[Congressional Record (Bound Edition), Volume 156 (2010), Part 11]
[Senate]
[Pages 15563-15576]
[From the U.S. Government Publishing Office, www.gpo.gov]




                SMALL BUSINESS LENDING FUND ACT OF 2010

  The ACTING PRESIDENT pro tempore. Under the previous order, the 
Senate will resume consideration of H.R. 5297, which the clerk will 
report.
  The legislative clerk read as follows:

       A bill (H.R. 5297) to create the Small Business Lending 
     Fund Program to direct the Secretary of the Treasury to make 
     capital investments in eligible institutions in order to 
     increase the availability of credit for small businesses, to 
     amend the Internal Revenue Code of 1986 to provide tax 
     incentives for small business job creation, and for other 
     purposes.

  Pending:

       Reid (for Baucus-Landrieu) amendment No. 4594, in the 
     nature of a substitute.
       Reid (for Nelson (FL)) amendment No. 4595 (to amendment No. 
     4594), to exempt certain amounts subject to other information 
     reporting from the information reporting provisions of the 
     Patient Protection and Affordable Care Act.
       Reid (for Johanns) amendment No. 4596 (to amendment No. 
     4595), to repeal the expansion of information reporting 
     requirements for payments of $600 or more to corporations.
       Reid amendment No. 4597 (to the language proposed to be 
     stricken by amendment No. 4594), to change the enactment 
     date.
       Reid amendment No. 4598 (to amendment No. 4597), of a 
     perfecting nature.
       Reid motion to commit the bill to the Committee on Finance 
     with instructions, Reid amendment No. 4599 (the instructions 
     on the motion to commit), to provide for a study.
       Reid amendment No. 4600 (to the instructions (amendment No. 
     4599) of the motion to commit), of a perfecting nature.
       Reid amendment No. 4601 (to amendment No. 4600), of a 
     perfecting nature.

  The ACTING PRESIDENT pro tempore. Under the previous order, the time 
until 11 a.m. will be equally divided and controlled between the two 
leaders or their designees.
  Mr. BAUCUS. Mr. President, what is the pending business?
  The ACTING PRESIDENT pro tempore. The pending business is H.R. 5297.
  Mr. BAUCUS. That is the Small Business Act.
  The ACTING PRESIDENT pro tempore. The Senator is correct.
  Mr. BAUCUS. Am I correct in saying the time is equally divided before 
the votes?
  The PRESIDING OFFICER. The Senator is correct.
  Mr. BAUCUS. Mr. President, I see my colleague. I have a statement to 
make on the bill.
  Mr. JOHANNS. Mr. President, I defer to the Senator from Montana.
  Mr. BAUCUS. Mr. President, the Book of Ecclesiastes teaches: ``The 
end of a matter is better than its beginning.''
  In other words, getting something done is better than starting 
something new. That is what a lot of folks are telling us these days. 
They are telling us to get some things done. They are telling us to do 
something to create jobs. They are telling us to enact legislation such 
as the small business jobs bill before us today.
  In America, the private sector creates the vast majority of jobs, and 
in the private sector, small businesses are the principal engine of job 
creation. Over the past 15 years, small businesses generated two-thirds 
of new jobs. That is about 12 million new jobs. That is even more true 
in my home State of Montana. In Montana, we have the largest share of 
workers employed by small businesses of any State in the Nation. Nearly 
4 out of 5 employees in Montana work in businesses with fewer than 10 
workers, and 3 out of 5 employees in Montana work in businesses with 
fewer than 5 workers.
  The great recession has hit small businesses hard. Over the course of 
the recession, small firms have incurred two-thirds of the net job 
losses. We need to focus on small businesses as we seek to create jobs. 
When we help small businesses, we help get Americans back to work, and 
that is exactly what this small business jobs bill would do. This bill 
would help small businesses get

[[Page 15564]]

capital. This bill would make it easier for small businesses to invest. 
This bill would promote entrepreneurship. This bill would improve 
equity in the law. This is exactly the kind of targeted job-creating 
legislation folks are telling us to enact, and we ought to get it done. 
But before we can pass this bill, we have to address the pending 
Johanns and Nelson amendments on information reporting.
  I urge my colleagues to oppose the Johanns amendment and support the 
Nelson amendment, and let me explain why. The Johanns amendment would 
repeal a tax-reporting provision enacted in the new health care law. No 
matter what you think of the reporting requirement in the new health 
care law, the offset in the Johanns amendment is a killer.
  The Johanns amendment would go in the wrong direction. It would 
expand the exemption from the responsibility to buy health insurance. 
Fewer people would be responsible to buy health insurance. The 
amendment would raise revenue because it would thus decrease the number 
of people who receive Federal tax credits. Fewer Americans would get 
insurance and fewer people would get tax credits to buy the insurance.
  According to the nonpartisan Congressional Budget Office, the Johanns 
amendment would increase premiums by up to 4 percent in the individual 
market; that is, in the market for those who individually buy health 
insurance. Their premiums would go up 4 percent, according to the 
Congressional Budget Office, under the Johanns amendment.
  The Johanns amendment would increase the number of uninsured by 2 
million people--increase by 2 million the number of people who are 
uninsured. Under the Johanns amendment, much of the cost of caring for 
the uninsured would therefore continue to be shifted to people with 
insurance, as it is today, and the premiums would continue to go up for 
all the rest of us to pay for that.
  By reducing the requirement for folks to buy insurance, the Johanns 
amendment would make it so that the share of folks who buy insurance 
who are sick would also increase, and that would make insurance 
premiums go up as well.
  We need to resist misguided efforts such as these to weaken the new 
health care law. What is more, the amendment would also cut money set 
aside for prevention in the new health care law, and that is a bad 
idea. The Johanns amendment is a wolf in sheep's clothing. It is 
dressed up as an attempt to help small businesses, but in reality it is 
just another partisan effort to undermine the new health care law.
  Let me take a few moments to address the information reporting 
requirement which the Johanns amendment purports to address. Current 
law, even before health care reform, requires all businesses to send a 
form 1099 information return to all unincorporated service providers to 
whom businesses pay $600 or more during the year. This information also 
goes to the IRS. That is current law. That is before the health care 
reform law. The new health care law expands this requirement to include 
payments to corporations--not just service providers but to 
unincorporated companies--as well as payments for goods and property 
beginning in 2012. So this goes into effect, the provision in the 
health care law, in 2012--not this year, not next year, but 2012. I 
know it takes time and money for small businesses to comply with 
information reporting requirements. I am very sympathetic to the 
record-keeping burdens of small businesses. But the research 
demonstrates that voluntary compliance doubles when information 
reporting is in place. The rate rises from 46 percent compliance to 98 
percent compliance. Information reporting does not increase taxes. Let 
me say that again. It does not increase taxes. Rather, it keeps tax 
rates lower. Why? Because more people pay the taxes they already owe.
  Both the Bush administration and the Obama administration included 
corporate information reporting among their tax compliance proposals. 
But we do need to address this requirement, and the Nelson amendment is 
an excellent start. The Nelson amendment directly addresses the 
concerns small businesses are raising. First, the Nelson amendment 
would completely exempt businesses with 25 or fewer employees from the 
new reporting requirements for goods and property--a complete exemption 
for a small business that has 25 or fewer employees. For businesses 
with more than 25 employees, the Nelson amendment would raise the 
threshold to report purchases of goods and property from $600 to 
$5,000. The Nelson amendment would also take other steps to reduce the 
burdens on small businesses.
  The bottom line is this: We have heard the concerns of small 
businesses. We hear it. I hear it. During the last month, I heard it 
two or three times, and on this particular provision. But when I asked 
about the Nelson solution, the people I talked to, the small 
businessmen I talked to, and the accountants I talked to at home said: 
Well, gee, maybe that might be OK.
  We intend to work diligently to address and mitigate the concerns of 
small businesses, and we are doing so with the Nelson amendment. The 
Nelson amendment is the first step in that process. So I urge my 
colleagues to support the Nelson amendment in response to the concerns 
of small businesses. Those concerns are real, and the Nelson amendment 
addresses them. But the offset in the Johanns amendment is a killer. 
The Johanns amendment would raise health insurance premiums--raise 
them. The Johanns amendment would result in fewer people having health 
insurance--fewer. And the Johanns amendment would cut funding for 
prevention--cut it. Those are results no one should want. I therefore 
urge that the Johanns amendment be opposed, and I urge my colleagues to 
vote against it.
  Let's address these amendments and get something done, as 
Ecclesiastes, in the Scriptures, suggests to us, let's do something to 
create jobs, and let's enact this small business jobs bill today.
  The ACTING PRESIDENT pro tempore. The Senator from Nebraska.
  Mr. JOHANNS. Mr. President, I rise today to speak on behalf of the 
amendment I offer, which is called the Johanns amendment. I think and 
very respectfully I say that the Senator from Montana has really joined 
the issues here. On one hand, we have this 1099 requirement, which no 
business in America supports--none. We have this 1099 requirement that 
every business association in America opposes. On the other hand, we 
have a health care bill--passed on Christmas Eve, put together with no 
bipartisan support--for which the President is demanding absolute 
loyalty of his Members. He doesn't want anything changed. And that is 
how the issue is joined today.
  But I believe today that we in the Senate have an opportunity to take 
a very clear and very decisive action that shows we mean what we say. A 
vote to repeal the 1099 paperwork mandate fulfills the promise to clear 
Federal roadblocks that are stopping small businesses from expanding 
and putting Americans to work.
  There have been a lot of promises from this administration and even 
from this Congress to support small businesses, but America is coming 
to the conclusion that the promises are empty. And this 1099 mandate in 
the health care bill is a perfect example of why they are giving up 
hope. You see, our small business owners, our medium-sized business 
owners, and our large business owners are frustrated with nice speeches 
that are followed by strangling regulation, new taxes, and really 
absurd paperwork mandates. Small businesses want to expand, they want 
to hire workers, and they want more customers. They do not like going 
to a long-term employee and saying: I have to lay you off. I have had 
employers talk to me about that literally with tears in their eyes. Yet 
this tax paperwork mandate--hidden in the health care law, of all 
things, in section 9006, page 700-something--requires businesses to 
file a mountain of additional 1099 tax forms. It will consume resources 
that could otherwise be spent on wages for new employees. It is an

[[Page 15565]]

undeniable example of the relentless hostility this administration has 
toward the business community.
  The Washington Post accurately summarized it this way:

       As small businesses try to plot their recovery, attention 
     is turning to what many owners consider burdensome policies--
     higher taxes, new accounting procedures and health-care 
     mandates.

  That quote goes on to say:

       Even as the government tries to help with an array of small 
     business initiatives, many owners say the intervention is as 
     much a hindrance to hiring as is the faltering economy.

  You see, this type of uncertainty and fear only leads to a paralyzed 
job market and, of course, anemic growth. Just look at what we have 
piled on the backs of businesses in the last 18 months. Is it any 
wonder they are sitting on capital? A so-called economic stimulus that 
cost taxpayers $862 billion but failed to deliver on the promise of 
keeping unemployment below 8 percent. Passage of a $2.6 trillion health 
care bill that, when honestly scored, imposes an employer mandate--an 
employer mandate--during one of the toughest economic times since the 
Great Depression. It increases taxes in areas completely unrelated to 
health care. A financial overhaul that increases small business burdens 
and cost of compliance. Threats of card check, which the Chamber of 
Commerce recently estimated will result in 600,000 lost jobs. And, of 
course, the endless threat of an energy tax. A cap-and-trade proposal 
that would result in increased production costs, harming America's 
competitiveness in a global marketplace--shipping jobs to India and 
China. To make matters worse, the uncertainty about the looming tax 
increases--the largest in history--only compounds the worries 
businesses are facing.
  All of us traveled during the August break. I traveled across my home 
State of Nebraska in August, and I heard from hundreds, thousands of 
constituents. The message was plain and simple. In 14 townhalls across 
the State, people said over and over again: Mike, go back there and 
fight for us. And do you know what they were asking me to do? Protect 
their businesses from Washington. Protect their businesses from 
Washington.
  We have an opportunity to do just that today by fully repealing the 
1099 filing requirements. Our job creators will be able to focus their 
time and energy on hiring and expanding, not dealing with mounds of 
paperwork.
  As the president of the Nebraska Federation of Independent Business 
put it, and I am quoting from the chart:

       You can't operate and grow your business if you are 
     spending all your time filling out IRS forms and haggling 
     with auditors.

