individual notice.--
       (A) Written notification to the last known home mailing 
     address of the individual in the records of the agency or 
     business entity;
       (B) Telephone notice to the individual personally; or
       (C) Electronic notice, if the primary method used by the 
     agency or business entity to communicate with the individual 
     is by electronic means, or the individual has consented to 
     receive such notice and the notice is consistent with the 
     provisions permitting electronic transmission of notices 
     under section 101 of the Electronic Signatures in Global and 
     National Commerce Act (15 U.S.C. 7001).
       (2) Media notice.--Notice to major media outlets serving a 
     State or jurisdiction, if the number of residents of such 
     State whose sensitive personally identifiable information 
     was, or is reasonably believed to have been, acquired by an 
     unauthorized person exceeds 5,000.

     SEC. 314. CONTENT OF NOTIFICATION.

       (a) In General.--Regardless of the method by which notice 
     is provided to individuals under section 313, such notice 
     shall include, to the extent possible--
       (1) a description of the categories of sensitive personally 
     identifiable information that was, or is reasonably believed 
     to have been, acquired by an unauthorized person;
       (2) a toll-free number or, if the primary method used by 
     the agency or business entity to communicate with the 
     individual is by electronic means, an electronic mail 
     address--
       (A) that the individual may use to contact the agency or 
     business entity, or the agent of the agency or business 
     entity; and
       (B) from which the individual may learn what types of 
     sensitive personally identifiable information the agency or 
     business entity maintained about that individual; and
       (3) the toll-free contact telephone numbers and addresses 
     for the major credit reporting agencies.
       (b) Additional Content.--Notwithstanding section 319, a 
     State may require that a notice under subsection (a) shall 
     also include information regarding victim protection 
     assistance provided for by that State.

     SEC. 315. COORDINATION OF NOTIFICATION WITH CREDIT REPORTING 
                   AGENCIES.

       If an agency or business entity is required to provide 
     notification to more than 1,000 individuals under section 
     311(a), the agency or business entity shall also notify, 
     without unreasonable delay, all consumer reporting agencies 
     that compile and maintain files on consumers on a nationwide 
     basis (as defined in section 603(p) of the Fair Credit 
     Reporting Act (15 U.S.C. 1681a(p)) of the timing and 
     distribution of the notices.

     SEC. 316. NOTICE TO LAW ENFORCEMENT.

       (a) Secret Service.--Any business entity or agency shall 
     give notice of a security breach to the United States Secret 
     Service if--
       (1) the number of individuals whose sensitive personally 
     identifying information was, or is reasonably believed to 
     have been acquired by an unauthorized person exceeds 10,000;
       (2) the security breach involves a database, networked or 
     integrated databases, or other data system containing the 
     sensitive personally identifiable information of more than 
     1,000,000 individuals nationwide;
       (3) the security breach involves databases owned by the 
     Federal Government; or
       (4) the security breach involves primarily sensitive 
     personally identifiable information of individuals known to 
     the agency or business entity to be employees and contractors 
     of the Federal Government involved in national security or 
     law enforcement.
       (b) Notice to Other Law Enforcement Agencies.--The United 
     States Secret Service shall be responsible for notifying--
       (1) the Federal Bureau of Investigation, if the security 
     breach involves espionage, foreign counterintelligence, 
     information protected against unauthorized disclosure for 
     reasons of national defense or foreign relations, or 
     Restricted Data (as that term is defined in section 11y of 
     the Atomic Energy Act of 1954 (42 U.S.C. 2014(y)), except for 
     offenses affecting the duties of the United

[[Page 3254]]

     States Secret Service under section 3056(a) of title 18, 
     United States Code;
       (2) the United States Postal Inspection Service, if the 
     security breach involves mail fraud; and
       (3) the attorney general of each State affected by the 
     security breach.
       (c) 14-Day Rule.--The notices to Federal law enforcement 
     and the attorney general of each State affected by a security 
     breach required under this section shall be delivered as 
     promptly as possible, but not later than 14 days after 
     discovery of the events requiring notice.

     SEC. 317. ENFORCEMENT.

       (a) Civil Actions by the Attorney General.--The Attorney 
     General may bring a civil action in the appropriate United 
     States district court against any business entity that 
     engages in conduct constituting a violation of this subtitle 
     and, upon proof of such conduct by a preponderance of the 
     evidence, such business entity shall be subject to a civil 
     penalty of not more than $1,000 per day per individual whose 
     sensitive personally identifiable information was, or is 
     reasonably believed to have been, accessed or acquired by an 
     unauthorized person, up to a maximum of $1,000,000 per 
     violation, unless such conduct is found to be willful or 
     intentional.
       (b) Injunctive Actions by the Attorney General.--
       (1) In general.--If it appears that a business entity has 
     engaged, or is engaged, in any act or practice constituting a 
     violation of this subtitle, the Attorney General may petition 
     an appropriate district court of the United States for an 
     order--
       (A) enjoining such act or practice; or
       (B) enforcing compliance with this subtitle.
       (2) Issuance of order.--A court may issue an order under 
     paragraph (1), if the court finds that the conduct in 
     question constitutes a violation of this subtitle.
       (c) Other Rights and Remedies.--The rights and remedies 
     available under this subtitle are cumulative and shall not 
     affect any other rights and remedies available under law.
       (d) Fraud Alert.--Section 605A(b)(1) of the Fair Credit 
     Reporting Act (15 U.S.C. 1681c-1(b)(1)) is amended by 
     inserting ``, or evidence that the consumer has received 
     notice that the consumer's financial information has or may 
     have been compromised,'' after ``identity theft report''.

     SEC. 318. ENFORCEMENT BY STATE ATTORNEYS GENERAL.

       (a) In General.--
       (1) Civil actions.--In any case in which the attorney 
     general of a State or any State or local law enforcement 
     agency authorized by the State attorney general or by State 
     statute to prosecute violations of consumer protection law, 
     has reason to believe that an interest of the residents of 
     that State has been or is threatened or adversely affected by 
     the engagement of a business entity in a practice that is 
     prohibited under this subtitle, the State or the State or 
     local law enforcement agency on behalf of the residents of 
     the agency's jurisdiction, may bring a civil action on behalf 
     of the residents of the State or jurisdiction in a district 
     court of the United States of appropriate jurisdiction or any 
     other court of competent jurisdiction, including a State 
     court, to--
       (A) enjoin that practice;
       (B) enforce compliance with this subtitle; or
       (C) civil penalties of not more than $1,000 per day per 
     individual whose sensitive personally identifiable 
     information was, or is reasonably believed to have been, 
     accessed or acquired by an unauthorized person, up to a 
     maximum of $1,000,000 per violation, unless such conduct is 
     found to be willful or intentional.
       (2) Notice.--
       (A) In general.--Before filing an action under paragraph 
     (1), the attorney general of the State involved shall provide 
     to the Attorney General of the United States--
       (i) written notice of the action; and
       (ii) a copy of the complaint for the action.
       (B) Exemption.--
       (i) In general.--Subparagraph (A) shall not apply with 
     respect to the filing of an action by an attorney general of 
     a State under this subtitle, if the State attorney general 
     determines that it is not feasible to provide the notice 
     described in such subparagraph before the filing of the 
     action.
       (ii) Notification.--In an action described in clause (i), 
     the attorney general of a State shall provide notice and a 
     copy of the complaint to the Attorney General at the time the 
     State attorney general files the action.
       (b) Federal Proceedings.--Upon receiving notice under 
     subsection (a)(2), the Attorney General shall have the right 
     to--
       (1) move to stay the action, pending the final disposition 
     of a pending Federal proceeding or action;
       (2) initiate an action in the appropriate United States 
     district court under section 317 and move to consolidate all 
     pending actions, including State actions, in such court;
       (3) intervene in an action brought under subsection (a)(2); 
     and
       (4) file petitions for appeal.
       (c) Pending Proceedings.--If the Attorney General has 
     instituted a proceeding or action for a violation of this 
     subtitle or any regulations thereunder, no attorney general 
     of a State may, during the pendency of such proceeding or 
     action, bring an action under this subtitle against any 
     defendant named in such criminal proceeding or civil action 
     for any violation that is alleged in that proceeding or 
     action.
       (d) Construction.--For purposes of bringing any civil 
     action under subsection (a), nothing in this subtitle 
     regarding notification shall be construed to prevent an 
     attorney general of a State from exercising the powers 
     conferred on such attorney general by the laws of that State 
     to--
       (1) conduct investigations;
       (2) administer oaths or affirmations; or
       (3) compel the attendance of witnesses or the production of 
     documentary and other evidence.
       (e) Venue; Service of Process.--
       (1) Venue.--Any action brought under subsection (a) may be 
     brought in--
       (A) the district court of the United States that meets 
     applicable requirements relating to venue under section 1391 
     of title 28, United States Code; or
       (B) another court of competent jurisdiction.
       (2) Service of process.--In an action brought under 
     subsection (a), process may be served in any district in 
     which the defendant--
       (A) is an inhabitant; or
       (B) may be found.
       (f) No Private Cause of Action.--Nothing in this subtitle 
     establishes a private cause of action against a business 
     entity for violation of any provision of this subtitle.

     SEC. 319. EFFECT ON FEDERAL AND STATE LAW.

       The provisions of this subtitle shall supersede any other 
     provision of Federal law or any provision of law of any State 
     relating to notification of a security breach, except as 
     provided in section 314(b).

     SEC. 320. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated such sums as may be 
     necessary to cover the costs incurred by the United States 
     Secret Service to carry out investigations and risk 
     assessments of security breaches as required under this 
     subtitle.

     SEC. 321. REPORTING ON RISK ASSESSMENT EXEMPTIONS.

       The United States Secret Service shall report to Congress 
     not later than 18 months after the date of enactment of this 
     Act, and upon the request by Congress thereafter, on--
       (1) the number and nature of the security breaches 
     described in the notices filed by those business entities 
     invoking the risk assessment exemption under section 312(b) 
     and the response of the United States Secret Service to such 
     notices; and
       (2) the number and nature of security breaches subject to 
     the national security and law enforcement exemptions under 
     section 312(a), provided that such report may not disclose 
     the contents of any risk assessment provided to the United 
     States Secret Service pursuant to this subtitle.

     SEC. 322. EFFECTIVE DATE.

       This subtitle shall take effect on the expiration of the 
     date which is 90 days after the date of enactment of this 
     Act.

       TITLE IV--GOVERNMENT ACCESS TO AND USE OF COMMERCIAL DATA

     SEC. 401. GENERAL SERVICES ADMINISTRATION REVIEW OF 
                   CONTRACTS.

       (a) In General.--In considering contract awards totaling 
     more than $500,000 and entered into after the date of 
     enactment of this Act with data brokers, the Administrator of 
     the General Services Administration shall evaluate--
       (1) the data privacy and security program of a data broker 
     to ensure the privacy and security of data containing 
     personally identifiable information, including whether such 
     program adequately addresses privacy and security threats 
     created by malicious software or code, or the use of peer-to-
     peer file sharing software;
       (2) the compliance of a data broker with such program;
       (3) the extent to which the databases and systems 
     containing personally identifiable information of a data 
     broker have been compromised by security breaches; and
       (4) the response by a data broker to such breaches, 
     including the efforts by such data broker to mitigate the 
     impact of such security breaches.
       (b) Compliance Safe Harbor.--The data privacy and security 
     program of a data broker shall be deemed sufficient for the 
     purposes of subsection (a), if the data broker complies with 
     or provides protection equal to industry standards, as 
     identified by the Federal Trade Commission, that are 
     applicable to the type of personally identifiable information 
     involved in the ordinary course of business of such data 
     broker.
       (c) Penalties.--In awarding contracts with data brokers for 
     products or services related to access, use, compilation, 
     distribution, processing, analyzing, or evaluating personally 
     identifiable information, the Administrator of the General 
     Services Administration shall--
       (1) include monetary or other penalties--
       (A) for failure to comply with subtitles A and B of title 
     III; or
       (B) if a contractor knows or has reason to know that the 
     personally identifiable information being provided is 
     inaccurate, and provides such inaccurate information; and

[[Page 3255]]

       (2) require a data broker that engages service providers 
     not subject to subtitle A of title III for responsibilities 
     related to sensitive personally identifiable information to--
       (A) exercise appropriate due diligence in selecting those 
     service providers for responsibilities related to personally 
     identifiable information;
       (B) take reasonable steps to select and retain service 
     providers that are capable of maintaining appropriate 
     safeguards for the security, privacy, and integrity of the 
     personally identifiable information at issue; and
       (C) require such service providers, by contract, to 
     implement and maintain appropriate measures designed to meet 
     the objectives and requirements in title III.
       (d) Limitation.--The penalties under subsection (c) shall 
     not apply to a data broker providing information that is 
     accurately and completely recorded from a public record 
     source or licensor.

     SEC. 402. REQUIREMENT TO AUDIT INFORMATION SECURITY PRACTICES 
                   OF CONTRACTORS AND THIRD PARTY BUSINESS 
                   ENTITIES.

       Section 3544(b) of title 44, United States Code, is 
     amended--
       (1) in paragraph (7)(C)(iii), by striking ``and'' after the 
     semicolon;
       (2) in paragraph (8), by striking the period and inserting 
     ``; and''; and
       (3) by adding at the end the following:
       ``(9) procedures for evaluating and auditing the 
     information security practices of contractors or third party 
     business entities supporting the information systems or 
     operations of the agency involving personally identifiable 
     information (as that term is defined in section 3 of the 
     Personal Data Privacy and Security Act of 2007) and ensuring 
     remedial action to address any significant deficiencies.''.

     SEC. 403. PRIVACY IMPACT ASSESSMENT OF GOVERNMENT USE OF 
                   COMMERCIAL INFORMATION SERVICES CONTAINING 
                   PERSONALLY IDENTIFIABLE INFORMATION.

       (a) In General.--Section 208(b)(1) of the E-Government Act 
     of 2002 (44 U.S.C. 3501 note) is amended--
       (1) in subparagraph (A)(i), by striking ``or''; and
       (2) in subparagraph (A)(ii), by striking the period and 
     inserting ``; or''; and
       (3) by inserting after clause (ii) the following:
       ``(iii) purchasing or subscribing for a fee to personally 
     identifiable information from a data broker (as such terms 
     are defined in section 3 of the Personal Data Privacy and 
     Security Act of 2007).''.
       (b) Limitation.--Notwithstanding any other provision of 
     law, commencing 1 year after the date of enactment of this 
     Act, no Federal agency may enter into a contract with a data 
     broker to access for a fee any database consisting primarily 
     of personally identifiable information concerning United 
     States persons (other than news reporting or telephone 
     directories) unless the head of such department or agency--
       (1) completes a privacy impact assessment under section 208 
     of the E-Government Act of 2002 (44 U.S.C. 3501 note), which 
     shall subject to the provision in that Act pertaining to 
     sensitive information, include a description of--
       (A) such database;
       (B) the name of the data broker from whom it is obtained; 
     and
       (C) the amount of the contract for use;
       (2) adopts regulations that specify--
       (A) the personnel permitted to access, analyze, or 
     otherwise use such databases;
       (B) standards governing the access, analysis, or use of 
     such databases;
       (C) any standards used to ensure that the personally 
     identifiable information accessed, analyzed, or used is the 
     minimum necessary to accomplish the intended legitimate 
     purpose of the Federal agency;
       (D) standards limiting the retention and redisclosure of 
     personally identifiable information obtained from such 
     databases;
       (E) procedures ensuring that such data meet standards of 
     accuracy, relevance, completeness, and timeliness;
       (F) the auditing and security measures to protect against 
     unauthorized access, analysis, use, or modification of data 
     in such databases;
       (G) applicable mechanisms by which individuals may secure 
     timely redress for any adverse consequences wrongly incurred 
     due to the access, analysis, or use of such databases;
       (H) mechanisms, if any, for the enforcement and independent 
     oversight of existing or planned procedures, policies, or 
     guidelines; and
       (I) an outline of enforcement mechanisms for accountability 
     to protect individuals and the public against unlawful or 
     illegitimate access or use of databases; and
       (3) incorporates into the contract or other agreement 
     totaling more than $500,000, provisions--
       (A) providing for penalties--
       (i) for failure to comply with title III of this Act; or
       (ii) if the entity knows or has reason to know that the 
     personally identifiable information being provided to the 
     Federal department or agency is inaccurate, and provides such 
     inaccurate information; and
       (B) requiring a data broker that engages service providers 
     not subject to subtitle A of title III for responsibilities 
     related to sensitive personally identifiable information to--
       (i) exercise appropriate due diligence in selecting those 
     service providers for responsibilities related to personally 
     identifiable information;
       (ii) take reasonable steps to select and retain service 
     providers that are capable of maintaining appropriate 
     safeguards for the security, privacy, and integrity of the 
     personally identifiable information at issue; and
       (iii) require such service providers, by contract, to 
     implement and maintain appropriate measures designed to meet 
     the objectives and requirements in title III.
       (c) Limitation on Penalties.--The penalties under 
     subsection (b)(3)(A) shall not apply to a data broker 
     providing information that is accurately and completely 
     recorded from a public record source.
       (d) Study of Government Use.--
       (1) Scope of study.--Not later than 180 days after the date 
     of enactment of this Act, the Comptroller General of the 
     United States shall conduct a study and audit and prepare a 
     report on Federal agency use of data brokers or commercial 
     databases containing personally identifiable information, 
     including the impact on privacy and security, and the extent 
     to which Federal contracts include sufficient provisions to 
     ensure privacy and security protections, and penalties for 
     failures in privacy and security practices.
       (2) Report.--A copy of the report required under paragraph 
     (1) shall be submitted to Congress.

     SEC. 404. IMPLEMENTATION OF CHIEF PRIVACY OFFICER 
                   REQUIREMENTS.

