[Congressional Record (Bound Edition), Volume 159 (2013), Part 9]
[Senate]
[Pages 13003-13028]
[From the U.S. Government Publishing Office, www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. WYDEN (for himself and Ms. Murkowski):
  S. 1419. A bill to promote research, development, and demonstration 
of marine and hydrokinetic renewable energy technologies, and for other 
purposes; to the Committee on Energy and Natural Resources.
  Mr. WYDEN. Mr. President, today Senator Murkowski and I are 
introducing legislation to promote a new form of hydropower, marine 
hydrokinetic renewable energy, or MHK. An MHK project generates energy 
from waves, currents, and tides in the ocean, an estuary or a tidal 
area as well as from the free-flowing water in a river, lake, or 
stream.
  Our bill will help commercialize MHK technologies through research 
and development and a more efficient and timely regulatory process for 
the siting of pilot projects intended to demonstrate the viability of 
these technologies. It is an ideal follow-up to a pair of bills, H.R. 
267 and H.R. 678, to streamline the regulatory process for low-impact 
conventional hydropower that were reported by the Committee on Energy 
and Natural Resources by unanimous bipartisan votes a few months ago. 
Considered together, the two conventional hydropower bills approved by 
the Committee along with this MHK legislation are a major step forward 
in advancing carbon-free hydropower technologies.
  MHK has tremendous potential to generate a substantial amount of 
clean renewable energy in the United States and across the globe. It is 
poised to be a key participant in the transition to a low carbon 
economy.
  What distinguishes MHK from conventional hydropower is that it 
generates energy without the use of a dam or other impoundment. This 
gets MHK off on the right foot in terms of minimizing any adverse 
environmental impact. Investments to capture our nation's rich domestic 
marine energy resources can also play a major role in the creation of 
essential domestic engineering and manufacturing jobs.
  The energy contained in predictable waves, tidal flows and currents 
is the basis for worldwide investments in this emerging industry. Water 
is approximately 800 times denser than air, providing great potential 
power density along with predictability. These characteristics mean 
that MHK technologies could provide predictable base-load renewable 
power in the future.
  At the present time there are many different types of MHK 
technologies with multiple applications under development that are 
intended to capture the power contained in waves, tides and currents.
  Wave energy devices capture the heave and/or surge power of waves and 
convert them via hydraulic or geared direct drive systems into 
electricity. Some of these devices are moored to the ocean floor, some 
are floating on the surface, while others are attached to breakwaters 
near shore. By last count, there are over 100 wave energy devices under 
development worldwide. Tidal energy technologies capture the ebb and 
flow of tides. It is estimated that 60 different tidal energy 
technologies are under development worldwide. There are other 
technologies that include run-of-river systems and offshore ocean 
current technologies. Most of these technologies under development 
capture uni-directional water flows and look similar to the tidal 
devices.
  The United States has not been a world leader in the development of 
these cutting edge technologies to date. Instead, our country is seen 
as a huge potential market for our international competitors in this 
new industrial sector. The United States has significant wave, tidal, 
current and in-stream energy resources. The Electric Power Research 
Institute has estimated that the commercially available wave energy 
potential off the coast of the United States is roughly 252 million 
megawatt hours--equal to 6.5 percent of today's entire generating 
portfolio. This is approximately the amount of electricity presently 
being produced by the existing fleet of American conventional 
hydroelectric dams.
  The Department of Energy, DOE, has released two nationwide resource 
assessments that indicate the waves, tides, and ocean currents off the 
nation's coasts could contribute significantly to the United States' 
total annual electricity production. DOE is currently developing an 
aggressive strategy to support its vision of producing at least fifteen 
percent of our nation's electricity from water power, including 
conventional hydropower, by 2030.
  Our goal should be the establishment of a commercially viable U.S. 
MHK renewable energy industry, supported by a robust domestic supply 
chain for fabrication, installation, operations and maintenance of MHK 
devices. The development of a substantial marine hydrokinetic industry 
in the U.S. could drive billions of dollars of investment in heavy 
industrial and maritime sectors, as well as in advanced electrical 
systems and materials common to many renewable technologies. Federal 
investments would stimulate private funds and jobs in the construction, 
manufacturing, engineering, and environmental science sectors.
  I am very pleased that my home State of Oregon has made a strategic 
decision to be an international leader in the commercialization of the 
marine renewable energy industry. Led by the Oregon Wave Energy Trust, 
the Northwest National Marine Renewable Energy Center co-located at 
Oregon State University, and several private companies that are part of 
the MHK supply chain, Oregon is positioning itself to be a leading 
force supporting this newly emerging industry.

[[Page 13004]]

  Unfortunately, the U.S. is falling behind in the race to capture the 
rich energy potential of our oceans and the jobs that will come with 
this new industry. The United Kingdom, Ireland, Portugal, Scotland, 
Australia, and other countries are committed to producing emission-
free, renewable energy from MHK sources. Scotland has had a grid-
connected, wave energy convertor unit in operation since 2001 and 
maintains a national goal of producing 2 GW of generation capacity from 
MHK renewable energy. The U.K. and Ireland have also set aggressive 
goals for MHK generation by 2020.
  The Ocean Renewable Energy Coalition, the industry's trade group here 
in Washington DC, calculates that more than $782 million has been spent 
by the UK government on wave energy R&D over the past 10 years. That 
total approaches $1 billion over the same period if you add in the 
commitments to ocean energy R&D from France, Portugal, Spain, Norway, 
and Denmark.
  Early funding support, along with development of full-scale device 
testing centers, demonstrates that the significant technological 
advances and the competitive advantages in this industry are trending 
in Europe's direction. As an example of the disparity in investments, 
Europe currently has several wave and tidal energy test facilities, led 
by the European Marine Energy Center in Scotland, that are helping 
technology developers commercialize their wave and tidal energy 
convertors. The United States clearly has a need for such 
infrastructure. I know that Oregon State University has a strong desire 
to compete for funding to help establish a testing center in the 
Pacific Northwest. Unfortunately, recent funding levels have not 
supported development of such offshore testing infrastructure in the 
U.S. to date.
  Given this internationally competitive situation, I believe that 
Congress must make targeted Federal investments to close the gap. 
Commercialization of technologies to harness marine renewable energy 
resources will require Federal funding to augment research and 
development efforts already underway in the private sector. Just as the 
wind and solar industries have received DOE funding support for over 3 
decades, which has resulted in the rapid deployment of these 
technologies in recent years, the nascent marine energy industry seeks 
similar Federal assistance to develop promising technologies that are 
on the verge of commercial viability.
  Unfortunately, in addition to the limited private sector funding 
available to these startup companies, permitting and regulatory 
obstacles are tremendous disincentives to technology developers of 
marine energy projects in the United States. While other countries have 
adopted permitting and regulatory regimes that appear to be more 
efficient, the United States is still struggling with how to permit and 
regulate these technologies. I cannot overstate the seriousness of this 
problem. To give just one example, it took one MHK developer 5 years 
and $2 million to obtain a license from the Federal Energy Regulatory 
Commission for a 1.5 megawatt project.
  The regulatory situation is simply unacceptable and is greatly 
slowing progress in the MHK industry. Until companies get projects in 
the water, Congress and the public will not learn about the 
environmental impacts, engineering challenges or the true costs of 
offshore renewables.
  Capturing the benefits of our vast marine-based renewable resources 
will require a mix of new incentives, updated regulatory regimes and 
general outreach and education. However, the most important actions 
that can be taken by the Federal Government in the short term are to 
provide the necessary resources for research, development and 
demonstration of various marine renewable energy technology platforms 
and a workable and efficient regulatory process. Increased federal 
support will accelerate deployment of these technologies, create 
thousands of high paying jobs, give confidence to investors, and help 
attract private capital.
  The Marine and Hydrokinetic Renewable Energy Act of 2013 helps 
accomplish these goals in a number of ways. It reauthorizes the DOE's 
MHK research, development and demonstration 3 programs, including the 
National Marine Renewable Energy Research, Development, and 
Demonstration Centers.
  Increased resources for the DOE Water Power Program will enable the 
United States to leverage its technological superiority in shipbuilding 
and offshore oil and gas production. This will create jobs and 
diversify these maritime industries. In the absence of such funding, 
however, the United States will have to depend on foreign suppliers for 
ocean energy technologies, and will have missed a significant 
opportunity to expand our economic competiveness in this renewable 
energy sector.
  The regulatory component of the bill makes the regulatory process for 
MHK of not more than 10 MW more efficient and timely. It modifies and 
improves the FERC ``pilot license'' process in many ways. Improvements 
include a goal to complete the pilot license process in 12 months or 
less; a designation of FERC as the ``Lead Agency'' for the purpose of 
coordinating environmental review; a clarification that any shut down 
requirement be ``reasonable,'' and a clarification that an MHK project 
does not need to be removed when it is shut down if FERC deems leaving 
it in place is preferable for environmental and other reasons.
  MHK is a clean, home-grown, emissions-free source of electricity that 
can improve the security and reliability of the electric grid. 
Investing in MHK research, development and demonstration today will pay 
great dividends in the future. MHK has tremendous potential to benefit 
the United States and the entire world. Now is the time to move forward 
on MHK and the Marine and Hydrokinetic Renewable Energy Act is the way 
to do it.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 1419

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Marine and 
     Hydrokinetic Renewable Energy Act of 2013''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title; table of contents.

     TITLE I--MARINE AND HYDROKINETIC RENEWABLE ENERGY TECHNOLOGIES

Sec. 101. Definition of marine and hydrokinetic renewable energy.
Sec. 102. Marine and hydrokinetic renewable energy research and 
              development.
Sec. 103. National Marine Renewable Energy Research, Development, and 
              Demonstration Centers.
Sec. 104. Authorization of appropriations.

     TITLE II--MARINE AND HYDROKINETIC RENEWABLE ENERGY REGULATORY 
                               EFFICIENCY

Sec. 201. Marine and hydrokinetic renewable energy projects and 
              facilities.

     TITLE I--MARINE AND HYDROKINETIC RENEWABLE ENERGY TECHNOLOGIES

     SEC. 101. DEFINITION OF MARINE AND HYDROKINETIC RENEWABLE 
                   ENERGY.

       Section 632 of the Energy Independence and Security Act of 
     2007 (42 U.S.C. 17211) is amended in the matter preceding 
     paragraph (1) by striking ``electrical''.

     SEC. 102. MARINE AND HYDROKINETIC RENEWABLE ENERGY RESEARCH 
                   AND DEVELOPMENT.

       Section 633 of the Energy Independence and Security Act of 
     2007 (42 U.S.C. 17212) is amended to read as follows:

     ``SEC. 633. MARINE AND HYDROKINETIC RENEWABLE ENERGY RESEARCH 
                   AND DEVELOPMENT.

       ``The Secretary, in consultation with the Secretary of the 
     Interior, the Secretary of Commerce, and the Federal Energy 
     Regulatory Commission, shall carry out a program of research, 
     development, demonstration, and commercial application to 
     expand marine and hydrokinetic renewable energy production, 
     including programs--
       ``(1) to assist technology development to improve the 
     components, processes, and systems used for power generation 
     from marine and hydrokinetic renewable energy resources;
       ``(2) to establish critical testing infrastructure 
     necessary--
       ``(A) to cost effectively and efficiently test and prove 
     marine and hydrokinetic renewable energy devices; and

[[Page 13005]]

       ``(B) to accelerate the technological readiness and 
     commercialization of those devices;
       ``(3) to support efforts to increase the efficiency of 
     energy conversion, lower the cost, increase the use, improve 
     the reliability, and demonstrate the applicability of marine 
     and hydrokinetic renewable energy technologies by 
     participating in demonstration projects;
       ``(4) to investigate variability issues and the efficient 
     and reliable integration of marine and hydrokinetic renewable 
     energy with the utility grid;
       ``(5) to identify and study critical short- and long-term 
     needs to create a sustainable marine and hydrokinetic 
     renewable energy supply chain based in the United States;
       ``(6) to increase the reliability and survivability of 
     marine and hydrokinetic renewable energy technologies, 
     including development of corrosion-resistant and anti-fouling 
     materials;
       ``(7) to verify the performance, reliability, 
     maintainability, and cost of new marine and hydrokinetic 
     renewable energy device designs and system components in an 
     operating environment;
       ``(8) to coordinate and avoid duplication of activities 
     across programs of the Department and other applicable 
     Federal agencies, including National Laboratories;
       ``(9) to identify opportunities for joint research and 
     development programs and development of economies of scale 
     between--
       ``(A) marine and hydrokinetic renewable energy 
     technologies; and
       ``(B) other renewable energy and fossil energy programs, 
     offshore oil and gas production activities, and activities of 
     the Department of Defense; and
       ``(10) to support in-water technology development with 
     international partners using existing cooperative procedures 
     (including memoranda of understanding)--
       ``(A) to allow cooperative funding and other support of 
     value to be exchanged and leveraged; and
       ``(B) to encourage the participation of international 
     research centers and companies in the United States and the 
     participation of research centers and companies of the United 
     States in international projects.''.

     SEC. 103. NATIONAL MARINE RENEWABLE ENERGY RESEARCH, 
                   DEVELOPMENT, AND DEMONSTRATION CENTERS.

       Section 634 of the Energy Independence and Security Act of 
     2007 (42 U.S.C. 17213) is amended by striking subsection (b) 
     and inserting the following:
       ``(b) Purposes.--The Centers (in coordination with the 
     Department and National Laboratories) shall--
       ``(1) advance research, development, demonstration, and 
     commercial application of marine and hydrokinetic renewable 
     energy technologies;
       ``(2) support in-water testing and demonstration of marine 
     and hydrokinetic renewable energy technologies, including 
     facilities capable of testing--
       ``(A) marine and hydrokinetic renewable energy systems of 
     various technology readiness levels and scales;
       ``(B) a variety of technologies in multiple test berths at 
     a single location; and
       ``(C) arrays of technology devices; and
       ``(3) serve as information clearinghouses for the marine 
     and hydrokinetic renewable energy industry by collecting and 
     disseminating information on best practices in all areas 
     relating to developing and managing marine and hydrokinetic 
     renewable energy resources and energy systems.''.

     SEC. 104. AUTHORIZATION OF APPROPRIATIONS.

       Section 636 of the Energy Independence and Security Act of 
     2007 (42 U.S.C. 17215) is amended by striking ``2008 through 
     2012'' and inserting ``2014 through 2017''.

     TITLE II--MARINE AND HYDROKINETIC RENEWABLE ENERGY REGULATORY 
                               EFFICIENCY

     SEC. 201. MARINE AND HYDROKINETIC RENEWABLE ENERGY PROJECTS 
                   AND FACILITIES.

       Part I of the Federal Power Act (16 U.S.C. 792 et seq.) is 
     amended by adding at the end the following:

     ``SEC. 34. PILOT LICENSE FOR MARINE AND HYDROKINETIC 
                   RENEWABLE ENERGY PROJECTS.

       ``(a) Definition of Hydrokinetic Pilot Project.--
       ``(1) In general.--In this section, the term `hydrokinetic 
     pilot project' means a facility that generates energy from--
       ``(A) waves, tides, or currents in an ocean, estuary, or 
     tidal area; or
       ``(B) free-flowing water in a river, lake, or stream.
       ``(2) Exclusions.--The term `hydrokinetic pilot project' 
     does not include a project that uses a dam or other 
     impoundment for electric power purposes.
       ``(b) Pilot Licenses Authorized.--The Commission may issue 
     a pilot license to construct, operate, and maintain a 
     hydrokinetic pilot project that meets the criteria listed in 
     subsection (c).
       ``(c) License Criteria.--The Commission may issue a pilot 
     license for a hydrokinetic pilot project if the project--
       ``(1) will have an installed capacity of not more than 10 
     megawatts;
       ``(2) is for a term of not more than 10 years;
       ``(3) will not cause a significant adverse environmental 
     impact or interfere with navigation;
       ``(4) is removable and can shut down on reasonable notice 
     in the event of a significant adverse safety, navigation, or 
     environmental impact;
       ``(5) can be removed, and the site can be restored, by the 
     end of the license term, unless the project has obtained a 
     new license or the Commission has determined, based on 
     substantial evidence, that the project should not be removed 
     because it would be preferable for environmental or other 
     reasons not to; and
       ``(6) is primarily for the purpose of--
       ``(A) testing new hydrokinetic technologies;
       ``(B) locating appropriate sites for new hydrokinetic 
     technologies; or
       ``(C) determining the environmental and other effects of a 
     hydrokinetic technology.
       ``(d) Lead Agency.--In carrying out this section, the 
     Commission shall act as the lead agency--
       ``(1) to coordinate all applicable Federal authorizations; 
     and
       ``(2) to comply with the National Environmental Policy Act 
     of 1969 (42 U.S.C. 4321 et seq.).
       ``(e) Schedule Goals.--
       ``(1) In general.--Not later than 30 days after the date on 
     which the Commission receives a completed application, and 
     following consultation with Federal, State, and local 
     agencies with jurisdiction over the hydrokinetic pilot 
     project, the Commission shall develop and issue pilot license 
     approval process scheduling goals that cover all Federal, 
     State, and local permits required by law.
       ``(2) Compliance.--Applicable Federal, State, and local 
     agencies shall comply with the goals established under 
     paragraph (1) to the maximum extent practicable, consistent 
     with applicable law.
       ``(3) 1-year goal.--It shall be the goal of the Commission 
     and the other applicable agencies to complete the pilot 
     license process by not later than 1 year after the date on 
     which the Commission receives the completed application.
       ``(f) Size Limitations.--
       ``(1) In general.--The Commission may grant a pilot license 
     for a project located in the ocean if the project covers a 
     surface area of not more than 1 square nautical mile.
       ``(2) Exception.--The Commission, at the discretion of the 
     Commission and for good cause, may grant a pilot license for 
     a project that covers a surface area of more than 1 square 
     nautical mile.
       ``(3) Limitation.--For proposed projects located in an 
     estuary, tidal area, river, lake, or stream, the Commission 
     shall determine the size limit on a case-by-case basis, 
     taking into account all relevant factors.
       ``(g) Extensions Authorized.--On application by a project, 
     the Commission may make a 1-time extension of a pilot license 
     for a term not to exceed 5 years.''.
                                 ______
                                 