  In fact, there has been an outpouring of support from business owners 
who are hoping that common sense will rule the day. The steady stream 
of support letters and key vote letters Senate offices have received is 
absolutely compelling evidence that our job creators feel very strongly 
about repealing this nonsensical mandate. The U.S. Chamber of Commerce, 
National Federation of Independent Business, and the National 
Association of Manufacturers all support full repeal, to name a few. 
But I could go on and on--the Farm Bureau, the National Restaurant 
Association, the Public Accountants Association, veterinarians, 
florists. There is no stopping here.
  I think it is time Washington listen to the concerns of constituents 
and businesses. They sure did not do that with the health care bill. 
Here is a sampling of what businesses are saying. From the American 
Rental Association:

       The reporting requirement substantially and 
     disproportionately increases compliance burdens on all types 
     of small businesses.

  Citizens Against Government Waste says:

       With a ballooning $13.4 trillion federal debt and a 
     national unemployment rate that is around 10 percent, 
     lawmakers should be focused on providing relief to America's 
     businesses, encouraging job creation, and spurring economic 
     growth. The 1099 mandate is a major roadblock, discouraging 
     them from expanding and hiring.

  The National Restaurant Association says this:

       This new requirement will impose a significant burden on 
     restaurants across the country.

  The International Franchise Association says:

       The paperwork filing burden associated with this provision 
     will be too great for many small businesses to comply and 
     could lead to inaccurate filings that may trigger audits and 
     penalties.

  Finally, the Coalition for Fairness in Tax Compliance says:

       The Johanns amendment is the only solution that fully 
     protects small businesses.

  They go on to speak to the Nelson amendment, and I am quoting again:

       The Nelson amendment does not remove the paperwork and 
     administrative burden that is created by this new law. 
     Instead, the Nelson alternative further complicates 
     compliance responsibilities . . . rather than clarify. The 
     Nelson amendment actually creates even greater complexity for 
     those who comply with the law.

  Businesses could not be more clear. Today are we going to turn our 
deaf ear to the job creators in America? Are we going to stand with the 
President, who does not want anybody fiddling with his health care 
reform, or are we going to stand with small businesses?
  This is a vote to put Americans back to work by freeing up our small 
businesses to expand and hire. It is as simple as that. Let's not force 
our job creators to fight the greatest battle they are fighting, which 
is the battle against Washington and its endless appetite for 
regulation and spending.
  We have talked about support for our small businesses. Let's stand 
behind them. I want to remind my colleagues that, according to analysis 
by one business group, this mandate is likely to increase the 1099s 
that businesses file by a whopping 2000 percent. Let's listen to the 
loud voices of an endless line of businesses pleading with us to repeal 
this job-killing mandate.
  I hope my colleagues across the aisle will reject the arm twisting 
that is going on by the White House to preserve at all costs the health 
care law and every word of it, every dotted i and every crossed t, even 
at the expense of American jobs. I ask you to vote in favor of the only 
bipartisan amendment you will vote on today, the Johanns-Lincoln 
amendment, a bipartisan approach, the only real fix to a 1099 nightmare 
created by the health care law.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Montana.
  Mr. BAUCUS. Mr. President, I will yield 8 minutes to my good friend 
from Florida, who has come up with a very good idea to resolve this 
question.


  Amendment No. 4595, As Modified, and Amendment No. 4596, As Modified

  Mr. NELSON of Florida. If it is OK with the chairman of the 
committee, we have a unanimous consent that has been agreed to on both 
sides.
  Mr. President, I ask unanimous consent that the pending amendments, 
No. 4595 and No. 4596, be modified with the changes at the desk.
  The ACTING PRESIDENT pro tempore. Is there objection?
  The Senator from Nebraska.
  Mr. JOHANNS. Mr. President, reserving the right to object, let me 
take a moment to analyze what the Senator has proposed.
  We have no objection.
  The ACTING PRESIDENT pro tempore. Hearing no objection, it is so 
ordered.
  The amendments, as modified, are as follows:


                    amendment no. 4595, as modified

       At the end of subtitle B of title II, add the following:

                     PART V--ADDITIONAL PROVISIONS

     SEC. ___. CERTAIN EXCEPTIONS TO INFORMATION REPORTING 
                   PROVISIONS.

       (a) In General.--Section 6041 of the Internal Revenue Code 
     of 1986, as amended by section 9006 of the Patient Protection 
     and Affordable Care Act and section 2101 of this Act, is 
     amended by redesignating subsection (j) as subsection (k) and 
     inserting after subsection (i) the following new subsection:
       ``(j) Coordination With Returns Relating to Payment Card 
     and Third Party Network Transactions.--This section shall not 
     apply to any amount with respect to which a return is 
     required to be made under section 6050W.''.
       (b) Increase in Threshold Amount and Exemption for Small 
     Employers for Reporting of Certain Payments.--Subsection (a) 
     of section 6041 of the Internal Revenue Code of 1986, as 
     amended by the Patient Protection and Affordable Care Act, is 
     amended

[[Page 15566]]

     by adding at the end the following new sentences: ``In the 
     case of payments in consideration of property, this 
     subsection shall be applied by substituting `$5,000' for 
     `$600' and this subsection shall not apply in the case of any 
     person employing not more than 25 employees at any time 
     during the taxable year. In the case of any payment to a 
     corporation which is not an organization exempt from tax 
     under section 501(a), this subsection shall not apply in the 
     case of any person employing not more than 25 employees at 
     any time during the taxable year. For purposes of the two 
     immediately preceding sentences, all persons treated as a 
     single employer under subsection (b), (c), (m), or (o) of 
     section 414 shall be treated as one employer.''.
       (c) Regulatory Authority.--Subsection (k) of section 6041 
     of the Internal Revenue Code of 1986, as redesignated by 
     subsection (a), is amended by striking ``including'' and all 
     that follows and inserting ``including--
       ``(1) rules to prevent duplicative reporting of 
     transactions, and
       ``(2) rules which identify, and provide exceptions for, 
     payments which bear minimal risk of noncompliance.''.
       (d) Effective Dates.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall apply to amounts with 
     respect to which a return is required to be made in calendar 
     years beginning after December 31, 2010.
       (2) Property threshold.--The amendment made by subsection 
     (b) shall apply as if included in the amendments made by 
     section 9006 of the Patient Protection and Affordable Care 
     Act.
       (e) Public Comments and Suggestions.--In order to minimize 
     the burden on small businesses and to avoid duplicative 
     information reporting by small businesses, the Secretary of 
     the Treasury or the Secretary's designee is directed to 
     request and consider comments and suggestions from the public 
     concerning implementation and administration of the 
     amendments made by section 9006 of the Patient Protection and 
     Affordable Care Act, including--
       (1) the appropriate scope of the terms ``gross proceeds'' 
     and ``amounts in consideration for property'' in section 
     6041(a) of the Internal Revenue Code of 1986, as amended by 
     such section 9006,
       (2) whether or how the reporting requirements should apply 
     to payments between affiliated corporations, including 
     payments related to intercompany transactions within the same 
     consolidated group,
       (3) the appropriate time and manner of reporting to the 
     Internal Revenue Service, and whether, and what, changes to 
     existing procedures, forms, and software for filing 
     information returns are needed, including electronic filing 
     of information returns to the Internal Revenue Service,
       (4) whether, and what, changes to existing procedures and 
     forms to acquire taxpayer identification numbers are needed, 
     and
       (5) how back-up withholding requirements should apply.
       (f) Timely Guidance.--The Secretary of the Treasury is 
     directed to issue timely guidance that will implement and 
     administer the amendments made by section 9006 of the Patient 
     Protection and Affordable Care Act in a manner that minimizes 
     the burden on small businesses and avoids duplicative 
     reporting by small businesses.
       (g) Reports to Congress.--
       (1) In general.--Prior to the effective date of the 
     amendments made by section 9006 of the Patient Protection and 
     Affordable Care Act, the Secretary of the Treasury shall 
     report quarterly to Congress concerning the steps taken to 
     implement such amendments, including ways to limit compliance 
     burdens and to avoid duplicative reporting. Such reports 
     shall include--
       (A) a description of actions taken to minimize, reduce or 
     eliminate burdens associated with information reporting by 
     small businesses, and
       (B) a description of business transactions exempted from 
     reporting requirements to avoid duplicative reporting or 
     because such transactions represent minimal compliance risk.
       (2) Comparison.--Not later than 6 months prior to the 
     effective date of the amendments made by section 9006 of the 
     Patient Protection and Affordable Care Act, the Secretary of 
     the Treasury shall report to Congress a comparison of the 
     expected compliance requirements after the implementation of 
     such amendments to the compliance requirements under section 
     6041 of the Internal Revenue Code of 1986 prior to the 
     effective date of such amendments.

     SEC. ___. DENIAL OF DEDUCTION FOR MAJOR INTEGRATED OIL 
                   COMPANIES FOR INCOME ATTRIBUTABLE TO DOMESTIC 
                   PRODUCTION OF OIL, GAS, OR PRIMARY PRODUCTS 
                   THEREOF.

       (a) In General.--Subparagraph (B) of section 199(c)(4) of 
     the Internal Revenue Code of 1986 is amended by striking 
     ``or'' at the end of clause (ii), by striking the period at 
     the end of clause (iii) and inserting ``, or'', and by 
     inserting after clause (iii) the following new clause:
       ``(iv) in the case of a taxpayer which is a major 
     integrated oil company (as defined in section 167(h)(5)(B)), 
     oil related qualified production activities (within the 
     meaning of subsection (d)(9)(B)).''.
       (b) Conforming Amendment.--Section 199(d)(9)(A) of the 
     Internal Revenue Code of 1986 is amended by inserting 
     ``(other than a major integrated oil company (as defined in 
     section 167(h)(5)(B))'' after ``taxpayer''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2010.


                    amendment no. 4596, as modified

       In lieu of the matter proposed to be inserted, insert the 
     following at the appropriate place insert the following:

                     PART IV--ADDITIONAL PROVISIONS

     SEC. 4271. REPEAL OF EXPANSION OF INFORMATION REPORTING 
                   REQUIREMENTS.

       Section 9006 of the Patient Protection and Affordable Care 
     Act, and the amendments made thereby, are hereby repealed; 
     and the Internal Revenue Code of 1986 shall be applied as if 
     such section, and amendments, had never been enacted.

     SEC. 4272. EXPANSION OF AFFORDABILITY EXCEPTION TO INDIVIDUAL 
                   MANDATE.

       Section 5000A(e)(1)(A) of the Internal Revenue Code of 1986 
     is amended by striking ``8 percent'' and inserting ``5 
     percent''.

     SEC. 4273. USE OF PREVENTION AND PUBLIC HEALTH FUND.

       (a) Use of Funds as Offset Through Fiscal Year 2017.--
     Section 4002(b) of the Patient Protection and Affordable Care 
     Act is amended by striking ``appropriated--'' and all that 
     follows and inserting ``appropriated, for fiscal year 2018, 
     and each fiscal year thereafter, $2,000,000,000''.
       (b) Effective Date.--The amendment made by this section 
     shall take effect as if included in the enactment of section 
     4002 of the Patient Protection and Affordable Care Act.

     SEC. 4274. TIME FOR PAYMENT OF CORPORATE ESTIMATED TAXES.

       The percentage under paragraph (2) of section 561 of the 
     Hiring Incentives to Restore Employment Act in effect on the 
     date of the enactment of this Act is increased by 4.25 
     percentage points.