       (a) Designation of the Chief Privacy Officer.--Pursuant to 
     the requirements under section 522 of the Transportation, 
     Treasury, Independent Agencies, and General Government 
     Appropriations Act, 2005 (division H of Public Law 108-447; 
     118 Stat. 3199) that each agency designate a Chief Privacy 
     Officer, the Department of Justice shall implement such 
     requirements by designating a department-wide Chief Privacy 
     Officer, whose primary role shall be to fulfill the duties 
     and responsibilities of Chief Privacy Officer and who shall 
     report directly to the Deputy Attorney General.
       (b) Duties and Responsibilities of Chief Privacy Officer.--
     In addition to the duties and responsibilities outlined under 
     section 522 of the Transportation, Treasury, Independent 
     Agencies, and General Government Appropriations Act, 2005 
     (division H of Public Law 108-447; 118 Stat. 3199), the 
     Department of Justice Chief Privacy Officer shall--
       (1) oversee the Department of Justice's implementation of 
     the requirements under section 403 to conduct privacy impact 
     assessments of the use of commercial data containing 
     personally identifiable information by the Department; and
       (2) coordinate with the Privacy and Civil Liberties 
     Oversight Board, established in the Intelligence Reform and 
     Terrorism Prevention Act of 2004 (Public Law 108-458), in 
     implementing this section.

  Mr. SPECTER. Mr. President, I seek recognition today to discuss the 
Personal Data Privacy and Security Act of 2007, which I am introducing 
with Senator Leahy. Not long ago, personal information--Social Security 
numbers, birthdates, mothers' maiden names, addresses--all remained 
relatively private. Some information--for example, whether you had a 
mortgage on your home--might have been publicly available, but finding 
that information required a trip to the local courthouse. For the most 
part, the sheer difficulty of obtaining personal information kept it 
private. This privacy--what Justice Brandeis called the freedom to be 
left alone--has been a cherished value throughout American history.
  As everyday transactions increasingly occur electronically, personal 
information can be stored, transmitted and accessed much more easily. 
Most Americans have benefited from this change. Because personal 
information is available electronically, Americans enjoy the 
convenience of purchasing goods over the phone or on the Internet. They 
can obtain a home mortgage in a matter of hours. They can apply for a 
credit card while they wait at the store. The availability of such 
information also helps law enforcement agencies conduct investigations 
and apprehend criminals.
  In electronic form, personal information is both more valuable and 
more vulnerable. As the multitude of security breaches that have 
occurred over the past 2 years demonstrate, electronic information is 
more vulnerable because it can be accessed anonymously from afar and 
can be stolen in a split second. According to the Privacy Rights 
Clearing House, since February 2005, over 100 million records 
containing personal information have

[[Page 3256]]

been subject to some sort of security breach. The first of these 
incidents to come to light involved commercial data broker ChoicePoint, 
which in February 2005 reported that identity thieves had gained access 
to personal information of 163,000 people. The identity thieves had 
obtained the information by setting up sham accounts with ChoicePoint. 
ChoicePoint eventually settled with the FTC for $15 million, including 
$5 million for consumer redress. However, consumers might never have 
found out about the breach. The incident only came to light because of 
a law California had recently adopted requiring ChoicePoint and others 
to provide notice of security breaches involving personal information 
to California residents who were affected by the breach. As a result of 
the California law, Americans for the first time began learning that 
data brokers and others were routinely collecting and selling their 
personal information, and in so doing, they were not always keeping the 
information secure.
  After the ChoicePoint incident came a long series of security 
breaches involving major American companies. In March of 2005, Designer 
Shoe Warehouse reported that hackers had gained access to personal 
information, including credit card numbers, on over 100,000 of its 
customers. Weeks later, Lexis Nexis reported that hackers had gained 
access to the personal information of over 300,000 individuals. Other 
blue-chip companies where unauthorized persons have gained access to 
personal information include Wal-Mart, General Motors, Wachovia Bank, 
H&R Block, Honeywell, AT&T, Lloyd's of London, ARCO, Visa, MasterCard, 
Bank of America, FedEx, OfficeMax, Blue Cross Blue Shield and Ralph 
Lauren. The largest incident came in June 2005, when Card Systems, 
which processes payments for the country's largest banks and credit 
card companies, reported that hackers had accessed 40 million records 
containing personal information. Most recently, TJ Maxx Stores and 
MoneyGram both had the personal information of their customers stolen 
from their computer systems. This list only includes security breaches 
involving wrong-doers who were trying to obtain personal information. 
The list would be much longer had it included inadvertent disclosure of 
personal information or incidents involving stolen computers or other 
equipment that happened to contain personal information.
  A large number of colleges and universities have also suffered 
significant breaches, including the University of Southern California, 
which in July of 2005 reported that hackers has accessed 270,000 
records containing personal data. Other educational institutions that 
have been hacked include Boston College, Northwestern University, Tufts 
University, UCLA, Michigan State, Carnegie Mellon, Perdue, Stanford, 
Duke, the University of Iowa, the University of Colorado, and the 
University of Utah.
  Governments also have not been immune from attempts by identity 
thieves to obtain personal information. Hackers have accessed personal 
data at the Department of Defense, Department of Energy, the Air Force 
and the Department of Agriculture. Hackers obtained over half a million 
records containing personal data from a State agency in Georgia. The 
San Diego County Employees Retirement Association, the California 
Department of Corrections, the Nebraska Treasurers office, the city of 
Lubbock, TX, and a Women, Infants and Children (WIC) program in Hawaii 
have all been the victims of similar thefts.
  Electronic personal data is more valuable because identity thieves 
can steal a large volume of data and use it before anyone even knows 
their personal information has been compromised. For the last 5 years, 
identity theft has topped the FTC's list of consumer complaints. From 
2002 to 2004, the number of complaints rose 52 percent, to 246,570. Put 
another way, that's one complaint every 2 minutes. But this is only the 
tip of the iceberg. Not all consumers report identity theft to the FTC. 
Not all victims report identity theft to their local police. Sixty 
percent of those who did file a report with the FTC did not call their 
local police department. It stands to reason that many did not call the 
FTC.
  A recent study by the Better Business Bureau concluded that 8.9 
million Americans were victims of identity fraud in 2006, and that each 
victim lost approximately $6,300. Ultimately, it has been predicted 
that nearly 20 percent of Americans will become victims of identity 
theft. Worse, according to the study, it took victims an average of 40 
hours on the phone with creditors and credit bureaus to clear their 
names. I use the term ``clear'' loosely, because in many cases the 
damage caused by identity theft is irreversible. Victims will have 
fraud alerts on their credit reports for years to come, making it more 
difficult for them to open new accounts or make major purchases. Some 
will be erroneously contacted by collection agencies. Many will not 
even know they have been victimized until they try to get a car loan or 
a mortgage on a home.
  Individuals who have not yet been victims also suffer. Businesses 
lose nearly $50 billion a year from identity thieves posing as 
customers. These losses translate into increased prices for every 
consumer. All Americans are victims of identify theft, even if their 
own information remains secure.
  In some cases, the availability of electronic personal data can lead 
to tragedy. In 1999, a former high school classmate of Amy Lynn Boyer 
obtained her former work address and Social Security number from an on-
line data broker. Using this information, he called Amy's mother and 
posed as the former employer, convincing Amy's mom to give him Amy's 
new work address. He then drove to Amy's workplace and fatally shot 
her.
  In an effort to protect the privacy and security of our personal 
information, and prevent future tragedies, small and large, last 
Congress, Senator Leahy and I introduced the Personal Data Privacy and 
Security Act. The problem is one of large proportions and many have 
views on how to go about tackling it. Six committees, three on the 
House side and three on the Senate side, introduced legislation last 
Congress addressing data security. At least two other Senate committees 
became involved in the issue. It is my hope that the differences among 
committees and members can be bridged this Congress. The problem is 
simply too large to ignore.
  In an effort to start that process, Senator Leahy and I are again 
introducing the Personal Data Privacy and Security Act. We are 
reintroducing the bill in largely the same form that it was approved by 
the Judiciary Committee last Congress. The bill takes a comprehensive 
approach to the problem, an approach I believe is necessary. First, the 
legislation goes after identity thieves by increasing penalties for 
crimes involving electronic personal information. It also contains 
criminal penalties for those who intentionally conceal a security 
breach involving personal data. Those who actively conceal breaches 
attempt to protect themselves by gambling with the reputations and 
finances of innocent Americans. They deserve to be punished.
  The bill also empowers Americans to look after the privacy of their 
own information. The bill will allow individuals to gain access to 
their personal information when it is in the hands of commercial data 
brokers. For individuals who believe their information is wrong--
possibly because the activities of identity thieves--data brokers must 
provide assistance with correcting their information.
  The legislation also places some of the burden of protecting privacy 
on those that collect personal information. It will require the 
companies, government agencies, universities and others that deal with 
personal information to identify and remedy any weaknesses in their 
computer systems.
  Such measures will not always be enough. As I've already noted, the 
nature of electronic information makes it vulnerable even when 
reasonable steps are taken to protect it. Currently, over 30 States 
have adopted legislation requiring companies, agencies, universities 
and others to give notice when they experience a security breach that

[[Page 3257]]

involves personal information. However, no Federal law imposes such a 
requirement. As a result, companies are forced to comply with over 30 
different State laws, an expensive and time-consuming endeavor.
  The Personal Data Privacy and Security Act requires that both 
affected individuals and law enforcement receive notice. Knowledge is 
power. Once individuals learn that their personal information is 
exposed, they can take steps to protect themselves. And, the company, 
school or agency that experienced the breach must help. They must 
provide individuals whose data was lost with credit monitoring. For 
large breaches, the media must be notified. Media reports over the 2 
years have made Americans far more aware of the problem of security 
breaches. Hopefully, we can raise awareness by continuing the practice 
of making public announcements. Notice will also give law enforcement a 
head start in catching those who steal personal information.
  Finally, this legislation will protect the privacy of all Americans 
by providing a check on the government's use of commercial databases. 
Federal law enforcement agencies use commercial databases to track 
criminals and criminal activity. Correctly used, these databases can be 
very useful tools in the fight against crime. However, there should be 
some check on their use. The bill makes it clear that protections 
similar to those provided by the Privacy Act are applied to the 
government's use of commercial databases. The legislation also aims at 
making sure the government's use of such data is secure.
  This bill represents a comprehensive effort to protect the privacy 
and security of the personal information of all Americans. The lives of 
most Americans have been made easier because our personal information 
is readily available to those who have a legitimate need for it. This 
legislation aims to keep such information out of the hands of those who 
have no legitimate need for it. I want to take a moment to thank my 
colleague, Senator Leahy, who has been tireless in his efforts to 
promote individual privacy. He has long fought these issues on the 
Senate floor and has been a leader in securing the privacy rights of 
all Americans. I urge my colleagues to join us in supporting this 
important legislation.
  Mr. FEINGOLD. Mr. President, I am proud to be an original cosponsor 
of the Personal Data Privacy and Security Act of 2007. This bill is a 
much-needed solution to the daunting problem of ensuring the privacy 
and the security of our personal data, which has become such a precious 
commodity.
  Several forces are converging to make our personal information more 
valuable--and more vulnerable--than ever. The world is digital and so 
is our personal data. In this day and age, almost everything we do 
results in a third party creating a digital record about us--digital 
records that we may not even realize exist. We seek the convenience of 
opening bank accounts, managing our credit cards, and making major 
purchases over the Internet. And we often complete these transactions 
without ever speaking to another person face-to-face or over the 
telephone. Businesses, nonprofits, and political parties are 
personalizing their messages, products, and services to a degree we've 
never seen before, and they are willing to invest significant amounts 
of money in collecting personal information about potential customers 
or donors. And we are living in an age where identity-based screening 
and security programs can be vitally important, resulting in more 
information being collected about individuals in an attempt to identify 
them accurately.
  As a result, personal information has become a hot commodity that is 
bought, sold, and--as so often happens when something becomes 
valuable--stolen.
  We are at a crossroads. We all know about the security breaches that 
have been on the front pages of newspapers. They have placed the 
identities of hundreds of thousands of Americans at risk. The fear 
among the American public is so widespread that it has become the basis 
of an entire ad campaign by a credit card company.
  But this is about much more than information security. Until 
California law required a company named ChoicePoint to notify 
individuals in 2005 that their information was compromised and that 
they might be vulnerable to identity theft, many Americans had never 
heard of ChoicePoint. As news stories focused on the data broker 
business, many Americans were surprised to discover that companies are 
creating digital dossiers about them that contain massive amounts of 
information, and that these companies sell that information to 
commercial and government entities. The revelations about these 
security breaches highlighted the fact that Americans need a better 
understanding of what happens to their information in a digital world--
and what kind of consequences they can face as a result.
  When I am back home in Wisconsin, I hear from people who do not 
understand why companies have the right to sell their sensitive 
personal information. I hear from people who are shocked to discover 
that personal information about them is available for free on the 
Internet.
  There is no question that data aggregators facilitate societal 
benefits, allowing consumers to obtain instant credit and personalized 
services, and allowing police officers to locate suspects. But these 
companies also gather a great deal of potentially sensitive information 
about individuals, and in many instances they go largely unregulated.
  Too many of my constituents feel that they have lost control over 
their own information. Congress must return some power to individual 
Americans so that we can all better understand and manage what happens 
to our own personal data.
  The Personal Data Privacy and Security Act takes a comprehensive 
approach to the privacy and security problems we face. It gives 
consumers back some control over their own information. The bill 
requires data brokers to allow consumers to access their own 
information and to investigate when consumers tell them that 
corrections are necessary. And it requires companies to give notice to 
affected consumers and to law enforcement if there is a serious 
security breach, so that individuals know their identity may be at risk 
and can take steps to protect themselves.
  In addition, the bill extends existing criminal law to ensure that it 
covers unauthorized access of data broker systems, as well as 
concealment of security breaches. It requires companies that buy and 
sell information to have appropriate data security systems in place. 
These protections will help safeguard against future privacy violations 
and security breaches in the commercial data industry. But that is not 
all this bill accomplishes.
  The bill also contains some critically important privacy and security 
provisions to govern the government's use of commercial data. This is 
an aspect of the data broker business that has not yet gotten as much 
attention in the wake of the security breaches over the past few years. 
The information gathered by these companies is not just sold to 
individuals and businesses; government agencies of all stripes also buy 
or subscribe to information from commercial sources. We all remember 
the discovery in 2005 that the Pentagon had a contract with a marketing 
firm to analyze commercial and other data about high school and college 
students.
  Although the government should be able to access commercial databases 
in appropriate circumstances, there are few existing rules or 
guidelines to ensure this information is used responsibly. Nor are 
there restrictions on the use of commercial data for powerful, 
intrusive data mining programs. The Privacy Act, which governs when 
government agencies themselves are collecting data, likely does not 
apply because the information is held outside the government and is not 
gathered solely at government direction.
  As a result, there is a great deal we do not know about government 
use of commercial data, even in clearly appropriate circumstances such 
as when the agency's goal is simply to locate an

[[Page 3258]]

individual already suspected of a crime.
  We don't know under what circumstances government employees can 
obtain access to these databases or for what purposes. We don't know 
how government agencies evaluate the accuracy of the databases to which 
they subscribe. We don't know how the accuracy level of the data 
affects government use of the data. We don't know how employees are 
monitored to ensure they do not abuse their access to these databases. 
We don't know how those who misuse the information are punished. And we 
don't know how government agencies, particularly those engaged in 
sensitive national security investigations, ensure that the data 
brokers cannot keep records of who the government is investigating, 
records which themselves could create a huge security risk in light of 
the vulnerabilities that have come to the forefront in recent months.
  That is why I am so pleased that this bill includes provisions to 
address the government's use of commercial data. A comprehensive 
approach to data privacy and security would be incomplete without 
taking on this piece of the puzzle. The bill recognizes there are many 
legitimate reasons for government agencies to obtain commercially 
available data, but that they need to be subject to privacy and 
security protections. It takes a common sense approach, pushing 
government agencies to take basic steps to ensure that individuals' 
personal information is secure and only used for legitimate purposes, 
and that the commercial information the government is paying for and 
relying on is accurate and complete.
  Specifically, the bill would require that federal agencies that 
subscribe to commercial data adopt standards governing its use. These 
standards would reflect long-standing basic privacy principles. The 
bill would ensure that government agencies consider and determine which 
personnel will be permitted to access the information and under what 
circumstances; develop retention policies for this personal data and 
get rid of data they no longer need, minimizing the opportunity for 
abuse or theft; rely only on accurate and complete data, and penalize 
vendors who knowingly provide inaccurate information to the Federal 
Government; provide individuals who suffer adverse consequences as a 
result of the agency's reliance on commercial data with a redress 
mechanism; and establish enforcement mechanisms for those privacy 
policies.
  The bill also directs the General Services Administration to review 
government contracts for commercial data to make sure that vendors have 
appropriate security programs in place, and that they do not provide 
information to the government that they know to be inaccurate. And it 
requires agencies to audit the information security practices of their 
vendors.
  These are basic good government measures. They guarantee that the 
Federal Government is not wasting money on inaccurate data and that 
vendors are undertaking the security programs that they have promised 
and for which the government is paying.
  We live in a new digital world. The law may never fully keep up with 
technology, but we must make every effort we can. I am proud to be 
involved in this comprehensive, reasoned approach to privacy and 
security, and I hope it will move forward in this Congress. I 
congratulate Senators Leahy and Specter for their excellent work on 
this bill. This bill is important and it deserves serious 
consideration.
                                 ______
                                 
      By Mrs. BOXER:
  S. 497. A bill to repeal a prohibition on the use of certain funds 
for tunneling in certain areas with respect to the Los Angeles to San 
Fernando Valley Metro Rail project, California; to the Committee on 
Banking, Housing, and Urban Affairs.
  Mrs. BOXER. Mr. Pesident, today I rise to introduce a bill for myself 
and Senator Feinstein to allow for subway tunneling in parts of Los 
Angeles.
  In 1985, in response to a methane gas explosion that destroyed a Ross 
Dress for Less Store in Los Angeles, Representative Waxman worked to 
enact a law that prohibits subway tunneling in his district.
  In 2004, the Los Angeles City Council passed a motion in support of 
reversing the laws banning tunneling. In February 2005, the Los Angeles 
Metropolitan Transportation Authority board also voted to begin 
discussions of subway expansion.
  As a result, a panel of scientific experts was created to conduct an 
independent safety review that determined that subway tunneling could 
move forward safely with new technology.
  Representative Waxman introduced a bill to lift the Federal tunneling 
prohibition in the last Congress--where it passed the House--and again 
in this Congress. Senator Feinstein and I are introducing the same bill 
in the Senate.
  This legislation has the support of Los Angeles Mayor Antonio 
Villaraigosa and the Los Angeles Metropolitan Transportation Authority.
  This bill is necessary to expand the subway, which is extremely 
important in Los Angeles--a city that ranks time and time again as the 
most congested region in the country. The Wilshire corridor is densely 
populated and is a large commercial area. The freeways and streets are 
filled--we need transit in this area.
                                 ______
                                 