      By Mrs. FISCHER (for herself, Mr. Grassley, Mr. Crapo, and Mr. 
        Risch):
  S. 1420. A bill to amend title 31, United States Code, to provide for 
transparency of payments made from the Judgment Fund; to the Committee 
on the Judiciary.
  Mrs. FISCHER. Mr. President, I rise to discuss legislation that I am 
introducing in the U.S. Senate today, the Judgment Fund Transparency 
Act.
  As my colleagues may or may not know, the Judgment Fund is 
administered by the Treasury Department and is used to pay certain 
court judgments and settlements against the Federal Government. It is 
essentially an unlimited amount of money available to pay for Federal 
Government liability. It is not subject to the annual appropriations 
process, and even more remarkably, the Treasury Department has no 
reporting requirements, so these funds are paid out with very little 
oversight or scrutiny.
  This is no small matter, as the Judgment Fund disburses billions of 
dollars in payments per year. In recent years, Treasury has paid the 
following from the Fund: fiscal year 2012--$2.9 billion, fiscal year 
2011--$2.2 billion, fiscal year 2010--$1.1 billion, fiscal year 2009--
$2.3 billion, fiscal year 2008--$790 million, fiscal year 2007--$1 
billion, and fiscal year 2006--$628 million.
  Before the Judgment Fund was established, claims against the 
government were assigned to a Congressional committee that would 
appropriate funds in order to pay liability, attorneys' fees, and costs 
associated with the claim. Once the Judgment Fund was established in 
1956, however, Congressional committees stopped appropriating funds 
explicitly for this purpose. Now, if a government agency does not use 
its own annual budget to cover the costs, Treasury simply pays the bill 
out of the Fund.
  Because the Treasury Department has no binding reporting 
requirements,

[[Page 13006]]

few public details exist about where the funds are going and why, and 
the information that is readily accessible is only made available at 
the administration's discretion.
  The U.S. Chamber of Commerce highlighted the nature of this problem 
in an article about the Judgment Fund written by Bill Kovacs on 
February 1, 2013:

       Without knowing who is being paid under the Judgment Fund 
     and for what reason, not to mention the validity of the 
     claim, Congress cannot oversee and control the federal 
     governments litigation costs, risks and exposure. Simply, 
     without disclosure Congress is being denied the opportunity 
     to take effective mitigation measures against improper agency 
     action that results in claims against the federal government. 
     Non-disclosure of Judgment Fund payments hides from Congress 
     what might be excessive markers of agency mismanagement and/
     or structural defects in statutes and programs. And due to a 
     lack of reporting, Congress is denied the opportunity to 
     understand claims against agencies that might shed light on 
     how to improve agency operations.

  The National Cattlemen's Beef Association has also decried the lack 
of oversight of the Judgment Fund by stating, ``Certain groups 
continuously sue the federal government, and Treasury simply writes a 
check to foot the bill without providing Members of Congress and 
American taxpayers basic information about the payment.''
  The Judgment Fund Transparency Act seeks to address these problems by 
requiring a public accounting of the taxpayer funds distributed via the 
Judgment Fund to parties who bring successful claims against the 
Federal government.
  The Judgment Fund Transparency Act promotes transparency and 
oversight by requiring the Treasury Department to post on a publicly 
accessible website the claimant, counsel, agency, fact summary, and 
payment amount for each claim from the Judgment Fund, unless a law or 
court order otherwise prohibits the disclosure of such information.
  The Judgment Fund Transparency Act would increase transparency and 
oversight of the Fund and would provide Members of Congress and the 
public with the ability to see how taxpayers' dollars are being spent.
  I am proud to introduce the Judgment Fund Transparency Act today and 
invite my colleagues to cosponsor this legislation.
                                 ______
                                 
      By Mr. LEAHY:
  S. 1421. A bill to amend the Internal Revenue Code of 1986 to provide 
a refundable tax credit for the installation of sprinklers and 
elevators in historic structures; to the Committee on Finance.
  Mr. LEAHY. Mr. President, each year fire destroys hundreds of 
vulnerable historic buildings that serve as the anchors of America's 
vibrant villages and downtowns. These fires leave gaping holes in Main 
Streets all across the country. All have destroyed property. Some have 
taken lives. And many could have been prevented by sprinkler systems. 
This upfront but costly investment could have helped prevent the loss 
of life, reduced property damage, and decreased federal expenditures on 
rebuilding efforts after these fires.
  To prevent fires from destroying buildings in historic downtowns and 
to preserve access to upper-story office, retail, and housing space in 
these buildings, I am introducing legislation today--the Historic 
Downtown Preservation and Access Act--that will create a 50 percent 
refundable tax credit, capped at $50,000, for the installation of fire 
sprinklers and elevators in older, multi-use buildings in historic 
downtowns.
  Since 2000, Vermont has had more than a dozen significant downtown 
fires causing tens of millions of dollars of damage and taking at least 
three lives. The original owners of at least 8 of these buildings were 
unable to rebuild--leaving the critical task of rebuilding both the 
building and the community to nonprofit entities that rely primarily on 
Federal funds. These 8 projects cost the Federal Government $20 million 
in Low Income Housing Tax Credits, Community Development Block-Grant 
building, and HOME funding. Only one of these 8 buildings had a 
sprinkler system. If the building owners had installed sprinklers in 
all eight buildings using the credit created by this legislation, the 
Federal Government may have saved $19.6 million, dozens of Vermonters 
would still be in their homes, more than a dozen businesses would have 
been sparred, and at least three Vermonters might still be alive today.
  According to the National Fire Sprinkler Association, housing units 
with sprinklers receive 69 percent less property damage during a fire 
than units without sprinklers, the death rate per fire in a home with a 
sprinkler is 83 percent less than in a home without a sprinkler, and 
firefighters are 65 percent less likely to be injured in a fire where a 
sprinkler is present than in a fire where a sprinkler is not present.
  This legislation also incentivizes the installation of elevators 
because too often upper story office, retail, and housing space in 
historic downtown buildings goes unused due to accessibility 
requirements.
  Financial cost-benefit modeling and existing federal incentives for 
rehabbing an historic building with sprinklers or an elevator fail to 
adequately incentivize building owners to install these assets. For 
instance, the Qualified Rehabilitation Tax Credit requires significant 
rehabilitation to a building equal to the value of the building before 
renovation in order to claim the credit. Asset depreciation tax 
benefits take decades for a building owner to offset the cost of a 
sprinkler or elevator system, and building owners who make no profit or 
minimal profit have no use for existing tax credits.
  The new refundable tax credit I am introducing today--modeled after 
the State of Vermont's highly successful downtown historic tax credit--
would allow private entities with little tax liability and nonprofits 
alike to install these important property- and life-saving devices in 
historic buildings.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 1421

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Historic Downtown 
     Preservation and Access Act''.

     SEC. 2. CREDIT FOR INSTALLATION OF SPRINKLERS AND ELEVATORS 
                   IN HISTORIC BUILDINGS.

       (a) In General.--Subpart C of part IV of subchapter A of 
     chapter 1 of the Internal Revenue Code of 1986 is amended by 
     inserting after section 36B the following new section:

     ``SEC. 36C. HISTORIC BUILDING EXPENSES.

       ``(a) In General.--There shall be allowed a credit against 
     the tax imposed by this subtitle for the taxable year an 
     amount equal to 50 percent of the qualified historic building 
     expenses paid or incurred by the taxpayer during such taxable 
     year.
       ``(b) Limitation.--The credit allowed under subsection (a) 
     with respect to any taxpayer for any taxable year shall not 
     exceed $50,000.
       ``(c) Qualified Historic Building Expenses.--For purposes 
     of this section--
       ``(1) In general.--The term `qualified historic building 
     expenses' means amounts paid or incurred to install in a 
     certified historic structure an elevator system or a 
     sprinkler system that meets the requirements found in the 
     most recent edition of NFPA 13: Standard for the Installation 
     of Sprinkler Systems.
       ``(2) National historic landmarks.--In the case of a 
     certified historic structure that is designated as a National 
     Historic Landmark in accordance with section 101(a) of the 
     National Historic Preservation Act (16 U.S.C. 470a(a)) and 
     that is open to the public, the term `qualified historic 
     building expenses' shall not include an expense described in 
     paragraph (1), unless the installation of property described 
     in such paragraph meets the requirements for a certified 
     rehabilitation under section 47(c)(2)(C).
       ``(3) Certified historic structure.--The term `certified 
     historic structure' has the meaning given such term in 
     section 47(c)(3), except that such term shall not include any 
     structure which is a single-family residence.''.
       (b) Conforming Amendments.--
       (1) Section 1324 of title 31, United States Code, is 
     amended by inserting ``, 36C'' after ``, 36B''.
       (2) The table of sections for subpart C of part IV of 
     subchapter A of chapter 1 of the Internal Revenue Code of 
     1986 is amended by inserting after the item relating to 
     section 36B the following new item:

``Sec. 36C. Historic building expenses.''.


[[Page 13007]]


       (c) Effective Date.--The amendments made by this section 
     shall apply to amounts paid or incurred in taxable years 
     beginning after the date of the enactment of this Act.
                                 ______
                                 
      By Mr. CARDIN (for himself, Mr. Crapo, Mr. King, Mr. Udall of New 
        Mexico, and Mrs. Shaheen):
  S. 1422. A bill to amend the Congressional Budget Act of 1974 
respecting the scoring of preventive health savings; to the Committee 
on the Budget.
  Mr. CARDIN. Mr. President, I rise to introduce legislation to 
modernize the Congressional budget scoring process with respect to 
health spending and the effects of preventive health care.
  Although the United States spends more than any other Nation in the 
world on health care, $2.6 trillion in 2010, our citizens' health 
status lags behind that of most developed countries, and we have the 
highest rate of preventable deaths among 19 industrialized nations. One 
reason is that the United States' expenditures for the treatment of 
disease far exceed our investments in preventive health.
  Our neglect of prevention has been costly. Spending on the treatment 
of chronic diseases is overwhelming our health care budgets, 
particularly those of the Medicare and Medicaid programs. The following 
statistics come from the U.S. Centers for Disease Control and 
Prevention: 7 out of 10 deaths among Americans each year are from 
chronic diseases. Heart disease, cancer and stroke account for more 
than 50 percent of all deaths each year.
  In 2005, 133 million Americans almost 1 out of every 2 adults had at 
least one chronic illness.
  About \1/4\ of people with chronic conditions have one or more daily 
activity limitations.
  Arthritis is the most common cause of disability, with nearly 19 
million Americans reporting activity limitations.
  Diabetes continues to be the leading cause of kidney failure, 
nontraumatic lower-extremity amputations, and blindness among adults, 
aged 20-74.
  Excessive alcohol consumption is the third leading preventable cause 
of death in the U.S., behind diet, physical activity, and tobacco.
  CDC also tells us that four health risk behaviors--lack of physical 
activity, poor nutrition, tobacco use, and excessive alcohol 
consumption--are responsible for much of the illness, suffering, and 
early death related to chronic diseases.
  More than \1/3\ of all adults do not meet recommendations for aerobic 
physical activity based on the 2008 Physical Activity Guidelines for 
Americans, and 23 percent report no leisure-time physical activity at 
all in the preceding month.
  In 2007, 22 percent of high school students and only 24 percent of 
adults reported eating 5 or more servings of fruits and vegetables per 
day.
  More than 43 million American adults, approximately 1 in 5, smoke. 
Lung cancer is the leading cause of cancer death, and cigarette smoking 
causes almost all cases. Compared to nonsmokers, men who smoke are 
about 23 times more likely to develop lung cancer and women who smoke 
are about 13 times more likely. Smoking causes about 90 percent of lung 
cancer deaths in men and almost 80 percent in women. Smoking also 
causes cancer of the voicebox, mouth and throat, esophagus, bladder, 
kidney, pancreas, cervix, and stomach, and causes acute myeloid 
leukemia.
  Excessive alcohol consumption contributes to over 54 different 
diseases and injuries, including cancer of the mouth, throat, 
esophagus, liver, colon, and breast, liver diseases, and other 
cardiovascular, neurological, psychiatric, and gastrointestinal health 
problems.
  Binge drinking, the most dangerous pattern of drinking, defined as 
consuming more than 4 drinks on an occasion for women or 5 drinks for 
men, is reported by 17 percent of U.S. adults, averaging 8 drinks per 
binge.
  By addressing just these four behaviors, we can alter the trajectory 
of chronic disease and the health costs associated with them. That is 
the power of prevention. As Dr. Albert Reece of the University of 
Maryland School of Medicine once said, ``Lifestyle is primary care.''
  Prevention also means early screening. In addition to increasing 
survival rates, identifying diseases early reduces health care costs. 
In the case of colorectal cancer, Medicare will pay under $400 for a 
colonoscopy, but if the patient is not diagnosed until the disease has 
metastasized, the costs of care can exceed $58,000 over the patient's 
lifetime. A screening mammography costs the Medicare program a small 
fraction of the tens of thousands of dollars that treatment of breast 
cancer costs, depending on when the cancer is found and the course of 
treatment used. One drug used to treat late stage breast cancer can 
cost as much as $40,000 a year.
  Research has shown that increasing to 90 percent the number of women 
aged 40 and older who have been screened for breast cancer in the past 
two years would save more than 100,000 lives each year in the United 
States.
  One of the most compelling cases for prevention is in the area of 
oral health. The tragic, preventable death of 12 year-old Marylander 
Deamonte Driver in 2007 illustrated the consequences of poor access to 
oral health care. His untreated tooth abscess spread to his brain and 
after two extensive operations, he died. Although a tooth extraction 
would have cost about $80, the final total cost of his medical care 
exceeded $250,000.
  The American Academy of Pediatric Dentistry tells us that dental 
decay is the most common chronic childhood disease among children in 
the United States. It affects one in five children aged 2 to 4, half of 
those aged 6 to 8, and nearly \3/5\ of 15 year olds. But it is also the 
most preventable disease if basic oral care is provided starting at an 
early age.
  The good news in that for nearly every category of chronic disease we 
can reduce its prevalence by making preventive health care a priority. 
All around us are examples of why prevention is an essential part of 
health care and why effective use of preventive measures, such as 
screening and smoking cessation can save lives and lower health care 
costs in the long run.
  But the current Congressional budget process has hindered our ability 
to get appropriate credit for the cost savings that prevention can 
bring. For this reason, investing in initiatives that can move our 
Nation forward toward optimal health often requires us to cut funding 
in other important areas because of the budget rules.
  Today, budget resolutions, budget reconciliation, and CBO scoring 
analyses use a ten-year ``scoring'' window. But the research performed 
at the National Institutes of Health in Bethesda, MD and at research 
centers across the nation has demonstrated that some expenditures for 
preventive services result in cost savings when considered in the long 
term. Unfortunately, Congressional budget scoring rules only permit 
taking into account the first ten years, a time frame in which savings 
may not be apparent.
  We want to change that. Today, with Senators Mike Crapo, Angus King, 
Tom Udall, and Jeanne Shaheen, I am introducing the Preventive Health 
Savings Act of 2013. It would allow the Chairman or Ranking Member of 
the House or Senate Budget Committee, or the health committees--HELP, 
Finance, Ways and Means, or Energy and Commerce--to request an analysis 
of preventive measures extending beyond the existing 10-year window to 
two additional ten-year periods.
  Re-evaluating our budget rules is not a new phenomenon. In recent 
years, Congress has increasingly looked for ways to assess long-term 
budget consequences. For example, Congress currently requests that CBO 
report on measures that would cause a large future increase in the 
deficit--more than $5 billion in the following four decades.
  The Preventive Health Savings Act would direct CBO to incorporate 
credible data on prevention. Because we want to ensure that CBO's 
projections are tied to scientific data, our bill would define 
preventive health as ``an action designed to avoid future health care 
costs that is demonstrated by credible and publicly available 
epidemiological projection models, incorporating clinical trials or 
observational studies in humans, longitudinal

[[Page 13008]]

studies, and meta-analysis.'' This narrow, responsible approach 
encourages a sensible review of health policy that Congress believes 
will promote public health, and it will make it easier for us to invest 
in proven methods of saving lives and money.
  CBO would be required to conduct an initial analysis to determine 
whether the provision would result in substantial savings outside the 
10-year scoring window and to include a description of those future-
year savings in its budget projections.
  The broad coalition of groups supporting this bill includes: the 
Academy of Nutrition and Dietetics, Aetna, Allscripts, American 
Association of Diabetes Educators, American College of Occupational 
Medicine, American College of Preventative Medicine, American Diabetes 
Association, BlueCross BlueShield Tennessee, Building Healthier 
America, Care Continuum Alliance, Council for Affordable Health 
Coverage, Dialysis Patient Citizens, The Endocrine Society, Healthcare 
Leadership Council, Healthways, IHRSA: International Health Racquet & 
Sportsclub Association, Johnson & Johnson, Marshfield Clinic, Memorial 
Care Health System, National Association of Public Hospitals and Health 
Systems, National Retail Federation, National Kidney Foundation, Novo 
Nordisk, the Partnership to Fight Chronic Disease, Sanofi, Texas Health 
Resources, and Weight Watchers.
  I also wish to applaud the bipartisan House sponsors of this 
legislation--two physicians--Representatives Michael Burgess of Texas 
and Donna Christensen of the U.S. Virgin Islands, for their vision in 
introducing the companion bill, H.R. 2663, which now has 19 cosponsors.
  I urge my colleagues to cosponsor this legislation, which will give 
our budget process the flexibility needed to dramatically bend the 
health care cost curve.
                                 ______
                                 
      By Mr. UDALL of Colorado (for himself, Mr. Alexander, Ms. 
        Murkowski, Mr. Udall of New Mexico, and Mr. Heinrich):
  S. 1423. A bill to amend the Energy Employees Occupational Illness 
Compensation Program Act of 2000 to strengthen the quality control 
measures in place for part B lung disease claims and to establish the 
Advisory Board on Toxic Substances and Worker Health for the contractor 
employee compensation program under subtitle E of such Act; to the 
Committee on Health, Education, Labor, and Pensions.
  Mr. UDALL of Colorado. Mr. President, I rise to speak about 
bipartisan legislation I am introducing today with Senator Alexander to 
provide much needed help to our Cold War patriots.
  In 2000, Congress passed the Energy Employees Occupational Illness 
Compensation Program to help Cold War workers like those from Rocky 
Flats in my home state of Colorado and other nuclear weapons facilities 
around the country. This effort was designed to get these patriots the 
help they need to treat cancer and other illnesses they developed as a 
result of exposure to radiation. Since then, the program has been 
plagued by procedural inconsistencies and delays preventing former 
nuclear workers from accessing the benefits they are owed.
  In March 2010, the U.S. Government Accountability Office issued a 
report on the efficacy of EEOICPA, confirming workers' ongoing 
frustrations with the program and recommending that Congress consider 
creating an advisory board. More recently, in March 2013, the Institute 
of Medicine issued a report recommending that an external advisory 
panel be created to review the health effects of the Department of 
Labor's approach to awarding benefits.
  Today, Senator Alexander and I are reintroducing our bill requiring 
the President to establish an independent advisory panel to do just 
that. This advisory board would add much needed transparency and 
certainty to decisions made affecting workers' compensation and access 
to benefits.
  Some 600,000 Cold War era workers, including thousands of workers at 
Rocky Flats, put their health on the line to preserve our national 
security during one of the most uncertain times in our nation's 
history. They were exposed to radiation and are sick and dying. Our 
country made a commitment to these patriots, but so far that promise 
has not been kept. Coloradans find that unacceptable. We cannot let 
another family suffer through the uncertainty of delays caused by 
bureaucratic red tape or see their loved ones denied the benefits they 
deserve. It is time for us to do right by these workers.
  I urge my colleagues to join me and Senator Alexander in this fight 
by cosponsoring this important legislation.
                                 ______
                                 
      By Mr. DURBIN (for himself and Mr. Blumenthal):
  S. 1425. A bill to improve the safety of dietary supplements by 
amending the Federal Food, Drug, and Cosmetic Act to require 
manufacturers of dietary supplements to register dietary supplements 
with the Food and Drug Administration and to amend labeling 
requirements with respect to dietary supplements; to the Committee on 
Health, Education, Labor, and Pensions.
  Mr. DURBIN. Mr. President, I ask unanimous consent that the text of 
the bill be printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 1425

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Dietary Supplement Labeling 
     Act of 2013''.