  Mr. NELSON of Florida. Mr. President, we are down now to passing what 
we have tried to pass so many times, this small business assistance 
bill, which is going to create a $30 billion lending facility that will 
work through community banks. The small business lending fund will 
generate $300 billion of loans that will specifically be targeted to 
small businesses to help get our country moving again economically. 
This is huge. But right now we are stuck on this issue of whether 
businesses are going to have to file these 1099 forms anytime they make 
purchases of goods.
  The Senator from Nebraska wants to eliminate all of the new 
information reporting rules. That is a salutary result. But how does he 
propose to do it? He has to come up with a way to pay for it. The 
underling law raises about $17 billion, so he has to come up with a 
pay-for if he is going to repeal it. Where does he get it? He basically 
goes directly at the health care bill, the reform bill, and he starts 
to gut the health care reform bill.
  This Senator does not think that is a very good idea, particularly 
since what the Senator from Nebraska is gutting is the subsidies that 
allow people to purchase health insurance who presently are uninsured. 
The amendment of the Senator would reduce the number of people that 
purchase coverage through the health insurance exchange. These are 
uninsured people whom we want to have private health insurance, 2 
million of them in this country who otherwise would go into their State 
health insurance exchange and be able to purchase health insurance with 
some assistance because of their income level.
  The amendment of the Senator involves a complicated formula. It 
actually gets at a provision in the current health reform law that says 
if your health premiums are going to be above 8 percent of your annual 
income, you do not have a responsibility to purchase health insurance. 
The Senator from Nebraska drops that to 5 percent, which means that 2 
million people in this country are not going to go into these health 
insurance exchanges and purchase health insurance.
  By the way, what is going to happen? They are still going to get 
health care if they do not have health insurance. Where are they going 
to get it? They are going to get it at the most expensive place at the 
most expensive time; that is, when they get sick they are going to go 
to the emergency room. If they do not have health insurance, guess who 
is going to pay. All the rest of us are going to pay, which was part

[[Page 15567]]

of the reason for the health reform bill in the first place. It was to 
get 32 million people in this country who are not insured into the 
health insurance system so that you spread that health risk over more 
people. That is 32 million people who are going to come into the health 
insurance system and pay for their care, instead of just those who 
currently have health insurance.
  The whole idea was to get more people into the system--more people 
paying insurance, more people with health insurance so they receive 
preventive care and so they do not wait around until the sniffles have 
turned into pneumonia and they have to go to the emergency room. If 
they don't have health insurance, everybody else pays for them.
  What the Senator from Nebraska is doing is he is driving a stake into 
the heart of the health insurance reform bill by taking 2 million 
people out of that pool, people who are uninsured, who otherwise would 
be getting health insurance. That is the essence of this; otherwise, 
the Senator from Nebraska and I agree. We want to stop this nonsense of 
the harassment of every time you make a purchase of a good, some 
equipment, et cetera, that you have to file a 1099 because the other 
guy on the other end who is selling you that good is not going to 
report the income. We would both prefer to eliminate all of that.
  The amendment of this Senator says, first of all, if you are a small 
business, if you are 25 employees or less, you are not going to have to 
worry about that requirement at all. Second, this Senator says that if 
you have 26 or more employees, you are not going to have to file that 
1099 form when you purchase equipment unless it is over $5,000 of 
value. Third, if it is a credit or debit card transaction, no 
information reporting by the business would be required, period.
  Is that too much to ask in order to help get people to pay the income 
tax that they owe, people who are now getting out of it to the tune of 
$17 billion? If somebody is not paying their income tax, is that fair? 
No, it is not. So in tightening up the law we are going to get people 
to pay their income tax, but we are going to do it in a way that is not 
harassing any business, and particularly small businesses, because we 
are going to exempt them if there are 25 employees or less.
  The long and short of it is if the amendment of the Senator from 
Nebraska, which is going to be voted on first, is not agreed to, then 
we come to the amendment of this Senator. You may want to eliminate 
everything. But if his amendment----
  The ACTING PRESIDENT pro tempore. The time of the Senator has 
expired.
  Mr. NELSON of Florida. Oh, goodness. I will conclude by saying if his 
amendment does not pass, then you have a viable alternative with the 
Nelson amendment.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Nebraska.
  Mr. JOHANNS. May I inquire how much time on this side is left?
  The ACTING PRESIDENT pro tempore. The Senator from Nebraska has 11 
minutes 14 seconds.
  Mr. JOHANNS. I will defer to the Senator from Wyoming for 3 minutes, 
and yield 3 minutes of my time.
  The ACTING PRESIDENT pro tempore. The Senator from Wyoming.
  Mr. ENZI. Mr. President, I just heard the discussion about this bill. 
I know in the health care bill we hired 16,000 more IRS agents. If we 
hired 16,000 more IRS agents, we should not need a whole bunch more 
paperwork for small businesses to do, to see if they are being honest.
  This is going to cost a fortune for small business, even if you go to 
the $5,000 level, because you have to keep track of how much you buy 
from every supplier. You have to see if you hit the $600 or $5,000 
mark. That is a cost to business with no benefit. I do not think it is 
going to wind up with the kind of benefit they are talking about in 
raising revenue to finance health care.
  As far as the mandate to buy insurance, I am not in favor of the 
mandate to begin with. But it mandates that they spend 8 percent of 
their income on health insurance. This reduces it to 5 percent of their 
health care. I think that is a pretty big mandate all in itself.
  But during the last month, my wife and I traveled around Wyoming. We 
visited small businesses. We looked to see what their problems were. I 
do that to get a sense of what Federal legislation is going to do to 
help or hinder them. I want to see firsthand the struggles they deal 
with. Every business looks simple until you have to make the decisions 
that deal with that business.
  The last thing we want to do in Washington is hurt those businesses 
by passing legislation that takes resources away from growing 
businesses and puts it into more paperwork. We also should not be 
passing legislation using regulation that stymies new jobs and causes 
uncertainty about what will come out in the near future.
  Unfortunately, I think that is exactly what happened in the health 
care reform law that was enacted earlier this year. Today, we have a 
chance to fix it. Although the health care reform battle may be in the 
rearview mirror for some of you, it is the small businesspeople in our 
hometowns who continue to bleed from it.
  The provision I am referring to will require business owners to 
submit onerous and duplicative 1099 forms for every single business-to-
business transaction over $600. Even $5,000 does not solve the problem. 
This includes anything from utilities, office supplies, construction 
materials. There are ways to audit that anyway. This is just trying to 
do an easy thing and putting a whole burden on businesses. So everybody 
on Main Street will have to do 200 to 2,000 of these 1099s depending on 
which one of these forms you go with. Repealing it is the best way to 
do it.
  Something else that is not mentioned is they have to get the 
taxpayer's ID number. If you are a small businessman, a really small 
businessman, your taxpayer ID is your Social Security number. How 
willing are you going to be to give your Social Security number to some 
kid that bought $600 worth of gas so he could mow lawns over the 
summer? If he does not get the taxpayer number, he is supposed to 
withhold 28 percent of the payment.
  Most businesses don't have personal accountants on hand to file these 
forms so they will need to hire someone just to file paperwork. This is 
the kind of onerous paperwork burden that will distract small 
businesses from doing day-to-day business, providing much-needed jobs 
and stimulating the economy.
  Many of my colleagues have joined me in co-sponsoring the Small 
Business Paperwork Mandate Eliminate Act to fix this problem, and today 
I urge them to join me in supporting Senator Johanns' amendment. The 
Johanns amendment eliminates the onerous section of the law and pays 
for it in a responsible way. While I appreciate the Senator from 
Florida would like to exempt businesses with under 25 employees, this 
exemption actually encourages businesses to stop growing so they aren't 
burdened with onerous bureaucratic regulations, and the method he uses 
to offset his amendment will lead to increased energy prices and fewer 
American energy jobs. My biggest surprise over the August recess was 
the number of businesses that have heard of this requirement. They know 
and they are mad. One more requirement that doesn't bring in a single 
dollar and has a huge cost!
  I urge all Senators to help the businesses in their State and make 
sure this section is repealed by supporting the Johanns amendment. You 
don't have to be a Republican and you don't have to be a Democrat to 
know that this is something we need to do. To know that, you just have 
to ask the business people you represent in your home State.
  Let's take a sandbag off the backs of the small business people. We 
know repeal will be better for them, our States and our country. Surely 
we can find a way together to do this one small thing that will make 
such a huge positive impact on those we serve.
  The ACTING PRESIDENT pro tempore. The time of the Senator from 
Wyoming has expired.

[[Page 15568]]


  Mr. ENZI. I think we can see what a terrible error it is to have this 
in the bill at all. I hope we will repeal it.
  I yield the floor.
  Ms. SNOWE. Mr. President, I rise today in support of the Johanns 
amendment to repeal an onerous mandate included in the health reform 
bill that would require millions of businesses to send billions of new 
information reporting forms to the IRS and other businesses. If Senator 
Johanns' amendment is not adopted here in the Senate, every business in 
America, starting in 2012, must report to the IRS on business purchases 
that exceed a threshold of only $600 per vendor or supplier--for 
purchases of supplies and equipment, and also services ranging from 
cell phone coverage to window washing to utilities.
  This new mandate was imposed in the health reform law, yet it has 
absolutely nothing to do with health insurance reform. What it does is 
make the Federal Government a more intrusive and burdensome presence in 
every aspect of American business--which is the very last thing 
American business needs during these tumultuous economic times. What 
small firms are clamoring for is certainty. They need the Federal 
Government to help foster an entrepreneurial environment under which 
they can do what they do best--create new jobs--and not saddle them 
with an incessant and unnecessary paperwork burden like this new 1099 
filing requirement.
  Most Americans recognize forms 1099 as the statements they get from a 
financial institution when they earn interest on savings or from their 
mortgage lender for the deductible interest the borrower pays to a bank 
or credit union for their home mortgage. The purpose of these 1099s is 
to accurately report income or deductions for a particular tax year so 
that income is appropriately taxed that year.
  However this new system of 1099s does not have anything to do with a 
direct tax liability in a given year--instead, this reporting regime 
will allow the IRS to track business purchases that exceed $600. 
Businesses typically have an intense focus on carefully tracking their 
sales to customers with marketing professionals. Rather than tracking 
sales to customers, this new government mandate will force a change in 
business focus to a detailed accounting of purchases from suppliers. 
While controlling costs is clearly a vital component of business 
profitability, this new government mandate on cost accounting and 
reporting to the IRS is an inordinate shift of priorities that will 
harm competitiveness and profitability because it will shift focus and 
resources away from customers.
  A separate dimension of this new cost accounting mandate is that 
purchases will also have to be separately tracked by type of payment 
because only payments made by check and cash would be reported on a 
1099 but payments by credit card would be excluded from this mandate 
and misreporting transactions by including credit card purchases might 
be subject to penalties. So for each supplier from which aggregate 
purchase might exceed $600 per year, purchases would have to be tracked 
by payment method. For instance, a construction contractor would have 
to make sure that employees know to use only a credit card at Home 
Depot but at the local lumber yard to only pay by check or invoice.
  The intent of this 1099 provision may have been to track the cash 
flow of businesses that operate in a cash economy in order to root out 
those that do not pay taxes. Ensuring that tax cheats pay their taxes 
is an admirable and necessary function of government. However, instead 
it has become clear that this provision could simply further expand the 
cash economy. The very businesses that currently evade taxation are not 
likely to become compliant with this new burdensome reporting regime. 
In fact, a predominantly cash-based business will likely further 
retrench and thrive absent both tax liability and the new reporting 
regime while tax compliant businesses either muddle through or fail 
under this new burden. For instance, a small plumbing business or a 
roofing business would likely thrive by simply working in an all-cash 
system for residential customers and evading both income taxes and 
information reporting while a similar business attempting to comply 
with tax liability and compliance would struggle.
  For the small businesses that attempt to comply with this tax 
reporting mandate, this paperwork burden will be imposed with a 
crushing effect. New tracking systems will have to be implemented for 
purchases in order to ensure that aggregated purchases exceeding $600 
are reported to the IRS. In fact, according to an NFIB Small Business 
Survey, at $74 an hour, tax paperwork is the most expensive paperwork 
burden placed on small businesses by the Federal Government. The Small 
Business Administration has found that the cost of tax compliance is 
already 67 percent higher in small firms than in large firms. Because 
this new 1099 reporting burden would be so ubiquitous for firms 
attempting to be compliant--by requiring new processes of making 
business purchases and tracking of business purchases--this compliance 
cost statistic is likely to be woefully outdated and more onerous.
  I fully expect the new Chief Counsel for Advocacy at the Small 
Business Administration, Winslow Sargeant, who President Obama recently 
recess appointed, to assess this new paperwork mandate and have his 
office recalibrate that statistic on cost of tax compliance which was 
last updated in 2005. Dr. Sargeant will also have the opportunity to 
fully use his office--the independent, ``regulatory watchdog'' for 
small business--to comment, by September 29, to a Treasury Department 
and IRS request for information on these expanded 1099 filing 
requirements. I want to quote from the SBA web site about the mission 
of the Office of Advocacy:

       In 1976, the U.S. Congress created the Office of Advocacy 
     within the U.S Small Business Administration to protect, 
     strengthen and effectively represent the nation's small 
     businesses within the federal government's legislative and 
     rule-making processes. The Office of Advocacy works to reduce 
     the burdens that federal policies impose on small firms and 
     maximize the benefits small businesses receive from the 
     government. Advocacy's mission, simply stated, is to 
     encourage policies that support the development and growth of 
     American small business.