      By Mr. FEINGOLD (for himself and Ms. Collins):
  S. 498. A bill to amend title XVIII of the Social Security Act to 
improve the Medicare program for beneficiaries residing in rural areas; 
to the Committee on Finance.
  Mr. FEINGOLD. Mr. President, today, along with my colleague Senator 
Collins from Maine, I am introducing legislation to address the needs 
of the nearly one-quarter of all Medicare beneficiaries who live in 
rural America. These beneficiaries are systematically disadvantaged in 
the Medicare program. The beauty of Medicare is its equity, its 
universality, and its accessibility. But we have compromised these 
values by stratifying payments, by under-representing rural voices on 
the Medicare Payment Advisory Commission, and by continuing to use 
obsolete payment data that hurts rural America.
  First, we must stop indexing physician payments for work based on 
geographic differences. Rural areas already have a hard enough time 
recruiting and retaining the Nation's top talent. Currently, even 
though 25 percent of Medicare beneficiaries live in rural areas, only 
10 percent of the Nation's physicians serve them. Lower payments to 
doctors in these areas only perpetuate this dangerous shortage of 
medical expertise. We should not be discouraging medical school 
graduates from moving to underserved rural areas by continuing to offer 
sub-par pay--in fact, we should be providing incentives to encourage 
them to work in underserved areas. My legislation proposes a project to 
help rural facilities to host educators and clinical practitioners in 
clinical rotations.
  Lack of dollars to rural health facilities has also prevented 
communities from investing in vital information technology. The 
Institute of Medicine published a report in 2005 detailing the ways in 
which health IT could assist isolated communities. For example, since 
rural physicians tend to be generalists rather than specialists, 
virtual libraries within physician offices would provide both doctors 
and patients with a wider and deeper source of information at their 
fingertips. Rural residents can also be quite far from health 
facilities, so technology that allows emergency room physicians to 
communicate with EMS workers in an ambulance can help patients receive 
life-saving treatment before they physically reach the hospital. These 
kinds of technologies will improve both the quality and efficiency of 
care given in rural areas. My legislation offers funding for quality 
improvement demonstration projects, to allow isolated communities to 
invest in this otherwise out of reach technology.
  Lastly, this legislation will end the disproportionately low 
representation of rural interests on the Medicare Payment Advisory 
Commission. This lack of representation has resulted in policies that 
hurt rural communities. Those policies have hurt--and continue

[[Page 3259]]

to hurt--the people of my State of Wisconsin, and they hurt my 
colleague Senator Collins' constituents as well. For every dollar that 
Medicare spends on the average beneficiary in the average State in this 
country, Medicare spends only 82 cents on a beneficiary in Wisconsin. 
In Maine, Medicare spends only 80 cents per dollar it spends on the 
average beneficiary.
  How is this the case, if beneficiaries in Wisconsin and in Maine pay 
the same payroll taxes as beneficiaries in other States? Because the 
distribution of Medicare dollars among the 50 States is grossly unfair 
to Wisconsin, and to much of the Upper Midwest. Wisconsinites pay 
payroll taxes just like every American taxpayer, but the Medicare funds 
we get in return are lower than those received in many other States.
  With the guidance and support of people across my State who are 
fighting for Medicare fairness, I am introducing this legislation to 
address Medicare's discrimination against Wisconsin's seniors and 
health care providers. My bill will decrease some of the inequitable 
payments that harm rural areas. It will provide rural areas the help 
they need to grow crucial health information technology infrastructure. 
It will offer the necessary incentives to help attract the Nation's top 
medical talent to underserved rural areas. And it will mandate rural 
representation on the Medicare Payment Advisory Commission. Rural 
seniors are already underserved in their communities; they should not 
be underrepresented in Washington as well.
  Rural Americans have worked hard and paid into the Medicare program 
all their lives. In return, they deserve full access to the same 
benefits as seniors throughout the country: their choice of highly 
skilled physicians, use of the latest technologies, and a strong voice 
representing their needs in Medicare policy.
  I ask unanimous consent that the text of my 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. 498

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Rural 
     Medicare Equity Act of 2007''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Elimination of geographic physician work adjustment factor from 
              geographic indices used to adjust payments under the 
              physician fee schedule.
Sec. 3. Clinical rotation demonstration project.
Sec. 4. Medicare rural health care quality improvement demonstration 
              projects.
Sec. 5. Ensuring proportional representation of interests of rural 
              areas on the Medicare Payment Advisory Commission.
Sec. 6. Implementation of GAO recommendations regarding geographic 
              adjustment indices under the Medicare physician fee 
              schedule.

     SEC. 2. ELIMINATION OF GEOGRAPHIC PHYSICIAN WORK ADJUSTMENT 
                   FACTOR FROM GEOGRAPHIC INDICES USED TO ADJUST 
                   PAYMENTS UNDER THE PHYSICIAN FEE SCHEDULE.

       (a) Findings.--Congress finds the following:
       (1) Variations in the geographic physician work adjustment 
     factors under section 1848(e) of the Social Security Act (42 
     U.S.C. 1395w-4(e)) result in inequity between localities in 
     payments under the Medicare physician fee schedule.
       (2) Beneficiaries under the Medicare program that reside in 
     areas where such adjustment factors are high have relatively 
     more access to services that are paid based on such fee 
     schedule.
       (3) There are a number of studies indicating that the 
     market for health care professionals has become nationalized 
     and historically low labor costs in rural and small urban 
     areas have disappeared.
       (4) Elimination of the adjustment factors described in 
     paragraph (1) would equalize the reimbursement rate for 
     services reimbursed under the Medicare physician fee schedule 
     while remaining budget-neutral.
       (b) Elimination.--Section 1848(e) of the Social Security 
     Act (42 U.S.C. 1395w-4(e)) is amended--
       (1) in paragraph (1)(A)(iii), by striking ``an index'' and 
     inserting ``for services provided before January 1, 2008, an 
     index''; and
       (2) in paragraph (2), by inserting ``, for services 
     provided before January 1, 2008,'' after ``paragraph (4)), 
     and''.
       (c) Budget Neutrality Adjustment for Elimination of 
     Geographic Physician Work Adjustment Factor.--Section 1848(d) 
     of the Social Security Act (42 U.S.C. 1395w-4(d)), as amended 
     by section 101 of the Medicare Improvement and Extension Act 
     of 2006, is amended--
       (1) in paragraph (1)(A), by striking ``The conversion'' and 
     inserting ``Subject to paragraph (8), the conversion''; and
       (2) by adding at the end the following new paragraph:
       ``(8) Budget neutrality adjustment for elimination of 
     geographic physician work adjustment factor.--Before applying 
     an update for a year under this subsection, the Secretary 
     shall (if necessary) provide for an adjustment to the 
     conversion factor for that year to ensure that the aggregate 
     payments under this part in that year shall be equal to 
     aggregate payments that would have been made under such part 
     in that year if the amendments made by section 2(b) of the 
     Rural Medicare Equity Act of 2007 had not been enacted.''.

     SEC. 3. CLINICAL ROTATION DEMONSTRATION PROJECT.

       (a) Establishment.--Not later than 6 months after the date 
     of enactment of this Act, the Secretary shall establish a 
     demonstration project that provides for demonstration grants 
     designed to provide financial or other incentives to 
     hospitals to attract educators and clinical practitioners so 
     that hospitals that serve beneficiaries under the Medicare 
     program under title XVIII of the Social Security Act (42 
     U.S.C. 1395 et seq.) who are residents of underserved areas 
     may host clinical rotations.
       (b) Duration of Project.--The demonstration project shall 
     be conducted over a 5-year period.
       (c) Waiver.--The Secretary shall waive such provisions of 
     titles XI and XVIII of the Social Security Act (42 U.S.C. 
     1301 et seq. and 1395 et seq.) as may be necessary to conduct 
     the demonstration project under this section.
       (d) Reports.--The Secretary shall submit to the appropriate 
     committees of Congress interim reports on the demonstration 
     project and a final report on such project within 6 months 
     after the conclusion of the project together with 
     recommendations for such legislative or administrative action 
     as the Secretary determines appropriate.
       (e) Funding.--There are appropriated to the Secretary 
     $20,000,000 to carry out this section.
       (f) Definitions.--In this section:
       (1) Hospital.--The term ``hospital'' means any subsection 
     (d) hospital (as defined in section 1886(d)(1)(B) of the 
     Social Security Act (42 U.S.C. 1395ww(d)(1)(B)) that had 
     indirect or direct costs of medical education during the most 
     recent cost reporting period preceding the date of enactment 
     of this Act.
       (2) Secretary.--The term ``Secretary'' means the Secretary 
     of Health and Human Services.
       (3) Underserved area.--The term ``underserved area'' means 
     such medically underserved urban areas and medically 
     underserved rural areas as the Secretary may specify.

     SEC. 4. MEDICARE RURAL HEALTH CARE QUALITY IMPROVEMENT 
                   DEMONSTRATION PROJECTS.

       (a) Establishment.--
       (1) In general.--Not later than 6 months after the date of 
     enactment of this Act, the Secretary of Health and Human 
     Services (in this section referred to as the ``Secretary'') 
     shall establish not more that 10 demonstration projects to 
     provide for improvements, as recommended by the Institute of 
     Medicine, in the quality of health care provided to 
     individuals residing in rural areas.
       (2) Activities.--Activities under the projects may include 
     public health surveillance, emergency room videoconferencing, 
     virtual libraries, telemedicine, electronic health records, 
     data exchange networks, and any other activities determined 
     appropriate by the Secretary.
       (3) Consultation.--The Secretary shall consult with the 
     Rural Health Quality Advisory Commission, the Office of Rural 
     Health Policy of the Health Resources and Services 
     Administration, the Agency for Healthcare Research and 
     Quality, and the Centers for Medicare & Medicaid Services in 
     carrying out the provisions of this section.
       (b) Duration.--Each demonstration project under this 
     section shall be conducted over a 4-year period.
       (c) Demonstration Project Sites.--The Secretary shall 
     ensure that the demonstration projects under this section are 
     conducted at a variety of sites representing the diversity of 
     rural communities in the Nation.
       (d) Waiver.--The Secretary shall waive such provisions of 
     titles XI and XVIII of the Social Security Act (42 U.S.C. 
     1301 et seq. and 1395 et seq.) as may be necessary to conduct 
     the demonstration projects under this section.
       (e) Independent Evaluation.--The Secretary shall enter into 
     an arrangement with an entity that has experience working 
     directly with rural health systems for the conduct of an 
     independent evaluation of the projects conducted under this 
     section.

[[Page 3260]]

       (f) Reports.--The Secretary shall submit to the appropriate 
     committees of Congress interim reports on each demonstration 
     project and a final report on such project within 6 months 
     after the conclusion of the project. Such reports shall 
     include recommendations regarding the expansion of the 
     project to other areas and recommendations for such other 
     legislative or administrative action as the Secretary 
     determines appropriate.
       (g) Funding.--There are appropriated to the Secretary 
     $50,000,000 to carry out this section.

     SEC. 5. ENSURING PROPORTIONAL REPRESENTATION OF INTERESTS OF 
                   RURAL AREAS ON THE MEDICARE PAYMENT ADVISORY 
                   COMMISSION.

       (a) In General.--Section 1805(c)(2) of the Social Security 
     Act (42 U.S.C. 1395b-6(c)(2)) is amended--
       (1) in subparagraph (A), by inserting ``consistent with 
     subparagraph (E)'' after ``rural representatives''; and
       (2) by adding at the end the following new subparagraph:
       ``(E) Proportional representation of interests of rural 
     areas.--In order to provide a balance between urban and rural 
     representatives under subparagraph (A), the proportion of 
     members who represent the interests of health care providers 
     and Medicare beneficiaries located in rural areas shall be no 
     less than the proportion, of the total number of Medicare 
     beneficiaries, who reside in rural areas.''.
       (b) Effective Date.--The amendments made by subsection (a) 
     shall apply with respect to appointments made to the Medicare 
     Payment Advisory Commission after the date of the enactment 
     of this Act.

     SEC. 6. IMPLEMENTATION OF GAO RECOMMENDATIONS REGARDING 
                   GEOGRAPHIC ADJUSTMENT INDICES UNDER THE 
                   MEDICARE PHYSICIAN FEE SCHEDULE.

       Not later than 180 days after the date of enactment of this 
     Act, the Secretary of Health and Human Services shall 
     implement the recommendations contained in the March 2005 GAO 
     report 05-119 entitled ``Medicare Physician Fees: Geographic 
     Adjustment Indices are Valid in Design, but Data and Methods 
     Need Refinement.''.
                                 ______
                                 
      By Mr. SALAZAR (for himself, Mr. Martinez, Mr. Menendez, Mr. 
        Bayh, Mr. Biden, Mr. Bingaman, Mrs. Boxer, Mr. Domenici, Mr. 
        Durbin, Mrs. Feinstein, Mrs. Hutchison, Mr. Kennedy, Mr. Kerry, 
        Mr. Lautenberg, Mr. Lieberman, Mr. Lugar, Mr. McCain, Mr. 
        Nelson of Florida, Mr. Obama, Mr. Reid, Mr. Schumer, Mr. Brown, 
        Mr. Feingold, and Mrs. Clinton):
  S. 500. A bill to establish the Commission to Study the Potential 
Creation of the National Museum of the American Latino to develop a 
plan of action for the establishment and maintenance of a National 
Museum of the American Latino in Washington, DC, and for other 
purposes; to the Committee on Energy and Natural Resources.
  Mr. SALAZAR. Mr. President, I rise to speak about bi-partisan 
legislation I am introducing today. I am proud to be joined by Senator 
Mel Martinez, Senator Bob Menendez, and 20 additional Senators from 
both sides of the aisle.
  The National Museum of the American Latino Community Commission Act 
will establish a Commission to study the potential creation of a 
National Museum of the American Latino Community. The Commission 
members, selected by the President and Members of Congress, will be 
tasked with studying the impact of such a Museum and the cost of 
constructing and maintaining a museum, developing a plan of action and 
a fundraising plan, and proposing recommendations to make the Museum a 
reality.
  As we begin our efforts to pass this significant legislation, the 
U.S. House of Representatives is set to complete their consideration of 
H.R. 512, the House companion bill, and will pass the bill on the House 
floor today. It has been a pleasure to working with Representative 
Xavier Becerra and Representative Ileana Ros-Lehtinen, who have 
championed this legislation for several years. I hope to work with the 
Senate Energy and Natural Resource Committee to quickly advance the 
Senate bill, so that we can, at last, move forward.
  If we are successful in our efforts, I believe we will have done our 
part to enhance the experience of the millions who visit our Nation's 
capital every year. By passing this legislation, we will contribute to 
the ongoing, deeply rewarding, and profoundly important process of 
national self-discovery.
  Washington, DC is the symbolic heart of our country. When Americans 
travel to their capital, they expect the museums, monuments, and 
national parks they visit to reflect the complete American experience. 
I celebrate the opening of the National Museum of the America Indian 
and efforts underway to establish the National Museum of African 
American History and Culture because I believe we must celebrate our 
rich, diverse national heritage.
  Hispanics have long been a part of our country's history and my own 
family's story illustrates this truth.
  Over 400 years ago, in 1598, my family helped found the oldest city 
in what is now these United States. They named the city Santa Fe--the 
City of Holy Faith--because they knew the hand of God would guide them 
through the struggles of survival in the ages ahead. In Hispanic 
Pioneers in Colorado and New Mexico, a new book by Colorado Society of 
Hispanic Genealogy, their triumph over extreme adversity is documented. 
The time has come for the story of these pioneers to be told in our 
Nation's capital.
  As a proud American, I want to ensure that every individual who 
visits Washington has a chance to learn the full history of who we are 
as Americans. It is my hope that the Senate can work to pass this 
important bill. In doing so, we will preserve our shared America 
history.
  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. 500

       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 ``Commission to Study the 
     Potential Creation of the National Museum of the American 
     Latino Act of 2007''.

     SEC. 2. ESTABLISHMENT OF COMMISSION.

       (a) In General.--There is established the Commission to 
     Study the Potential Creation of a National Museum of the 
     American Latino (in this Act referred to as the 
     ``Commission'').
       (b) Membership.--The Commission shall consist of 23 members 
     appointed not later than 6 months after the date of enactment 
     of this Act as follows:
       (1) The President shall appoint 7 voting members.
       (2) The Speaker of the House of Representatives, the 
     minority leader of the House of Representatives, the majority 
     leader of the Senate, and the minority leader of the Senate 
     shall each appoint 3 voting members.
       (3) In addition to the members appointed under paragraph 
     (2), the Speaker of the House of Representatives, the 
     minority leader of the House of Representatives, the majority 
     leader of the Senate, and the minority leader of the Senate 
     shall each appoint 1 nonvoting member.
       (c) Qualifications.--Members of the Commission shall be 
     chosen from among individuals, or representatives of 
     institutions or entities, who possess either--
       (1) a demonstrated commitment to the research, study, or 
     promotion of American Latino life, art, history, political or 
     economic status, or culture, together with--
       (A) expertise in museum administration;
       (B) expertise in fundraising for nonprofit or cultural 
     institutions;
       (C) experience in the study and teaching of Latino culture 
     and history at the post-secondary level;
       (D) experience in studying the issue of the Smithsonian 
     Institution's representation of American Latino art, life, 
     history, and culture; or
       (E) extensive experience in public or elected service; or
       (2) experience in the administration of, or the planning 
     for the establishment of, museums devoted to the study and 
     promotion of the role of ethnic, racial, or cultural groups 
     in American history.