     SEC. 2. REGULATION OF DIETARY SUPPLEMENTS.

       (a) Registration Requirements.--
       (1) In general.--Section 415(a) of the Federal Food, Drug, 
     and Cosmetic Act (21 U.S.C. 350d(a)) is amended by adding at 
     the end the following:
       ``(6) Requirements with respect to dietary supplements.--
       ``(A) In general.--A facility engaged in manufacturing or 
     processing dietary supplements that is required to register 
     under this section shall comply with the requirements of this 
     paragraph, in addition to the other requirements of this 
     section.
       ``(B) Additional information.--
       ``(i) In general.--A facility described in subparagraph (A) 
     shall submit a registration under paragraph (1) that 
     includes, in addition to the information required under 
     paragraph (2)--

       ``(I) a description of each dietary supplement manufactured 
     or processed by such facility;
       ``(II) a list of all ingredients in each such dietary 
     supplement; and
       ``(III) a copy of the label for each such dietary 
     supplement.

       ``(ii) Public availability.--The Secretary shall make the 
     information provided under clause (i) publicly available, 
     including by posting such information on the Internet Web 
     site of the Food and Drug Administration.
       ``(C) Registration with respect to new, reformulated, and 
     discontinued dietary supplements.--
       ``(i) In general.--Not later than the date described in 
     clause (ii), if a facility described in subparagraph (A)--

       ``(I) manufactures or processes a dietary supplement that 
     the facility previously did not manufacture or process and 
     for which the facility did not submit the information 
     required under subclauses (I) through (III) of subparagraph 
     (B)(i);
       ``(II) reformulates a dietary supplement for which the 
     facility previously submitted the information required under 
     subclauses (I) through (III) of subparagraph (B)(i); or
       ``(III) no longer manufactures or processes a dietary 
     supplement for which the facility previously submitted the 
     information required under subclauses (I) through (III) of 
     subparagraph (B)(i),

     such facility shall submit to the Secretary an updated 
     registration describing the change described in subclause 
     (I), (II), or (III) and, in the case of a facility described 
     in subclause (I) or (II), containing the information required 
     under subclauses (I) through (III) of subparagraph (B)(i).
       ``(ii) Date described.--The date described in this clause 
     is--

       ``(I) in the case of a facility described in subclause (I) 
     of clause (i), 30 days after the date on which such facility 
     first markets the dietary supplement described in such 
     subclause;
       ``(II) in the case of a facility described in subclause 
     (II) of clause (i), 30 days after the date on which such 
     facility first markets the reformulated dietary supplement 
     described in such subclause; or
       ``(III) in the case of a facility described in subclause 
     (III) of clause (i), 30 days after the date on which such 
     facility removes the dietary supplement described in such 
     subclause from the market.''.

       (2) Enforcement.--Section 403 of the Federal Food, Drug, 
     and Cosmetic Act (21 U.S.C.

[[Page 13009]]

     343) is amended by adding at the end the following:
       ``(z) If it is a dietary supplement for which a facility is 
     required to submit the registration information required 
     under section 415(a)(6) and such facility has not complied 
     with the requirements of such section 415(a)(6) with respect 
     to such dietary supplement.''.
       (b) Labeling.--
       (1) Establishment of labeling requirements.--Chapter IV of 
     the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 341 et 
     seq.) is amended by inserting after section 411 the 
     following:

     ``SEC. 411A. DIETARY SUPPLEMENTS.

       ``(a) Dietary Supplement Ingredients.--Not later than 1 
     year after the date of enactment of the Dietary Supplement 
     Labeling Act of 2013, the Secretary shall compile a list of 
     dietary supplement ingredients and proprietary blends of 
     ingredients that the Secretary determines could cause 
     potentially serious adverse events, drug interactions, or 
     contraindications, or potential risks to subgroups such as 
     children and pregnant or breastfeeding women.
       ``(b) IOM Study.--The Secretary shall seek to enter into a 
     contract with the Institute of Medicine under which the 
     Institute of Medicine shall evaluate dietary supplement 
     ingredients and proprietary blends of ingredients, including 
     those on the list compiled by the Secretary under subsection 
     (a), and scientific literature on dietary supplement 
     ingredients and, not later than 18 months after the date of 
     enactment of the Dietary Supplement Labeling Act of 2013, 
     submit to the Secretary a report evaluating the safety of 
     dietary supplement ingredients and proprietary blends of 
     ingredients the Institute of Medicine determines could cause 
     potentially serious adverse events, drug interactions, or 
     contraindications, or potential risks to subgroups such as 
     children and pregnant or breastfeeding women.
       ``(c) Establishment of Requirements.--Not later than 2 
     years after the date on which the Institute of Medicine 
     issues the report under subsection (b), the Secretary, after 
     providing for public notice and comment and taking into 
     consideration such report, shall--
       ``(1) establish mandatory warning label requirements for 
     dietary supplement ingredients that the Secretary determines 
     to cause potentially serious adverse events, drug 
     interactions, or contraindications, or potential risks to 
     subgroups; and
       ``(2) identify proprietary blends of ingredients for which, 
     because of potentially serious adverse events, drug 
     interactions, or contraindications, or potential risks to 
     subgroups such as children and pregnant or breastfeeding 
     women, the weight per serving of the ingredient in the 
     proprietary blend shall be provided on the label.
       ``(d) Updates.--As appropriate, the Secretary, after 
     providing for public notice and comment, shall update--
       ``(1) the list compiled under subsection (a);
       ``(2) the mandatory warning label requirements established 
     under paragraph (1) of subsection (c); and
       ``(3) the requirements under paragraph (2) of subsection 
     (c).''.
       (2) Enforcement.--Section 403 of the Federal Food, Drug, 
     and Cosmetic Act (21 U.S.C. 343) is amended--
       (A) in paragraph (q)(5)(F)(ii), by inserting ``, and for 
     each proprietary blend identified by the Secretary under 
     section 411A(c)(2), the weight of such proprietary blend,'' 
     after ``ingredients)''; and
       (B) in paragraph (s)(2)--
       (i) in clause (A)(ii)(II), by inserting ``, and for each 
     proprietary blend identified by the Secretary under section 
     411A(c)(2), the weight of each such proprietary blend per 
     serving'' before the semicolon at the end;
       (ii) in clause (D)(iii), by striking ``or'' at the end;
       (iii) in clause (E)(ii)(II), by striking the period at the 
     end and inserting a semicolon; and
       (iv) by adding at the end the following:
       ``(F) the label does not include information with respect 
     to potentially serious adverse events, drug interactions, or 
     contraindications, or potential risks to subgroups such as 
     children and pregnant or breastfeeding women, as required 
     under section 411A(c)(1); or
       ``(G) the label does not include the batch number.''.
       (c) Structure and Function Claims.--Section 403(r)(6)(B) of 
     the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 
     343(r)(6)(B)) is amended by inserting ``, and provides such 
     substantiation to the Secretary, as the Secretary may 
     require'' after ``misleading''.
       (d) Conventional Foods.--The Secretary of Health and Human 
     Services, not later than 1 year after the date of enactment 
     of this Act and after providing for public notice and 
     comment, shall establish a definition for the term 
     ``conventional food'' for purposes of the Federal Food, Drug, 
     and Cosmetic Act (21 U.S.C. 301 et seq.). Such definition 
     shall take into account conventional foods marketed as 
     dietary supplements, including products marketed as dietary 
     supplements that simulate conventional foods.
                                 ______
                                 
      By Mr. GRASSLEY (for himself and Mr. Franken):
  S. 1427. A bill to amend title 11 of the United States Code to 
clarify the rule allowing discharge as a nonpriority claim of 
governmental claims arising from the disposition of farm assets under 
chapter 12 bankruptcies; to the Committee on Finance.
  Mr. GRASSLEY. Mr. President, I rise today to introduce, along with 
Senator Franken, the Family Farmer Bankruptcy Clarification Act of 
2013. We introduced similar legislation in the 112th Congress, but the 
Senate never had a chance to consider the bill. The bill addresses the 
2012 United States Supreme Court case Hall v. United States. In a 5-4 
decision, the Supreme Court ruled that a provision I inserted into the 
2005 Bankruptcy Abuse Prevention and Consumer Protection Act did not 
accomplish what we in Congress intended. The Family Farmer Bankruptcy 
Clarification Act of 2013 corrects this and clarifies that bankrupt 
family farmers reorganizing their debts are able to treat capital gains 
taxes owed to a governmental unit, arising from the sale of farm assets 
during a bankruptcy, as general unsecured claims. This bill will remove 
the Internal Revenue Service's veto power over a bankruptcy 
reorganization plan's confirmation, giving the family farmer a chance 
to reorganize successfully.
  In 1986 Congress enacted Chapter 12 of the Bankruptcy Code to provide 
a specialized bankruptcy process for family farmers. In 2005 Chapter 12 
was made permanent. Between 1986 and 2005 we learned what aspects 
worked and did not work for family farmers reorganizing in bankruptcy. 
One problematic area was where a family farmer needed to sell assets in 
order to generate cash for the reorganization. Specifically, a family 
farmer would have to sell portions of the farm to generate cash to fund 
a reorganization plan so that the creditors could receive payment. 
Unfortunately, in situations like this, the family farmer is selling 
land that has been owned for a very long time, with a very low cost 
basis. Thus, when the land is sold, the family farmer is hit with a 
substantial capital gains tax, which is owed to the Internal Revenue 
Service.
  Under the Bankruptcy Code, taxes owed to the Internal Revenue Service 
receive priority treatment. Holders of priority claims must receive 
payment in full, unless the claim holder agrees to be treated 
differently. This creates problems for the family farmer who needs the 
cash to pay creditors to reorganize. However, since the Internal 
Revenue Service has the ability to require full payment, they hold veto 
power over a plan's confirmation, which means in many instances the 
plan will not be confirmed. This does not make sense if the goal is to 
give the family farmer a fresh start. Thus, in 2005 Congress said that 
in these limited situations, the taxes owed to the Internal Revenue 
Service would be stripped of their priority and treated as general, 
unsecured debt. This removed the government's veto power over plan 
confirmation and paved the way for family farmers to reorganize.
  Unfortunately, in Hall v. United States, the Supreme Court ruled that 
despite Congress's express goal of helping family farmers, the language 
inserted into the Bankruptcy Code in 2005 conflicted with the Tax Code. 
The Hall case was one of statutory interpretation. There is no question 
what Congress was trying to do; rather, did Congress use the correct 
language? My goal, along with others at the time, was to relieve family 
farmers from having their reorganization plans fail because of huge tax 
liabilities to the federal government. Justice Breyer noted this in the 
dissent: ``Congress was concerned about the effect on the farmer of 
collecting capital gains tax debts that arose during, and were 
connected with, the Chapter 12 proceedings themselves. . . . The 
majority does not deny the importance of Congress' objective. Rather, 
it feels compelled to hold that Congress put the Amendment in the wrong 
place.'' Hall v. United States, 132 S.Ct. 1882, 1897 (2012) (Breyer, 
J., dissenting) (internal citations and quotations omitted).
  As a result of the Hall case, family farmers facing bankruptcy now 
find themselves caught in a tough spot. The

[[Page 13010]]

rules have now changed and must be corrected in order to provide 
certainty and clarity in the law. The Family Farmer Bankruptcy 
Clarification Act of 2013 will provide the clarity needed to help 
family farmers.
  This bill, which has been worked on over the past year to make sure 
the problem is addressed correctly, adds a new section 1232 to title 11 
of the United States Code. This new section, along with other 
conforming changes to the Bankruptcy Code, will provide clarity to 
practitioners and courts as to how these claims are to be treated 
during bankruptcy. I am pleased that what we are introducing today, 
building from the bill we introduced last Congress, is an improved 
product that can help family farmers who are facing hard times. The 
Family Farmer Bankruptcy Clarification Act of 2013 will ensure that 
what Congress sought to do in 2005 actually occurs. In the wake of the 
Hall decision, clarification is needed to help family farmers 
reorganize successfully.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 1427

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Family Farmer Bankruptcy 
     Clarification Act of 2013''.

     SEC. 2. CLARIFICATION OF RULE ALLOWING DISCHARGE TO 
                   GOVERNMENTAL CLAIMS ARISING FROM THE 
                   DISPOSITION OF FARM ASSETS UNDER CHAPTER 12 
                   BANKRUPTCIES.

       (a) In General.--Subchapter II of chapter 12 of title 11, 
     United States Code, is amended by adding at the end the 
     following:

     ``Sec. 1232. Claim by a governmental unit based on the 
       disposition of property used in a farming operation

       ``(a) Any unsecured claim of a governmental unit against 
     the debtor or the estate that arises before the filing of the 
     petition, or that arises after the filing of the petition and 
     before the debtor's discharge under section 1228, as a result 
     of the sale, transfer, exchange, or other disposition of any 
     property used in the debtor's farming operation--
       ``(1) shall be treated as an unsecured claim arising before 
     the date on which the petition is filed;
       ``(2) shall not be entitled to priority under section 507;
       ``(3) shall be provided for under a plan; and
       ``(4) shall be discharged in accordance with section 1228.
       ``(b) For purposes of applying sections 1225(a)(4), 
     1228(b)(2), and 1229(b)(1) to a claim described in subsection 
     (a) of this section, the amount that would be paid on such 
     claim if the estate of the debtor were liquidated in a case 
     under chapter 7 of this title shall be the amount that would 
     be paid by the estate in a chapter 7 case if the claim were 
     an unsecured claim arising before the date on which the 
     petition was filed and were not entitled to priority under 
     section 507.
       ``(c) For purposes of applying sections 523(a), 1228(a)(2), 
     and 1228(c)(2) to a claim described in subsection (a) of this 
     section, the claim shall not be treated as a claim of a kind 
     specified in section 523(a)(1).
       ``(d)(1) A governmental unit may file a proof of claim for 
     a claim described in subsection (a) that arises after the 
     date on which the petition is filed.
       ``(2) If a debtor files a tax return after the filing of 
     the petition for a period in which a claim described in 
     subsection (a) arises, and the claim relates to the tax 
     return, the debtor shall serve notice of the claim on the 
     governmental unit charged with the responsibility for the 
     collection of the tax at the address and in the manner 
     designated in section 505(b)(1). Notice under this paragraph 
     shall state that the debtor has filed a petition under this 
     chapter, state the name and location of the court in which 
     the case under this chapter is pending, state the amount of 
     the claim, and include a copy of the filed tax return and 
     documentation supporting the calculation of the claim.
       ``(3) If notice of a claim has been served on the 
     governmental unit in accordance with paragraph (2), the 
     governmental unit may file a proof of claim not later than 
     180 days after the date on which such notice was served. If 
     the governmental unit has not filed a timely proof of the 
     claim, the debtor or trustee may file proof of the claim that 
     is consistent with the notice served under paragraph (2). If 
     a proof of claim is filed by the debtor or trustee under this 
     paragraph, the governmental unit may not amend the proof of 
     claim.
       ``(4) A claim filed under this subsection shall be 
     determined and shall be allowed under subsection (a), (b), or 
     (c) of section 502, or disallowed under subsection (d) or (e) 
     of section 502, in the same manner as if the claim had arisen 
     immediately before the date of the filing of the petition.''.
       (b) Technical and Conforming Amendments.--
       (1) In general.--Subchapter II of chapter 12 of title 11, 
     United States Code, is amended--
       (A) in section 1222(a)--
       (i) in paragraph (2), by striking ``unless--'' and all that 
     follows through ``the holder'' and inserting ``unless the 
     holder'';
       (ii) in paragraph (3), by striking ``and'' at the end;
       (iii) in paragraph (4), by striking the period at the end 
     and inserting ``; and''; and
       (iv) by adding at the end the following:
       ``(5) subject to section 1232, provide for the treatment of 
     any claim by a governmental unit of a kind described in 
     section 1232(a).'';
       (B) in section 1228--
       (i) in subsection (a)--

       (I) in the matter preceding paragraph (1)--

       (aa) by inserting a comma after ``all debts provided for by 
     the plan''; and
       (bb) by inserting a comma after ``allowed under section 503 
     of this title''; and

       (II) in paragraph (2), by striking ``the kind'' and all 
     that follows and inserting ``a kind specified in section 
     523(a) of this title, except as provided in section 
     1232(c).''; and

       (ii) in subsection (c)(2), by inserting ``, except as 
     provided in section 1232(c)'' before the period at the end; 
     and
       (C) in section 1229(a)--
       (i) in paragraph (2), by striking ``or'' at the end;
       (ii) in paragraph (3), by striking the period at the end 
     and inserting ``; or''; and
       (iii) by adding at the end the following:
       ``(4) provide for the payment of a claim described in 
     section 1232(a) that arose after the date on which the 
     petition was filed.''.
       (2) Table of sections.--The table of sections for 
     subchapter II of chapter 12 of title 11, United States Code, 
     is amended by adding at the end the following:

``1232. Claim by a governmental unit based on the disposition of 
              property used in a farming operation.''.