  I expect Dr. Sargeant to fulfill his duties as the Chief Counsel for 
Advocacy by serving as a strong voice in this IRS rulemaking. In 
voicing the concerns of small businesses, Dr. Sargeant would be 
standing shoulder to shoulder with the IRS National Taxpayer Advocate, 
Nina Olson, who has stated that the administrative costs to small 
businesses of this provision are so high that it ``may turn out to be 
disproportionate as compared with any resulting improvement in tax 
compliance.''
  Separate from the burden of compliance, I fear the onerous and 
pervasive nature of this mandate, for it will surely change business 
purchasing decisions and disadvantage small businesses. Should the 
Johanns amendment to repeal this provision not be adopted, it would 
incentivize centralized purchasing from large integrated companies and 
away from smaller specialized ones. Rather than a roofing company 
putting out a bid to different suppliers for materials, this new 
government mandate would be another reason to consolidate purchasing in 
order to ease paperwork burdens of the 1099 process. With fewer 
businesses willing to put out bids to a wide variety of suppliers, a 
constricting spiral will take effect resulting in fewer and fewer 
specialty suppliers. While large big-box retailers serve a critical 
role, they don't need to have the heavy hand of government pushing 
customers through their doors instead of through the local building 
supply business or local office supply businesses. This further 
consolidation of suppliers is bad for innovation, bad for price 
competition, and bad for small business.
  No wonder a broad coalition of businesses has come together to form 
the Coalition for Fairness in Tax Compliance. This group includes 
dozens and dozens of business organizations including Washington 
mainstays such as the National Federation of Independent

[[Page 15569]]

Business, the National Association of Manufacturers, the Associated 
Builders and Contractors, the National Restaurant Association, and the 
US Chamber of Commerce, to groups as varied as the Electronic Security 
Association, the Independent Community Bankers of America and the 
American Road & Transportation Builders Association.
  Finally, I want to turn to an aspect of this issue that has not been 
discussed widely. The process of tracking business-to-business 
purchases, aggregating information on purchase prices and then 
reporting this information to the IRS on those purchases would largely 
put in place the infrastructure for a value added tax--or VAT--tax 
system. A typical value added tax is a credit-invoice method system 
where one business tracks the purchases it makes from others and then 
when it sells goods, it remits a tax for the increase in value of those 
goods. The increase in value is through either a manufacturing process 
or by adding value through a retail sale of goods.
  A VAT depends upon reporting the price of goods purchased and sold. 
Imposing a system whereby virtually every business-to-business sale of 
goods or services is aggregated and reported to the IRS certainly puts 
in place all of the infrastructure of a VAT. This provision would be 
implemented and become effective in 2012. It would certainly take a 
year to two for taxpayers and the IRS to work through all of the 
administrative hassles associated with its implementation. By 2014, 
when the health benefit subsidies become effective, all of the 
machinery necessary for a VAT would be functioning and the machine 
would simply have to be turned on to start generating the money 
necessary to pay for these benefits at a time when our national 
deficits are likely to continue at atrocious levels.
  Early in the debate for health reform, Obama advisers were proponents 
of a VAT to fund health reform, but were quickly publicly disavowed. 
Even in the Senate, last April, I joined 84 colleagues on the floor in 
April to repudiate the concept of a VAT. Putting in place the machinery 
of a VAT to not expect that machinery to be switched on is a test of 
faith that millions of small businesses across America are not willing 
to take.
  We cannot tinker with this 1099 provision. We cannot amend this 
provision. We cannot leave a vestige of it to sprout in the future. We 
must repeal it. Now. I urge my colleagues to support the Johanns 
amendment and oppose the Nelson amendment.
  Ms. MIKULSKI. Mr. President, I rise today to express my strong 
support for repealing the 1099 tax form requirement enacted in the 
Affordable Care Act. This requirement is burdensome for businesses in 
Maryland, especially small businesses. The 1099 tax provision requires 
businesses to report information on anyone they pay $600 or more to for 
goods in a year. Businesses will also have to send copies of the form 
to their vendors, suppliers and contractors. This requirement is costly 
and burdensome to businesses.
  Although I agree that we must ease the hassle faced by businesses, we 
must be careful about how we pay for this. The Johanns amendment to the 
Small Business Jobs and Credit Act repeals the new 1099 tax reporting 
requirement, yet could end up increasing health care costs and cost 
small businesses even more as a result of higher health expenditures. 
The Johanns amendment eliminates funding for prevention programs such 
as providing immunizations and screenings for diseases like cancer, 
heart disease, and diabetes. By catching diseases earlier and reducing 
the incidence of chronic disease, prevention programs lead to cost 
savings which lower the cost of health insurance for small businesses.
  That is why I support the Nelson amendment which provides a more 
affordable alternative. The Nelson amendment reduces the burden faced 
by businesses by eliminating the 1099 reporting requirement all 
together for businesses with 25 employees or less. It also raises the 
reporting threshold to anyone paid $5,000 or more for purchased goods 
in a year in a way that is affordable. This will help over 85 percent 
of businesses in Maryland.
  I am also a cosponsor of Senator Landrieu's Information Reporting 
Modernization Act. Senator Landrieu chairs the Small Business Committee 
and her bill would simplify and modernize 1099 reporting requirements 
so that nothing paid for with credit or debit cards would need to be 
reported and the $5,000 threshold amount for reporting established in 
the bill could be adjusted and increased every year for inflation. I 
will continue to support lessening the burdens faced by small 
businesses and help lower their costs.
  Mr. FEINGOLD. Mr. President, I am pleased to vote for the motion to 
invoke cloture on Senator Bill Nelson's amendment to ease reporting 
requirements on small businesses, which are the engine of our economy. 
Unlike Senator Nelson's commonsense amendment, which was paid for by 
taking away a tax break from big oil, Senator Johanns's alternative 
proposal would deny health insurance for roughly 2 million Americans 
and raise insurance premiums for many more. We can and should help 
small businesses without making health insurance more expensive and 
less accessible.
  The ACTING PRESIDENT pro tempore. Who yields time?
  Mr. BAUCUS. Mr. President, how much time do I have remaining?
  The ACTING PRESIDENT pro tempore. The Senator has 5 minutes 45 
seconds remaining.
  Mr. BAUCUS. I yield 5 minutes 45 seconds to the Senator from Iowa.
  Mr. HARKIN. I thank my friend from Montana for yielding me this time.
  Mr. President, the Johanns amendment would kill--would kill--the 
Prevention and Public Health Fund that we have established for our 
American citizens. Chronic diseases are one of the main reasons health 
care costs have increased so dramatically over the past several 
decades.
  This chart shows it. In 2005 we spent $2 trillion on health care. For 
every dollar spent, we spent 75 cents treating people who had a chronic 
disease. But we spent four pennies on prevention--four pennies on 
prevention--and 75 cents out of the dollar treating them.
  This second chart shows what has happened from 1987 to now: a $314 
billion increase in spending on all health care. Two-thirds of the 
increase went to take care of people who had chronic illnesses.
  Most of this is preventable. That is why we know, and we have good 
data to show, that for every dollar we spend on prevention and wellness 
we get a great return. For every dollar spent on childhood 
immunization, we get a $16.50 return. For every smoking cessation 
program for pregnant women, $6; chronic disease prevention overall, 
$5.60. Even tuberculosis screening, for every dollar we spend we get 
more money back in savings because we are not treating people with 
chronic illnesses.
  So, again, why would we want to gut this program? But that is what 
the Johanns amendment does. It says the Prevention and Public Health 
Fund that we established in health care, which had support from both 
sides of the aisle--I think regardless of how anyone felt about the 
final version of the health care reform bill, I found no one who wanted 
to go after the Prevention and Public Health Fund because we all 
recognized this is the path to our future: keeping people healthy in 
the first place.
  So we have this established. We have the fund established. The 
Johanns amendment guts it. It says no money; no money for prevention, 
no money for wellness until 2018. Well, we will just let people 
continue to get chronic illnesses, chronic diseases, and we will take 
care of them later.
  Remember what Benjamin Franklin said: An ounce of prevention is worth 
a pound of cure. Our mothers were right when they told us that. We 
finally have realized that in our society. Ask the medical community. 
Ask the nurses. Ask anyone. They will tell you we need to put more 
money into prevention and wellness programs across the board.
  That is what we designed. That is what we put in the health care 
bill. It was broadly supported on both sides of the aisle. Yet 
regardless of whatever benefits the Johanns amendment may

[[Page 15570]]