     SEC. 3. FUNCTIONS OF THE COMMISSION.

       (a) Plan of Action for Establishment and Maintenance of 
     Museum.--The Commission shall submit a report to the 
     President and Congress containing its recommendations with 
     respect to a plan of action for the establishment and 
     maintenance of a National Museum of the American Latino in 
     Washington, DC (in this Act referred to as the ``Museum'').
       (b) Fundraising Plan.--The Commission shall develop a 
     fundraising plan for supporting the creation and maintenance 
     of the Museum through contributions by the American people, 
     and a separate plan on fundraising by the American Latino 
     community.
       (c) Report on Issues.--The Commission shall examine (in 
     consultation with the Secretary of the Smithsonian 
     Institution), and

[[Page 3261]]

     submit a report to the President and Congress on, the 
     following issues:
       (1) The availability and cost of collections to be acquired 
     and housed in the Museum.
       (2) The impact of the Museum on regional Hispanic- and 
     Latino-related museums.
       (3) Possible locations for the Museum in Washington, DC and 
     its environs, to be considered in consultation with the 
     National Capital Planning Commission and the Commission of 
     Fine Arts, the Department of the Interior and Smithsonian 
     Institution.
       (4) Whether the Museum should be located within the 
     Smithsonian Institution.
       (5) The governance and organizational structure from which 
     the Museum should operate.
       (6) How to engage the American Latino community in the 
     development and design of the Museum.
       (7) The cost of constructing, operating, and maintaining 
     the Museum.
       (d) Legislation to Carry Out Plan of Action.--Based on the 
     recommendations contained in the report submitted under 
     subsection (a) and the report submitted under subsection (c), 
     the Commission shall submit for consideration to the 
     Committee on Transportation and Infrastructure of the House 
     of Representatives, the Committee on House Administration of 
     the House of Representatives, the Committee on Rules and 
     Administration of the Senate, the Committees on Natural 
     Resources of the House of Representatives and the Senate, and 
     the Committees on Appropriations of the House of 
     Representatives and the Senate recommendations for a 
     legislative plan of action to create and construct the 
     Museum.
       (e) National Conference.--In carrying out its functions 
     under this section, the Commission may convene a national 
     conference on the Museum, comprised of individuals committed 
     to the advancement of American Latino life, art, history, and 
     culture, not later than 18 months after the commission 
     members are selected.

     SEC. 4. ADMINISTRATIVE PROVISIONS.

       (a) Facilities and Support of Department of the Interior.--
     The Department of the Interior shall provide from funds 
     appropriated for this purpose administrative services, 
     facilities, and funds necessary for the performance of the 
     Commission's functions. These funds shall be made available 
     prior to any meetings of the Commission.
       (b) Compensation.--Each member of the Commission who is not 
     an officer or employee of the Federal Government may receive 
     compensation for each day on which the member is engaged in 
     the work of the Commission, at a daily rate to be determined 
     by the Secretary of the Interior.
       (c) Travel Expenses.--Each member shall be entitled to 
     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) Federal Advisory Committee Act.--The Commission is not 
     subject to the provisions of the Federal Advisory Committee 
     Act.

     SEC. 5. DEADLINE FOR SUBMISSION OF REPORTS; TERMINATION.

       (a) Deadline.--The Commission shall submit final versions 
     of the reports and plans required under section 3 not later 
     than 24 months after the date of the Commission's first 
     meeting.
       (b) Termination.--The Commission shall terminate not later 
     than 30 days after submitting the final versions of reports 
     and plans pursuant to subsection (a).

     SEC. 6. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated for carrying out 
     the activities of the Commission $2,100,000 for the first 
     fiscal year beginning after the date of enactment of this Act 
     and $1,100,000 for the second fiscal year beginning after the 
     date of enactment of this Act.
                                 ______
                                 
      By Mr. SMITH:
  S. 504. A bill to amend the Internal Revenue Code of 1986 to 
establish long-term care trust accounts and allow a refundable tax 
credit for contributions to such accounts, and for other purposes; to 
the Committee on Finance.
  Mr. SMITH. Mr. President, I rise today to introduce the Long-Term 
Care Trust Account Act of 2007. I am pleased to be joined by my 
colleague Senator Blanche Lincoln who has been a tireless leader on 
issues of importance to the health of our Nation. I look forward to 
continuing to work with Senator Lincoln on this legislation as well as 
other opportunities to improve health care in America.
  We are an aging Nation. With babyboomers rapidly retiring, the need 
for long-term care planning is becoming even more critical. However, we 
know all too well that planning for the likelihood of disability in 
young or old age is not done as actively as we would like it to be. 
Currently, only about 7 percent of all money spent on long-term care 
comes from private insurance. Too often, insurance is not being 
purchased, funds are not being saved and persons with disabilities are 
forced to rely on Medicaid for their daily care.
  As a Nation, we need to do better. Senator Lincoln and I believe that 
our bill will encourage Americans to invest in their futures and in 
their care, which is an important first step.
  Specifically, our legislation will create a new type of savings 
mechanism for the purpose of preparing for the costs associated with 
long-term care services and purchasing long-term care insurance. An 
individual who establishes a long-term care trust account can 
contribute up to $5,000 per year to their account and receive a 
refundable 10 percent tax credit on that contribution. Interest accrued 
on these accounts will be tax free, and funds could be withdrawn for 
the purchase of long-term care insurance or to pay for long-term care 
services. Our bill also will allow an individual to make contributions 
to another person's Long-Term Care Trust Account. This will allow 
relatives to help their parents or a loved one prepare for their future 
health care needs.
  The Centers for Medicare and Medicaid Services estimates that 
national spending for long-term care was more than $190 billion in 
2004, representing about 12.5 percent of all personal health care 
expenditures. While those numbers already are staggering, we also know 
that the need for long-term care is expected to grow significantly in 
coming decades. Almost two-thirds of people receiving long-term care 
are over age 65, with this number expected to double by 2030. We also 
know that the population over age 85, those most likely to need long-
term services and supports, is expected to increase more than 250 
percent by 2040 from 4.3 million to 15.4 million.
  Today, millions of Americans are receiving or are in need of long-
term care services and supports. Surprisingly, more than 40 percent of 
persons receiving long-term care are between the ages of 18 and 64. 
Some were born with disabilities; others came to be disabled through 
accident or illness. No one can predict their long-term health care 
needs. Therefore, everyone needs to be prepared.
  Currently, long-term care insurance is the main way to prepare for 
possible future care and support needs. Long-term care insurance helps 
protect assets and income from the devastating financial consequences 
of long-term health care costs. Today's comprehensive long-term care 
insurance policies allow consumers to choose from a variety of benefits 
and offer a wide range of coverage choices. They allow individuals to 
receive care in a variety of settings including nursing homes, home 
care, assisted living facilities and adult day care. Some of the most 
recent policies also provide a cash-benefit that a consumer can spend 
in the manner he or she chooses. When we buy long-term care insurance, 
we are also working to ensure that we can make more independent long-
term care decisions and reduce the strain on state Medicaid budgets.
  Unfortunately, for too many, the struggle to pay the immediate costs 
of long-term care insurance sometimes outweighs the security these 
products would provide. As Americans are spending more and saving less, 
I fear the American middle class is woefully unprepared to meet the 
coming challenges of their long-term care needs. Moving forward in our 
effort to help individuals prepare for life in their later years, we 
must encourage them to purchase long-term care insurance and save for 
long-term care services. The Long-Term Care Trust Account Act of 2007 
is designed to achieve both goals.
  It is my hope that this legislation will help all Americans save for 
their future and their independence during times of vulnerability. I 
urge my colleagues on both sides of the aisle to support this important 
bill.
  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. 504

       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 ``Long-Term Care Trust Account 
     Act of 2007''.

[[Page 3262]]



     SEC. 2. LONG-TERM CARE TRUST ACCOUNTS.

       (a) In General.--Subchapter F of chapter 1 of the Internal 
     Revenue Code of 1986 (relating to exempt organizations) is 
     amended by adding at the end the following new part:

                ``PART IX--LONG-TERM CARE TRUST ACCOUNTS

     ``SEC. 530A. LONG-TERM CARE TRUST ACCOUNTS.

       ``(a) General Rule.--A Long-Term Care Trust Account shall 
     be exempt from taxation under this subtitle. Notwithstanding 
     the preceding sentence, such account shall be subject to the 
     taxes imposed by section 511 (relating to imposition of tax 
     on unrelated business income of charitable organizations).
       ``(b) Long-Term Care Trust Account.--For purposes of this 
     section, the term `Long-Term Care Trust Account' means a 
     trust created or organized in the United States for the 
     exclusive benefit of an individual who is the designated 
     beneficiary of the trust and which is designated (in such 
     manner as the Secretary shall prescribe) at the time of the 
     establishment of the trust as a Long-Term Care Trust Account, 
     but only if the written governing instrument creating the 
     trust meets the following requirements:
       ``(1) Except in the case of a qualified rollover 
     contribution described in subsection (d)--
       ``(A) no contribution will be accepted unless it is in 
     cash, and
       ``(B) contributions will not be accepted for the calendar 
     year in excess of the contribution limit specified in 
     subsection (c)(1).
       ``(2) The trustee is a bank (as defined in section 408(n)), 
     an insurance company (as defined in section 816), or another 
     person who demonstrates to the satisfaction of the Secretary 
     that the manner in which that person will administer the 
     trust will be consistent with the requirements of this 
     section or who has so demonstrated with respect to any 
     individual retirement plan.
       ``(3) No part of the trust assets will be invested in life 
     insurance contracts.
       ``(4) The interest of an individual in the balance of his 
     account is nonforfeitable.
       ``(5) The assets of the trust shall not be commingled with 
     other property except in a common trust fund or common 
     investment fund.
       ``(6) Except as provided in subsection (e)(2), no 
     distribution will be allowed if at the time of such 
     distribution the designated beneficiary is not a chronically 
     ill individual (as defined in section 7702B(c)(2)).
       ``(c) Tax Treatment of Contributions.--
       ``(1) Contribution limit.--
       ``(A) In general.--The aggregate amount of contributions 
     (other than qualified rollover contributions described in 
     subsection (d)) for any taxable year to all Long-Term Care 
     Trust Accounts maintained for the benefit of the designated 
     beneficiary shall not exceed $5,000.
       ``(B) Inflation adjustment.--In the case of any taxable 
     year beginning in a calendar year after 2007, the dollar 
     amount under subparagraph (A) shall be increased by an amount 
     equal to--
       ``(i) such dollar amount, multiplied by
       ``(ii) the medical care cost adjustment determined under 
     section 213(d)(10)(B)(ii) for the calendar year in which the 
     taxable year begins, determined by substituting `2006' for 
     `1996' in subclause (II) thereof.

     If any amount as adjusted under the preceding sentence is not 
     a multiple of $10, such amount shall be rounded to the next 
     lowest multiple of $10.
       ``(2) Gift tax treatment of contributions.--For purposes of 
     chapters 12 and 13--
       ``(A) In general.--Any contribution to a Long-Term Care 
     Trust Account on behalf of any designated beneficiary--
       ``(i) shall be treated as a completed gift to such 
     beneficiary which is not a future interest in property, and
       ``(ii) shall not be treated as a qualified transfer under 
     section 2503(e).
       ``(B) Treatment of excess contributions.--If the aggregate 
     amount of contributions described in subparagraph (A) during 
     the calendar year by a donor exceeds the limitation for such 
     year under section 2503(b), such aggregate amount shall, at 
     the election of the donor, be taken into account for purposes 
     of such section ratably over the 5-year period beginning with 
     such calendar year.
       ``(d) Qualified Rollover Contribution.--For purposes of 
     this section, the term `qualified rollover contribution' 
     means a contribution to a Long-Term Care Trust Account--
       ``(1) from another such account of the same beneficiary, 
     but only if such amount is contributed not later than the 
     60th day after the distribution from such other account, and
       ``(2) from a Long-Term Care Trust Account of a spouse of 
     the beneficiary of the account to which the contribution is 
     made, but only if such amount is contributed not later than 
     the 60th day after the distribution from such other account.
       ``(e) Tax Treatment of Distributions.--
       ``(1) In general.--Any distribution from a Long-Term Care 
     Trust Account shall be includible in the gross income of the 
     distributee in the manner as provided under section 72 to the 
     extent not excluded from gross income under any other 
     provision of this subsection.
       ``(2) Long-term care insurance premiums.--If at the time of 
     any distribution, the designated beneficiary is not a 
     chronically ill individual (as defined in section 
     7702B(c)(2)), no amount shall be includible in gross income 
     under paragraph (1) if the aggregate premiums for any 
     qualified long-term care insurance contract for such 
     beneficiary during the taxable year are not less than the 
     aggregate distributions during the taxable year.
       ``(3) Distributions for qualified long-term care 
     services.--For purposes of this subsection, if at the time of 
     any distribution, the designated beneficiary is a chronically 
     ill individual (as so defined)--
       ``(A) In-kind distributions.--No amount shall be includible 
     in gross income under paragraph (1) by reason of a 
     distribution which consists of providing a benefit to the 
     distributee which, if paid for by the distributee, would 
     constitute expenses for any qualified long-term care services 
     (as defined in section 7702B(c)).
       ``(B) Cash distributions.--In the case of distributions not 
     described in subparagraph (A), if--
       ``(i) such distributions do not exceed the expenses for 
     qualified long-term care services (as so defined), reduced by 
     expenses described in subparagraph (A), no amount shall be 
     includible in gross income, and
       ``(ii) in any other case, the amount otherwise includible 
     in gross income shall be reduced by an amount which bears the 
     same ratio to such amount as such expenses bear to such 
     distributions.
       ``(4) Change in beneficiaries or accounts.--Paragraph (1) 
     shall not apply to that portion of any distribution which, 
     within 60 days of such distribution, is transferred--
       ``(A) to another Long-Term Care Trust Account for the 
     benefit of the designated beneficiary, or
       ``(B) to the credit of another designated beneficiary under 
     a Long-Term Care Trust Account who is a spouse of the 
     designated beneficiary with respect to which the distribution 
     was made.
       ``(5) Operating rules.--For purposes of applying section 
     72--
       ``(A) to the extent provided by the Secretary, all Long-
     Term Care Trust Accounts of which an individual is a 
     designated beneficiary shall be treated as one account,
       ``(B) except to the extent provided by the Secretary, all 
     distributions during a taxable year shall be treated as one 
     distribution, and
       ``(C) except to the extent provided by the Secretary, the 
     value of the contract, income on the contract, and investment 
     in the contract shall be computed as of the close of the 
     calendar year in which the taxable year begins.
       ``(6) Special rules for death and divorce.--
       ``(A) In general.--Rules similar to the rules of paragraphs 
     (7) and (8) of section 220(f) shall apply.
       ``(B) Amounts includible in estate of donor making excess 
     contributions.--In the case of a donor who makes the election 
     described in subsection (c)(2)(B) and who dies before the 
     close of the 5-year period referred to in such subsection, 
     the gross estate of the donor shall include the portion of 
     such contributions properly allocable to periods after the 
     date of death of the donor.
       ``(7) Additional tax.--The tax imposed by this chapter for 
     any taxable year on any taxpayer who receives a payment or 
     distribution from a Long-Term Care Trust Account which is 
     includible in gross income shall be increased by 25 percent 
     of the amount which is so includible under rules similar to 
     the rules of section 530(d)(4).
       ``(8) Denial of double benefit.--For purposes of 
     determining the amount of any deduction under this chapter, 
     any payment or distribution out of a Long-Term Care Trust 
     Account shall not be treated as an expense paid for medical 
     care.
       ``(f) Designated Beneficiary.--For purposes of this 
     section, the term `designated beneficiary' means the 
     individual designated at the commencement of participation in 
     the Long-Term Care Trust Account as the beneficiary of 
     amounts paid (or to be paid) to the account.
       ``(g) Loss of Taxation Exemption of Account Where 
     Beneficiary Engages in Prohibited Transaction.--Rules similar 
     to the rules of paragraph (2) of section 408(e) shall apply 
     to any Long-Term Care Trust Account.
       ``(h) Custodial Accounts.--For purposes of this section, a 
     custodial account or an annuity contract issued by an 
     insurance company qualified to do business in a State shall 
     be treated as a trust under this section if--
       ``(1) the custodial account or annuity contract would, 
     except for the fact that it is not a trust, constitute a 
     trust which meets the requirements of subsection (b), and
       ``(2) in the case of a custodial account, the assets of 
     such account are held by a bank (as defined in section 
     408(n)) or another person who demonstrates, to the 
     satisfaction of the Secretary, that the manner in which he 
     will administer the account will be consistent with the 
     requirements of this section.