       (c) Effective Date.--The amendments made by this section 
     shall apply to any bankruptcy case that--
       (1) is pending on the date of enactment of this Act and 
     relating to which an order of discharge under section 1228 of 
     title 11, United States Code, has not been entered; or
       (2) commences on or after the date of enactment of this 
     Act.
                                 ______
                                 
      By Mr. RISCH (for himself and Mr. Crapo):
  S. 1430. A bill to authorize the continued use of certain water 
diversions located on National Forest System land in the Frank Church-
River of No Return Wilderness and the Selway-Bitterroot Wilderness in 
the State of Idaho, and for other purposes; to the Committee on Energy 
and Natural Resources.
  Mr. RISCH. Mr. President, I rise today to introduce a bill called the 
Idaho Wilderness Water Facilities Act. This bill is identical to the 
House version, H.R. 876, which was introduced and carried through the 
House by my colleague from Idaho, Representative Mike Simpson, who did 
yeoman's work on pursuing this and putting it together and shepherding 
it through. It passed unanimously in the House. I thank him on behalf 
of all Idahoans for his work on this issue.
  The need for this legislation is simple. The Frank Church River of No 
Return Wilderness, which was designated by Congress in 1980, abuts the 
Selway-Bitterroot Wilderness area, which was designated by Congress in 
1964. These areas contain some of the largest and most rugged remote 
tracts of land in the lower 48 States. It is magnificent in its 
beauty--substantially better, in my opinion, than the Alps.
  There are a number of water diversions within the Idaho wilderness 
areas that have existed since the time of this legislation--since the 
time these wilderness areas were established. Although the diversions 
continue to exist, the owners currently lack authority to maintain and 
repair the facilities.
  Predating the existence of these two wilderness areas, private 
landowners had received permits to maintain and repair water diversions 
that existed on National Forest System lands. The water is used for a 
combination of many things, including, but not limited to, drinking 
water for private cabins and ranches and also for generating 
electricity in some places on a very small scale. Many of the permits 
have since expired, leaving those who own the water diversions without 
any options for mechanically maintaining their water systems. In some 
cases, this lack of management threatens the

[[Page 13011]]

environment and the watersheds in which they exist.
  The Idaho Wilderness Water Facilities Act will give the Secretary of 
Agriculture the authority to reissue and issue special use 
authorizations to the owners of these diversion facilities within the 
Frank Church and the Selway Wilderness areas for the continued 
maintenance of their water facilities. The permits would only be issued 
if the owner could prove the facility existed prior to those lands 
being designated as wilderness, the facility has been used to deliver 
water to the owner's land since the designation, and the owner had a 
valid water right and it would not be practical to move the facility 
outside of the wilderness area. Undoubtedly, in exercising the 
discretion, the Secretary would ensure that in no way would it 
denigrate these wilderness areas. There are several different 
individuals or businesses that have water diversions in these 
wilderness areas that meet the description I have given.
  Earlier this week the Senate Committee on Energy and Natural 
Resources held a hearing on H.R. 876. The U.S. Forest Service appeared 
at that hearing and testified in support of this bill. I look forward 
to working with Chairman Wyden and Ranking Member Murkowski to pass 
this bill quickly so as to allow for the maintenance of this water 
infrastructure.
                                 ______
                                 
      By Ms. HIRONO:
  S. 1432. A bill to direct the Secretary of the Interior to study the 
suitability and feasibility of designating portions of the Ka'u Coast 
in the State of Hawaii as a unit of the National Park System; to the 
Committee on Energy and Natural Resources.
  Ms. HIRONO. Mr. President, I rise today to introduce the Ka`u Coast 
Preservation Act of 2013, a bill directing the National Park Service to 
assess the feasibility of designating certain coastal lands on the Ka`u 
Coast of the island of Hawaii as units of the National Park System.
  The National Park Service conducted a reconnaissance survey in 2006 
that made a preliminary assessment of whether the Ka`u Coast would meet 
the National Park Service's demanding criteria as a resource of 
national significance. The reconnaissance survey concluded that ``based 
upon the significance of the resources in the study area and the 
current integrity and intact condition of these resources, a 
preliminary finding of national significance and suitability can be 
concluded.'' The report goes on to recommend that Congress proceed with 
a full resource study of the area.
  Since the time of the initial reconnaissance report and my 
introduction of this Act in previous Congresses, two additional 
properties in the Ka`u that deserve evaluation have come to my 
attention: the Kahuku Coastal Property, also known as Sands of South 
Kona and Road to the Sea, and the Nani Kahuku `Aina property adjacent 
to Pohue Bay. I have added these areas to the study area for the full 
resource study.
  The coastline of Ka`u is still largely unspoiled. The study area 
contains significant natural, geological, and archeological features. 
The northern part of the study area is adjacent to Hawaii Volcanoes 
National Park and contains a number of noteworthy geological features, 
including an ancient lava tube known as the Great Crack, which the 
National Park Service has expressed interest in acquiring in the past.
  The study area includes both black and green sand beaches as well as 
a significant number of endangered and threatened species, most notably 
the endangered hawksbill turtle, at least half of the Hawaiian 
population of this rare sea turtle nests within the study area, the 
threatened green sea turtle, the highly endangered Hawaiian monk seal, 
the endangered Hawaiian hawk, the endangered Hawaiian bat, native bees, 
the endangered and very rare Hawaiian orange-black damselfy, the 
largest population in the State, and a number of native birds. Humpback 
whales and spinner dolphins also frequent the area. The Ka`u Coast also 
boasts some of the best remaining examples of native coastal vegetation 
in Hawaii.
  The archeological resources related to ancient Hawaiian settlements 
within the study area are also very impressive. These include dwelling 
complexes, heiau, religious shrines, walls, fishing and canoe houses or 
sheds, burial sites, petroglyphs, water and salt collection sites, 
caves, and trails. The Ala Kahakai National Historic Trail runs through 
the study area.
  The Ka'u Coast is a truly remarkable area: its combination of 
natural, archeological, cultural, and recreational resources, as well 
as its spectacular viewscapes, are an important part of Hawaii's and 
our nation's natural and cultural heritage.
  As this process evolves, the successful preservation of this pristine 
land will depend on the federal government working closely with local 
stakeholders, seeking their input, and collaborating with them to 
address concerns as they arise. I encourage the National Park Service 
to continue working with all involved to ensure this coastline is 
preserved for decades to come.
  I believe a full feasibility study, which was recommended in the 
reconnaissance survey, will confirm that the area meets the National 
Park Service's high standards as an area of national significance.
  I urge my colleagues to join me in supporting this bill.
                                 ______
                                 
      By Mr. WYDEN (for himself and Mr. Merkley):
  S. 1437. A bill to provide for the release of the reversionary 
interest held by the United States in certain land conveyed in 1954 by 
the United States, acting through the Director of the Bureau of Land 
Management, to the State of Oregon for the establishment of the 
Hermiston Agricultural Research and Extension Center of Oregon State 
University in Hermiston, Oregon; to the Committee on Energy and Natural 
Resources.
  Mr. WYDEN. Mr. President, today I rise to introduce a bill that will 
give Oregon State University the flexibility to continue its important 
agricultural work in Hermiston, Oregon. I am pleased to be joined on 
this bill with my colleague from Oregon, Senator Merkely. I look 
forward to working with Senator Merkley, other colleagues, and 
supporters of the bill to update the federal interests in the land to 
match current needs and conditions.
  The Hermiston Agricultural Research & Extension Center, HAREC, 
provides support to one of the most unique and important agricultural 
areas in the world: the Columbia Basin region of Oregon and Washington. 
As one of Oregon State University's, OSU, 12 Agricultural Experiment 
Stations, HAREC concentrates on the discovery and implementation of 
agricultural opportunities while also providing solutions to production 
issues for regional growers and beyond.
  Research at HAREC emphasizes identification of new crop 
opportunities, improved production practices that save money while 
reducing inputs, plant breeding and varietal evaluation of cereals and 
potatoes. Through this work it has developed new lines with higher 
nutritional value, integrated pest management of insects and insect-
transmitted diseases, and provided information related to environmental 
issues and salmon restoration. In recent years the center provided 
leadership, research, and new knowledge essential to allow growers to 
diversify production and convert 30,000 acres of commodity crops to 
high-value crops. The station has led efforts to cultivate value-added 
agriculture in Morrow and Umatilla counties, resulting in over 
$50,000,000 in annual economic return.
  The history of HAREC and a Umatilla agricultural research center 
spans more than a century. The Federal Government paved the way in the 
development of farming and ranching in the Umatilla Basin. In 1954, the 
Bureau of Land Management granted land to the State of Oregon on the 
condition that the land is used for cooperative agricultural 
experimental work. Over the past nearly 60 years, OSU has developed a 
center with state-of-the-art laboratories, irrigation technology 
abilities, greenhouses, screenhouses and research and extension 
faculty. HAREC now supports nearly 500,000 acres of irrigated 
agriculture.

[[Page 13012]]

  Just as agriculture in the Columbia Basin has grown by leaps and 
bounds since 1954, so has the community of Hermiston. This bill removes 
the reversionary clause from the original land grant while conditioning 
that any consideration gained by OSU from the sale, lease, or other use 
of the land be put back into agricultural experimental and research 
work. It gives OSU the flexibility to adapt to the population growth 
and city expansion that will ultimately necessitate the relocation of 
HAREC from inside the urban growth boundary to a more rural location. 
Without this bill, moving the station would mean triggering the federal 
reversionary clause and losing HAREC land and all the buildings and 
improvements over nearly six decades to the Federal Government. I'm 
sponsoring this bill to ensure HAREC can continue for another hundred 
years.
  Regional leaders and Oregon State University support removing the 
barriers to the continued operation of the center. I express my 
gratitude for their work with me on this legislation. I also look 
forward to working with Senator Merkley to advance this bill and 
support the agricultural heart of the regional economy.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 1437

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Hermiston Agricultural 
     Research and Extension Center Land Conveyance Act''.

     SEC. 2. DEFINITIONS.

       In this Act:
       (1) Research center land.--The term ``research center 
     land'' means the approximately 290 acres of land in 
     Hermiston, Oregon, identified as the ``Reversionary Interest 
     Area'' on the map entitled ``Hermiston Agricultural Research 
     and Extension Center'' and dated July 23, 2013, including any 
     improvements to, and building on, the land.
       (2) Patent.--The term ``patent'' means the patent granted 
     by the Director of the Bureau of Land Management (acting on 
     behalf of the United States) to the State, numbered 130889, 
     and dated September 17, 1954.
       (3) State.--The term ``State'' means the State of Oregon 
     (acting through the Oregon State Board of Higher Education on 
     behalf of Oregon State University).

     SEC. 3. RELEASE OF REVERSIONARY INTEREST AND RESERVATION OF 
                   MINERAL RIGHTS TO BUREAU OF LAND MANAGEMENT 
                   LAND CONVEYED TO THE STATE OF OREGON FOR THE 
                   ESTABLISHMENT OF HERMISTON AGRICULTURAL 
                   RESEARCH AND EXTENSION CENTER.

       (a) Release of Reversionary Interest and Reservation of 
     Mineral Rights.--Subject to subsection (b), there are 
     released by the United States without consideration--
       (1) the reversionary interest retained by the United States 
     to the research center land under the patent; and
       (2) the reservation of mineral rights by the United States 
     to the research center land under the patent.
       (b) Condition.--The release of the reversionary interest 
     under subsection (a)(1) is subject to the condition that the 
     State agrees to use any consideration received by the State 
     from the sale, lease, or other conveyance of the research 
     center land after the date of enactment of this Act for 
     agricultural experimental and research work of Oregon State 
     University.
       (c) Instrument of Release.--The Secretary of the Interior 
     (acting through the Director of the Bureau of Land 
     Management) shall execute and file in the appropriate office 
     a deed of release, amended deed, or other appropriate 
     instrument reflecting the release under subsection (a).
                                 ______
                                 
      By Mr. REID (for Ms. Landrieu):
  S. 1440. A bill to amend the Small Business Act to allow the use of 
physical damage disaster loans for the construction of safe rooms; to 
the Committee on Small Business and Entrepreneurship.
  Ms. LANDRIEU. Mr. President, I come to the floor today to speak on an 
issue that is of great importance to my home state of Louisiana: 
disaster preparedness. As you know, along the Gulf Coast, we keep an 
eye trained on the Gulf of Mexico during hurricane season. This is 
following the devastating one-two punch of Hurricanes Katrina and Rita 
of 2005 as well as Hurricanes Gustav and Ike in 2008. Unfortunately, 
our region also has had to deal with the economic and environmental 
damage from the Deepwater Horizon disaster in 2010 and more recently 
Hurricane Isaac. For this reason, as Chair of the Senate Committee on 
Small Business and Entrepreneurship, ensuring Federal disaster programs 
are effective and responsive to disaster victims is one of my top 
priorities. While the Gulf Coast is prone to hurricanes, other parts of 
the country are no strangers to disaster. For example, the Midwest and 
Southeast have tornadoes, California experiences earthquakes and 
wildfires, and the Northeast sees crippling snowstorms. So no part of 
our country is spared from disasters--disasters which can and will 
strike at any moment. This certainly hit home when the northeast was 
struck by Hurricane Sandy in October of last year and when Moore, 
Oklahoma was hit by a massive tornado earlier this summer. With this in 
mind, we must ensure that families have the resources they need to be 
better prepared the next time disasters strike their communities.
  In order to give families in tornado prone areas more resources to 
protect lives and property, I am proud to file the Tornado Family 
Safety Act of 2013. Representative Tom Cole from Oklahoma is filing the 
House companion bill today as well. I want to thank him for being my 
partner in this effort as his district has seen firsthand how 
destructive these tornadoes can be to homes and businesses. In 
particular, our bill would allow U.S. Small Business Administration, 
SBA, disaster home mitigation loans to go towards the construction of 
tornado safe rooms. Under current law, SBA can increase the size of a 
home disaster loan by 20 percent of the total damage to decrease future 
disaster risk. The Small Business Act lists out examples of mitigation 
activities such as ``. . . retaining walls, sea walls, grading and 
contouring land, relocating utilities and modifying structures . . .'' 
The bill would add safe rooms as an eligible activity so homeowners 
would have access to these low-interest loans. It does not replace or 
duplicate other programs, but instead provides a backstop for families 
in disaster prone areas.
  Under guidelines from the Federal Emergency Management Agency, FEMA, 
and the International Code Council, ICC, a safe room should withstand 
250 mph winds and the impact of a 15-pound plank hitting a wall at 100 
miles per hour, according to the Insurance Institute for Business and 
Home Safety, IBHS. Safe rooms designed to the FEMA and ICC standards 
are recommended for both tornadoes and hurricanes. For individual 
homes, a safe room could range anywhere from $3,000 to $12,000.
  The concept for the bill came about after discussions with the FEMA 
and the SBA on recent disasters. We learned that safe rooms are not 
allowable under FEMA preparedness grant programs. Safe rooms would be 
considered construction and FEMA only allows for limited construction 
under the preparedness grants for very specific items, such as 
communications towers, as specified in the appropriations acts. Safe 
rooms are an eligible activity under the FEMA Hazard Mitigation Grant 
Program, HMGP. States decide how they use their HMGP, and reimbursing 
safe room construction for homeowners could be eligible. However, given 
the larger cost involved in reimbursing individual homeowners, HMGP 
funded safe rooms are oftentimes community-owned not residential.
  As I have indicated, FEMA Individual Assistance does not allow the 
construction of safe rooms. FEMA does allow HMGP grants for safe rooms 
and states can decide to reimburse safe room construction for 
homeowners. However, most are typically community-owned not residential 
since HMGP funds both single and multi-use facilities--schools, 
community centers, etc. For example, according to FEMA data, out of 21 
states funding safe rooms, only four states, Oklahoma, Alabama, 
Mississippi, and Arkansas, represent the bulk of residential safe 
rooms, appproximately 21,600 of the 21,880 funded.
  But let me give you an example of how the needs for these types of 
structures are often outpacing the resources

[[Page 13013]]

currently available. Following the May 20, 2013 tornado there, Moore, 
OK, Mayor Glenn Lewis proposed a requirement that all new homes built 
in the city include a safe room. Oklahoma Governor Fallin also told the 
Associated Press that only 100 of the 1,752 public schools in Oklahoma 
have a safe room. In a subsequent June 9, 2013, interview, Albert 
Ashwood, Director of the Oklahoma Department of Emergency Management, 
estimated that putting safe rooms in 1,000 Oklahoma schools, via 
traditional FEMA grant programs, would cost between $500 million to $1 
billion alone. So in the near future, there is likely to be less, not 
more, Federal funding available at the State level for these types of 
residential safe rooms. Our bill would allow a backstop to homeowners 
in the event that other Federal/State funds are not available for safe 
rooms for that particular disaster.
  In closing, I believe that this commonsense disaster reform will 
greatly benefit homeowners impacted by future tornadoes and other 
disasters.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 1440

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Tornado Family Safety Act of 
     2013''.