have--and, quite frankly, I tend to sympathize with the problems that 
were raised about paperwork on small businesses--this is not the place 
to rob the money. This is the worst place from which to take the money. 
I do not know why my friend from Nebraska saw fit to take money out of 
something that is going to save us money, save lives, and cut down on 
needless human suffering in the future. Think of all of the people who 
will be cut off of smoking, people who will have wellness programs, 
screening programs for the elderly that will start now. Every senior 
citizen can go in and get on Medicare, get an annual free checkup, and 
a personalized medical plan to keep them healthy. Free mammograms, 
childhood screenings--all part of getting ahead of the curve rather 
than just treating people after they get sick.
  I have looked at that amendment. I have looked at the Nelson 
amendment. It seems to me the Nelson amendment does basically do the 
same thing in terms of helping our small businesses. So I think the 
Nelson amendment is the way to go because it does eliminate any 
reporting burden on the great majority of small businesses, those with 
less than 25 employees at any point in the year. But, most importantly, 
it does not take money out of the Prevention and Public Health Fund. It 
does not gut it.
  So, as I say, regardless of whatever benefits you may think the 
Johanns amendment has, it is the wrong place to get the money, 
absolutely the wrong place. So I ask my colleagues, if you really want 
to help small businesses and not gut the one thing in health care that 
is going to bend the cost curve, bend the cost curve, keep people 
healthy, cut down on all of this money we are spending to take care of 
people when they get sick, the best way to do that is to support the 
Nelson amendment which does both: keeps the Prevention and Public 
Health Fund intact, and yet helps our small businesses. To me, that is 
the right process to take.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Nebraska.
  Mr. JOHANNS. How much time remains?
  The ACTING PRESIDENT pro tempore. There is 7 minutes 45 seconds 
remaining.
  Mr. JOHANNS. I yield 3 minutes to the Senator from South Dakota, Mr. 
Thune.
  Mr. THUNE. Mr. President, when the health care reform bill passed, 
the Speaker of the House famously said: We have to pass this bill so we 
can figure out what is in it.
  Well, what more and more Americans are finding when they look at what 
is in it are things they do not like. This is becoming increasingly 
less popular over time, and one of the most egregious provisions in 
this bill is this 1099 provision.
  The Senator from Iowa is worried about making sure more people have 
access to health care. We all are. Well, the best way for most 
Americans to get access to health care, because most Americans still 
get their health care coverage through their employers, the best way to 
get health care coverage is to get a job. This provision kills jobs.
  This is directly targeted at small businesses, the economic engine, 
the job creators in America today. So what the Senator from Nebraska is 
trying to do is to correct this by repealing this onerous compliance 
burden that we are placing on the small businesses of this country. It 
is not the tax delinquents who get hurt by this, it is the hard-working 
small businesses. It is the charities. It is the government agencies 
who have to deal with this burdensome paperwork.
  That, I think, is why we have so many organizations. We have 
agricultural organizations such as the American Farm Bureau, the Corn 
Growers, the Soybean Growers, the Cattlemen, and go right down the 
list. We have small business organizations such as the Chamber of 
Commerce, the National Federation of Independent Business, the National 
Association of Manufacturers, the National Association of Home 
Builders, the International Food Service Distributors, the Restaurant 
Association, and the Associated General Contractors that support repeal 
because it would hurt both their employees and their bottom line.
  We even have government organizations such as the National 
Association of Towns and Townships, which represents local governments. 
They support repeal because it would force cities and communities to 
keep track of every purchase they make whether it be cement, snowplows, 
or pencils. This is a ridiculous requirement that we are imposing, in 
many cases, on small businesses, on small charities, on small 
organizations, and local governments.
  I can tell you from personal experience, in my State this is 
something they cannot comply with and cannot deal with. So if we are 
worried about job creation in this country, if we are worried about 
economic growth, this is absolutely the wrong way to go about promoting 
it.
  What the Johanns amendment does is repeal this provision. It does it 
in a fiscally responsible way. It is offset, it is paid for, and it 
makes sense. I hope my colleagues will vote for this commonsense 
amendment because whether this was an intended consequence or an 
unintended consequence, this is absolutely disastrous for small 
businesses across this country, and it is essential that we get this 
part of the health care reform bill repealed.
  There are many others I think we are probably going to be talking 
about before this is all said and done because, as I said, the more 
people read the fine print in this legislation, the more they come to 
the realization of how bad this is for small businesses and for job 
creation in this country.
  So I would urge all of my colleagues to vote for the Johanns 
amendment and to repeal this onerous provision.
  The ACTING PRESIDENT pro tempore. The Senator from Nebraska.
  Mr. JOHANNS. Mr. President, I yield 3 minutes to the Senator from 
Missouri, Mr. Bond.
  Mr. BOND. Mr. President, the distinguished Senator from Montana, the 
chairman of the Finance Committee, earlier this morning said small 
businesses are the engine that drives jobs in the economy. I agree with 
him. I agree.
  As the former chairman of the Small Business Committee, I know how 
important small businesses are. I traveled around the State during the 
past breaks to find out, meeting with small businesses, why they are 
not creating jobs. We, frankly, have cut off the fuel supply, the 
profits that drive these jobs.
  I asked a group of small businesses: Why is it that you are not 
creating jobs? Is it because of the uncertainty people are talking 
about? I was immediately corrected.
  They said: It is the certainty. We know what you have done in the 
health care law, putting unbelievable burdens on us.
  They did not even know about this 1099 requirement at the time. But 
the health care costs are burdening small businesses, and it is making 
it impossible and unwise for them to try to hire. I talked to a small 
businessman today, and I asked him about it. I told him what the 
requirements were. He said: That is nuts. What do you think they are 
talking about? We are going to have to hire more bookkeepers.
  Unfortunately, my colleagues on the other side of the aisle refuse to 
listen to small businesses in passing this bill. They put burdens on 
them that are unbelievable. The new health care bill passed and signed 
into law is a boondoggle that will bury small businesses in higher 
taxes, new mandates, and more paperwork.
  This particular job-killing mandate of the 1099 we are debating today 
will drown small businesses in paperwork by requiring a small business 
owner to file two forms, one with the vendor and one with the IRS, for 
every business-to-business transaction over $600.
  According to the Wall Street Journal this morning, this means more 
than 30 million small businesses will be hit by the new paperwork 
mandate beginning in 2013. That is not the worst of it. Even the 
National Taxpayer Advocate at the Treasury Department, Nina Olson, said 
the cost of this measure is ``disproportionate as compared with any 
resulting improvements in tax compliance.''

[[Page 15571]]

  That is the problem. That is the problem, and the Johanns amendment 
is the only solution. We have to correct this job-killing mandate as 
urged by the NFIB, the Chamber of Commerce, and the National Small 
Business Association. Democrats are trying to sell a pig in a poke.
  The Nelson alternative would leave the same bad provision in place, 
only making it more complicated for small business owners to comply. It 
would only exempt small businesses with 25 employees or less. So, in 
other words, we are telling small businesses not to hire the 26th 
worker while we are having unemployment up around 10 percent.
  If you have small businesses in your State, you better listen to 
them. They are wanting a repeal, the full repeal of this burdensome 
mandate.
  The ACTING PRESIDENT pro tempore. The Senator's time has expired.
  Mr. BOND. Mr. President, I ask unanimous consent that the article 
from today's Wall Street Journal editorial be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

             [From the Wall Street Journal, Sept. 14, 2010]

                            Review & Outlook


                         The 1099 Insurrection

       The White House fights an effort to ease a burden on small 
     business. You might not have seen it reported, but the Senate 
     will vote this morning on whether to repeal part of ObamaCare 
     that it passed only months ago. The White House is opposed, 
     but this fight is likely to be the first of many as Americans 
     discover--as Nancy Pelosi once famously predicted--what's in 
     the bill.
       The Senate will vote on amendments to the White House small 
     business bill that would rescind an ObamaCare mandate that 
     companies track and submit to the IRS all business-to-
     business transactions over $600 annually. Democrats tucked 
     the 1099 reporting footnote into the bill to raise an 
     estimated $17.1 billion, part of the effort to claim that 
     ObamaCare reduces the deficit by $100 billion or so.
       But this ``tax gap'' of unreported business income is 
     largely a Beltway myth, and no less than the Treasury 
     Department's National Taxpayer Advocate Nina Olson says the 
     costs will be ``disproportionate as compared with any 
     resulting improvements in tax compliance.''
       Meanwhile, small businesses are staring in horror toward 
     2013, when the 1099 mandate will hit more than 30 million of 
     them. Currently businesses only have to tell the IRS the 
     value of services they purchase from vendors and the like. 
     Under the new rules, they'll have to report the value of 
     goods and merchandise they purchase as well, adding vast 
     accounting and paperwork costs.
       Think about a midsized trucking company. The back office 
     would have to collect hundreds of thousands of receipts from 
     every gas station where its drivers filled up and figure out 
     where it spent more than $600 that year. Then it would also 
     need to match those payments to the stations' corporate 
     parents.
       Most Democrats now claim they were blindsided and didn't 
     understand the implications of the 1099 provision--which is 
     typical of the slapdash, destructive way the bill was written 
     and passed. As the critics claimed, most Members had no idea 
     what they were voting on. Some 239 House Democrats voted to 
     dump the 1099 provision in August, and the repeal would have 
     passed except Speaker Pelosi rigged the vote procedurally so 
     it needed a two-thirds majority. She thus gave Democrats the 
     cover of a repeal vote without actually repealing it.
       In the Senate today, Nebraska Republican Mike Johanns will 
     offer his amendment to scrap the new 1099 rules altogether. 
     But the White House is opposing this because it fears it 
     would set a precedent for repealing the larger health bill. 
     Over the weekend the Treasury Department pronounced the 
     Johanns amendment ``not acceptable in its current form.''
       Yesterday the White House endorsed a competing proposal 
     from Florida Democrat Bill Nelson that would increase the 
     1099 threshold to $5,000 and exempt businesses with fewer 
     than 25 workers. Yet this is little more than a rearguard 
     action in favor of the status quo; the Nelson amendment 
     leaves the basic architecture unchanged while making the 
     problem more complex.
       Businesses would still have to track all purchases, not 
     knowing in advance which contractors will exceed $5,000 at 
     the end of the year. It also creates a marginal barrier to 
     job creation--for a smaller firm, hiring a 26th employee 
     would be extremely costly. The Nelson amendment also includes 
     new taxes on domestic oil production, as every Democratic 
     bill now seems to do.
       As of yesterday, no one was sure if either amendment would 
     get 60 votes, though Democrat Blanche Lincoln of Arkansas is 
     cosponsoring the Johanns version. Enough Democrats may bend 
     to White House wishes and produce a stalemate, but this issue 
     won't go away. The President's opposition to a clean repeal 
     shows the hollowness of his alleged support for small 
     business, which he expresses at every campaign stop but is 
     less a priority than preserving his health-care legacy.
       The larger political story here is that ObamaCare is 
     already under bipartisan siege--and in the same Congress that 
     passed it. The 1099 provision is only one plank, but 
     repealing the law plank by plank may be the right strategy. 
     Sooner or later the whole thing becomes unworkable. Voters 
     should watch this vote to see who's really on the side of 
     small business.

  The ACTING PRESIDENT pro tempore. The Senator from Nebraska is 
recognized.
  Mr. JOHANNS. Mr. President, how much time is on this side?
  The ACTING PRESIDENT pro tempore. Forty-five seconds.
  Mr. JOHANNS. Let me wrap up with something. If the Nelson amendment 
passes, this is the effect: These are businesses, real people who are 
going to be hurt because they are left out. In the State of Iowa, 3,334 
businesses are left out; in the State of California, 18,960. Over 
40,000 businesses, employing 93 million people, are left out.
  This talk about gutting the health care reform bill; are you kidding 
me? The President himself used $250 million of the $500 million this 
year for purposes other than what was intended by this health care 
bill.
  This is simply a choice between standing with our small businesses or 
standing with the President on the health care bill against small 
businesses. I ask my colleagues to vote yes on the Johanns amendment 
and stand with small businesses.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Iowa is 
recognized.
  Mr. HARKIN. Mr. President, I ask unanimous consent that a letter 
signed by 228 different organizations in the United States opposing the 
Johanns amendment be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                                September 1, 2010.
       Dear Senator: As the Senate considers the Small Business 
     Jobs and Credit Act (H.R. 5297), the 228 undersigned 
     organizations listed below strongly urge you to oppose the 
     use of the Prevention and Public Health Fund from the 
     Affordable Care Act (ACA) as an offset for an amendment 
     offered by Senator Johanns (No. 4596). Such an action would 
     virtually eliminate the Fund, and mark a severe blow to this 
     monumental commitment to prevention and public health under 
     the Act. We will also oppose any other such efforts to use 
     the Fund as an offset.
       ACA included historic reforms that have the potential to 
     transform our health system. For too long, we have focused 
     spending on treating people once they are sick rather than 
     preventing illness in the first place. The Prevention and 
     Public Health Fund (Fund) is urgently needed to address the 
     many emerging health threats our country faces and the 
     persistent chronic disease rates that we must begin to 
     control. The Fund is intended to ensure a coordinated, 
     comprehensive, sustainable, and accountable approach to 
     improving our country's health outcomes through the most 
     effective prevention and public health programs.
       ACA clearly states That the money be used ``for programs 
     authorized by the Public Health Service Act, for prevention, 
     wellness, and public health activities.'' The money would be 
     strategically used to support disease prevention by promoting 
     access to vaccines, building the public health workforce, and 
     investing in community-based prevention. Furthermore, the Act 
     specifically states that community-based prevention funding 
     must only support evidence-based prevention programs which 
     have been shown through scientific research to reduce chronic 
     disease, including behavioral health conditions, and address 
     health disparities. Research has shown that effective 
     community level prevention activities focusing on nutrition, 
     physical activity and smoking cessation can reduce chronic 
     disease rates and have a significant return on investment.
       Already in Fiscal Year 2010, we have seen these funds 
     invested for programs to promote tobacco control and 
     implement tobacco cessation services and campaigns, as well 
     as obesity prevention, better nutrition and physical 
     activity. The fund has been invested to support state, local 
     and tribal public health efforts to advance health promotion 
     and disease prevention, and to build state and local capacity 
     to prevent, detect and respond to infectious disease 
     outbreaks. The funds are also being used to support the 
     training of current and next generation public health 
     professionals.
       The Fund is a unique opportunity to truly bend the cost 
     curve on health care spending.