     For purposes of this title, in the case of a custodial 
     account or annuity contract treated as a trust by reason of 
     the preceding sentence, the person holding the assets of such 
     account or holding such annuity contract shall be treated as 
     the trustee thereof.
       ``(i) Reports.--The trustee of a Long-Term Care Trust 
     Account shall make such reports

[[Page 3263]]

     regarding such account to the Secretary and to the 
     beneficiary of the account with respect to contributions, 
     distributions, and such other matters as the Secretary may 
     require. The reports required by this subsection shall be 
     filed at such time and in such manner and furnished to such 
     individuals at such time and in such manner as may be 
     required.''.
       (b) Tax on Excess Contributions.--
       (1) In general.--Subsection (a) of section 4973 of the 
     Internal Revenue Code of 1986 (relating to tax on excess 
     contributions to certain tax-favored accounts and annuities) 
     is amended by striking ``or'' at the end of paragraph (4), by 
     inserting ``or'' at the end of paragraph (5), and by 
     inserting after paragraph (5) the following new paragraph:
       ``(6) a Long-Term Care Trust Account (as defined in section 
     530A),''.
       (2) Excess contribution.--Section 4973 of such Code is 
     amended by adding at the end the following new subsection:
       ``(h) Excess Contributions to Long-Term Care Trust 
     Accounts.--For purposes of this section--
       ``(1) In general.--In the case of Long-Term Care Trust 
     Accounts (within the meaning of section 530A), the term 
     `excess contributions' means the sum of--
       ``(A) the amount by which the amount contributed for the 
     calendar year to such accounts (other than qualified rollover 
     contributions (as defined in section 530A(d))) exceeds the 
     contribution limit under section 530A(c)(1), and
       ``(B) the amount determined under this subsection for the 
     preceding calendar year, reduced by the excess (if any) of 
     the maximum amount allowable as a contribution under section 
     530A(c)(1) for the calendar year over the amount contributed 
     to the accounts for the calendar year.
       ``(2) Special rule.--A contribution shall not be taken into 
     account under paragraph (1) if such contribution (together 
     with the amount of net income attributable to such 
     contribution) is returned to the beneficiary before June 1 of 
     the year following the year in which the contribution is 
     made.''.
       (c) Failure To Provide Reports on Long-Term Care Trust 
     Accounts.--Paragraph (2) of section 6693(a) of the Internal 
     Revenue Code of 1986 (relating to failure to provide reports 
     on individual retirement accounts or annuities) is amended by 
     striking ``and'' at the end of subparagraph (D), by striking 
     the period at the end of subparagraph (E) and inserting ``, 
     and'', and by inserting after subparagraph (E) the following 
     new subparagraph:
       ``(F) section 530A(i) (relating to Long-Term Care Trust 
     Accounts).''.
       (d) Conforming Amendment.--The table of parts for 
     subchapter F of chapter 1 of the Internal Revenue Code of 
     1986 is amended by adding at the end the following new item:

              ``Part IX. Long-Term Care Trust Accounts''.

       (e) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2006.

     SEC. 3. REFUNDABLE CREDIT FOR CONTRIBUTIONS TO LONG-TERM CARE 
                   TRUST ACCOUNTS.

       (a) In General.--Subpart C of part IV of subchapter A of 
     chapter 1 of the Internal Revenue Code of 1986 (relating to 
     refundable credits) is amended by inserting after section 35 
     the following new section:

     ``SEC. 35A. CONTRIBUTIONS TO LONG-TERM CARE TRUST ACCOUNTS.

       ``(a) General Rule.--In the case of an individual, there 
     shall be allowed as a credit against the tax imposed by this 
     subtitle for the taxable year an amount equal to 10 percent 
     of the contributions to any Long-Term Care Trust Account 
     allowed under section 530A for such taxable year.
       ``(b) Reduction Based on Adjusted Gross Income.--
       ``(1) In general.--The percentage which would (but for this 
     subsection) be taken into account under subsection (a) for 
     the taxable year shall be reduced (but not below zero) by the 
     percentage determined under paragraph (2).
       ``(2) Amount of reduction.--The percentage determined under 
     this paragraph is the percentage which bears the same ratio 
     to the percentage which would be so taken into account as--
       ``(A) the excess of--
       ``(i) the taxpayer's adjusted gross income for such taxable 
     year, over
       ``(ii) $95,000 ($190,000 in the case of a joint return), 
     bears to
       ``(B) $10,000 ($20,000 in the case of a joint return).
       ``(3) Adjusted gross income.--For purposes of this 
     subsection, adjusted gross income shall be determined without 
     regard to sections 911, 931, and 933.
       ``(c) Denial of Double Benefit.--No deduction shall be 
     allowed under this chapter for any amount taken into account 
     in determining the credit under this section.''.
       (b) Conforming Amendments.--
       (1) Paragraph (2) of section 1324(b) of title 31, United 
     States Code, is amended by inserting before the period ``, or 
     from section 35A of such Code''.
       (2) The table of sections of subpart C of part IV of 
     subchapter A of chapter 1 of the Internal Revenue Code of 
     1986 is amended by inserting after the item relating to 
     section 35 the following new item:

``Sec. 35A. Contributions to Long-Term Care Trust Accounts.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to amounts paid or incurred in taxable years 
     beginning after December 31, 2005.
                                 ______
                                 
      By Ms. COLLINS (for herself, Mr. Warner, Ms. Landrieu, Mr. 
        Coleman, Mr. Vitter, Mr. Smith, and Mr. Nelson of Nebraska).
  S. 505. A bill to amend the Internal Revenue Code of 1986 to increase 
the above-the-line deduction for teacher classroom supplies and to 
expand such deduction to include qualified professional development 
expenses; to the Committee on Finance.
  Ms. COLLINS. Mr. President, the bill that I am introducing today, 
along with Senators Warner, Landrieu, Vitter, Coleman, Smith, and 
Nelson of Nebraska, would increase and expand the Teacher Tax deduction 
provided in current law. The Teacher Tax deduction is available to 
school teachers and other educators who incur out-of-pocket expenses in 
order to purchase classroom supplies for their students. The bill we 
are offering today would increase this above-the-line tax deduction to 
$400, allow the deduction to be taken for expenses related to 
professional development, and make the deduction permanent.
  This bill builds upon a $250 tax deduction in current law authored by 
Senator Warner and myself, which became law as part of the tax relief 
package in 2001. This tax relief was later extended through the end of 
this year, but we need to act to extend it further.
   I would suggest that there is no reason why we should not make the 
deduction permanent. Teachers who buy classroom supplies in order to 
improve the educational experience of their students deserve more than 
just our gratitude. They deserve this modest tax relief to thank them 
for their hard work.
  So often teachers in my State, and throughout the country, spend 
their own money in order to improve the classroom experiences of their 
students. Many of us are familiar with a survey of the National 
Education Association that found that teachers spend, on average, $443 
a year on classroom supplies. Other surveys show that they are spending 
even more than that. In fact, the National School Supply and Equipment 
Association found that educators spend an average of $826 to supplement 
classroom supplies, plus $926 for instructional materials on top of 
that--for a total of over $1,700 out of their own pockets.
  In most States, including mine, teachers are very modestly paid for 
their jobs. I think it is so impressive that despite challenging jobs 
and modest salaries, teachers are willing to dig deep into their own 
pockets to enrich the classroom experience, because they care so deeply 
for their students.
  Indeed, I have spoken to dozens of teachers in Maine who tell me they 
routinely spend far in excess of the $250 deduction limit that is in 
current law. I have made a practice of visiting schools all over Maine, 
and so far, I have had the opportunity to visit more than 160 schools 
in my State. At virtually every school I visit, I find teachers who are 
spending their own money to benefit their students. Year after year, 
these teachers spend hundreds of dollars on books, bulletin boards, 
computer software, crayons, construction paper, stamps, inkpads--
everything you can think of. Let me just give you a couple of examples. 
Anita Hopkins and Kathi Toothaker, who are elementary school teachers 
from Augusta, ME, purchase books for their students to have as a 
classroom library, as well as workbooks and sight cards. They have also 
purchased special prizes for positive reinforcement for their students. 
Mrs. Hopkins estimates that she spends $800 to $1,000 of her own money 
on extra materials to make learning fun and to create a stimulating 
classroom environment.
  This bill would also expand the Teacher Tax deduction to make it 
available to teachers who incur expenses for professional development. 
Whenever the provisions of ``No Child Left Behind'' are being debated, 
we hear a lot of discussion about the need for highly-qualified 
teachers. One of

[[Page 3264]]

the best ways for teachers to improve their qualifications is through 
professional development. Yet, in towns in my State, and I suspect 
throughout the country, school budgets are often very tight, and money 
for professional development is either very limited or non-existent. 
For that reason, I believe we should allow this tax deduction to also 
apply when a teacher takes a course or attends a workshop and has to 
pay for it out of his or her own pocket.
  In my view, students are the ultimate beneficiaries when teachers 
receive professional development to sharpen their skills or to learn a 
new approach to presenting material to their students. Studies have 
consistently shown that, other than involved parents, the single 
greatest determinant of classroom success is the presence of a well-
qualified teacher. Educators themselves understand just how important 
professional development is to their ability to make a positive impact 
in the classroom.
  The Teacher Tax relief that we have made available since 2001 is 
certainly a positive step, and I was proud to have authored that law, 
along with Senator Warner. This bill would increase that deduction from 
$250 to $400, reflecting more accurately what teachers really spend, 
and would make the deduction permanent. The National Education 
Association has endorsed this bill, and I ask unanimous consent that a 
copy of the NEA's letter be printed in the Record at the end of my 
statement.
  This bill is a small but appropriate means of recognizing the many 
sacrifices that our teachers make every day to benefit the children of 
America. I urge my colleagues to support it.
  There being no objection, the letter was ordered to be printed in the 
Record, as follows:

                               National Education Association,

                                 Washington, DC, January 24, 2007.
     Senator Susan Collins,
     Senator John Warner,
     U.S. Senate,
     Washington, DC.
       Dear Senators Collins and Warner: On behalf of the National 
     Education Association's, NEA, 3.2 million members, we would 
     like to express our strong support for your legislation that 
     would increase, expand, and make permanent the tax deduction 
     for educators' out-of-pocket classroom supply expenses. We 
     thank you for your continued leadership and advocacy on this 
     important issue.
       As you know, the educator tax deduction helps recognize the 
     financial sacrifices made by teachers and paraprofessionals, 
     who often reach into their own pockets to purchase classroom 
     supplies such as books, pencils, paper, and art supplies. 
     Studies show that teachers are spending more of their own 
     funds each year to supply their classrooms, including 
     purchasing essential items such as pencils, glue, scissors, 
     and facial tissues. For example, NEA's 2003 report Status of 
     the American Public School Teacher, 2000-2001 found that 
     teachers spent an average of $443 a year on classroom 
     supplies. More recently, the National School Supply and 
     Equipment Association found that in 2005-2006, educators 
     spent out of their own pockets an average of $826.00 for 
     supplies and an additional $926 for instructional materials, 
     for a total of $1,752.
       By increasing the current deduction and making it 
     permanent, your legislation will make a real difference for 
     many educators, who often must sacrifice other personal needs 
     in order to pay for classroom supplies.
       NEA also strongly supports your proposal to extend the tax 
     deduction to cover out-of-pocket professional development 
     expenses. Teacher quality is the single most critical factor 
     in maximizing student achievement. Ongoing professional 
     development is essential to ensure that educators stay up-to-
     date on the skills and knowledge necessary to prepare 
     students for the challenges of the 21 st century. Your bill 
     will make a critical difference in helping educators access 
     quality training.
       We thank you again for your work on this important 
     legislation and look forward to continuing to work with you 
     to support our nation's educators.
           Sincerely,
     Diane Shust,
       Director of Government Relations.
     Randall Moody,
       Manager, Policy and Politics.
  Mr. WARNER. Mr. President, I rise today in support, once again, of 
America's teachers by joining with Senator Collins in introducing 
legislation regarding the Teacher Tax Relief Act.
  Senator Collins and I have worked closely for some time now in 
support of legislation to provide our teachers with tax relief in 
recognition of the many out-of-pocket expenses they incur as part of 
their profession. In the 107th Congress, we were successful in 
providing much needed tax relief for our Nation's teachers with passage 
of H.R. 3090, the ``Job Creation and Worker Assistance Act of 2002.''
  This legislation, which was signed into law by President Bush, 
included the Collins/Warner ``Teacher Tax Relief Act of 2001'' 
provisions that provided a $250 above the line deduction for educators 
who incur out-of-pocket expenses for supplies they bring into the 
classroom to better the education of their students. These important 
provisions provided almost half a billion dollars worth of tax relief 
to teachers all across America in 2002 and 2003.
  In the 108th Congress we were able to successfully extend the 
provisions of the Teacher Tax Relief Act for 2004 and 2005. In the 
109th Congress we were able to successfully extend the provisions for 
2006 and 2007.
  While these provisions will provide substantial relief to America's 
teachers, our work is not yet complete.
  It is now estimated that the average teacher spends $826 out of their 
own pocket each year on classroom materials--materials such as pens, 
pencils and books. First year teachers spend even more.
  Why do they do this? Simply because school budgets are not adequate 
to meet the costs of education. Our teachers dip into their own pocket 
to better the education of America's youth.
  Moreover, in addition to spending substantial money on classroom 
supplies, many teachers spend even more money out of their own pocket 
on professional development. Such expenses include tuition, fees, 
books, and supplies associated with courses that help our teachers 
become even better instructors.
  The fact is that these out-of-pocket costs place lasting financial 
burdens on our teachers. This is one reason our teachers are leaving 
the profession. Little wonder that our country is in the midst of a 
teacher shortage.
  Without a doubt the Teacher Tax Relief Act of 2001 took a step 
forward in helping to alleviate the Nation's teaching shortage by 
providing a $250 above the line deduction for classroom expenses.
  However, it is clear that our teachers are spending much more than 
$250 a year out of their own pocket to better the education of our 
children.
  Accordingly, Senator Collins and I have joined together to take 
another step forward by introducing this legislation.
  This proposed legislation will build upon current law in three ways. 
The legislation will: One, increase the above-the-line deduction, as 
President Bush has called for, from $250 allowed under current law to 
$400; two, allow educators to include professional development costs 
within that $400 deduction. Under current law, up to $250 is deductible 
but only for classroom expenses; and three, make the Teacher Tax Relief 
provisions in the law permanent. Current law sunsets the Collins/Warner 
provisions after 2007.
  Our teachers have made a personal commitment to educate the next 
generation and to strengthen America. And, in my view, the Federal 
Government should recognize the many sacrifices our teachers make in 
their career.
  This Teacher Tax Relief Act is another step forward in providing our 
educators with the recognition they deserve.
                                 ______
                                 
      By Mr. LAUTENBERG (for himself, Ms. Snowe, and Mrs. Boxer):
  S. 506. A bill to improve efficiency in the Federal Government 
through the use of high-performance green buildings, and for other 
purposes; to the committee on Environment and Public Works.
  Mr. LAUTENBERG. Mr. President, I am pleased to be joined by my 
colleagues, Senators Snowe and Boxer, to introduce the High Performance 
Green Buildings Act. This legislation encourages the government to 
improve the energy efficiency, indoor air quality,

[[Page 3265]]

and environmental impacts of our Nation's Federal buildings, and will 
reenergize and focus the Federal Government's leadership and commitment 
on this issue.
  Buildings in the United States have an enormous impact on the 
environment and also on our overall energy situation. According to the 
Department of Energy, buildings in the United States use almost 40 
percent of the total energy consumed in this country. That figure is 
expected to rise to 53 percent by 2030, meaning that over half of the 
energy consumed in this country will be used by buildings alone. In 
addition, buildings are the source of 35 percent of national carbon 
dioxide emissions, 49 percent of sulfur dioxide emissions, and 25 
percent of nitrogen oxide emissions.
  However, the impact of buildings is even broader than that. Americans 
spend approximately 90 percent of their time indoors and the quality of 
the air they breathe can have an impact on their health, as well as 
work productivity and absenteeism. The U.S. Green Buildings Council, a 
national non-profit, indicates that on average, installing high 
performance lighting enhances worker productivity by 6.7 percent. There 
are also numerous sources of indoor air pollutants, ranging from mold 
to radon, and strong building design that considers ventilation can 
help to remedy these potential health problems.
  It is important that we confront these issues, and our legislation 
does just that. High Performance Green Buildings are designed with the 
impact on occupants, surroundings and energy consumption in mind. 
Buildings designed or renovated on these merits save money, have 
healthier occupants, and have a more positive impact on their 
communities.
  While the initial investment cost of green buildings may be higher 
than a traditional building, many of these costs are recouped over 
time. For instance, the Federal government spends about $170 million 
per year on the lighting of federal buildings; using new lighting 
technology can reduce energy use by 50 to 75 percent. Some estimates 
show that the payback time for energy efficient lighting is as little 
as four months.
  The High Performance Green Buildings Act focuses the Federal 
Government's efforts on promoting sustainable design in federal 
buildings, and realizing the economic benefits associated with reduced 
energy use and increased occupant health. It creates an Office of High 
Performance Green Buildings within the General Services Administration 
(GSA), which manages buildings owned or leased by the Federal 
Government. GSA is the largest ``landlord'' in the country the 
government owns or leases nearly 500,000 buildings in the United 
States, covering 3.1 billion square feet. The new Office will promote 
public outreach, focus ongoing research and development, and create an 
Advisory Committee consisting of Agency representatives and experts 
from various sectors, to improve coordination across Federal Government 
agencies and bring best practices to the Federal government.
  Additionally, the High Performance Green Buildings Act provides 
grants to schools, in consultation with the Environmental Protection 
Agency and the Department of Education, to provide technical assistance 
to address environmental and health concerns. The health of our 
children is our primary concern and this legislation takes important 
steps to ensure their well-being.
  It is clear that having sustainable design in our buildings is smart 
public policy and a wise financial investment, and this bill will allow 
the Federal Government to increase its leadership role on the promotion 
of green buildings. I urge my colleagues to support this bill.
  I ask unanimous consent that the full 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. 506

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``High-
     Performance Green Buildings Act of 2007''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Definitions.

          TITLE I--OFFICE OF HIGH-PERFORMANCE GREEN BUILDINGS

Sec. 101. Oversight.
Sec. 102. Office of High-Performance Green Buildings.
Sec. 103. Green Building Advisory Committee.
Sec. 104. Public outreach.
Sec. 105. Research and development.
Sec. 106. Budget and life-cycle costing and contracting.
Sec. 107. Authorization of appropriations.

               TITLE II--HEALTHY HIGH-PERFORMANCE SCHOOLS

Sec. 201. Definition of high-performance school.
Sec. 202. Grants for healthy school environments.
Sec. 203. Model guidelines for siting of school facilities.
Sec. 204. Public outreach.
Sec. 205. Environmental health program.
Sec. 206. Authorization of appropriations.

              TITLE III--STRENGTHENING FEDERAL LEADERSHIP

Sec. 301. Incentives.
Sec. 302. Federal procurement.
Sec. 303. Federal green building performance.

                    TITLE IV--DEMONSTRATION PROJECT

Sec. 401. Coordination of goals.
Sec. 402. Authorization of appropriations.

     SEC. 2. DEFINITIONS.