     SEC. 2. USE OF PHYSICAL DAMAGE DISASTER LOANS.

       Section 7(b)(1)(A) of the Small Business Act (15 U.S.C. 
     636(b)(1)(A)) is amended--
       (1) by striking ``the Administration may increase'' and 
     inserting ``the Administration may, subject to section 18(a), 
     increase''; and
       (2) by striking ``and modifying structures'' and inserting 
     ``, and modifying structures (including construction of a 
     safe room or similar storm shelter designed to protect 
     property and occupants from tornadoes or other natural 
     disasters)''.
                                 ______
                                 
      By Mr. UDALL of Colorado (for himself and Mr. Bennet):
  S. 1443. A bill to facilitate the remediation of abandoned hardrock 
mines, and for other purposes; to the Committee on Environment and 
Public Works.
  Mr. UDALL of Colorado. Mr. President, today I am reintroducing 
legislation designed to help promote the cleanup of abandoned and 
inactive hard rock mines that are a great detriment to the environment 
and public health throughout the country, but especially to the West. I 
want to thank my colleague Senator Bennet for joining me in this 
effort.
  For over one hundred years, miners and prospectors have searched for 
and developed valuable ``hard rock'' minerals--gold, silver, copper, 
molybdenum, and others. Hard rock mining has played a key role in the 
history of Colorado and other states, and the resulting mineral wealth 
has been an important contributor to our economy and the development of 
essential products.
  Too often, however, the miners would abandon their work and move on, 
seeking riches over the next mountain. The resulting legacy of unsafe 
open mine shafts and acid mine drainages can be seen throughout the 
country and especially on public lands in the West where mineral 
development was encouraged to help settle our region.
  Unfortunately, many of our current environmental laws designed to 
mitigate the impact from operating hard rock mines are of limited 
effectiveness when applied to abandoned and inactive mines. As a 
result, many of these old mines continue to pollute streams and rivers 
and pose a risk to the health of people who live nearby or downstream.
  The bill I am reintroducing today will help address this impediment 
and make it easier for volunteers, who had no role in creating the 
problem, to help clean up these sites and improve the environment. It 
does so by providing a new permit program under the Clean Water Act 
whereby volunteers can, under an approved plan, reduce the water 
pollution flowing from an abandoned mine. At the same time, volunteers 
will not be exposed to the full liability and ongoing responsibility 
provisions of the Clean Water Act.
  I would be remiss not to thank the Environmental Protection Agency 
for its work in addressing this issue. Most recently, EPA issued a 
memorandum on December 12, 2012, to reduce the Clean Water Act legal 
vulnerability faced by ``Good Samaritans'' by clarifying that parties 
who volunteer to clean up these abandoned sites are generally not 
responsible for obtaining a permit under the Clean Water Act both 
during and following a successful cleanup. While this was an important 
step forward, my legislation will provide binding legal protections for 
Good Samaritans, allowing them to move forward--knowing the long-term 
certainty of their rights--with the imperative work of mine cleanup.
  The new permits proposed in this bill would help address problems 
that have frustrated federal and state agencies throughout the country. 
As population growth continues near these old mines, more and more 
risks to public health and safety are likely to occur. We simply must 
begin to address this issue--not only to improve the environment, but 
also to ensure that our water supplies are safe and usable. This bill 
does not address all the concerns some would-be Good Samaritans may 
have about initiating cleanup projects and I am committed to continue 
working to address those additional concerns, through additional 
legislation and in other ways. However, this bill can make a real 
difference, and I think it deserves approval without unnecessary delay.
                                 ______
                                 
      By Mr. WYDEN (for himself and Mr. Isakson):
  S. 1444. A bill to amend title XVIII of the Social Security Act to 
provide payment under part A of the Medicare Program on a reasonable 
cost basis for anesthesia services furnished by an anesthesiologist in 
certain rural hospitals in the same manner as payments are provided for 
anesthesia services furnished by anesthesiologist assistants and 
certified anesthetists in such hospitals; to the Committee on Finance.
  Mr. WYDEN. Mr. President. I am honored to join my colleague from 
Georgia, Senator Johnny Isakson, in introducing a bill essential to 
expanding health care options for rural hospitals and beneficiaries 
living in rural areas, the Medicare Access to Rural Anesthesiology Act.
  As it stands today, low Medicare Part B anesthesia payments and low 
patient volume in rural areas makes it difficult for rural hospitals to 
attract and retain anesthesiologists. Our legislation would take an 
important step towards leveling the playing field between urban and 
rural health care by ensuring that rural Medicare beneficiaries have 
similar access to anesthesia services.
  Generally, Medicare pays for anesthesia services under the Medicare 
Part B fee schedule, but in order to attract anesthesia providers to 
rural areas, a statutory exception was created in the 1980s that allows 
eligible rural hospital to use Part A funds to employ or contract with 
non-physician anesthesiologist assistants, AA, or certified registered 
nurse anesthetists, CRNA. This policy however, does not permit eligible 
hospitals to use pass-through funds to pay anesthesiologists. Leaving 
anesthesiologists out also prevents AAs from receiving pass through 
payment because AAs must have an anesthesiologist on premises in order 
to practice. As a result, many folks in rural areas only have access to 
one type of anesthesia provider compared to folks in urban areas who 
can easily visit an anesthesiologist, CRNA, or an AA.
  Our legislation would allow eligible rural hospitals to use ``pass-
through'' Part A funds to employ CRNAs, AAs, and anesthesiologists. 
This common sense change would give eligible rural hospitals the power 
to choose the anesthesia providers that best suit the medical needs of 
their patients, and would provide these hospitals with another tool to 
recruit and retain anesthesiology professionals as well as expand the 
availability of anesthesiology care in medically underserved areas.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed In the Record.

[[Page 13014]]

  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 1444

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Medicare Access to Rural 
     Anesthesiology Act of 2013''.

     SEC. 2. MEDICARE PART A PAYMENT FOR ANESTHESIOLOGIST SERVICES 
                   IN CERTAIN RURAL HOSPITALS BASED ON CRNA PASS-
                   THROUGH RULES.

       (a) In General.--Section 1814 of the Social Security Act 
     (42 U.S.C. 1395f) is amended by adding at the end the 
     following new subsection:

    ``Anesthesiologist Services Provided in Certain Rural Hospitals

       ``(m)(1) Notwithstanding any other provision of this title, 
     coverage and payment shall be provided under this part for 
     physicians' services that are anesthesia services furnished 
     by a physician who is an anesthesiologist in a rural hospital 
     described in paragraph (3) in the same manner as payment is 
     made under the exception provided in section 9320(k) of the 
     Omnibus Budget Reconciliation Act of 1986, as amended by 
     section 6132 of the Omnibus Budget Reconciliation Act of 1989 
     (42 U.S.C. 1395k note) (relating to payment on a reasonable 
     cost, pass-through basis), for certified registered nurse 
     anesthetist services furnished by a certified registered 
     nurse anesthetist in a hospital described in such section.
       ``(2) No payment shall be made under any other provision of 
     this title for physicians' services for which payment is made 
     under this subsection.
       ``(3) A rural hospital described in this paragraph is a 
     hospital described in section 9320(k) of the Omnibus Budget 
     Reconciliation Act of 1986, as so amended (42 U.S.C. 1395k 
     note), except that--
       ``(A) any reference in such section to a `certified 
     registered nurse anesthetist' or `anesthetist' is deemed a 
     reference to a `physician who is an anesthesiologist' or 
     `anesthesiologist', respectively; and
       ``(B) any reference to `January 1, 1988' or `1987' is 
     deemed a reference to such date and year as the Secretary 
     shall specify.''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to services furnished during cost reporting 
     periods beginning on or after the date of the enactment of 
     this Act.
                                 ______
                                 
      By Mr. ROCKEFELLER:
  S. 1449. A bill to amend the Internal Revenue Code of 1986 to provide 
that income attributable to certain passenger cruise voyages beginning 
or ending in the United States shall be treated as effectively 
connected with the conduct of a trade or business within the United 
States; to the Committee on Finance.
  Mr. ROCKEFELLER. Mr. President, today I am introducing comprehensive 
legislation to repeal corporate tax loopholes that allow the cruise 
industry to avoid paying its fair share of U.S. corporate income taxes.
  These bills change the treatment of the revenue that foreign-based 
cruise lines earn from ships that embark or disembark nearly 15 million 
passengers a year in the United States. A string of recent incidents 
has demonstrated that when cruise ships get into trouble, the companies 
rely on the resources and assistance of the U.S. Navy and Coast Guard. 
The industry also uses the services of over 20 other U.S. agencies to 
the tune of millions of taxpayer dollars every year.
  The majority of cruise companies are organized as foreign 
corporations, even though many of their headquarters and executives are 
located in the United States. By incorporating in foreign countries, 
the cruise industry enjoys a special exemption under section 883 of the 
Internal Revenue Code, which provides that certain foreign corporations 
are not subject to U.S. taxes on income derived from the international 
operation of ships, even if the source of the income is in the United 
States.
  Today, I am introducing two bills, S. 1449 and S. 1450. The first 
would eliminate the section 883 special exemption for cruise industry 
income derived from passenger cruise voyages that embark or disembark 
passengers in the United States. This income would be treated as being 
U.S. sourced and effectively connected with a U.S. trade or business, 
so it would be subject to U.S. taxes at the same rate as other income.
  The second bill would impose a 5 percent excise tax on gross income 
from cruises where passengers embark or disembark in the United States. 
Funds generated from the excise tax will help fund a national program 
to make infrastructure improvements vital to the efficient 
transportation of goods and services.
  For too long, the cruise industry has been able to use taxpayer 
provided services without actually paying for them. It is time the 
cruise industry begins to pay for the services it uses.
  Mr. President, I ask unanimous consent that the text of the bills be 
printed in the Record.
  There being no objection, the text of the bills were ordered to be 
printed in the Record, as follows:

                                S. 1449

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

     SECTION 1. TAXATION OF UNITED STATES CRUISE INDUSTRY INCOME 
                   OF NONRESIDENT ALIENS AND FOREIGN CORPORATIONS.

       (a) United States Cruise Industry Income Treated as 
     Effectively Connected to the Conduct of a Trade or Business 
     Within the United States.--
       (1) Income from sources without the united states.--
       (A) In general.--Paragraph (4) of section 864(c) of the 
     Internal Revenue Code of 1986 is amended by redesignating 
     subparagraph (D) as subparagraph (C) and by inserting after 
     subparagraph (C) the following new subparagraph:
       ``(C) United states cruise industry income.--
       ``(i) In general.--United States cruise industry income 
     shall be treated as effectively connected with the conduct of 
     a trade or business within the United States.
       ``(ii) United states cruise industry income.--For purposes 
     of this subparagraph, the term `United States cruise industry 
     income' means income attributable to any covered passenger 
     cruise (as defined in paragraph (8)), including income 
     directly or indirectly attributable to the carriage of 
     passengers and any on-board or off-board activities 
     incidental to such covered passenger cruise.''.
       (B) Covered passenger cruise.--Subsection (c) of section 
     864 of such Code is amended by adding at the end the 
     following new paragraph:
       ``(8) Covered passenger cruise.--For purposes of paragraph 
     (4)(C)--
       ``(A) Definition.--
       ``(i) In general.--The term `covered passenger cruise' 
     means a voyage of a commercial passenger cruise vessel--

       ``(I) that extends over 1 or more nights,
       ``(II) during which passengers embark or disembark the 
     vessel in the United States.

       ``(ii) Exceptions for certain voyages.--Such term shall not 
     include any voyage--

       ``(I) on any vessel owned or operated by the United States, 
     a State, or any subdivision thereof,
       ``(II) which occurs exclusively on the inland waterways of 
     the United States, or
       ``(III) in which a vessel in the usual course of employment 
     proceeds, without an intervening foreign port of call from 
     one port or place in the United States to the same port or 
     place or to another port or place in the United States.

       ``(B) Passenger cruise vessel.--For purposes of 
     subparagraph (A)--
       ``(i) In general.--The term `passenger cruise vessel' means 
     any passenger vessel having berth or stateroom accommodations 
     for at least 250 passengers.
       ``(ii) Exceptions.--Such term shall not include any ferry, 
     recreational vessel, sailing school vessel, small passenger 
     vessel, offshore supply vessel, or any other vessel 
     determined under regulations by the Secretary to be excluded 
     from the application of this part.
       ``(iii) Definitions.--Any term used in this section which 
     used in chapter 21 of title 46, United States Code, shall 
     have the meaning given such term under section 2101 of such 
     title.''.
       (C) Conforming amendment.--Subparagraph (A) of section 
     864(c)(4) of such Code is amended by striking ``subparagraphs 
     (B) and (C)'' and inserting ``subparagraphs (B), (C), and 
     (D)''.
       (2) Income from sources within the united states.--
     Paragraph (4) of section 887(b) of such Code is amended by 
     adding at the end the following flush sentence:

     ``The preceding sentence shall not apply to with respect to 
     any United State source gross transportation income which is 
     United States cruise industry income (as defined in section 
     864(c)((4)(C)(ii)).''.
       (b) Repeal of Exemption From Gross Income for Certain 
     Taxpayers.--
       (1) Nonresident aliens.--Paragraph (1) of section 872(b) of 
     the Internal Revenue Code of 1986 is amended by inserting 
     ``(other than United States cruise industry income (as 
     defined in section 864(c)(4)(C)))'' after ``or ships''.
       (2) Foreign corporations.--Paragraph (1) of section 883(a) 
     of such Code is amended by inserting ``(other than United 
     States cruise industry income (as defined in section 
     864(c)(4)(C)))'' after ``or ships''.
       (c) Income Tax Treaties.--Section 894 of the Internal 
     Revenue Code of 1986 is amended by adding at the end the 
     following new subsection:

[[Page 13015]]

       ``(d) Special Rule for United States Cruise Industry 
     Income.--Notwithstanding subsection (a), no tax exemption or 
     reduced tax rate shall be permitted under any treaty of the 
     United States with respect to United States cruise industry 
     income (as defined in section 864(c)(4)(C)).''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to income attributable to voyages made after the 
     date of the enactment of this Act.

                                S. 1450

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

     SECTION 1. EXCISE TAX ON GROSS RECEIPTS DERIVED FROM CRUISES.

       (a) In General.--Subchapter B of chapter 36 of the Internal 
     Revenue Code of 1986 is amended by inserting after section 
     4472 the following:

                       ``PART II--AD VALOREM TAX

``Sec. 4476. Imposition of tax.
``Sec. 4477. Definitions.

     ``SEC. 4476. IMPOSITION OF TAX.

       ``(a) In General.--In addition to any other tax, there is 
     hereby imposed a tax of 5 percent of the allocable amount 
     with respect to any covered passenger cruise.
       ``(b) By Whom Paid.--The tax imposed by this section shall 
     be paid by the person providing the covered passenger cruise.

     ``SEC. 4477. DEFINITIONS.

       ``For purposes of this section--
       ``(1) Covered passenger cruise.--
       ``(A) In general.--The term `covered passenger cruise' 
     means a voyage of a commercial passenger cruise vessel--
       ``(i) that extends over 1 or more nights,
       ``(ii) during which passengers embark or disembark the 
     vessel in the United States.
       ``(B) Exceptions for certain voyages.--Such term shall not 
     include any voyage--
       ``(i) on any vessel owned or operated by the United States, 
     a State, or any subdivision thereof,
       ``(ii) which occurs exclusively on the inland waterways of 
     the United States, or
       ``(iii) in which a vessel in the usual course of employment 
     proceeds, without an intervening foreign port of call from 
     one port or place in the United States to the same port or 
     place or to another port or place in the United States.
       ``(2) Passenger cruise vessel.--
       ``(A) In general.--The term `passenger cruise vessel' means 
     any passenger vessel--
       ``(i) having berth or stateroom accommodations for at least 
     250 passengers, and
       ``(ii) that is used in the business of carrying passengers 
     for hire.
       ``(B) Exceptions.--Such term shall not include any ferry, 
     recreational vessel, sailing school vessel, small passenger 
     vessel, offshore supply vessel, or any other vessel 
     determined under regulations by the Secretary to be excluded 
     from the application of this part.
       ``(C) Definitions.--Any term used in this section which is 
     used in chapter 21 of title 46, United States Code, shall 
     have the meaning given such term under section 2101 of such 
     title.
       ``(3) Allocable amount.--The term `allocable amount' 
     means--
       ``(A) in the case in which a majority of the passengers on 
     any covered passenger cruise embark or disembark in the 
     United States, 100 percent of the gross receipts attributable 
     to such covered passenger cruise, and
       ``(B) in any other case, 50 percent of the gross receipts 
     attributable to such covered passenger cruise.
       ``(4) United states.--The term `United States' includes any 
     possession of the United States.''.
       (b) Conforming Amendment.--Subchapter B of chapter 36 of 
     the Internal Revenue Code of 1986 is amended by striking all 
     preceding section 4471 and inserting the following:

                ``Subchapter B--Transportation by Water

                      ``PART I--Per Passenger Tax

                       ``PART II--Ad Valorem Tax

                      ``PART I--PER PASSENGER TAX

``Sec. 4471. Imposition of tax.
``Sec. 4472. Definitions.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to voyages made after the date of the enactment 
     of this Act.

     SEC. 2. INTERMODAL INFRASTRUCTURE TRUST FUND.