[[Page 15572]]

     Seventy-five percent of all health care costs in our country 
     are spent on the treatment of chronic diseases, many of which 
     could be prevented. Further, in a public opinion survey 
     conducted just prior to the passage of the Act, Trust for 
     America's Health and the Robert Wood Johnson Foundation 
     (RWJF) found that 71 percent of Americans favored an 
     increased investment in disease prevention and that disease 
     prevention was one of the most popular components of health 
     reform.
       We must ensure that we capitalize on the unprecedented 
     opportunity to transform our public health system by 
     investing in prevention and public health. We urge you to 
     vote NO on the prevention fund offset within the Johanns 
     amendment, or on any other such legislative vehicles.
           Sincerely,
       AARP; ACCESS Women's Health Justice; Advocates for Better 
     Children's Diets; AIDS Action; AIDS Alabama; All Saints Home 
     Care; American Academy of Pediatrics; American Academy of 
     Physician Assistants; American Association for International 
     Aging; American Association of Colleges of Nursing; American 
     Association of Colleges of Osteopathic Medicine; American 
     Association of Colleges of Pharmacy; American Association of 
     People With Disabilities; American Cancer Society Cancer 
     Action Network; American College of Clinical Pharmacy; 
     American College of Gastroenterology; American Congress of 
     Obstetricians and Gynecologists; American College of 
     Occupational and Environmental Medicine; American College of 
     Preventive Medicine; American Counseling Association; 
     American Dental Education Association.
       American Diabetes Association; American Federation of 
     State, County and Municipal Employees; American Foundation 
     for Suicide Prevention; American Heart Association; American 
     Lung Association; American Medical Student Association; 
     American Nurses Association; American Psychological 
     Association; American Public Health Association; American 
     Social Health Association; American Society for 
     Gastrointestinal Endoscopy; American Thoracic Society; 
     Applied Research Center; Arthritis Foundation; Asian and 
     Pacific Islander American Health Forum; Association of 
     American Medical Colleges; Association of Maternal & Child 
     Health Programs; Association for Prevention Teaching and 
     Research; Association of Public Health Laboratories.
       Association of Schools of Public Health; Association of 
     State and Territorial Dental Directors; Association of State 
     and Territorial Directors of Nursing; Association of State 
     and Territorial Health Officials; Association of Women's 
     Health, Obstetric and Neonatal Nurses; Atlanta Regional 
     Health Forum; A World Fit for Kids!; Bazelon Center for 
     Mental Health Law; Boston Public Health Commission; Building 
     Healthier America; C3: Colorectal Cancer Coalition; 
     California Association of Alcohol and Drug Abuse Counselors; 
     California Center for Public Health Advocacy; California Food 
     Policy Advocates; California Foundation for the Advancement 
     of Addiction Professionals; California Immigrant Policy 
     Center; California Pan-Ethnic Health Network; California 
     Partnership; California School Health Centers Association; 
     Campaign for Community Change; Campaign for Public Health.
       Campaign for Tobacco-Free Kids; CASA de Maryland; C-Change; 
     Center for Biosecurity, University of Pittsburgh Medical 
     Center; Center for Health Improvement; Center for Science in 
     the Public Interest; Cerebral Palsy Association of Ohio; 
     Children and Adults with Attention-Deficit/Hyperactivity 
     Disorder; Children Now; Children's Dental Health Project; 
     City of Philadelphia Department of Public Health; Coalition 
     for Health Services Research; Coalition for Humane Immigrant 
     Rights of LA; Colon Cancer Alliance; Colorado Progressive 
     Coalition; Commissioned Officers Association of the U.S. 
     Public Health Service; CommonHealth ACTION; Community Action 
     Partnership; Community Catalyst; Community Health Councils.
       Community Health Partnership: Oregon's Public Health 
     Institute; Comprehensive Health Education Foundation; 
     Connecticut Certification Board; Connecticut Citizen Action 
     Group.
       Council of State and Territorial Epidemiologists; County 
     Health Executives Association of California; Crohn's and 
     Colitis Foundation of America; Defeat Diabetes Fund; 
     Digestive Disease National Coalition; Faith Action for 
     Community Equity; Family Voices; Federation of Associations 
     in Behavioral & Brain Sciences; First Five; Friends of AHRQ; 
     Friends of NCHS; Friends of SAMHSA; Georgia AIDS Coalition; 
     Granite State Organizing Project; Grassroots Organizing.
       Harlem United Community AIDS Center, Inc.; Having Our Say 
     Coalition; Health Care for America Now; Health Law Advocates 
     of Louisiana, Inc; Health Promotion Advocates; Health Rights 
     Organizing Project; Hepatitis Foundation International; HIV 
     Medicine Association; Home Safety Council; Idaho Community 
     Action Network; Indian People's Action; Infectious Diseases 
     Society of America; Institute for Health and Productivity 
     Studies Rollins School of Public Health, Emory University; 
     Institute for Public Health Innovation; International 
     Certification and Reciprocity Consortium (IC&RC); 
     International Health, Racquet & Sportsclub Association; 
     Interstitial Cystitis Association; ISAIAH; Korean Resource 
     Center; Libreria del Pueblo Inc.
       Louisiana Public Health Institute; Mahoning Valley 
     Organizing Collaborative; Main Street Alliance; Maine 
     People's Alliance; Make the Road New York; March of Dimes 
     Foundation; Maricopa County Dept of Public Health; Media 
     Policy Center; Mental Health America; Michigan Association 
     for Local Public Health; Montana Organizing Project; National 
     Alliance of State and Territorial AIDS Directors; National 
     Assembly on School-Based Health Care; National Association 
     for Public Health Statistics and Information Systems; 
     National Association of Chain Drug Stores; National 
     Association of Children's Hospitals; National Association of 
     Chronic Disease Directors; National Association of Community 
     Health Centers; National Association of Counties; National 
     Association of County & City Health Officials.
       National Association of Local Boards of Health; National 
     Association of Public Hospitals and Health Systems; National 
     Association of School Nurses; National Association of State 
     Alcohol and Drug Abuse Directors; National Association of 
     State Mental Health Program Directors; National Business 
     Coalition on Health; National Coalition for LGBT Health; 
     National Coalition of STD Directors; National Council of 
     Asian Pacific Islander Physicians; National Council of Jewish 
     Women; National Council of La Raza; National Education 
     Association; National Environmental Health Association; 
     National Family Planning & Reproductive Health Association; 
     National Federation of Families for Children's Mental Health; 
     National Forum for Heart Disease and Stroke Prevention; 
     National Health Council; National Indian Project Center; 
     Northeast Ohio Alliance for Hope; National Korean American 
     Service and Education Consortium.
       National Network of Public Health Institutes; National 
     Nursing Centers Consortium; National Recreation and Park 
     Association; National Rural Health Association; National WIC 
     Association; Nebraska Appleseed; Nebraska Urban Indian Health 
     Coalition; Nemours; New Hampshire Public Health Association; 
     NYC Department of Health and Mental Hygiene; New York 
     Immigration Coalition; New York Society for Gastrointestinal 
     Endoscopy; North Carolina Fair Share; Northern Illinois 
     Public Health Consortium; Northwest Federation of Community 
     Organizations; Novo Nordisk; NYU Langone Medical Center; 
     Ocean State Action; Ohio Alliance for Retired Americans; 
     Oregon Action; Out of Many, One.
       Papa Ola Lokahi; Partners for a Healthy Nevada; Partnership 
     for Prevention; Physician Assistant Education Association; 
     Planned Parenthood Federation of America; Prevention 
     Institute; Progress Ohio; Progressive Leadership Association 
     of Nevada; Project Inform; Public Health Association of 
     Nebraska; Public Health Foundation; Public Health Institute; 
     Public Health Law and Policy; Public Health-Monroe County 
     (MI); Public Health--Seattle and King County; Public Health 
     Solutions; Pulmonary Hypertension Association; Rails-to-
     Trails Conservancy; REACH U.S. SouthEastern African American 
     Center of Excellence for Elimination of Disparities (REACH 
     U.S. SEA-CEED).
       RiverStone Health; Safe States Alliance; Service Employees 
     International Union; Sexuality Information and Education 
     Council of the U.S.; Society for Adolescent Health and 
     Medicine; Society for Healthcare Epidemiology of America; 
     Society for Public Health Education; South Carolina Fair 
     Share; Summit Health Institute for Research and Education, 
     Inc.; TakeAction Minnesota; Tenants and Workers United; The 
     AIDS Institute; The Amos Project; The Greenlining Institute; 
     The MetroHealth System; The National Alliance to Advance 
     Adolescent Health; Toledo Area Jobs with Justice; Trust for 
     America's Health; UHCAN Ohio; United Action Connecticut.
       United Ostomy Associations of America; Urban Coalition for 
     HIV/AIDS Prevention Services; U.S. PIRG; Virginia Organizing 
     Project; Washington Health Foundation; West South Dakota 
     Native American Organizing Project; WomenHeart: The National 
     Coalition for Women with Heart Disease; YMCA of the USA.

  Mr. HARKIN. Here is what it says. They found that 71 percent of 
Americans favored an increased investment in disease prevention. The 
letter is signed by organizations from the American Academy of 
Pediatrics to--
  The ACTING PRESIDENT pro tempore. All time has expired.


                             Cloture Motion

  The ACTING PRESIDENT pro tempore. Under the previous order, pursuant 
to rule XXII, the Chair lays before the Senate the pending cloture 
motion, which the clerk will state.
  The legislative clerk read as follows:

                             Cloture Motion

       We, the undersigned Senators, in accordance with the 
     provisions of rule XXII of the Standing Rules of the Senate, 
     hereby move to bring to a close debate on Johanns amendment 
     No. 4596, as modified.

[[Page 15573]]

         Harry Reid, Patrick J. Leahy, Dianne Feinstein, Charles 
           E. Schumer, Herb Kohl, Joseph I. Lieberman, Jeff 
           Bingaman, Barbara A. Mikulski, Richard J. Durbin, Al 
           Franken, Byron L. Dorgan, Mark Begich, Benjamin L. 
           Cardin, Amy Klobuchar, Kirsten E. Gillibrand, Jeanne 
           Shaheen, Kay R. Hagan.

  The ACTING PRESIDENT pro tempore. The Senator from Iowa is 
recognized.
  Mr. HARKIN. Mr. President, I ask unanimous consent that all votes 
after the first vote this morning in this series be 10 minute votes.
  The ACTING PRESIDENT pro tempore. Is there objection?
  Without objection, it is so ordered.
  By unanimous consent, the mandatory quorum call has been waived.
  The question is, Is it the sense of the Senate that debate on 
amendment No. 4596, as modified, to H.R. 5297, the Small Business 
Lending Fund Act of 2010, shall be brought to a close?
  The yeas and nays are mandatory under the rule.
  The clerk will call the roll.
  The legislative clerk called the roll.
  Mr. KYL. The following Senators are necessarily absent: The Senator 
from Alaska (Ms. Murkowski) and the Senator from New Hampshire (Mr. 
Gregg).
  The PRESIDING OFFICER (Mr. Udall of New Mexico). Are there any other 
Senators in the Chamber desiring to vote?
  The result was announced--yeas 46, nays 52, as follows:

                      [Rollcall Vote No. 231 Leg.]

                                YEAS--46

     Alexander
     Barrasso
     Bayh
     Bennet
     Bennett
     Bond
     Brown (MA)
     Brownback
     Bunning
     Burr
     Chambliss
     Coburn
     Cochran
     Collins
     Corker
     Cornyn
     Crapo
     DeMint
     Ensign
     Enzi
     Graham
     Grassley
     Hatch
     Hutchison
     Inhofe
     Isakson
     Johanns
     Kyl
     LeMieux
     Lincoln
     Lugar
     McCain
     McConnell
     Nelson (NE)
     Pryor
     Risch
     Roberts
     Sessions
     Shelby
     Snowe
     Thune
     Vitter
     Voinovich
     Warner
     Webb
     Wicker

                                NAYS--52

     Akaka
     Baucus
     Begich
     Bingaman
     Boxer
     Brown (OH)
     Burris
     Cantwell
     Cardin
     Carper
     Casey
     Conrad
     Dodd
     Dorgan
     Durbin
     Feingold
     Feinstein
     Franken
     Gillibrand
     Goodwin
     Hagan
     Harkin
     Inouye
     Johnson
     Kaufman
     Kerry
     Klobuchar
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     McCaskill
     Menendez
     Merkley
     Mikulski
     Murray
     Nelson (FL)
     Reed
     Reid
     Rockefeller
     Sanders
     Schumer
     Shaheen
     Specter
     Stabenow
     Tester
     Udall (CO)
     Udall (NM)
     Whitehouse
     Wyden

                             NOT VOTING--2

     Gregg
     Murkowski
  The PRESIDING OFFICER. On this question, the yeas are 46, the nays 
are 52. Three-fifths of the Senators duly chosen and sworn not having 
voted in the affirmative, the motion is rejected.