       In this Act:
       (1) Administrator.--The term ``Administrator'' means the 
     Administrator of General Services.
       (2) Committee.--The term ``Committee'' means the Green 
     Building Advisory Committee established under section 103(a).
       (3) Director.--The term ``Director'' means the individual 
     appointed to the position established under section 101(a).
       (4) Federal facility.--
       (A) In general.--The term ``Federal facility'' means any 
     building or facility the intended use of which requires the 
     building or facility to be--
       (i) accessible to the public; and
       (ii) constructed or altered by or on behalf of the United 
     States.
       (B) Exclusions.--The term ``Federal facility'' does not 
     include a privately-owned residential or commercial structure 
     that is not leased by the Federal Government.
       (5) High-performance green building.--The term ``high-
     performance green building'' means a building--
       (A) that, during its life-cycle--
       (i) reduces energy, water, and material resource use and 
     the generation of waste;
       (ii) improves indoor environmental quality, including 
     protecting indoor air quality during construction, using low-
     emitting materials, improving thermal comfort, and improving 
     lighting and acoustic environments that affect occupant 
     health and productivity;
       (iii) improves indoor and outdoor impacts of the building 
     on human health and the environment;
       (iv) increases the use of environmentally preferable 
     products, including biobased, recycled content, and nontoxic 
     products with lower life-cycle impacts;
       (v) increases reuse and recycling opportunities; and
       (vi) integrates systems in the building; and
       (B) for which, during its planning, design, and 
     construction, the environmental and energy impacts of 
     building location and site design are considered.
       (6) Life cycle.--The term ``life cycle'', with respect to a 
     high-performance green building, means all stages of the 
     useful life of the building (including components, equipment, 
     systems, and controls of the building) beginning at 
     conception of a green building project and continuing through 
     site selection, design, construction, landscaping, 
     commissioning, operation, maintenance, renovation, 
     deconstruction or demolition, removal, and recycling of the 
     green building.
       (7) Life-cycle assessment.--The term ``life-cycle 
     assessment'' means a comprehensive system approach for 
     measuring the environmental performance of a product or 
     service over the life of the product or service, beginning at 
     raw materials acquisition and continuing through 
     manufacturing, transportation, installation, use, reuse, and 
     end-of-life waste management.
       (8) Life-cycle costing.--The term ``life-cycle costing'', 
     with respect to a high-performance green building, means a 
     technique of economic evaluation that--
       (A) sums, over a given study period, the costs of initial 
     investment (less resale value), replacements, operations 
     (including energy use), and maintenance and repair of an 
     investment decision; and
       (B) is expressed--
       (i) in present value terms, in the case of a study period 
     equivalent to the longest useful life of the building, 
     determined by taking

[[Page 3266]]

     into consideration the typical life of such a building in the 
     area in which the building is to be located; or
       (ii) in annual value terms, in the case of any other study 
     period.
       (9) Office.--The term ``Office'' means the Office of High-
     Performance Green Buildings established under section 102(a).

          TITLE I--OFFICE OF HIGH-PERFORMANCE GREEN BUILDINGS

     SEC. 101. OVERSIGHT.

       (a) In General.--The Administrator shall establish within 
     the General Services Administration, and appoint an 
     individual to serve as Director in, a position in the career-
     reserved Senior Executive service, to--
       (1) establish and manage the Office in accordance with 
     section 102; and
       (2) carry out other duties as required under this Act.
       (b) Compensation.--The compensation of the Director shall 
     not exceed the maximum rate of basic pay for the Senior 
     Executive Service under section 5382 of title 5, United 
     States Code, including any applicable locality-based 
     comparability payment that may be authorized under section 
     5304(h)(2)(C) of that title.

     SEC. 102. OFFICE OF HIGH-PERFORMANCE GREEN BUILDINGS.

       (a) Establishment.--The Director shall establish within the 
     General Services Administration an Office of High-Performance 
     Green Buildings.
       (b) Duties.--The Director shall--
       (1) ensure full coordination of high-performance green 
     building information and activities within the General 
     Services Administration and all relevant Federal agencies, 
     including, at a minimum--
       (A) the Environmental Protection Agency;
       (B) the Office of the Federal Environmental Executive;
       (C) the Office of Federal Procurement Policy;
       (D) the Department of Energy;
       (E) the Department of Health and Human Services;
       (F) the Department of Defense; and
       (G) such other Federal agencies as the Director considers 
     to be appropriate;
       (2) establish a senior-level green building advisory 
     committee, which shall provide advice and recommendations in 
     accordance with section 103;
       (3) identify and biennially reassess improved or higher 
     rating standards recommended by the Committee;
       (4) establish a national high-performance green building 
     clearinghouse in accordance with section 104, which shall 
     provide green building information through--
       (A) outreach;
       (B) education; and
       (C) the provision of technical assistance;
       (5) ensure full coordination of research and development 
     information relating to high-performance green building 
     initiatives under section 105;
       (6) identify and develop green building standards that 
     could be used for all types of Federal facilities in 
     accordance with section 105;
       (7) establish green practices that can be used throughout 
     the life of a Federal facility;
       (8) review and analyze current Federal budget practices and 
     life-cycle costing issues, and make recommendations to 
     Congress, in accordance with section 106; and
       (9) complete and submit the report described in subsection 
     (c).
       (c) Report.--Not later than 2 years after the date of 
     enactment of this Act, and biennially thereafter, the 
     Director shall submit to Congress a report that--
       (1) describes the status of the green building initiatives 
     under this Act and other Federal programs in effect as of the 
     date of the report, including--
       (A) the extent to which the programs are being carried out 
     in accordance with this Act; and
       (B) the status of funding requests and appropriations for 
     those programs;
       (2) identifies within the planning, budgeting, and 
     construction process all types of Federal facility procedures 
     that inhibit new and existing Federal facilities from 
     becoming high-performance green buildings as measured by--
       (A) a silver rating, as defined by the Leadership in Energy 
     and Environmental Design Building Rating System standard 
     established by the United States Green Building Council (or 
     an equivalent rating obtained through a comparable system); 
     or
       (B) an improved or higher rating standard, as identified by 
     the Committee;
       (3) identifies inconsistencies, as reported to the 
     Committee, in Federal law with respect to product acquisition 
     guidelines and high-performance product guidelines;
       (4) recommends language for uniform standards for use by 
     Federal agencies in environmentally responsible acquisition;
       (5) in coordination with the Office of Management and 
     Budget, reviews the budget process for capital programs with 
     respect to alternatives for--
       (A) restructuring of budgets to require the use of complete 
     energy- and environmental-cost accounting;
       (B) using operations expenditures in budget-related 
     decisions while simultaneously incorporating productivity and 
     health measures (as those measures can be quantified by the 
     Office, with the assistance of universities and national 
     laboratories);
       (C) permitting Federal agencies to retain all identified 
     savings accrued as a result of the use of life cycle costing; 
     and
       (D) identifying short- and long-term cost savings that 
     accrue from high-performance green buildings, including those 
     relating to health and productivity;
       (6) identifies green, self-sustaining technologies to 
     address the operational needs of Federal facilities in times 
     of national security emergencies, natural disasters, or other 
     dire emergencies;
       (7) summarizes and highlights development, at the State and 
     local level, of green building initiatives, including 
     Executive orders, policies, or laws adopted promoting green 
     building (including the status of implementation of those 
     initiatives); and
       (8) includes, for the 2-year period covered by the report, 
     recommendations to address each of the matters, and a plan 
     for implementation of each recommendation, described in 
     paragraphs (1) through (6).
       (d) Implementation.--The Office shall carry out each plan 
     for implementation of recommendations under subsection 
     (c)(7).

     SEC. 103. GREEN BUILDING ADVISORY COMMITTEE.

       (a) Establishment.--Not later than 180 days after the date 
     of enactment of this Act, the Director shall establish an 
     advisory committee, to be known as the ``Green Building 
     Advisory Committee''.
       (b) Membership.--
       (1) In general.--The Committee shall be composed of 
     representatives of, at a minimum--
       (A) each agency referred to in section 102(b)(1); and
       (B) other relevant agencies and entities, as determined by 
     the Director, including at least 1 representative of each 
     of--
       (i) State and local governmental green building programs;
       (ii) independent green building associations or councils;
       (iii) building experts, including architects, material 
     suppliers, and construction contractors;
       (iv) security advisors focusing on national security needs, 
     natural disasters, and other dire emergency situations; and
       (v) environmental health experts, including those with 
     experience in children's health.
       (2) Non-federal members.--The total number of non-Federal 
     members on the Committee at any time shall not exceed 15.
       (c) Meetings.--The Director shall establish a regular 
     schedule of meetings for the Committee.
       (d) Duties.--The Committee shall provide advice and 
     expertise for use by the Director in carrying out the duties 
     under this Act, including such recommendations relating to 
     Federal activities carried out under sections 104 through 106 
     as are agreed to by a majority of the members of the 
     Committee.
       (e) FACA Exemption.--The Committee shall not be subject to 
     section 14 of the Federal Advisory Committee Act (5 U.S.C. 
     App.).

     SEC. 104. PUBLIC OUTREACH.

       The Director, in coordination with the Committee, shall 
     carry out public outreach to inform individuals and entities 
     of the information and services available Government-wide 
     by--
       (1) establishing and maintaining a national high-
     performance green building clearinghouse, including on the 
     Internet, that--
       (A) identifies existing similar efforts and coordinates 
     activities of common interest; and
       (B) provides information relating to high-performance green 
     buildings, including hyperlinks to Internet sites that 
     describe related activities, information, and resources of--
       (i) the Federal Government;
       (ii) State and local governments;
       (iii) the private sector (including nongovernmental and 
     nonprofit entities and organizations); and
       (iv) other relevant organizations, including those from 
     other countries;
       (2) identifying and recommending educational resources for 
     implementing high-performance green building practices, 
     including security and emergency benefits and practices;
       (3) providing access to technical assistance on using tools 
     and resources to make more cost-effective, energy-efficient, 
     health-protective, and environmentally beneficial decisions 
     for constructing high-performance green buildings, including 
     tools available to conduct life-cycle costing and life-cycle 
     assessment;
       (4) providing information on application processes for 
     certifying a high-performance green building, including 
     certification and commissioning;
       (5) providing technical information, market research, or 
     other forms of assistance or advice that would be useful in 
     planning and constructing high-performance green buildings; 
     and
       (6) using such other methods as are determined by the 
     Director to be appropriate.

     SEC. 105. RESEARCH AND DEVELOPMENT.

       (a) Establishment.--The Director, in coordination with the 
     Committee, shall--

[[Page 3267]]

       (1)(A) survey existing research and studies relating to 
     high-performance green buildings; and
       (B) coordinate activities of common interest;
       (2) develop and recommend a high-performance green building 
     research plan that--
       (A) identifies information and research needs, including 
     the relationships between human health, occupant 
     productivity, and each of--
       (i) emissions from materials and products in the building;
       (ii) natural day lighting;
       (iii) ventilation choices and technologies;
       (iv) heating, cooling, and system control choices and 
     technologies;
       (v) moisture control and mold;
       (vi) maintenance, cleaning, and pest control activities;
       (vii) acoustics; and
       (viii) other issues relating to the health, comfort, 
     productivity, and performance of occupants of the building; 
     and
       (B) promotes the development and dissemination of high-
     performance green building measurement tools that, at a 
     minimum, may be used--
       (i) to monitor and assess the life-cycle performance of 
     facilities (including demonstration projects) built as high-
     performance green buildings; and
       (ii) to perform life-cycle assessments;
       (3) assist the budget and life-cycle costing functions of 
     the Office under section 106;
       (4) study and identify potential benefits of green 
     buildings relating to security, natural disaster, and 
     emergency needs of the Federal Government; and
       (5) support other research initiatives determined by the 
     Office.
       (b) Indoor Air Quality.--The Director, in consultation with 
     the Committee, shall develop and carry out a comprehensive 
     indoor air quality program for all Federal facilities to 
     ensure the safety of Federal workers and facility occupants--
       (1) during new construction and renovation of facilities; 
     and
       (2) in existing facilities.

     SEC. 106. BUDGET AND LIFE-CYCLE COSTING AND CONTRACTING.

       (a) Establishment.--The Director, in coordination with the 
     Committee, shall--
       (1) identify, review, and analyze current budget and 
     contracting practices that affect achievement of high-
     performance green buildings, including the identification of 
     barriers to green building life-cycle costing and budgetary 
     issues;
       (2) develop guidance and conduct training sessions with 
     budget specialists and contracting personnel from Federal 
     agencies and budget examiners to apply life-cycle cost 
     criteria to actual projects;
       (3) identify tools to aid life-cycle cost decisionmaking; 
     and
       (4) explore the feasibility of incorporating the benefits 
     of green buildings, such as security benefits, into a cost-
     budget analysis to aid in life-cycle costing for budget and 
     decision making processes.

     SEC. 107. AUTHORIZATION OF APPROPRIATIONS.

       There is authorized to be appropriated to carry out this 
     title $4,000,000 for each of fiscal years 2008 through 2012, 
     to remain available until expended.

               TITLE II--HEALTHY HIGH-PERFORMANCE SCHOOLS

     SEC. 201. DEFINITION OF HIGH-PERFORMANCE SCHOOL.

       In this title, the term ``high-performance school'' has the 
     meaning given the term ``healthy, high-performance school 
     building'' in section 5586 of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 7277e).

     SEC. 202. GRANTS FOR HEALTHY SCHOOL ENVIRONMENTS.

       The Administrator of the Environmental Protection Agency, 
     in consultation with the Secretary of Education, may provide 
     grants to qualified State agencies for use in--
       (1) providing technical assistance for programs of the 
     Environmental Protection Agency (including the Tools for 
     Schools Program and the Healthy School Environmental 
     Assessment Tool) to schools for use in addressing 
     environmental issues; and
       (2) development of State school environmental quality plans 
     that include--
       (A) standards for school building design, construction, and 
     renovation; and
       (B) identification of ongoing school building environmental 
     problems in the State and recommended solutions to address 
     those problems, including assessment of information on the 
     exposure of children to environmental hazards in school 
     facilities.

     SEC. 203. MODEL GUIDELINES FOR SITING OF SCHOOL FACILITIES.

       The Administrator of the Environmental Protection Agency, 
     in consultation with the Secretary of Education and the 
     Secretary of Health and Human Services, shall develop school 
     site selection guidelines that account for--
       (1) the special vulnerability of children to hazardous 
     substances or pollution exposures in any case in which the 
     potential for contamination at a potential school site 
     exists;
       (2) modes of transportation available to students and 
     staff; and
       (3) the potential use of a school at the site as an 
     emergency shelter.

     SEC. 204. PUBLIC OUTREACH.

       (a) In General.--The Administrator of the Environmental 
     Protection Agency shall provide to the Director information 
     relating to all activities carried out under this title, 
     which the Director shall include in the report described in 
     section 102(c).
       (b) Public Outreach.--The Director shall ensure, to the 
     maximum extent practicable, that the public clearinghouse 
     established under section 104 receives and makes available 
     information on the exposure of children to environmental 
     hazards in school facilities, as provided by the 
     Administrator of the Environmental Protection Agency.

     SEC. 205. ENVIRONMENTAL HEALTH PROGRAM.

       (a) In General.--The Administrator of the Environmental 
     Protection Agency, in consultation with the Secretary of 
     Education, the Secretary of Health and Human Services, and 
     other relevant agencies, shall issue guidelines for use by 
     the State in developing and implementing an environmental 
     health program for schools that--
       (1) takes into account the status and findings of Federal 
     research initiatives established under this Act and other 
     relevant Federal law with respect to school facilities, 
     including relevant updates on trends in the field, such as 
     the impact of school facility environments on student and 
     staff--
       (A) health, safety, and productivity; and
       (B) disabilities or special needs;
       (2) provides research using relevant tools identified or 
     developed in accordance with section 105(a) to quantify the 
     relationships between--
       (A) human health, occupant productivity, and student 
     performance; and
       (B) with respect to school facilities, each of--
       (i) pollutant emissions from materials and products;
       (ii) natural day lighting;
       (iii) ventilation choices and technologies;
       (iv) heating and cooling choices and technologies;
       (v) moisture control and mold;
       (vi) maintenance, cleaning, and pest control activities;
       (vii) acoustics; and
       (viii) other issues relating to the health, comfort, 
     productivity, and performance of occupants of the school 
     facilities;
       (3) provides technical assistance on siting, design, 
     management, and operation of school facilities, including 
     facilities used by students with disabilities or special 
     needs;
       (4) collaborates with federally funded pediatric 
     environmental health centers to assist in on-site school 
     environmental investigations;
       (5) assists States and the public in better understanding 
     and improving the environmental health of children; and
       (6) provides to the Office a biennial report of all 
     activities carried out under this title, which the Director 
     shall include in the report described in section 102(c).
       (b) Public Outreach.--The Director shall ensure, to the 
     maximum extent practicable, that the public clearinghouse 
     established under section 104 receives and makes available--
       (1) information from the Administrator of the Environmental 
     Protection Agency that is contained in the report described 
     in subsection (a)(6); and
       (2) information on the exposure of children to 
     environmental hazards in school facilities, as provided by 
     the Administrator of the Environmental Protection Agency.

     SEC. 206. AUTHORIZATION OF APPROPRIATIONS.

       There is authorized to be appropriated to carry out this 
     title $10,000,000 for the period of fiscal years 2008 through 
     2012, to remain available until expended.

              TITLE III--STRENGTHENING FEDERAL LEADERSHIP

     SEC. 301. INCENTIVES.

       As soon as practicable after the date of enactment of this 
     Act, the Director shall identify incentives to encourage the 
     use of green buildings and related technology in the 
     operations of the Federal Government, including through--
       (1) the provision of recognition awards; and
       (2) the maximum feasible retention of financial savings in 
     the annual budgets of Federal agencies.

     SEC. 302. FEDERAL PROCUREMENT.