       (a) In General.--Subchapter A of Chapter 98 of the Internal 
     Revenue Code of 1986 is amended by adding at the end the 
     following new section:

     ``SEC. 9512. INTERMODAL INFRASTRUCTURE TRUST FUND.

       ``(a) Creation of Trust Fund.--There is hereby established 
     in the Treasury of the United States a trust fund to be known 
     as the `Intermodal Infrastructure Trust Fund', consisting of 
     such amounts as may be appropriated or credited to the 
     Intermodal Infrastructure Trust Fund in this section or 
     section 9602(b).
       ``(b) Transfers to Intermodal Infrastructure Trust Fund.--
     There are hereby appropriated to the Intermodal 
     Infrastructure Trust Fund amounts equivalent to the taxes 
     received in the Treasury under section 4471.
       ``(c) Expenditures From Intermodal Infrastructure Trust 
     Fund.--Amounts in the Intermodal Infrastructure Trust Fund 
     shall be available, as provided in appropriations Acts, for 
     transportation improvement, including--
       ``(1) the construction or improvement of--
       ``(A) passenger or freight rail lines,
       ``(B) highways,
       ``(C) bridges,
       ``(D) airports,
       ``(E) air traffic control systems,
       ``(F) port or marine facilities,
       ``(G) inland waterways,
       ``(H) transmission or distribution pipelines,
       ``(I) public transportation facilities or systems
       ``(J) intercity passenger bus or passenger rail facilities 
     or equipment, and
       ``(K) freight rail facilities or equipment, and
       ``(2) planning, preparation, or design of any project 
     described in paragraph (1).''.
       (b) Clerical Amendment.--The table of sections for 
     subchapter A of Chapter 98 of such Code is amended by adding 
     at the end the following new item:

``Sec. 9512. Intermodal Infrastructure Trust Fund.''.
                                 ______
                                 
      By Mrs. FEINSTEIN (for herself, Mr. Reid, Mr. Heller, and Mrs. 
        Boxer):
  S. 1451. A bill to provide for environmental restoration activities 
and forest management activities in the Lake Tahoe Basin, to amend 
title 18, United States Code, to prohibit the importation or shipment 
of quagga mussels, and for other purposes; to the Committee on 
Environment and Public Works.
  Mrs. FEINSTEIN. Mr. President, I rise today to again discuss the need 
to restore and protect Lake Tahoe. Lake Tahoe is a national treasure. 
Her alpine beauty has drawn and inspired people for centuries: artists 
and poets, John Muir and Mark Twain, and countless millions the world 
over.
  As a girl, I went to Lake Tahoe to ride horses through the woods, to 
swim in the clear blue waters and to bike around the magnificent Basin.
  For over 16 years, representatives from different ends of the 
political spectrum have come together to Keep Tahoe Blue.
  The challenges are great. Climate change and drought have created a 
persistent threat from catastrophic wildfire. Sedimentation and 
pollution threaten water quality and the lake's treasured clarity. And 
invasive species threaten the economy of the region.
  The time to act is now, and the federal government must take a 
leading role--78 percent of the land surrounding Lake Tahoe is public 
land, primarily the Eldorado, Toiyabe and Tahoe National Forests.
  That is why today I am reintroducing the Lake Tahoe Restoration Act 
of 2013, which is co-sponsored by Senators Harry Reid, Dean Heller and 
Barbara Boxer.
  The bill would continue the Federal commitment at Lake Tahoe by 
authorizing $415 million over ten years to improve water clarity, 
reduce the threat of catastrophic fire, combat invasive species, and 
restore and protect the environment in the Lake Tahoe Basin.
  Specifically, it would do the following:
  Provide $243 million over 10 years for the highest priority 
restoration projects, according to scientific data. The legislation 
authorizes at least $138 million for stormwater management and 
watershed restoration projects scientifically determined to be the most 
effective ways to improve water clarity.
  This bill also requires prioritized ranking of environmental 
restoration projects and authorizes $80 million for State and local 
agencies to implement these projects with costs being split evenly 
between the Federal agencies and non-federal partners.
  Eligible projects must demonstrate their cost effectiveness, 
stakeholder support, ability to leverage non-federal contributions and 
meet environmental improvement goals.
  Implementation of priority projects will improve water quality, 
forest health, air quality and fish and wildlife habitat around Lake 
Tahoe.
  Authorizes $135 million over ten years to reduce the threat of 
wildfire in Lake Tahoe. These funds will finance hazardous fuels 
reduction projects including grants to local fire agencies, who must 
contribute at least 25 percent of project costs.

[[Page 13016]]

  The bill also authorizes important restoration work related to the 
devastating 2007 Angora fire, which destroyed 242 residences and 67 
commercial structures. Fuels treatment on Washoe Tribal lands, wildfire 
prevention planning, and improvements to local water district 
infrastructure to fight wildfires that reach urban areas are eligible 
for grant funding.
  The bill also creates incentives for local communities to have 
dedicated funding for defensible space inspections and enforcement.
  Protecting Lake Tahoe from the threat of quagga mussels and other 
invasive aquatic species. Protecting Lake Tahoe from the threat of 
quagga mussels and other invasive aquatic species is a major priority 
because of the serious threats posed to Lake Tahoe.
  University of California, Davis and University of Nevada, Reno 
scientists report that they have found up to 3,000 Asian clams per 
square meter at spots between Zephyr Point and Elk Point in Lake Tahoe. 
The spreading Asian clam population could put sharp shells and rotting 
algae on the Lake's beaches and help spread other invasive species such 
as quagga mussels.
  The bill would authorize $30 million for watercraft inspections and 
removal of existing invasive species. It would require all watercraft 
to be inspected and decontaminated if they are determined to be a risk 
to the lake.
  These invasive species threats are serious. For example, one quagga 
or zebra mussel can lay 1 million eggs in a year. This means that a 
single boat carrying quagga could devastate the lake's biology, local 
infrastructure, and the local economy.
  The threat to Lake Tahoe cannot be overstated. In 2007 quagga mussels 
were discovered in Lake Mead. In the 6 years since, their population 
has swelled exponentially. Today there are more than 3 trillion. The 
infestation is probably irreversible.
  There is good news. There is promising news on this front. Scientists 
have begun testing a new strategy by placing long rubber mats across 
the bottom of Lake Tahoe to cut off the oxygen to the Asian clams. 
Early research suggests that these mats were very effective at killing 
the clams. We continue to learn from this important research about how 
best to manage invasive species.
  We can fight off these invaders. But it will require drive and 
imagination and the help authorized within this bill.
  Supports reintroduction of the Lahontan Cutthroat Trout. The 
legislation authorizes $20 million over 10 years for the Lahontan 
Cutthroat Trout Recovery Plan. The Lahontan Cutthroat Trout is an 
iconic species that has an important historic legacy in Lake Tahoe.
  When John C. Fremont first explored the Truckee River in January of 
1844, he called it the Salmon Trout River because he found the Pyramid 
Lake Lahontan Cutthroat Trout. The trout relied on the Truckee River 
and its tributaries for their spawning runs in spring, traveling up the 
entire river's length as far as Lake Tahoe and Donner Lake, where they 
used the cool, pristine waters and clean gravel beds to lay their eggs. 
But dams, pollution and overfishing caused the demise of the Lahontan 
Cutthroat Trout.
  Lake Tahoe is one of the historic 11 lakes where Lahontan Cutthroat 
Trout flourished in the past, and it's a critical part of the strategy 
to recover the species.
  Funds scientific research. The legislation authorizes $30 million 
over ten years for scientific programs and research which will produce 
information on long-term trends in the Basin and inform the most cost-
effective projects.
  Prohibiting mining operations in the Tahoe Basin. This legislation 
would prohibit new mining operations in the Basin, ensuring that the 
fragile watershed and Lake Tahoe's water clarity are not threatened by 
pollution from mining operations.
  Increases accountability and oversight. Every project funded by this 
legislation will have monitoring and assessment to determine the most 
cost-effective projects and best management practices for future 
projects.
  The legislation also requires the Chair of the Federal Partnership to 
work with the Forest Service, Environmental Protection Agency, Fish and 
Wildlife Service and regional and state agencies, to prepare an annual 
report to Congress detailing the status of all projects undertaken, 
including project scope, budget and justification and overall 
expenditures and accomplishments.
  This will ensure that Congress can have oversight on the progress of 
environmental restoration in Lake Tahoe.
  Provides for public outreach and education. The Forest Service, 
Environmental Protection Agency, Fish and Wildlife Service and Tahoe 
Regional Planning Agency will implement new public outreach and 
education programs including encouraging Basin residents and visitors 
to implement defensible space, conducting best management practices for 
water quality and preventing the introduction and proliferation of 
invasive species. In addition, the legislation requires signage on 
federally financed projects to improve public awareness of restoration 
efforts.
  Allows for increased efficiency in the management of public land. 
Under this legislation, the Forest Service would have increased 
flexibility to exchange land with state agencies which will allow for 
more cost-efficient management of public land. There is currently a 
checkerboard pattern of ownership in some areas of the Basin.
  Under this new authority, the Forest Service could exchange land with 
the California Tahoe Conservancy and the California Department of Parks 
and Recreation of approximately equal value without going through a 
lengthy process to assess the land.
  For example, if there are several plots of Forest Service land that 
surround or are adjacent to Tahoe Conservancy or California State Parks 
land, the state could transfer that land to the Forest Service so that 
it can be managed more efficiently.
  This legislation is needed because the ``Jewel of the Sierra'' is in 
big trouble. If we don't act now, we could lose Lake Tahoe, lose it 
with stunning speed, to several devastating threats.
  Anyone doubting that climate change poses a severe threat to Lake 
Tahoe should read an alarming recent report by the UC Davis Tahoe 
Environmental Research Center.
  It was written for the U.S. Forest Service by scientists who have 
devoted their professional careers to studying Lake Tahoe. And it 
paints a distinctly bleak picture of the future for the ``Jewel of the 
Sierra.''
  Among its findings are the Tahoe Basin's regional snowpack could 
decline by as much as 60 percent in the next century, with increased 
floods likely by 2050 and prolonged droughts by 2100.
  Even ``under the most optimistic projections,'' average snowpack in 
the Sierra Nevada around Tahoe will decline by 40 to 60 percent by 
2100, according to the report.
  This would likely bankrupt Tahoe's ski industry, threaten the water 
supply of Reno and other communities, and degrade the lake's fabled 
water clarity. It is devastating.
  According to the UC Davis report, an all-out attack on pollution and 
sedimentation may be the lake's last best hope.
  Geoff Schladow, director of the UC Davis Tahoe Environmental Research 
Center and one of the report's authors, noted the need to restore 
short-term water quality in Lake Tahoe--while there's still time to do 
it.
  ``Reducing the load of external nutrients entering the lake in the 
coming decades may be the only possible mitigation measure to reduce 
the impact of climate change on lake clarity . . . ,'' the report said.
  Without such an effort, the ``internal loading of nutrients'' could 
fundamentally change the lake and fuel algal growth, creating a 
downward spiral in water quality and clarity.
  Water clarity is one of the central problems the legislation would 
address.
  Pollution and sedimentation have threatened Lake Tahoe's water 
clarity for years now. In 1968, the first year UC Davis scientists made 
measurements using a device called a Secchi disk, clarity was measured 
at an average depth of 102.4 feet. Clarity declined

[[Page 13017]]

over the next three decades, hitting a low of 64 feet in 1997.
  There has been some improvement in this decade. Last year scientists 
recorded average clarity at 75.3 feet--the clearest readings in a 
decade. But it is a fragile gain. Sedimentation and stormwater runoff 
pose a persistent threat.
  Climate change has already made itself apparent at Lake Tahoe. It 
makes the basin dry and tinder-hot, raising the risks of catastrophic 
wildfire. Daily air temperatures have increased 4 degrees since 1911. 
Snow has declined as a fraction of total precipitation, from an average 
of 52 percent in 1910 to just 36 percent in recent years.
  Climate change has caused Lake Tahoe's surface water temperature to 
rise over 2 degrees in 44 years. That means the cyclical deep-water 
mixing of the lake's waters will occur less frequently, and this could 
significantly disrupt Lake Tahoe's ecosystem.
  This legislation is intended to address these problems.
  Last year, the Senate Environment and Public Works Committee reported 
out the bill favorably, but there was not enough time for a floor vote. 
It is my hope that this legislation can move through committee quickly 
and be passed later this year.
  A lot of good work has been done. But there's a lot more work to do, 
and time is running out.
  Mark Twain called Lake Tahoe ``the fairest picture the whole world 
affords.'' We must not be the generation who lets this picture fall 
into ruin. We must rise to the challenge, and do all we can to preserve 
this ``noble sheet of water.''
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 1451

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Lake Tahoe Restoration Act 
     of 2013''.

     SEC. 2. FINDINGS AND PURPOSES.

       The Lake Tahoe Restoration Act (Public Law 106-506; 114 
     Stat. 2351) is amended by striking section 2 and inserting 
     the following:

     ``SEC. 2. FINDINGS AND PURPOSES.

       ``(a) Findings.--Congress finds that--
       ``(1) Lake Tahoe--
       ``(A) is 1 of the largest, deepest, and clearest lakes in 
     the world;
       ``(B) has a cobalt blue color, a biologically diverse 
     alpine setting, and remarkable water clarity; and
       ``(C) is recognized nationally and worldwide as a natural 
     resource of special significance;
       ``(2) in addition to being a scenic and ecological 
     treasure, the Lake Tahoe Basin is 1 of the outstanding 
     recreational resources of the United States, which--
       ``(A) offers skiing, water sports, biking, camping, and 
     hiking to millions of visitors each year; and
       ``(B) contributes significantly to the economies of 
     California, Nevada, and the United States;
       ``(3) the economy in the Lake Tahoe Basin is dependent on 
     the protection and restoration of the natural beauty and 
     recreation opportunities in the area;
       ``(4) the Lake Tahoe Basin continues to be threatened by 
     the impacts of land use and transportation patterns developed 
     in the last century that damage the fragile watershed of the 
     Basin;
       ``(5) the water clarity of Lake Tahoe declined from a 
     visibility level of 105 feet in 1967 to only 70 feet in 2008;
       ``(6) the rate of decline in water clarity of Lake Tahoe 
     has decreased in recent years;
       ``(7) a stable water clarity level for Lake Tahoe could be 
     achieved through feasible control measures for very fine 
     sediment particles and nutrients;
       ``(8) fine sediments that cloud Lake Tahoe, and key 
     nutrients such as phosphorus and nitrogen that support the 
     growth of algae and invasive plants, continue to flow into 
     the lake from stormwater runoff from developed areas, roads, 
     turf, other disturbed land, and streams;
       ``(9) the destruction and alteration of wetland, wet 
     meadows, and stream zone habitat have compromised the natural 
     capacity of the watershed to filter sediment, nutrients, and 
     pollutants before reaching Lake Tahoe;
       ``(10) approximately 25 percent of the trees in the Lake 
     Tahoe Basin are either dead or dying;
       ``(11) forests in the Tahoe Basin suffer from over a 
     century of fire suppression and periodic drought, which have 
     resulted in--
       ``(A) high tree density and mortality;
       ``(B) the loss of biological diversity; and
       ``(C) a large quantity of combustible forest fuels, which 
     significantly increases the threat of catastrophic fire and 
     insect infestation;
       ``(12) the establishment of several aquatic and terrestrial 
     invasive species (including perennial pepperweed, milfoil, 
     and Asian clam) threatens the ecosystem of the Lake Tahoe 
     Basin;
       ``(13) there is an ongoing threat to the Lake Tahoe Basin 
     of the introduction and establishment of other invasive 
     species (such as yellow starthistle, New Zealand mud snail, 
     and quagga mussel);
       ``(14) the report prepared by the University of California, 
     Davis, entitled the `State of the Lake Report', found that 
     conditions in the Lake Tahoe Basin had changed, including--
       ``(A) the average surface water temperature of Lake Tahoe 
     has risen by more than 1.2 degrees Fahrenheit in the past 43 
     years;
       ``(B) since 1910, the percent of precipitation that has 
     fallen as snow in the Lake Tahoe Basin decreased from 51 
     percent to 35.5 percent; and
       ``(C) daily air temperatures have increased by more than 4 
     degrees Fahrenheit and the trend in daily maximum temperature 
     has risen by approximately 2 degrees Fahrenheit;
       ``(15) 75 percent of the land in the Lake Tahoe Basin is 
     owned by the Federal Government, which makes it a Federal 
     responsibility to restore environmental health to the Basin;
       ``(16) the Federal Government has a long history of 
     environmental preservation at Lake Tahoe, including--
       ``(A) congressional consent to the establishment of the 
     Tahoe Regional Planning Agency with--
       ``(i) the enactment in 1969 of Public Law 91-148 (83 Stat. 
     360); and
       ``(ii) the enactment in 1980 of Public Law 96-551 (94 Stat. 
     3233);
       ``(B) the establishment of the Lake Tahoe Basin Management 
     Unit in 1973;
       ``(C) the enactment of Public Law 96-586 (94 Stat. 3381) in 
     1980 to provide for the acquisition of environmentally 
     sensitive land and erosion control grants in the Lake Tahoe 
     Basin;
       ``(D) the enactment of sections 341 and 342 of the 
     Department of the Interior and Related Agencies 
     Appropriations Act, 2004 (Public Law 108-108; 117 Stat. 
     1317), which amended the Southern Nevada Public Land 
     Management Act of 1998 (Public Law 105-263; 112 Stat. 2346) 
     to provide payments for the environmental restoration 
     projects under this Act; and
       ``(E) the enactment of section 382 of the Tax Relief and 
     Health Care Act of 2006 (Public Law 109-432; 120 Stat. 3045), 
     which amended the Southern Nevada Public Land Management Act 
     of 1998 (Public Law 105-263; 112 Stat. 2346) to authorize 
     development and implementation of a comprehensive 10-year 
     hazardous fuels and fire prevention plan for the Lake Tahoe 
     Basin;
       ``(17) the Assistant Secretary of the Army for Civil Works 
     was an original signatory in 1997 to the Agreement of Federal 
     Departments on Protection of the Environment and Economic 
     Health of the Lake Tahoe Basin;
       ``(18) the Chief of Engineers, under direction from the 
     Assistant Secretary of the Army for Civil Works, has 
     continued to be a significant contributor to Lake Tahoe Basin 
     restoration, including--
       ``(A) stream and wetland restoration;
       ``(B) urban stormwater conveyance and treatment; and
       ``(C) programmatic technical assistance;
       ``(19) at the Lake Tahoe Presidential Forum in 1997, the 
     President renewed the commitment of the Federal Government to 
     Lake Tahoe by--
       ``(A) committing to increased Federal resources for 
     environmental restoration at Lake Tahoe; and
       ``(B) establishing the Federal Interagency Partnership and 
     Federal Advisory Committee to consult on natural resources 
     issues concerning the Lake Tahoe Basin;
       ``(20) at the 2011 and 2012 Lake Tahoe Forums, Senator 
     Reid, Senator Feinstein, Senator Heller, Senator Ensign, 
     Governor Gibbons, Governor Sandoval, and Governor Brown--
       ``(A) renewed their commitment to Lake Tahoe; and
       ``(B) expressed their desire to fund the Federal and State 
     shares of the Environmental Improvement Program through 2022;
       ``(21) since 1997, the Federal Government, the States of 
     California and Nevada, units of local government, and the 
     private sector have contributed more than $1,620,000,000 to 
     the Lake Tahoe Basin, including--
       ``(A) $521,100,000 from the Federal Government;
       ``(B) $636,200,000 from the State of California;
       ``(C) $101,400,000 from the State of Nevada;
       ``(D) $68,200,000 from units of local government; and
       ``(E) $299,600,000 from private interests;
       ``(22) significant additional investment from Federal, 
     State, local, and private sources is necessary--
       ``(A) to restore and sustain the environmental health of 
     the Lake Tahoe Basin;
       ``(B) to adapt to the impacts of changing water temperature 
     and precipitation; and