                             Cloture Motion

  Under the previous order and pursuant to rule XXII, the Chair lays 
before the Senate the pending cloture motion, which the clerk will 
report.
  The assistant legislative clerk read as follows:

                             Cloture Motion

       We, the undersigned Senators, in accordance with the 
     provisions of rule XXII of the Standing Rules of the Senate, 
     hereby move to bring to a close debate on amendment No. 4595, 
     as modified.
         Harry Reid, Tim Johnson, Richard J. Durbin, Barbara 
           Boxer, Al Franken, Byron L. Dorgan, Patty Murray, 
           Robert P. Casey, Jr., Jon Tester, Jack Reed, Kay R. 
           Hagan, Jeanne Shaheen, Patrick J. Leahy, Christopher J. 
           Dodd, Bill Nelson, Tom Harkin.

  The PRESIDING OFFICER. By unanimous consent, the mandatory quorum 
call has been waived.
  The question is, Is it the sense of the Senate that debate on the 
amendment No. 4595, as modified, to H.R. 5297, the Small Business 
Lending Fund Act of 2010, shall be brought to a close?
  The yeas and nays are mandatory under the rule.
  The clerk will call the roll.
  The assistant legislative clerk called the roll.
  Mr. KYL. The following Senators are necessarily absent: the Senator 
from Alaska (Ms. Murkowski) and the Senator from New Hampshire (Mr. 
Gregg).
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 56, nays 42, as follows:

                      [Rollcall Vote No. 232 Leg.]

                                YEAS--56

     Akaka
     Baucus
     Bayh
     Bennet
     Bingaman
     Boxer
     Brown (OH)
     Burris
     Cantwell
     Cardin
     Carper
     Casey
     Conrad
     Dodd
     Dorgan
     Durbin
     Feingold
     Feinstein
     Franken
     Gillibrand
     Goodwin
     Hagan
     Harkin
     Inouye
     Johnson
     Kaufman
     Kerry
     Klobuchar
     Kohl
     Lautenberg
     Leahy
     Levin
     Lieberman
     McCaskill
     Menendez
     Merkley
     Mikulski
     Murray
     Nelson (NE)
     Nelson (FL)
     Pryor
     Reed
     Reid
     Rockefeller
     Sanders
     Schumer
     Shaheen
     Specter
     Stabenow
     Tester
     Udall (CO)
     Udall (NM)
     Warner
     Webb
     Whitehouse
     Wyden

                                NAYS--42

     Alexander
     Barrasso
     Begich
     Bennett
     Bond
     Brown (MA)
     Brownback
     Bunning
     Burr
     Chambliss
     Coburn
     Cochran
     Collins
     Corker
     Cornyn
     Crapo
     DeMint
     Ensign
     Enzi
     Graham
     Grassley
     Hatch
     Hutchison
     Inhofe
     Isakson
     Johanns
     Kyl
     Landrieu
     LeMieux
     Lincoln
     Lugar
     McCain
     McConnell
     Risch
     Roberts
     Sessions
     Shelby
     Snowe
     Thune
     Vitter
     Voinovich
     Wicker

                             NOT VOTING--2

     Gregg
     Murkowski
  The PRESIDING OFFICER. On this vote, the yeas are 56, the nays are 
42. Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is rejected.


                           Amendment No. 4594

  Ms. LANDRIEU. Mr. President, parliamentary inquiry.
  The PRESIDING OFFICER. The Senator from Louisiana is recognized.
  Ms. LANDRIEU. Mr. President, could you acknowledge the vote we are 
about ready to take?
  The PRESIDING OFFICER. The vote is on invoking cloture on the 
substitute amendment No. 4594 to H.R. 5297, the Small Business Lending 
Fund Act of 2010.
  Ms. LANDRIEU. Parliamentary inquiry: If we get 60 votes, we move 
forward with the bill; is that correct?
  The PRESIDING OFFICER. That is correct. Cloture is invoked on the 
substitute.


                             Cloture Motion

  By unanimous consent, pursuant to rule XXII, the Chair lays before 
the Senate the pending cloture motion, which the clerk will report.
  The assistant legislative clerk read as follows:

                             Cloture Motion

       We, the undersigned Senators, in accordance with the 
     provisions of rule XXII of the Standing Rules of the Senate, 
     hereby move to bring to a close debate on the Reid substitute 
     amendment No. 4594.
         Mary L. Landrieu, Max Baucus, Dianne Feinstein, Patty 
           Murray, Charles E. Schumer, Christopher J. Dodd, Al 
           Franken, Robert P. Casey, Jr., Maria Cantwell, Sheldon 
           Whitehouse, Byron L. Dorgan, Benjamin L. Cardin, Ron 
           Wyden, Kent Conrad, Roland W. Burris, Jeff Merkley, 
           Debbie Stabenow.

  The PRESIDING OFFICER. By unanimous consent, the mandatory quorum 
call has been waived.
  The question is, Is it the sense of the Senate that the debate on 
amendment No. 4594 to H.R. 5297, the Small Business Lending Fund Act of 
2010, shall be brought to a close?
  The yeas and nays are mandatory under the rule. The clerk will call 
the roll.
  The legislative clerk called the roll.
  Mr. KYL. The following Senators are necessarily absent: the Senator 
from Alaska (Ms. Murkowski) and the Senator from New Hampshire (Mr. 
Gregg).
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  They yeas and nays resulted--yeas 61, nays 37, as follows:

                      [Rollcall Vote No. 233 Leg.]

                                YEAS--61

     Akaka
     Baucus
     Bayh
     Begich
     Bennet
     Bingaman
     Boxer
     Brown (OH)
     Burris
     Cantwell
     Cardin
     Carper
     Casey
     Conrad
     Dodd

[[Page 15574]]


     Dorgan
     Durbin
     Feingold
     Feinstein
     Franken
     Gillibrand
     Goodwin
     Hagan
     Harkin
     Inouye
     Johnson
     Kaufman
     Kerry
     Klobuchar
     Kohl
     Landrieu
     Lautenberg
     Leahy
     LeMieux
     Levin
     Lieberman
     Lincoln
     McCaskill
     Menendez
     Merkley
     Mikulski
     Murray
     Nelson (NE)
     Nelson (FL)
     Pryor
     Reed
     Reid
     Rockefeller
     Sanders
     Schumer
     Shaheen
     Specter
     Stabenow
     Tester
     Udall (CO)
     Udall (NM)
     Voinovich
     Warner
     Webb
     Whitehouse
     Wyden

                                NAYS--37

     Alexander
     Barrasso
     Bennett
     Bond
     Brown (MA)
     Brownback
     Bunning
     Burr
     Chambliss
     Coburn
     Cochran
     Collins
     Corker
     Cornyn
     Crapo
     DeMint
     Ensign
     Enzi
     Graham
     Grassley
     Hatch
     Hutchison
     Inhofe
     Isakson
     Johanns
     Kyl
     Lugar
     McCain
     McConnell
     Risch
     Roberts
     Sessions
     Shelby
     Snowe
     Thune
     Vitter
     Wicker

                             NOT VOTING--2

     Gregg
     Murkowski
  The PRESIDING OFFICER. On this vote, the yeas are 61, the nays are 
37. Three-fifths of the Senators duly chosen and sworn having voted in 
the affirmative, the motion is agreed to.
  The majority leader is recognized.
  Mr. REID. Mr. President, we hope we can finish this very quickly. The 
votes are in. There are a number of technical things that could be done 
by those who oppose this legislation, but it would just waste a lot of 
the Senate's time, which we do not have a lot of, so I hope we can move 
through this very expeditiously.
  This is an important piece of legislation. It is the most significant 
thing we have done since the stimulus bill was passed to create jobs. 
It is estimated this will create from 500,000 to 700,000 jobs. It will 
give community banks the ability now to compete with the big banks and 
loan money to small businesses.
  As I said this morning, big banks are doing great. The stock market 
jumped up yesterday because they looked at the financials of the big 
banks and they are doing terrific. Big business is doing just fine. But 
in this recession we have the jobs that have been lost in the small 
business sector. Eighty percent of the jobs lost are from small 
businesses. This legislation will allow community banks to start 
loaning money.
  As you drive across the country, you see these strip malls with ``For 
Lease'' signs up. That will be ending in the near future. People will 
be able to borrow money to keep inventory for these little businesses 
that create thousands and thousands of jobs. It will allow Karen Mills 
at the SBA, who has begged us for this legislation, to have the SBA 
part of stimulating our economy. There are programs there that are 
under-resourced. This will allow her to have the resources to do good 
things. There are tax incentives the Finance Committee has come up with 
that will give tax breaks to small businesses. The chairman of the 
committee will talk about that at a subsequent time.
  I want to acknowledge the hard work of many people. Of course, the 
person who has been out front has been the chairman of the Small 
Business Committee, Senator Landrieu. She has done a remarkably good 
job. She has been diligent, persistent, and she never gives up. I am 
very grateful to her for what she has done for the American people with 
this legislation. She has had some help. The ability to give these tax 
breaks to small businesses came from the Finance Committee, which is 
chaired by Senator Baucus of Montana. That is significant, for small 
businesses to get billions and billions of dollars of tax cuts.
  Remember, everything in this bill is paid for. There is not a penny 
that is deficit spending. In fact, we have a little extra money on this 
bill.
  I would also say the breakthrough we had came with a seasoned 
politician, someone who will go down in the history of Ohio as one of 
its great statespersons, the mayor of a big city, Governor of a State, 
and a Senator who has decided not to run for reelection, which is 
unfortunate in the minds of many. Senator George Voinovich in effect 
said: We have had enough of posturing on both sides, and I am going to 
vote for this bill because it is going to help the economy of Ohio and 
the people of this country.
  I admire and respect George Voinovich for what he has done, not only 
on this legislation but what he has done in the past. This is not the 
first time he has decided that party is not as important as the 
American people. I will always be an admirer of George Voinovich. There 
is no one more studious in the entire Senate than George Voinovich. He 
is known for studying legislation. He is someone who is very concerned 
and has been from the day he came here about the deficits this country 
has. So I am not going to belabor the point other than to say I am very 
grateful to George Voinovich for, in fact, breaking the logjam and 
saying: I am going to vote for this legislation. He didn't do it 
secretly, and he came out publicly and said what he was going to do.
  I also want to express my appreciation to George LeMieux, who has 
been working on this legislation with Senator Landrieu for several 
months now. I appreciate his willingness to work with us in this 
regard.
  On the Democratic side, Senator Landrieu, of course, and Senator 
Baucus led the charge. But we have had Boxer, Merkley, Cantwell, 
Stabenow, Warner, Lincoln--a number of Senators who have worked very 
hard.
  I spread across the record, this is not a victory for the Democratic 
Party. This is not a loss for the Republican Party. This is a win for 
the American people. This is going to help small business, which has 
always been the driver of jobs in our country.
  The PRESIDING OFFICER. Cloture having been invoked, the motion to 
commit falls.
  The Senator from Louisiana is recognized.
  Ms. LANDRIEU. Mr. President, I thank the leader for his kind words, 
but the fact is we would not have gotten to this point this morning 
where 61 Senators raised their hands or their voices to vote yes for 
this important and substantial piece of legislation had it not been for 
the leadership of Harry Reid.
  The majority leader knows not only what Nevada needs but what America 
needs. What America and Nevada both need right now is to get back to 
work. The entities that are going to put Americans back to work are not 
found on Wall Street; they are found on Main Street. They are not big 
businesses; they are small businesses. They are not the businesses that 
have been around for 50 or 100 or 200 years; they are the businesses 
that started up last year or that want to start up today.
  Majority Leader Reid knows and understands that. We would not be here 
this morning without his leadership. He is right to acknowledge 
Chairman Baucus. I said he is a long-suffering chairman of the Finance 
Committee and has also the patience of Job to put up with all he puts 
up with. Trying to pay for every idea that comes from all 100 of these 
desks ends up on his desk. They say: You have a great idea, Senator; 
now we need to pay for it. That is what Max Baucus does every day. I 
hope people appreciate it, not only in Montana but around the country. 
He found a way not only to pay for this bill but for it to generate for 
the taxpayer earnings of $1.1 billion. That is good work. It does not 
happen here every day, and it would not have happened without Senator 
Baucus and the many cosponsors Senator Reid pointed out: Senator Boxer, 
Senator Merkley, Senator Cantwell, Senator Warner, Senator Levin, 
Senator Lincoln--particularly helpful and supportive.
  I also want to say this vote today to end debate was the vote on this 
bill. Make no mistake about it, if 60 or 61 Senators had not said yes 
this morning, this bill would have gone into this trash can right here 
not to be seen again. The $12 billion in tax cuts would not be a 
reality. The substantial improvement of the core small business 
programs would not be a reality, and the $30 billion lending fund that 
is going to leverage $300 billion in lending would not be a reality. It 
would be in the trash can right now. But it is not. It is alive. It is 
a living bill we are going to pass later today because 61 Senators in 
this Chamber said yes to the country and no to party politics.