       (a) In General.--Not later than 2 years after the date of 
     enactment of this Act, the Director of the Office of Federal 
     Procurement Policy, in consultation with the Director and the 
     Under Secretary of Defense for Acquisition, Technology, and 
     Logistics, shall promulgate revisions of the applicable 
     acquisition regulations, to take effect as of the date of 
     promulgation of the revisions--
       (1) to direct any Federal procurement executives involved 
     in the acquisition, construction, or major renovation 
     (including contracting for the construction or major 
     renovation) of any facility, to the maximum extent 
     practicable--
       (A) to employ integrated design principles;
       (B) to optimize building and systems energy performance;
       (C) to protect and conserve water;
       (D) to enhance indoor environmental quality; and
       (E) to reduce environmental impacts of materials and waste 
     flows; and
       (2) to direct Federal procurement executives involved in 
     leasing buildings, to give

[[Page 3268]]

     preference to the lease of facilities that, to the maximum 
     extent practicable--
       (A) are energy-efficient; and
       (B) have applied contemporary high-performance and 
     sustainable design principles during construction or 
     renovation.
       (b) Guidance.--Not later than 90 days after the date of 
     promulgation of the revised regulations under subsection (a), 
     the Director shall issue guidance to all Federal procurement 
     executives providing direction and the option to renegotiate 
     the design of proposed facilities, renovations for existing 
     facilities, and leased facilities to incorporate improvements 
     that are consistent with this section.

     SEC. 303. FEDERAL GREEN BUILDING PERFORMANCE.

       (a) In General.--Not later than October 31 of each of the 2 
     fiscal years following the fiscal year in which this Act is 
     enacted, and at such times thereafter as the Comptroller 
     General of the United States determines to be appropriate, 
     the Comptroller General of the United States shall, with 
     respect to the fiscal years that have passed since the 
     preceding report--
       (1) conduct an audit of the implementation of this Act; and
       (2) submit to the Office, the Committee, the Administrator, 
     and Congress a report describing the results of the audit.
       (b) Contents.--An audit under subsection (a) shall include 
     a review, with respect to the period covered by the report 
     under subsection (a)(2), of--
       (1) budget, life-cycle costing, and contracting issues, 
     using best practices identified by the Comptroller General of 
     the United States and heads of other agencies in accordance 
     with section 106;
       (2) the level of coordination among the Office, the Office 
     of Management and Budget, and relevant agencies;
       (3) the performance of the Office in carrying out the 
     implementation plan;
       (4) the design stage of high-performance green building 
     measures;
       (5) high-performance building data that were collected and 
     reported to the Office; and
       (6) such other matters as the Comptroller General of the 
     United States determines to be appropriate.
       (c) Environmental Stewardship Scorecard.--The Director 
     shall consult with the Committee to enhance, and assist in 
     the implementation of, the Environmental Stewardship 
     Scorecard announced at the White House summit on Federal 
     sustainable buildings in January 2006, to measure the 
     implementation by each Federal agency of sustainable design 
     and green building initiatives.

                    TITLE IV--DEMONSTRATION PROJECT

     SEC. 401. COORDINATION OF GOALS.

       (a) In General.--The Director shall establish guidelines to 
     implement a demonstration project to contribute to the 
     research goals of the Office.
       (b) Projects.--
       (1) In general.--In accordance with guidelines established 
     by the Director under subsection (a) and the duties of the 
     Director described in title I, the Director shall carry out 3 
     demonstration projects.
       (2) Location of projects.--Each project carried out under 
     paragraph (1) shall be located in a Federal building in a 
     State recommended by the Director in accordance with 
     subsection (c).
       (3) Requirements.--Each project carried out under paragraph 
     (1) shall--
       (A) provide for the evaluation of the information obtained 
     through the conduct of projects and activities under this 
     Act; and
       (B) achieve a platinum rating, as defined by the Leadership 
     in Energy and Environmental Design Building Rating System 
     standard established by the United States Green Building 
     Council (or an equivalent rating obtained through a 
     comparable system).
       (c) Criteria.--With respect to the existing or proposed 
     Federal facility at which a demonstration project under this 
     section is conducted, the Federal facility shall--
       (1) be an appropriate model for a project relating to--
       (A) the effectiveness of high-performance technologies;
       (B) analysis of materials, components, and systems, 
     including the impact on the health of building occupants;
       (C) life-cycle costing and life-cycle assessment of 
     building materials and systems; and
       (D) location and design that promote access to the Federal 
     facility through walking, biking, and mass transit; and
       (2) possess sufficient technological and organizational 
     adaptability.
       (d) Report.--Not later than 1 year after the date of 
     enactment of this Act, and annually thereafter through 
     September 30, 2013, the Director shall submit to the 
     Administrator a report that describes the status of and 
     findings regarding the demonstration project.

     SEC. 402. AUTHORIZATION OF APPROPRIATIONS.

       There is authorized to be appropriated to carry out the 
     Federal demonstration project described in section 401(b) 
     $10,000,000 for the period of fiscal years 2008 through 2012, 
     to remain available until expended.
                                 ______
                                 
      By Mr. CONRAD (for himself, Ms. Collins, Ms. Cantwell, and Mr. 
        Durbin):
  S. 507. A bill to amend title XVIII of the Social Security Act to 
provide for reimbursement of certified midwife services and to provide 
for more equitable reimbursement rates for certified nurse-midwife 
services; to the Committee on Finance.
  Mr. CONRAD. Mr. President, today I am introducing the Midwifery Care 
Access and Reimbursement Equity (M-CARE) Act of 2007. For too many 
years, certified nurse midwives (CNMs) have not received adequate 
reimbursement under the Medicare program. My legislation takes steps to 
improve reimbursement for these important healthcare providers.
  Since 1988, CNMs have been authorized to provide maternity-related 
services to Medicare-eligible women of child-bearing age. There are 
approximately three million disabled women of child-bearing age on 
Medicare; however, if they choose to utilize a CNM for ``well women'' 
services, the CNM is only reimbursed at 65 percent of the physician fee 
schedule. This is not right and does not come close to offsetting the 
costs incurred by these professionals.
  At this incredibly low rate of reimbursement, the Medicare Payment 
Advisory Committee (MedPAC) agrees that a CNM simply cannot afford to 
provide services to Medicare patients and has supported increasing 
reimbursement for CNMs. In fact, the Commission recommended in 2002 
that CNMs' reimbursement be increased and acknowledged that the care 
provided by these individuals is at least comparable to similar 
providers.
  My legislation would make several changes to improve the ability of 
CNMs and certified midwives (CMs) to effectively serve the Medicare-
eligible population. First, and most importantly, my bill recognizes 
the need to increase Medicare reimbursement for CNMs by raising the 
reimbursement level from 65 percent to 100 percent of the physician fee 
schedule. CNMs provide the same care as physicians; therefore, it is 
only fair to reimburse CNMs at the same level. Several states have 
recognized this in their Medicaid programs--approximately 29 States 
reimburse at 100 percent of the physician fee schedule for out-of-
hospital services.
  In addition, the M-CARE Act would establish recognition for a 
certified midwife (CM) to provide services under Medicare. Despite the 
fact that CNMs and CMs provide the same services, Medicare has yet to 
recognize CMs as eligible providers. My bill would change this.
  This bill will enhance access to ``well woman'' care for thousands of 
women in underserved communities and make several needed changes to 
improve access to midwives. I urge my colleagues to support this 
legislation.
                                 ______
                                 
      By Mr. GRASSLEY:
  S. 508. A bill to amend the Congressional Accountability Act of 1995 
to apply whistleblower protections available to certain executive 
branch employees to legislative branch employees, and for other 
purposes; to the Committee on Homeland Security and Governmental 
Affairs.
  Mr. GRASSLEY. Mr. President, I rise to reintroduce the Congressional 
Whistleblower Protection Act of 2007, which will extend whistleblower 
protections currently available to certain executive branch employees 
to legislative branch employees.
  Presently, executive branch employees are shielded from retaliation 
for exposing waste, fraud, or abuse by the Whistleblower Protection 
Act. The bill I'm introducing today simply extends those same 
protections to legislative branch employees.
  A theme that has dominated this new Congress, as well as the 
elections this past November, is accountability and responsibility in 
Washington. I have fought hard for whistleblowers over the years 
because they are key in our efforts to ensure government accountability 
to the people we are sent here to serve. In most instances, the only 
reason we discover waste or fraud is because employees are brave enough 
to stand up to the wrongdoers and expose their offenses. Without these 
whistleblowers, the American taxpayer would continue to foot the bill.

[[Page 3269]]

  The Office of Compliance has called for these changes on numerous 
occasions in recent years, and they are very supportive of this bill. 
We have already taken the steps to protect whistleblowers in the 
executive branch. It doesn't make sense not to extend these same 
protections to whistleblowers in our own backyard. My bill will, very 
simply, give congressional employees the same protections that workers 
in the other branches of government already possess.
  I hope my colleagues will join me in supporting this bill to ensure 
that those who help us in the fight to hold government accountable are 
not punished for their efforts.
  I ask unanimous consent that the text of this 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. 508

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

     SECTION 1. APPLICATION OF WHISTLEBLOWER PROTECTION RULES TO 
                   LEGISLATIVE BRANCH EMPLOYEES.

       (a) Short Title.--This Act may be cited as the 
     ``Congressional Whistleblower Protection Act of 2007''.
       (b) In General.--Part A of title II of the Congressional 
     Accountability Act of 1995 (2 U.S.C. 1311 et seq.) is 
     amended--
       (1) in the heading, by striking ``fair labor standards,'' 
     and all that follows and inserting ``and other protections 
     and benefits'';
       (2) by redesignating section 207 as section 208; and
       (3) by inserting after section 206 the following:

     ``SEC. 207. RIGHTS AND PROTECTIONS UNDER WHISTLEBLOWER 
                   PROTECTION RULES.

       ``(a) Rights and Protections Described.--
       ``(1) In general.--No employing office may take or fail to 
     take, or threaten to take or fail to take, a personnel action 
     (within the meaning of chapter 23 of title 5, United States 
     Code) with respect to any covered employee or applicant for 
     employment because of--
       ``(A) any disclosure of information by a covered employee 
     or applicant which the employee or applicant reasonably 
     believes evidences--
       ``(i) a violation of any law, rule, or regulation; or
       ``(ii) gross mismanagement, a gross waste of funds, an 
     abuse of authority, or a substantial and specific danger to 
     public health or safety;

     if such disclosure is not specifically prohibited by law and 
     if such information is not specifically required by Executive 
     order or the rules of the Senate or the House of 
     Representatives to be kept secret in the interest of national 
     defense or the conduct of foreign affairs; or
       ``(B) any disclosure to the General Counsel, or to the 
     Inspector General of a legislative or executive agency or 
     another employee designated by the head of the legislative or 
     executive agency to receive such disclosures, of information 
     which the employee or applicant reasonably believes 
     evidences--
       ``(i) a violation of any law, rule, or regulation; or
       ``(ii) gross mismanagement, a gross waste of funds, an 
     abuse of authority, or a substantial and specific danger to 
     public health or safety.
       ``(2) Definitions.--For purposes of this section and for 
     purposes of applying the procedures established under title 
     IV for the consideration of alleged violations of this 
     section--
       ``(A) the term `covered employee' includes an employee of 
     the Government Accountability Office or Library of Congress; 
     and
       ``(B) the term `employing office' includes the Government 
     Accountability Office and the Library of Congress.
       ``(b) Remedy.--The remedy for a violation of subsection (a) 
     shall be such remedy as would be appropriate if awarded under 
     chapter 12 of title 5, United States Code, with respect to a 
     prohibited personnel practice described in section 2302(b)(8) 
     of such title.
       ``(c) Regulations To Implement Section.--
       ``(1) In general.--The Board shall, pursuant to section 
     304, issue regulations to implement this section.
       ``(2) Agency regulations.--The regulations issued under 
     paragraph (1) shall be the same as the substantive 
     regulations promulgated by the Merit Systems Protection Board 
     to implement chapters 12 and 23 of title 5, United States 
     Code, except to the extent that the Board of Directors of the 
     Office of Compliance may determine, for good cause shown and 
     stated together with the regulation, that a modification of 
     such regulations would be more effective for the 
     implementation of the rights and protections under this 
     section.''.
       (c) Technical and Conforming Amendments.--
       (1) Table of contents.--The table of contents for part A of 
     title II of the Congressional Accountability Act of 1995 is 
     amended--
       (A) in the item relating to part A, by striking ``FAIR 
     LABOR STANDARDS,'' and all that follows and inserting ``AND 
     OTHER PROTECTIONS AND BENEFITS'';
       (B) by redesignating the item relating to section 207 as 
     relating to section 208; and
       (C) by inserting after the item relating to section 206 the 
     following:

``Sec. 207. Rights and protections under whistleblower protection 
              rules.''.
       (2) Application of laws.--Section 102(a) of the 
     Congressional Accountability Act of 1995 (2 U.S.C. 1302(a)) 
     is amended by adding at the end the following:
       ``(12) Section 2302(b)(8) of title 5, United States 
     Code.''.
                                 ______
                                 
      Mr. INOUYE (for himself, Mr. Stevens, Mr. Rockefeller, Mr. Lott, 
        and Mr. Lautenberg):
  S. 509. A bill to provide improved aviation security, and for other 
purposes; to the Committee on Commerce, Science, and Transportation.
  Mr. INOUYE. Mr. President, I rise today to introduce the Aviation 
Security Improvement Act with Senators Stevens, Rockefeller, Lott, and 
Lautenberg, who are all original cosponsors of this legislation.
  When the 9/11 Commission released its report in 2004, the Commission 
expressed continuing concern over the state of air cargo security, the 
screening of passengers and baggage, access controls at airports, and 
the security of general aviation. Congress responded then and enacted 
measures to address inefficiencies highlighted by the Commission. 
However, implementation through the rulemaking process was slow, and as 
a result, significant shortfalls in our security regime remain.
  In fact, a little more than year ago, the 9/11 Public Discourse 
project issued a scorecard that gave inadequate grades in those key 
areas where the Commission had advocated for improvements in aviation 
security. Checked Baggage and Cargo Screening received a ``D,'' Airline 
Passenger Explosive Screening received a ``C,'' and Airline Passenger 
Prescreenig received an ``F.''
  Over the past year, the Transportation Security Administration, TSA, 
has continued working to significantly bolster air cargo security in 
the United States. While that is a good step in response to the report 
card, more must be done. The government must remain vigilant in its 
effort to provide security for our Nation, and the steps proposed in 
this bill will both improve our existing security system and give TSA 
the flexibility to combat new and emerging threats.
  The bill we are introducing today would require the screening of all 
cargo going on passenger aircraft within 3 years. We expect TSA to 
develop a robust screening program that improves upon current measures 
and ensures the security of all cargo transported in commercial 
passenger air carriers.
  To improve our ability to detect explosives in checked baggage and at 
passenger screening checkpoints, the bill extends the Aviation Security 
Capital Fund and promotes the purchase and installation of advanced 
baggage screening systems that can be integrated into the daily 
workings of our Nation's air transportation system. This capital 
investment will improve security screening by permitting TSA employees 
to better focus on potential threats while reducing the high workplace 
injury rates.
  The bill addresses airline passenger explosive screening in several 
ways:
  1. By promoting advanced research and development for checkpoint 
technology;
  2. By enhancing screener training to more clearly identify and 
address potential threats; and
  3. By requiring the Administration to complete and implement a plan 
over the next year that thoroughly addresses the threat of and response 
to carry-on explosives.
  Airline passenger prescreening also remains a primary concern of the 
Congress. Not enough progress has been made by the TSA to develop an 
advanced passenger prescreening system since it took on this task 
nearly 4 years ago. Too many passengers are inconvenienced each year by 
false positives when matched against passenger watchlists.

[[Page 3270]]

  Our bill would ensure a system is in place to coordinate passenger 
redress matters, and that the TSA moves rapidly to develop a strategic 
plan to test and implement an advanced passenger prescreening system.
  Our bill also takes steps to improve general aviation security, 
airport access issues for airline employees, screener staffing issues, 
and other issues where there have been consistent shortcomings over the 
past several years.
  The 9/11 Commission's report and subsequent Public Discourse project 
helped keep Congress and the Administration focused on the need for 
aviation security. While they did not have all the answers for quick 
fixes, they did offer a vital blueprint, particularly in the areas of 
infrastructure and transportation system security.
  My colleagues and I used that guideline in drafting the legislation 
we are introducing today. We believe that once this bill is enacted, it 
will significantly improve aviation security in the specific areas I 
have highlighted, and the aviation system as a whole. I look forward to 
working with my colleagues to move this bill quickly. We have had 5 
years to consider what does and does not work. Now it is time to 
implement what we have learned.
  I ask unanimous consent that this 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. 509

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

     SEC. 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Aviation 
     Security Improvement Act''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

                     TITLE      --AVIATION SECURITY

Sec. 1. Short title; table of contents.
Sec. 2. Extension of authorization for aviation security funding.
Sec. 3. Passenger aircraft cargo screening.
Sec. 4. Blast-resistant cargo containers.
Sec. 5. Protection of air cargo on passenger planes from explosives.
Sec. 6. In-line baggage screening.
Sec. 7. Enhancement of in-line baggage system deployment.
Sec. 8. Research and development of aviation transportation security 
              technology.
Sec. 9. Certain TSA personnel limitations not to apply.
Sec. 10. Specialized training.
Sec. 11. Explosive detection at passenger screening checkpoints.
Sec. 12. Appeal and redress process for passengers wrongly delayed or 
              prohibited from boarding a flight.
Sec. 13. Repair station security.
Sec. 14. Strategic plan to test and implement advanced passenger 
              prescreening system.
Sec. 15. General aviation security.
Sec. 16. Security credentials for airline crews.

     SEC. 2. EXTENSION OF AUTHORIZATION FOR AVIATION SECURITY 
                   FUNDING.

       Section 48301(a) of title 49, United States Code, is 
     amended by striking ``and 2006'' and inserting ``2006, 2007, 
     2008, and 2009''.

     SEC. 3. PASSENGER AIRCRAFT CARGO SCREENING.