[[Page 13018]]

       ``(C) to protect the Lake Tahoe Basin from the introduction 
     and establishment of invasive species; and
       ``(23) the Secretary has indicated that the Lake Tahoe 
     Basin Management Unit has the capacity for at least 
     $10,000,000 for the Fire Risk Reduction and Forest Management 
     Program.
       ``(b) Purposes.--The purposes of this Act are--
       ``(1) to enable the Chief of the Forest Service, the 
     Director of the United States Fish and Wildlife Service, and 
     the Administrator of the Environmental Protection Agency, in 
     cooperation with the Planning Agency and the States of 
     California and Nevada, to fund, plan, and implement 
     significant new environmental restoration activities and 
     forest management activities to address in the Lake Tahoe 
     Basin the issues described in paragraphs (4) through (14) of 
     subsection (a);
       ``(2) to ensure that Federal, State, local, regional, 
     tribal, and private entities continue to work together to 
     manage land in the Lake Tahoe Basin and to coordinate on 
     other activities in a manner that supports achievement and 
     maintenance of--
       ``(A) the environmental threshold carrying capacities for 
     the region; and
       ``(B) other applicable environmental standards and 
     objectives;
       ``(3) to support local governments in efforts related to 
     environmental restoration, stormwater pollution control, fire 
     risk reduction, and forest management activities; and
       ``(4) to ensure that agency and science community 
     representatives in the Lake Tahoe Basin work together--
       ``(A) to develop and implement a plan for integrated 
     monitoring, assessment, and applied research to evaluate the 
     effectiveness of the Environmental Improvement Program; and
       ``(B) to provide objective information as a basis for 
     ongoing decisionmaking, with an emphasis on decisionmaking 
     relating to public and private land use and resource 
     management in the Basin.''.

     SEC. 3. DEFINITIONS.

       The Lake Tahoe Restoration Act (Public Law 106-506; 114 
     Stat. 2351) is amended by striking section 3 and inserting 
     the following:

     ``SEC. 3. DEFINITIONS.

       ``In this Act:
       ``(1) Administrator.--The term `Administrator' means the 
     Administrator of the Environmental Protection Agency.
       ``(2) Assistant secretary.--The term `Assistant Secretary' 
     means the Assistant Secretary of the Army for Civil Works.
       ``(3) Chair.--The term `Chair' means the Chair of the 
     Federal Partnership.
       ``(4) Compact.--The term `Compact' means the Tahoe Regional 
     Planning Compact included in the first section of Public Law 
     96-551 (94 Stat. 3233).
       ``(5) Directors.--The term `Directors' means--
       ``(A) the Director of the United States Fish and Wildlife 
     Service; and
       ``(B) the Director of the United States Geological Survey.
       ``(6) Environmental improvement program.--The term 
     `Environmental Improvement Program' means--
       ``(A) the Environmental Improvement Program adopted by the 
     Planning Agency; and
       ``(B) any amendments to the Program.
       ``(7) Environmental threshold carrying capacity.--The term 
     `environmental threshold carrying capacity' has the meaning 
     given the term in article II of the compact.
       ``(8) Federal partnership.--The term `Federal Partnership' 
     means the Lake Tahoe Federal Interagency Partnership 
     established by Executive Order 13957 (62 Fed. Reg. 41249) (or 
     a successor Executive order).
       ``(9) Forest management activity.--The term `forest 
     management activity' includes--
       ``(A) prescribed burning for ecosystem health and hazardous 
     fuels reduction;
       ``(B) mechanical and minimum tool treatment;
       ``(C) road decommissioning or reconstruction;
       ``(D) stream environment zone restoration and other 
     watershed and wildlife habitat enhancements;
       ``(E) nonnative invasive species management; and
       ``(F) other activities consistent with Forest Service 
     practices, as the Secretary determines to be appropriate.
       ``(10) Maps.--The term `Maps' means the maps--
       ``(A) entitled--
       ``(i) `LTRA USFS-CA Land Exchange/North Shore';
       ``(ii) `USFS-CA Land Exchange/West Shore'; and
       ``(iii) `USFS-CA Land Exchange/South Shore'; and
       ``(B) dated April 12, 2013, and on file and available for 
     public inspection in the appropriate offices of--
       ``(i) the Forest Service;
       ``(ii) the California Tahoe Conservancy; and
       ``(iii) the California Department of Parks and Recreation.
       ``(11) National wildland fire code.--The term `national 
     wildland fire code' means--
       ``(A) the most recent publication of the National Fire 
     Protection Association codes numbered 1141, 1142, 1143, and 
     1144;
       ``(B) the most recent publication of the International 
     Wildland-Urban Interface Code of the International Code 
     Council; or
       ``(C) any other code that the Secretary determines provides 
     the same, or better, standards for protection against 
     wildland fire as a code described in subparagraph (A) or (B).
       ``(12) Planning agency.--The term `Planning Agency' means 
     the Tahoe Regional Planning Agency established under Public 
     Law 91-148 (83 Stat. 360) and Public Law 96-551 (94 Stat. 
     3233).
       ``(13) Priority list.--The term `Priority List' means the 
     environmental restoration priority list developed under 
     section 8.
       ``(14) Secretary.--The term `Secretary' means the Secretary 
     of Agriculture, acting through the Chief of the Forest 
     Service.
       ``(15) Stream environment zone.--The term `Stream 
     Environment Zone' means an area that generally owes the 
     biological and physical characteristics of the area to the 
     presence of surface water or groundwater.
       ``(16) Total maximum daily load.--The term `total maximum 
     daily load' means the total maximum daily load allocations 
     adopted under section 303(d) of the Federal Water Pollution 
     Control Act (33 U.S.C. 1313(d)).
       ``(17) Watercraft.--The term `watercraft' means motorized 
     and non-motorized watercraft, including boats, seaplanes, 
     personal watercraft, kayaks, and canoes.''.

     SEC. 4. ADMINISTRATION OF THE LAKE TAHOE BASIN MANAGEMENT 
                   UNIT.

       Section 4 of the Lake Tahoe Restoration Act (Public Law 
     106-506; 114 Stat. 2353) is amended--
       (1) in subsection (b)(3), by striking ``basin'' and 
     inserting ``Basin''; and
       (2) by adding at the end the following:
       ``(c) Transit.--
       ``(1) In general.--The Lake Tahoe Basin Management Unit 
     shall, consistent with the regional transportation plan 
     adopted by the Planning Agency, manage vehicular parking and 
     traffic in the Lake Tahoe Basin Management Unit, with 
     priority given--
       ``(A) to improving public access to the Lake Tahoe Basin, 
     including the prioritization of alternatives to the private 
     automobile, consistent with the requirements of the Compact;
       ``(B) to coordinating with the Nevada Department of 
     Transportation, Caltrans, State parks, and other entities 
     along Nevada Highway 28 and California Highway 89; and
       ``(C) to providing support and assistance to local public 
     transit systems in the management and operations of 
     activities under this subsection.
       ``(2) National forest transit program.--Consistent with the 
     support and assistance provided under paragraph (1)(C), the 
     Secretary, in consultation with the Secretary of 
     Transportation, may enter into a contract, cooperative 
     agreement, interagency agreement, or other agreement with the 
     Department of Transportation to secure operating and capital 
     funds from the National Forest Transit Program.
       ``(d) Forest Management Activities.--
       ``(1) Coordination.--
       ``(A) In general.--In conducting forest management 
     activities in the Lake Tahoe Basin Management Unit, the 
     Secretary shall, as appropriate, coordinate with the 
     Administrator and State and local agencies and organizations, 
     including local fire departments and volunteer groups.
       ``(B) Goals.--The coordination of activities under 
     subparagraph (A) should aim to increase efficiencies and 
     maximize the compatibility of management practices across 
     public property boundaries.
       ``(2) Multiple benefits.--
       ``(A) In general.--In conducting forest management 
     activities in the Lake Tahoe Basin Management Unit, the 
     Secretary shall conduct the activities in a manner that--
       ``(i) except as provided in subparagraph (B), attains 
     multiple ecosystem benefits, including--

       ``(I) reducing forest fuels;
       ``(II) maintaining or restoring biological diversity;
       ``(III) improving wetland and water quality, including in 
     Stream Environment Zones; and
       ``(IV) increasing resilience to changing water temperature 
     and precipitation; and

       ``(ii) helps achieve and maintain the environmental 
     threshold carrying capacities established by the Planning 
     Agency.
       ``(B) Exception.--Notwithstanding clause (A)(i), the 
     attainment of multiple ecosystem benefits shall not be 
     required if the Secretary determines that management for 
     multiple ecosystem benefits would excessively increase the 
     cost of a project in relation to the additional ecosystem 
     benefits gained from the management activity.
       ``(3) Ground disturbance.--Consistent with applicable 
     Federal law and Lake Tahoe Basin Management Unit land and 
     resource management plan direction, the Secretary shall--
       ``(A) establish post-project ground condition criteria for 
     ground disturbance caused by forest management activities; 
     and
       ``(B) provide for monitoring to ascertain the attainment of 
     the post-project conditions.
       ``(e) Withdrawal of Federal Land.--

[[Page 13019]]

       ``(1) In general.--Subject to valid existing rights and 
     paragraph (2), the Federal land located in the Lake Tahoe 
     Basin Management Unit is withdrawn from--
       ``(A) all forms of entry, appropriation, or disposal under 
     the public land laws;
       ``(B) location, entry, and patent under the mining laws; 
     and
       ``(C) disposition under all laws relating to mineral and 
     geothermal leasing.
       ``(2) Exceptions.--A conveyance of land shall be exempt 
     from withdrawal under this subsection if carried out under--
       ``(A) the Lake Tahoe Restoration Act (Public Law 106-506; 
     114 Stat. 2351); or
       ``(B) the Santini-Burton Act (Public Law 96-586; 94 Stat. 
     3381).
       ``(f) Environmental Threshold Carrying Capacity.--The Lake 
     Tahoe Basin Management Unit shall support the attainment of 
     the environmental threshold carrying capacities.
       ``(g) Cooperative Authorities.--During the 4 fiscal years 
     following the date of enactment of the Lake Tahoe Restoration 
     Act of 2013, the Secretary, in conjunction with land 
     adjustment projects or programs, may enter into contracts and 
     cooperative agreements with States, units of local 
     government, and other public and private entities to provide 
     for fuel reduction, erosion control, reforestation, Stream 
     Environment Zone restoration, and similar management 
     activities on Federal land and non-Federal land within the 
     projects or programs.''.

     SEC. 5. CONSULTATION.

       The Lake Tahoe Restoration Act (Public Law 106-506; 114 
     Stat. 2351) is amended by striking section 5 and inserting 
     the following:

     ``SEC. 5. CONSULTATION.

       ``In carrying out this Act, the Secretary, the 
     Administrator, and the Directors shall, as appropriate and in 
     a timely manner, consult with the heads of the Washoe Tribe, 
     applicable Federal, State, regional, and local governmental 
     agencies, and the Lake Tahoe Federal Advisory Committee.''.

     SEC. 6. AUTHORIZED PROJECTS.

       The Lake Tahoe Restoration Act (Public Law 106-506; 114 
     Stat. 2351) is amended by striking section 6 and inserting 
     the following:

     ``SEC. 6. AUTHORIZED PROJECTS.

       ``(a) In General.--The Secretary, the Assistant Secretary, 
     the Directors, and the Administrator, in coordination with 
     the Planning Agency and the States of California and Nevada, 
     may carry out or provide financial assistance to any project 
     or program that--
       ``(1) is described in subsection (d);
       ``(2) is included in the Priority List under section 8; and
       ``(3) furthers the purposes of the Environmental 
     Improvement Program if the project has been subject to 
     environmental review and approval, respectively, as required 
     under Federal law, article 7 of the Compact, and State law, 
     as applicable.
       ``(b) Restriction.--The Administrator shall use not more 
     than 3 percent of the funds provided under subsection (a) for 
     administering the projects or programs described in 
     paragraphs (1) and (2) of subsection (d).
       ``(c) Monitoring and Assessment.--All projects authorized 
     under subsection (d) shall--
       ``(1) include funds for monitoring and assessment of the 
     results and effectiveness at the project and program level 
     consistent with the program developed under section 11; and
       ``(2) use the integrated multiagency performance measures 
     established under section 13.
       ``(d) Description of Activities.--
       ``(1) Stormwater management, erosion control, and total 
     maximum daily load implementation.--Of the amounts made 
     available under section 17(a), $75,000,000 shall be made 
     available--
       ``(A) to the Secretary or the Administrator for the Federal 
     share of stormwater management and related projects and 
     programs consistent with the adopted Total Maximum Daily Load 
     and near-shore water quality goals; and
       ``(B) for grants by the Secretary and the Administrator to 
     carry out the projects and programs described in subparagraph 
     (A).
       ``(2) Stream environment zone and watershed restoration.--
     Of the amounts made available under section 17(a), 
     $38,000,000 shall be made available--
       ``(A) to the Secretary or the Assistant Secretary for the 
     Federal share of the Upper Truckee River restoration projects 
     and other watershed restoration projects identified in the 
     priority list established under section 8; and
       ``(B) for grants by the Administrator to carry out the 
     projects described in subparagraph (A).
       ``(3) Fire risk reduction and forest management.--
       ``(A) In general.--Of the amounts made available under 
     section 17(a), $135,000,000 shall be made available to the 
     Secretary to carry out, including by making grants, the 
     following projects:
       ``(i) Projects identified as part of the Lake Tahoe Basin 
     Multi-Jurisdictional Fuel Reduction and Wildfire Prevention 
     Strategy 10-Year Plan.
       ``(ii) Competitive grants for fuels work to be awarded by 
     the Secretary to communities that have adopted national 
     wildland fire codes to implement the applicable portion of 
     the 10-year plan described in clause (i).
       ``(iii) Biomass projects, including feasibility assessments 
     and transportation of materials.
       ``(iv) Angora Fire Restoration projects under the 
     jurisdiction of the Secretary.
       ``(v) Washoe Tribe projects on tribal lands within the Lake 
     Tahoe Basin.
       ``(vi) Development of an updated Lake Tahoe Basin 
     multijurisdictional fuel reduction and wildfire prevention 
     strategy, consistent with section 4(d).
       ``(vii) Development of updated community wildfire 
     protection plans by local fire districts.
       ``(viii) Municipal water infrastructure that significantly 
     improves the firefighting capability of local government 
     within the Lake Tahoe Basin.
       ``(B) Minimum allocation.--Of the amounts made available to 
     the Secretary to carry out subparagraph (A), at least 
     $80,000,000 shall be used by the Secretary for projects under 
     subparagraph (A)(i).
       ``(C) Priority.--Units of local government that have 
     dedicated funding for inspections and enforcement of 
     defensible space regulations shall be given priority for 
     amounts provided under this paragraph.
       ``(D) Cost-sharing requirements.--
       ``(i) In general.--As a condition on the receipt of funds, 
     communities or local fire districts that receive funds under 
     this paragraph shall provide a 25 percent match.
       ``(ii) Form of non-federal share.--

       ``(I) In general.--The non-Federal share required under 
     clause (i) may be in the form of cash contributions or in-
     kind contributions, including providing labor, equipment, 
     supplies, space, and other operational needs.
       ``(II) Credit for certain dedicated funding.--There shall 
     be credited toward the non-Federal share required under 
     clause (i) any dedicated funding of the communities or local 
     fire districts for a fuels reduction management program, 
     defensible space inspections, or dooryard chipping.
       ``(III) Documentation.--Communities and local fire 
     districts shall--

       ``(aa) maintain a record of in-kind contributions that 
     describes--
       ``(AA) the monetary value of the in-kind contributions; and
       ``(BB) the manner in which the in-kind contributions assist 
     in accomplishing project goals and objectives; and
       ``(bb) document in all requests for Federal funding, and 
     include in the total project budget, evidence of the 
     commitment to provide the non-Federal share through in-kind 
     contributions.
       ``(4) Invasive species management.--Of the amounts to be 
     made available under section 17(a), $30,000,000 shall be made 
     available to the Director of the United States Fish and 
     Wildlife Service for the Aquatic Invasive Species Program and 
     the watercraft inspections described in section 9.
       ``(5) Special status species management.--Of the amounts to 
     be made available under section 17(a), $20,000,000 shall be 
     made available to the Director of the United States Fish and 
     Wildlife Service for the Lahontan Cutthroat Trout Recovery 
     Program.
       ``(6) Lake tahoe basin science program.--Of the amounts to 
     be made available under section 17(a), $30,000,000 shall be 
     made available to the Chief of the Forest Service to develop 
     and implement, in coordination with the Tahoe Science 
     Consortium, the Lake Tahoe Basin Science Program established 
     under section 11.
       ``(7) Program performance and accountability.--
       ``(A) In general.--Of the amounts to be made available 
     under section 17(a), $5,000,000 shall be made available to 
     the Secretary to carry out sections 12, 13, and 14.
       ``(B) Planning agency.--Of the amounts described in 
     subparagraph (A), not less than 50 percent shall be made 
     available to the Planning Agency to carry out the program 
     oversight, coordination, and outreach activities established 
     under sections 12, 13, and 14.
       ``(8) Land conveyance.--
       ``(A) In general.--Of the amount made available under 
     section 17(a), $2,000,000 shall be made available to the 
     Secretary to carry out the activities under section 3(b)(2) 
     of Public Law 96-586 (94 Stat. 3384) (commonly known as the 
     `Santini-Burton Act').
       ``(B) Other funds.--Of the amounts available to the 
     Secretary under subparagraph (A), not less than 50 percent 
     shall be provided to the California Tahoe Conservancy to 
     facilitate the conveyance of land described in section 
     3(b)(2) of Public Law 96-586 (94 Stat. 3384) (commonly known 
     as the `Santini-Burton Act').''.