[[Page 15575]]

  Particularly, I wish to point out Senator Voinovich. His statement 
was so poignant in the paper today or yesterday when he said, or it was 
reported: I have run across small businesspeople in Ohio who went to 40 
banks to try to get a loan, he said, and were turned down every time.
  This is happening all over America today. Senator Voinovich is a 
Senator who governs with his heart as well as his head, and he is not 
led around by the nose like some people here, by their party politics. 
He said: No, the debate has to come to an end. If you want to debate 
the George Bush tax cuts, do it on somebody else's back, not on the 
backs of small businesses in Ohio or Louisiana or Virginia. They have 
taken too much weight.
  When Wall Street collapsed because of the their greed and their 
recklessness and because of our failure to regulate them, do you know 
who got hurt? Small businesses that did not have anything to do with 
derivatives or international investment. All these people do every day 
is wake up before the Sun comes up and they stay up when it is dark and 
they work hard, sometimes by themselves once they send their workers 
home, and keep that business going. They did nothing and they deserve 
help and they are getting it this morning.
  One more word before I turn it over to my colleague from Virginia. 
This whole debate this morning was a joke on Johanns. I want to talk 
about that. If the Republicans were serious about repealing something 
that needs to be repealed, they would have put an offset on this floor 
that we could vote for. They knew very few Democrats would vote for a 
provision that would harm one of the underlying principles of health 
care reform. So that was all theater--all theater. I have had about 
enough of it, and I think many Americans have had enough of it as well.
  Senator Johanns is right that the 1099 section needs to be repealed. 
He is absolutely correct. It was the wrong thing to do. Even our side 
acknowledges that.
  I am going to file a bill right now to take care of it. We are going 
to repeal 1099. We are not only going to repeal the portion that was 
put in by health care--which was not done intentionally, but there are 
sometimes unintended consequences. Anybody around here who thinks they 
can write perfect pieces of legislation--they cannot. When you do 
something wrong, you should correct it. We are going to correct it.
  But in addition, my bill that I am going to file right now is going 
to repeal the $600 requirement that has been in the law for 62 years, 
and we are going to raise that threshold to $5,000, clean up the way 
small businesses have to report, and do something good for small 
business in America.
  It is going to be a Landrieu bill. Lots of other people have 
indicated an interest in the past. It is not theater, it is real. We 
are going to find a way to pay for it that both sides can agree to.
  I want to tell the Chamber of Commerce that I know is listening right 
now: We have heard you. I have heard the NFIB. I have heard small 
businesses in my State, and I know we made a mistake on this 1099 and 
we are going to fix it. But it does not have to be fixed this morning. 
It doesn't even go into effect for a year and a half.
  Hear me, it doesn't go into effect for a year and a half. We have 
time to fix 1099. But we don't have 1 minute to wait to send money to 
small businesses that are putting ``Closed'' signs on their businesses 
this morning. If the Republican Party thinks they can keep saying no to 
small business and keep saying no to Main Street and keep saying no to 
the middle class--they cannot. I hope when we vote on final passage 
there will be a few more yeses.
  We have a year and a half to fix 1099. We don't have any more time to 
help small businesses.
  I yield the floor for the Senator from Virginia.
  The PRESIDING OFFICER. The Senator from Virginia is recognized.
  Mr. WARNER. Mr. President, first, I commend my friend and colleague, 
the Senator from Louisiana, who I know the Senate has heard repeatedly 
over the last few weeks, relentlessly over the last few weeks, come 
back time and again and again on this issue around small business. I 
think many Americans are getting a chance to see what those of us who 
have the privilege of serving with Mary Landrieu see regularly: This is 
somebody who does not take no. This is someone I know we sometimes need 
to prod to come out of her shell. But this is someone who is so 
passionate about the people of Louisiana and, in her role as Chair of 
the Small Business Committee, has been a tireless voice for small 
businesses, not just in Louisiana but in Virginia, New Mexico, all 
across the country. I want to join the majority leader and others in 
commending her for her ``stick-to-it-iveness'' on this critical piece 
of legislation.
  I want to add a couple of other comments. I concur as well with the 
Senator from Louisiana on the issue of 1099s. We do need to have an 
accurate way to ensure that the standing law that has been the law of 
the land for 62 years is enforced. But this process of filing a 1099 at 
a $600 threshold at this moment in time is way overburdensome. I, like 
the Senator from Louisiana, and I think most Members, heard that loudly 
and clearly, and we do need to fix that.
  I look forward to working with Senator Landrieu. I know Senator 
Begich and others have been involved in those efforts. I look forward 
to joining them in this effort.
  I want to take a moment or two--our time is about up before we break 
for our caucus lunches--I think it is important that the pieces of this 
bill have been emphasized time and again, the lending facility, small 
businesses that can take capital in if they increase their percentage 
of lending, this is particularly helpful to small banks that might be 
in challenging financial times at this point.
  The SBA, the replenishment of funding for the SBA, the one message I 
brought out everywhere across Virginia over the last month and a half 
was that the SBA today is not your grandfather's or even your daddy's 
SBA. It is not even 5 years ago's SBA. The SBA, under Administrator 
Karen Mills, is much less bureaucratic, much more streamlined.
  With the work the Small Business Committee has done in terms of 
upping the guarantees, the SBA's role and the type of businesses the 
SBA has served during this crisis has expanded dramatically. Look at 
the number of banks that participate now with the SBA today versus 18 
months ago. That remarkably successful effort ground to an immediate 
halt in June when funding ran out. Why in the heck it has taken us this 
long simply to replenish that proven program that does not add to the 
deficit is one of the things that gets a lot of folks in Virginia, 
Louisiana, and New Mexico scratching their heads.
  There is another piece of this bill, one that the chairman was kind 
enough to work with me and others on, that builds upon an existing 
initiative in the private sector and I believe in about 26 States, a 
Capital Access Program, that helps those marginal small business loans 
become more bankable. I hear the same concerns the Chair of the Small 
Business Committee hears: A small business cannot get their loans, 
although I have got to say it is not only the bankers' fault, because, 
let's face it, a lot of small businesses today are not as financially 
healthy as they were 2 years ago. If they have real estate as 
collateral, it has decreased in value. If they are lending on cashflow, 
that has decreased as well. So how do we take that otherwise healthy 
small business, in good times and in normal recessions, and not let it 
fall off the cliff in this deepest recession since the Great 
Depression?
  The Capital Access Program is one place where a borrower will be 
charged a couple of extra points, we will go in from the government and 
match those points, and we can create a first-dollar loss, a separate 
loss reserve pool, for a whole series of loans; another $30- to $60 
billion of capacity in that aspect. Finally, what is not to like about 
the series of small business tax credits that have also been built into 
this legislation? So I commend the chairperson of the Small Business 
Committee. I am

[[Page 15576]]

glad the Senate has come to its senses on this issue. Candidly, I wish 
we would have passed this legislation last spring, but better late than 
never.
  I want to add two other points that I think are important. One other 
piece of legislation, a bipartisan piece of legislation that we passed 
recently--and I would be curious to hear the response of the Chair of 
the Small Business Committee on this with the financial reform bill, a 
very important piece of legislation. We set, appropriately, in that 
financial reform bill the requirement for banks to set higher capital 
standards. The challenge we have right now is starting to implement 
those higher capital standards in the trough of the recession. That 
sends a very mixed message to our bankers and to our regulators. I hope 
the Chair of the Small Business Committee and I and others can think 
about how we work with our regulators at the FDIC and the OCC and the 
Fed to ensure that while we want to build up the capital reserves and 
make our banks healthier, that some level of forbearance for those 
small business performing loans that may not meet every covenant in 
their loan document, because their real estate has depreciated in 
value, somehow we have to have some flex. Because what we are doing by 
having the regulators come down so hard on the banks at this point is 
we are, in many ways, even with this very good program that Senator 
Landrieu has put out, strangling that recovery because of this mixed 
message.
  The final point I want to make is, with this piece of small business 
legislation, I think it may be--again, it is not going to be a single 
silver bullet, but one piece of good news that I do not think we have 
come back to enough in these discussions is that not only have large 
banks recovered nicely since the decline, but large cap companies, the 
Fortune 1,0000 companies, their balance sheets are healthier today than 
they have ever been. There is north of $2 trillion in cash sitting on 
Fortune 1,000 balance sheets. One of the things I am looking forward to 
working with my colleagues on is how we get that cash off the sidelines 
and invested back in the market. When they invest in the market, and 
the large companies go to their supply chains, which is the small 
businesses, those small businesses have to get the credit as well to 
keep functioning. So this piece of legislation is important not only to 
small businesses, but as large cap companies start to spend out as 
well, it is important to the overall economic recovery.
  I would ask my friend and my colleague, the leader on this important 
piece of legislation, if she might have some ideas as well about how we 
meet that appropriate long-term financial goal of making our financial 
standards appropriate, but not send this mixed message to regulators so 
that those small business loans that are still performing have the 
appropriate forbearance to get through this trough in the recession.
  The PRESIDING OFFICER. The Senator from Louisiana is recognized.
  Ms. LANDRIEU. Mr. President, the Senator from Virginia is absolutely 
correct. He has put his finger on two pending and very serious 
problems. One is the regulation direction being driven by some of the 
new legislation we have passed. Of course, he would know this, because 
as a member of the Banking Committee, he has been such a strong 
advocate for commonsense regulation and supporting community banks. So 
he is absolutely correct. And you do have my commitment, through the 
Small Business Committee, to keep this issue alive and in view so that 
we can find some appropriate solution. I think the Senator raises an 
absolutely very key point.
  The second point the Senator from Virginia has put his finger on is 
the $2 trillion in capital sitting there. One thing that makes further 
interest is the zero capital gains rate in this bill, should they take 
some of that $2 trillion in capital and invest in some small businesses 
that have a capitalization level below $50 million. That is one thing 
that could help encourage them. They will pay no tax, none, on the 
money they earn through that investment, which should be an incentive.
  But there are some additional things I think we can do. I want to 
work with the Senator from Virginia because his leadership is very much 
needed at this time, with his particular background as a successful 
business person, as a Governor. So the Senator is right, this bill is 
not a silver bullet. It is a good first step. But there are some other 
things we need to do as quickly as we can. I look forward to working 
with the Senator on those two and others in the weeks to come.
  Mr. WARNER. Mr. President, again I will close my comments and thank 
the chairman of the Small Business Committee for her leadership on this 
bill. We would not be here today but for her relentlessness on this 
legislation.
  This legislation has had more hurdles, many of them false hurdles, 
put in its face, and Senator Landrieu does not know how to say no when 
it affects the well-being of small businesses, which are the lifeblood 
of job creation coming out of a recession.
  I thank her for her leadership.
  I yield the floor.
  Ms. LANDRIEU. Mr. President, I ask unanimous consent that the time in 
recess for the caucus luncheons count postcloture.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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