       (a) In General.--Section 44901 of title 49, United States 
     Code, is amended--
       (1) by redesignating subsections (g) and (h) as subsections 
     (h) and (i), respectively; and
       (2) by inserting after subsection (f) the following:
       ``(g) Air Cargo on Passenger Aircraft.--
       ``(1) In general.--Not later than 3 years after the date of 
     enactment of the Aviation Security Improvement Act, the 
     Secretary of Homeland Security, acting through the 
     Administrator of the Transportation Security Administration, 
     shall establish a system to screen all cargo transported on 
     passenger aircraft operated by an air carrier or foreign air 
     carrier in air transportation or intrastate air 
     transportation to ensure the security of all such passenger 
     aircraft carrying cargo.
       ``(2) Minimum standards.--The system referred to in 
     paragraph (1) shall require, at a minimum, that the 
     equipment, technology, procedures, personnel, or other 
     methods determined by the Administrator of the Transportation 
     Security Administration, provide a level of security 
     comparable to the level of security in effect for passenger 
     checked baggage.
       ``(3) Regulations.--
       ``(A) Interim final rule.--The Secretary of Homeland 
     Security may issue an interim final rule as a temporary 
     regulation to implement this subsection without regard to the 
     provisions of chapter 5 of title 5.
       ``(B) Final rule.--
       ``(i) In general.--If the Secretary issues an interim final 
     rule under subparagraph (A), the Secretary shall issue, not 
     later than 1 year after the effective date of the interim 
     final rule, a final rule as a permanent regulation to 
     implement this subsection in accordance with the provisions 
     of chapter 5 of title 5.
       ``(ii) Failure to act.--If the Secretary does not issue a 
     final rule in accordance with clause (i) on or before the 
     last day of the 1-year period referred to in clause (i), the 
     Secretary shall submit a report to the Congress explaining 
     why the final rule was not timely issued and providing an 
     estimate of the earliest date on which the final rule will be 
     issued. The Secretary shall submit the first such report 
     within 10 days after such last day and submit a report to the 
     Congress containing updated information every 60 days 
     thereafter until the final rule is issued.
       ``(iii) Superseding of interim final rule.--The final rule 
     issued in accordance with this subparagraph shall supersede 
     the interim final rule issued under subparagraph (A).
       ``(4) Report.--Not later than 1 year after the date on 
     which the system required by paragraph (1) is established, 
     the Secretary shall transmit a report to Congress that 
     details and explains the system.''.
       (b) Assessment of Exemptions.--
       (1) TSA assessment of exemptions.--
       (A) In general.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary of Homeland Security, 
     through the Administrator of the Transportation Security 
     Administration, shall submit a report to Congress and to the 
     Comptroller General containing an assessment of each 
     exemption granted under section 44901(i) of title 49, United 
     States Code, for the screening required by section 
     44901(g)(1) of that title for cargo transported on passenger 
     aircraft and an analysis to assess the risk of maintaining 
     such exemption. The Secretary may submit the report in both 
     classified and redacted formats if the Secretary determines 
     that such action is appropriate or necessary.
       (B) Contents.--The report shall include--
       (i) the rationale for each exemption;
       (ii) a statement of the percentage of cargo that is not 
     screened as a result of each exemption;
       (iii) the impact of each exemption on aviation security;
       (iv) the projected impact on the flow of commerce of 
     eliminating such exemption;
       (v) a statement of any plans, and the rationale, for 
     maintaining, changing, or eliminating each exemption.
       (2) GAO Assessment.--Not later than 120 days after the date 
     on which the report required under paragraph (1) is 
     submitted, the Comptroller General shall review the report 
     and provide to Congress an assessment of the methodology used 
     for determinations made by the Secretary for maintaining, 
     changing, or eliminating an exemption.

     SEC. 4. BLAST-RESISTANT CARGO CONTAINERS.

       Section 44901 of title 49, United States Code, is amended 
     by adding at the end thereof the following:
       ``(i) Blast-resistant Cargo Containers.--
       ``(1) In general.--Before January 1, 2008, the 
     Administrator of the Transportation Security Administration 
     shall--
       ``(A) evaluate the results of the blast-resistant cargo 
     container pilot program instituted before the date of 
     enactment of the Aviation Security Improvement Act;
       ``(B) based on that evaluation, begin the acquisition of a 
     sufficient number of blast-resistant cargo containers to meet 
     the requirements of the Transportation Security 
     Administration's cargo security program under paragraph (2); 
     and
       ``(C) develop a system under which the Administrator--
       ``(i) will make such containers available for use by 
     passenger aircraft operated by air carriers or foreign air 
     carriers in air transportation or intrastate air 
     transportation on a random or risk-assessment basis as 
     determined by the Administrator, in sufficient number to 
     enable the carriers to meet the requirements of the 
     Administration's cargo security system; and
       ``(ii) provide for the storage, maintenance, and 
     distribution of such containers.
       ``(2) Distribution to air carriers.--Within 90 days after 
     the date on which the Administrator completes development of 
     the system required by paragraph (1)(C), the Administrator of 
     the Transportation Security Administration shall implement 
     that system and begin making blast-resistant cargo containers 
     available to such carriers as necessary.''.

     SEC. 5. PROTECTION OF AIR CARGO ON PASSENGER PLANES FROM 
                   EXPLOSIVES.

       (a) Technology Research and Pilot Projects.--
       (1) Research and development.--The Secretary of Homeland 
     Security shall expedite research and development for 
     technology that can disrupt or prevent an explosive device 
     from being introduced onto a passenger plane or from damaging 
     a passenger plane while in flight or on the ground. The 
     research shall include blast resistant cargo containers and 
     other promising technology and will be used in concert with 
     implementation of section 4 of this Act.
       (2) Pilot projects.--The Secretary, in conjunction with the 
     Secretary of Transportation, shall establish a grant program 
     to fund pilot projects--

[[Page 3271]]

       (A) to deploy technologies described in paragraph (1); and
       (B) to test technology to expedite the recovery, 
     development, and analysis of information from aircraft 
     accidents to determine the cause of the accident, including 
     deployable flight deck and voice recorders and remote 
     location recording devices.
       (b) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary of Homeland Security for 
     fiscal year 2008 such sums as may be necessary to carry out 
     this section, such funds to remain available until expended.

     SEC. 6. IN-LINE BAGGAGE SCREENING.

       (a) Extension of Authorization.--Section 44923(i)(1) of 
     title 49, United States Code, is amended by striking 
     ``2007.'' and inserting ``2007, and $450,000,000 for each of 
     fiscal years 2008 and 2009.''.
       (b) Report.--Within 30 days after the date of enactment of 
     this Act, the Secretary of Homeland Security shall submit the 
     report the Secretary was required by section 4019(d) of the 
     Intelligence Reform and Terrorism Prevention Act of 2004 (49 
     U.S.C. 44901 note) to have submitted in conjunction with the 
     submission of the budget for fiscal year 2006.

     SEC. 7. ENHANCEMENT OF IN-LINE BAGGAGE SYSTEM DEPLOYMENT.

       (a) In General.--Section 44923 of title 49, United States 
     Code, is amended--
       (1) by striking ``may'' in subsection (a) and inserting 
     ``shall'';
       (2) by striking ``may'' in subsection (d)(1) and inserting 
     ``shall'';
       (3) by striking ``2007'' in subsection (h)(1) and inserting 
     ``2028'';
       (4) by striking paragraphs (2) and (3) of subsection (h) 
     and inserting the following:
       ``(2) Allocation.--Of the amount made available under 
     paragraph (1) for a fiscal year, not less than $200,000,000 
     shall be allocated to fulfill letters of intent issued under 
     subsection (d).
       ``(3) Discretionary grants.--Of the amount made available 
     under paragraph (1) for a fiscal year, up to $50,000,000 
     shall be used to make discretionary grants, with priority 
     given to small hub airports and non-hub airports.''; and
       (5) by redesignating subsection (i) as subsection (j) and 
     inserting after subsection (h) the following:
       ``(i) Leveraged Funding.--For purposes of this section, a 
     grant under subsection (a) to an airport sponsor to service 
     an obligation issued by or on behalf of that sponsor to fund 
     a project described in subsection (a) shall be considered to 
     be a grant for that project.''.
       (b) Prioritization of Projects.--
       (1) In general.--The Administrator shall create a 
     prioritization schedule for airport security improvement 
     projects described in section 44923(b) of title 49, United 
     States Code, based on risk and other relevant factors, to be 
     funded under the grant program provided by that section. The 
     schedule shall include both hub airports (as defined in 
     section 41731(a)(3) of title 49, United States Code) and 
     nonhub airports (as defined in section 41731(a)4) of title 
     49, United States Code).
       (2) Airports that have commenced projects.--The schedule 
     shall include airports that have incurred eligible costs 
     associated with development of partial in-line baggage 
     systems before the date of enactment of this Act in 
     reasonable anticipation of receiving a grant under section 
     44923 of title 49, United States Code, in reimbursement of 
     those costs but that have not received such a grant.
       (3) Report.--Within 180 days after the date of enactment of 
     this Act, the Administrator shall provide a copy of the 
     prioritization schedule, a corresponding timeline, and a 
     description of the funding allocation under section 44923 of 
     title 49, United States Code, to the Senate Committee on 
     Commerce, Science, and Transportation and the House of 
     Representatives Committee on Homeland Security.

     SEC. 8. RESEARCH AND DEVELOPMENT OF AVIATION TRANSPORTATION 
                   SECURITY TECHNOLOGY.

       Section 137(a) of the Aviation and Transportation Security 
     Act (49 U.S.C. 44912 note) is amended--
       (1) by striking ``2002 through 2006,'' and inserting ``2006 
     through 2009,'';
       (2) by striking ``aviation'' and inserting 
     ``transportation''; and
       (3) by striking ``2002 and 2003'' and inserting ``2006 
     through 2009''.

     SEC. 9. CERTAIN TSA PERSONNEL LIMITATIONS NOT TO APPLY.

       (a) In General.--Notwithstanding any provision of law to 
     the contrary, any statutory limitation on the number of 
     employees in the Transportation Security Administration, 
     before or after its transfer to the Department of Homeland 
     Security from the Department of Transportation, does not 
     apply after fiscal year 2007.
       (b) Aviation Security.--Notwithstanding any provision of 
     law imposing a limitation on the recruiting or hiring of 
     personnel into the Transportation Security Administration to 
     a maximum number of permanent positions, the Secretary of 
     Homeland Security shall recruit and hire such personnel into 
     the Administration as may be necessary--
       (1) to provide appropriate levels of aviation security; and
       (2) to accomplish that goal in such a manner that the 
     average aviation security-related delay experienced by 
     airline passengers is reduced to a level of less than 10 
     minutes.

     SEC. 10. SPECIALIZED TRAINING.

       The Administrator of the Transportation Security 
     Administration shall provide advanced training to 
     transportation security officers for the development of 
     specialized security skills, including behavior observation 
     and analysis, explosives detection, and document examination, 
     in order to enhance the effectiveness of layered 
     transportation security measures.

     SEC. 11. EXPLOSIVE DETECTION AT PASSENGER SCREENING 
                   CHECKPOINTS.

       (a) In General.--Within 90 days after the date of enactment 
     of this Act, the Secretary of Homeland Security shall issue 
     the strategic plan the Secretary was required by section 
     44925(a) of title 49, United States Code, to have issued 
     within 90 days after the date of enactment of the 
     Intelligence Reform and Terrorism Prevention Act of 2004.
       (b) Deployment.--Section 44925(b) of title 49, United 
     States Code, is amended by adding at the end thereof the 
     following:
       ``(3) Full deployment.--The Secretary shall fully implement 
     the strategic plan within 1 year after the date of enactment 
     of the Aviation Security Improvement Act.''.

     SEC. 12. APPEAL AND REDRESS PROCESS FOR PASSENGERS WRONGLY 
                   DELAYED OR PROHIBITED FROM BOARDING A FLIGHT.

       (a) In General.--Subtitle C of title IV of the Homeland 
     Security Act of 2002 (6 U.S.C. 231 et seq.) is amended by 
     adding at the end the following:

     ``SEC. 431. APPEAL AND REDRESS PROCESS FOR PASSENGERS WRONGLY 
                   DELAYED OR PROHIBITED FROM BOARDING A FLIGHT.

       ``(a) In General.--The Secretary shall establish a timely 
     and fair process for individuals who believe they have been 
     delayed or prohibited from boarding a commercial aircraft 
     because they were wrongly identified as a threat under the 
     regimes utilized by the Transportation Security 
     Administration, the Bureau of Customs and Border Protection, 
     or any other Department entity.
       ``(b) Office of Appeals and Redress.--
       ``(1) Establishment.--The Secretary shall establish an 
     Office of Appeals and Redress to oversee the process 
     established by the Secretary pursuant to subsection (a).
       ``(2) Records.--The process established by the Secretary 
     pursuant to subsection (a) shall include the establishment of 
     a method by which the Office of Appeals and Redress, under 
     the direction of the Secretary, will be able to maintain a 
     record of air carrier passengers and other individuals who 
     have been misidentified and have corrected erroneous 
     information.
       ``(3) Information.--To prevent repeated delays of an 
     misidentified passenger or other individual, the Office of 
     Appeals and Redress shall--
       ``(A) ensure that the records maintained under this 
     subsection contain information determined by the Secretary to 
     authenticate the identity of such a passenger or individual; 
     and
       ``(B) furnish to the Transportation Security 
     Administration, the Bureau of Customs and Border Protection, 
     or any other appropriate Department entity, upon request, 
     such information as may be necessary to allow such agencies 
     to assist air carriers in improving their administration of 
     the advanced passenger prescreening system and reduce the 
     number of false positives.''.
       (b) Clerical Amendment.--The table of contents in section 
     1(b) of such Act is amended by inserting after the item 
     relating to section 430 the following:

``431. Appeal and redress process for passengers wrongly delayed or 
              prohibited from boarding a flight.''.

     SEC. 13. STRATEGIC PLAN TO TEST AND IMPLEMENT ADVANCED 
                   PASSENGER PRESCREENING SYSTEM.

       Not later than 180 days after the date of enactment of this 
     Act, the Secretary of Homeland Security, in consultation with 
     the Administrator of the Transportation Security 
     Administration, shall submit to the Congress a plan that--
       (1) describes the system to be utilized by the Department 
     of Homeland Security to assume the performance of comparing 
     passenger information, as defined by the Administrator of the 
     Transportation Security Administration, to the automatic 
     selectee and no-fly lists, utilizing appropriate records in 
     the consolidated and integrated terrorist watchlist 
     maintained by the Federal government;
       (2) provides a projected timeline for each phase of testing 
     and implementation of the system;
       (3) explains how the system will be integrated with the 
     prescreening system for passengers on international flights; 
     and
       (4) describes how the system complies with section 552a of 
     title 5, United States Code.

     SEC. 14. REPAIR STATION SECURITY.

       (a) Certification of Foreign Repair Stations Suspension.--
     If the regulations required by section 44924(f) of title 49, 
     United States Code, are not issued within 90 days after the 
     date of enactment of this Act, the Administrator of the 
     Federal Aviation Administration may not certify any foreign 
     repair station under part 145 of title 14, Code of

[[Page 3272]]

     Federal Regulations, after such 90th day unless the station 
     was previously certified by the Administration under that 
     part.
       (b) 6-Month Deadline for Security Review and Audit.--
     Subsections (a) and (d) of section 44924 of title 49, United 
     States Code, are each amended by striking ``18 months'' and 
     inserting ``6 months''.

     SEC. 15. GENERAL AVIATION SECURITY.

       Section 44901 of title 49, United States Code, is amended 
     by adding at the end thereof the following:
       ``(i) General Aviation Airport Security Program.--
       ``(1) In general.--Within 1 year after the date of 
     enactment of the Aviation Security Improvement Act the 
     Administrator of the Transportation Security Administration 
     shall--
       ``(A) develop a standardized threat and vulnerability 
     assessment program for general aviation airports (as defined 
     in section 47135(m)); and
       ``(B) implement a program to perform such assessments on a 
     risk-assessment basis at general aviation airports.
       ``(2) Grant program.--Within 6 months after date of 
     enactment of the Aviation Security Improvement Act the 
     Administrator shall initiate and complete a study of the 
     feasibility of a program, based on a risk-managed approach, 
     to provide grants to general aviation airport operators for 
     projects to upgrade security at general aviation airports (as 
     defined in section 47135(m)). If the Administrator determines 
     that such a program is feasible, the Administrator shall 
     establish such a program.
       ``(3) Application to foreign-registered general aviation 
     aircraft.--Within 180 days after the date of enactment of the 
     Aviation Security Improvement Act, the Administrator shall 
     develop a risk-based system under which--
       ``(A) foreign-registered general aviation aircraft, as 
     identified by the Administrator, in coordination with the 
     Administrator of the Federal Aviation Administration, are 
     required to submit passenger information to the 
     Transportation Security Administration before entering United 
     States airspace; and
       ``(B) such information is checked against appropriate 
     databases maintained by the Transportation Security 
     Administration.''.
       ``(4) Authorization of appropriations.--There are 
     authorized to be appropriated to the Secretary of Homeland 
     Security such sums as may be necessary to carry out any 
     program established under paragraph (2).''.

     SEC. 16. SECURITY CREDENTIALS FOR AIRLINE CREWS.

       Within 180 days after the date of enactment of this Act, 
     the Administrator of the Transportation Security 
     Administration shall, after consultation with airline, 
     airport, and flight crew representatives, transmit a report 
     to the Senate Committee on Commerce, Science, and 
     Transportation and the House of Representatives Committee on 
     Transportation and Infrastructure on the status of its 
     efforts to institute a sterile area access system or method 
     that will enhance security by properly identifying authorized 
     airline flight deck and cabin crew members at screening 
     checkpoints and granting them expedited access through 
     screening checkpoints. The Administrator shall include in the 
     report recommendations on the feasibility of implementing the 
     system for the domestic aviation industry beginning 1 year 
     after the date on which the report is submitted. The 
     Administrator shall begin full implementation of the system 
     or method not later than 1 year after the date on which the 
     Administrator transmits the report.

                          ____________________