     SEC. 7. ENVIRONMENTAL RESTORATION PRIORITY LIST.

       The Lake Tahoe Restoration Act (Public Law 106-506; 114 
     Stat. 2351) is amended--
       (1) by striking sections 8 and 9;
       (2) by redesignating sections 10, 11, and 12 as sections 
     15, 16, and 17, respectively; and
       (3) by inserting after section 7 the following:

     ``SEC. 8. ENVIRONMENTAL RESTORATION PRIORITY LIST.

       ``(a) Deadline.--Not later than February 15 of the year 
     after the date of enactment of

[[Page 13020]]

     the Lake Tahoe Restoration Act of 2013, the Chair, in 
     consultation with the Secretary, the Administrator, the 
     Directors, the Planning Agency, the States of California and 
     Nevada, the Federal Partnership, the Washoe Tribe, the Lake 
     Tahoe Federal Advisory Committee, and the Tahoe Science 
     Consortium shall submit to Congress a prioritized list of all 
     Environmental Improvement Program projects for the Lake Tahoe 
     Basin for each program category described in section 6(d).
       ``(b) Criteria.--
       ``(1) In general.--The priority of projects included in the 
     Priority List shall be based on the best available science 
     and the following criteria:
       ``(A) The 5-year threshold carrying capacity evaluation.
       ``(B) The ability to measure progress or success of the 
     project.
       ``(C) The potential to significantly contribute to the 
     achievement and maintenance of the environmental threshold 
     carrying capacities identified in the Compact for--
       ``(i) air quality;
       ``(ii) fisheries;
       ``(iii) noise;
       ``(iv) recreation;
       ``(v) scenic resources;
       ``(vi) soil conservation;
       ``(vii) forest health;
       ``(viii) water quality; and
       ``(ix) wildlife.
       ``(D) The ability of a project to provide multiple 
     benefits.
       ``(E) The ability of a project to leverage non-Federal 
     contributions.
       ``(F) Stakeholder support for the project.
       ``(G) The justification of Federal interest.
       ``(H) Agency priority.
       ``(I) Agency capacity.
       ``(J) Cost-effectiveness.
       ``(K) Federal funding history.
       ``(2) Secondary factors.--In addition to the criteria under 
     paragraph (1), the Chair shall, as the Chair determines to be 
     appropriate, give preference to projects in the Priority List 
     that benefit existing neighborhoods in the Basin that are at 
     or below regional median income levels, based on the most 
     recent census data available.
       ``(c) Revisions.--
       ``(1) In general.--The Priority List submitted under 
     subsection (b) shall be revised--
       ``(A) every 2 years; or
       ``(B) on a finding of compelling need under paragraph (2).
       ``(2) Finding of compelling need.--
       ``(A) In general.--If the Secretary, the Administrator, or 
     the Director of the United States Fish and Wildlife Service 
     makes a finding of compelling need justifying a priority 
     shift and the finding is approved by the Secretary, the 
     Executive Director of the Planning Agency, the California 
     Natural Resources Secretary, and the Director of the Nevada 
     Department of Conservation, the Priority List shall be 
     revised in accordance with this subsection.
       ``(B) Inclusions.--A finding of compelling need includes--
       ``(i) major scientific findings;
       ``(ii) results from the threshold evaluation of the 
     Planning Agency;
       ``(iii) emerging environmental threats; and
       ``(iv) rare opportunities for land acquisition.
       ``(d) Funding.--Of the amount made available under section 
     17(a), $80,000,000 shall be made available to the Secretary 
     to carry out this section.

     ``SEC. 9. AQUATIC INVASIVE SPECIES PREVENTION.

       ``(a) In General.--The Director of the United States Fish 
     and Wildlife Service, in coordination with the Planning 
     Agency, the California Department of Fish and Game, and the 
     Nevada Department of Wildlife, shall deploy strategies 
     consistent with the Lake Tahoe Aquatic Invasive Species 
     Management Plan to prevent the introduction of aquatic 
     invasive species into the Lake Tahoe Basin.
       ``(b) Criteria.--The strategies referred to in subsection 
     (a) shall provide that--
       ``(1) combined inspection and decontamination stations be 
     established and operated at not less than 2 locations in the 
     Lake Tahoe Basin; and
       ``(2) watercraft not be allowed to launch in waters of the 
     Lake Tahoe Basin if the watercraft has not been inspected in 
     accordance with the Lake Tahoe Aquatic Invasive Species 
     Management Plan.
       ``(c) Certification.--The Planning Agency may certify State 
     and local agencies to perform the decontamination activities 
     described in subsection (b)(3) at locations outside the Lake 
     Tahoe Basin if standards at the sites meet or exceed 
     standards for similar sites in the Lake Tahoe Basin 
     established under this section.
       ``(d) Applicability.--The strategies and criteria developed 
     under this section shall apply to all watercraft to be 
     launched on water within the Lake Tahoe Basin.
       ``(e) Fees.--The Director of the United States Fish and 
     Wildlife Service may collect and spend fees for 
     decontamination only at a level sufficient to cover the costs 
     of operation of inspection and decontamination stations under 
     this section.
       ``(f) Civil Penalties.--
       ``(1) In general.--Any person that launches, attempts to 
     launch, or facilitates launching of watercraft not in 
     compliance with strategies deployed under this section shall 
     be liable for a civil penalty in an amount not to exceed 
     $1,000 per violation.
       ``(2) Other authorities.--Any penalties assessed under this 
     subsection shall be separate from penalties assessed under 
     any other authority.
       ``(g) Limitation.--The strategies and criteria under 
     subsections (a) and (b), respectively, may be modified if the 
     Secretary of the Interior, in a nondelegable capacity and in 
     consultation with the Planning Agency and State governments, 
     issues a determination that alternative measures will be no 
     less effective at preventing introduction of aquatic invasive 
     species into Lake Tahoe than the strategies and criteria.
       ``(h) Supplemental Authority.--The authority under this 
     section is supplemental to all actions taken by non-Federal 
     regulatory authorities.
       ``(i) Savings Clause.--Nothing in this title shall be 
     construed as restricting, affecting, or amending any other 
     law or the authority of any department, instrumentality, or 
     agency of the United States, or any State or political 
     subdivision thereof, respecting the control of invasive 
     species.

     ``SEC. 10. CORPS OF ENGINEERS; INTERAGENCY AGREEMENTS.

       ``(a) In General.--The Assistant Secretary may enter into 
     interagency agreements with non-Federal interests in the Lake 
     Tahoe Basin to use Lake Tahoe Partnership-Miscellaneous 
     General Investigations funds to provide programmatic 
     technical assistance for the Environmental Improvement 
     Program.
       ``(b) Local Cooperation Agreements.--
       ``(1) In general.--Before providing technical assistance 
     under this section, the Assistant Secretary shall enter into 
     a local cooperation agreement with a non-Federal interest to 
     provide for the technical assistance.
       ``(2) Components.--The agreement entered into under 
     paragraph (1) shall--
       ``(A) describe the nature of the technical assistance;
       ``(B) describe any legal and institutional structures 
     necessary to ensure the effective long-term viability of the 
     end products by the non-Federal interest; and
       ``(C) include cost-sharing provisions in accordance with 
     paragraph (3).
       ``(3) Federal share.--
       ``(A) In general.--The Federal share of project costs under 
     each local cooperation agreement under this subsection shall 
     be 65 percent.
       ``(B) Form.--The Federal share may be in the form of 
     reimbursements of project costs.
       ``(C) Credit.--The non-Federal interest may receive credit 
     toward the non-Federal share for the reasonable costs of 
     related technical activities completed by the non-Federal 
     interest before entering into a local cooperation agreement 
     with the Assistant Secretary under this subsection.

     ``SEC. 11. LAKE TAHOE BASIN SCIENCE PROGRAM.

       ``The Secretary (acting through the Station Director of the 
     Forest Service, Pacific Southwest Research Station), the 
     Administrator, the Planning Agency, the States of California 
     and Nevada, and the Tahoe Science Consortium, shall develop 
     and implement the Lake Tahoe Basin Science Program that--
       ``(1) develops and regularly updates an integrated 
     multiagency programmatic assessment and monitoring plan--
       ``(A) to evaluate the effectiveness of the Environmental 
     Improvement Program;
       ``(B) to evaluate the status and trends of indicators 
     related to environmental threshold carrying capacities; and
       ``(C) to assess the impacts and risks of changing water 
     temperature, precipitation, and invasive species;
       ``(2) produces and synthesizes scientific information 
     necessary for--
       ``(A) the identification and refinement of environmental 
     indicators for the Lake Tahoe Basin; and
       ``(B) the evaluation of standards and benchmarks;
       ``(3) conducts applied research, programmatic technical 
     assessments, scientific data management, analysis, and 
     reporting related to key management questions;
       ``(4) develops new tools and information to support 
     objective assessments of land use and resource conditions;
       ``(5) provides scientific and technical support to the 
     Federal Government and State and local governments in--
       ``(A) reducing stormwater runoff, air deposition, and other 
     pollutants that contribute to the loss of lake clarity; and
       ``(B) the development and implementation of an integrated 
     stormwater monitoring and assessment program;
       ``(6) establishes and maintains independent peer review 
     processes--
       ``(A) to evaluate the Environmental Improvement Program; 
     and
       ``(B) to assess the technical adequacy and scientific 
     consistency of central environmental documents, such as the 
     5-year threshold review; and
       ``(7) provides scientific and technical support for the 
     development of appropriate management strategies to 
     accommodate changing water temperature and precipitation in 
     the Lake Tahoe Basin.

[[Page 13021]]



     ``SEC. 12. PUBLIC OUTREACH AND EDUCATION.

       ``(a) In General.--The Secretary, the Administrator, and 
     the Directors will coordinate with the Planning Agency to 
     conduct public education and outreach programs, including 
     encouraging--
       ``(1) owners of land and residences in the Lake Tahoe 
     Basin--
       ``(A) to implement defensible space; and
       ``(B) to conduct best management practices for water 
     quality; and
       ``(2) owners of land and residences in the Lake Tahoe Basin 
     and visitors to the Lake Tahoe Basin, to help prevent the 
     introduction and proliferation of invasive species as part of 
     the private share investment in the Environmental Improvement 
     Program.
       ``(b) Scientific and Technical Guidance.--The Director of 
     the United States Geological Survey shall provide scientific 
     and technical guidance to public outreach and education 
     programs conducted under this section.
       ``(c) Required Coordination.--Public outreach and education 
     programs for aquatic invasive species under this section 
     shall--
       ``(1) be coordinated with Lake Tahoe Basin tourism and 
     business organizations; and
       ``(2) include provisions for the programs to extend outside 
     of the Lake Tahoe Basin.

     ``SEC. 13. REPORTING REQUIREMENTS.

       ``Not later than February 15 of each year, the Secretary, 
     in cooperation with the Chair, the Administrator, the 
     Directors, the Planning Agency, and the States of California 
     and Nevada, consistent with section 6(d)(6), shall submit to 
     Congress a report that describes--
       ``(1) the status of all Federal, State, local, and private 
     projects authorized under this Act, including to the maximum 
     extent practicable, for projects that will receive Federal 
     funds under this Act during the current or subsequent fiscal 
     year--
       ``(A) the project scope;
       ``(B) the budget for the project; and
       ``(C) the justification for the project, consistent with 
     the criteria established in section 8(b)(1);
       ``(2) Federal, State, local, and private expenditures in 
     the preceding fiscal year to implement the Environmental 
     Improvement Program and projects otherwise authorized under 
     this Act;
       ``(3) accomplishments in the preceding fiscal year in 
     implementing this Act in accordance with the performance 
     measures and other monitoring and assessment activities; and
       ``(4) public education and outreach efforts undertaken to 
     implement programs and projects authorized under this Act.

     ``SEC. 14. ANNUAL BUDGET PLAN.

       ``As part of the annual budget of the President, the 
     President shall submit information regarding each Federal 
     agency involved in the Environmental Improvement Program 
     (including the Forest Service, the Environmental Protection 
     Agency, the United States Fish and Wildlife Service), the 
     United States Geological Survey, and the Corps of Engineers), 
     including--
       ``(1) an interagency crosscut budget that displays the 
     proposed budget for use by each Federal agency in carrying 
     out restoration activities relating to the Environmental 
     Improvement Program for the following fiscal year;
       ``(2) a detailed accounting of all amounts received and 
     obligated by Federal agencies to achieve the goals of the 
     Environmental Improvement Program during the preceding fiscal 
     year; and
       ``(3) a description of the Federal role in the 
     Environmental Improvement Program, including the specific 
     role of each agency involved in the restoration of the Lake 
     Tahoe Basin.''.

     SEC. 8. RELATIONSHIP TO OTHER LAWS.

       Section 16 of The Lake Tahoe Restoration Act (Public Law 
     106-506; 114 Stat. 2358) (as redesignated by section 7(2)) is 
     amended by inserting ``, Director, or Administrator'' after 
     ``Secretary''.

     SEC. 9. AUTHORIZATION OF APPROPRIATIONS.

       The Lake Tahoe Restoration Act (Public Law 106-506; 114 
     Stat. 2351) is amended by striking section 17 (as 
     redesignated by section 7(2)) and inserting the following:

     ``SEC. 17. AUTHORIZATION OF APPROPRIATIONS.

       ``(a) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this Act $415,000,000 for a 
     period of 10 fiscal years beginning the first fiscal year 
     after the date of enactment of the Lake Tahoe Restoration Act 
     of 2013.
       ``(b) Effect on Other Funds.--Amounts authorized under this 
     section and any amendments made by this Act--
       ``(1) shall be in addition to any other amounts made 
     available to the Secretary, the Administrator, or the 
     Directors for expenditure in the Lake Tahoe Basin; and
       ``(2) shall not reduce allocations for other Regions of the 
     Forest Service, Environmental Protection Agency, or the 
     United States Fish and Wildlife Service.
       ``(c) Cost-Sharing Requirement.--Except as provided in 
     subsection (d) and section 6(d)(3)(D), the States of 
     California and Nevada shall pay 50 percent of the aggregate 
     costs of restoration activities in the Lake Tahoe Basin 
     funded under section 6.
       ``(d) Relocation Costs.--Notwithstanding subsection (c), 
     the Secretary shall provide to local utility districts two-
     thirds of the costs of relocating facilities in connection 
     with--
       ``(1) environmental restoration projects under sections 6 
     and 8; and
       ``(2) erosion control projects under section 2 of Public 
     Law 96-586 (94 Stat. 3381).
       ``(e) Signage.--To the maximum extent practicable, a 
     project provided assistance under this Act shall include 
     appropriate signage at the project site that--
       ``(1) provides information to the public on--
       ``(A) the amount of Federal funds being provided to the 
     project; and
       ``(B) this Act; and
       ``(2) displays the visual identity mark of the 
     Environmental Improvement Program.''.

     SEC. 10. ADMINISTRATION OF ACQUIRED LAND.

       (a) In General.--Section 3(b) of Public Law 96-586 (94 
     Stat. 3384) (commonly known as the ``Santini-Burton Act'') is 
     amended--
       (1) by striking ``(b) Lands'' and inserting the following:
       ``(b) Administration of Acquired Land.--
       ``(1) In general.--Land''; and
       (2) by adding at the end the following:
       ``(2) Conveyance.--
       ``(A) In general.--If the State of California (acting 
     through the California Tahoe Conservancy and the California 
     Department of Parks and Recreation) offers to donate to the 
     United States acceptable title to the non-Federal land 
     described in subparagraph (B)(i), the Secretary--
       ``(i) may accept the offer; and
       ``(ii) not later than 180 days after the date on which the 
     Secretary receives acceptable title to the non-Federal land 
     described in subparagraph (B)(i), convey to the State of 
     California, subject to valid existing rights and for no 
     consideration, all right, title, and interest of the United 
     States in and to the Federal land that is acceptable to the 
     State of California.
       ``(B) Description of land.--
       ``(i) Non-federal land.--The non-Federal land referred to 
     in subparagraph (A) includes--

       ``(I) the approximately 1,981 acres of land administered by 
     the Conservancy and identified on the Maps as `Conservancy to 
     the United States Forest Service'; and
       ``(II) the approximately 187 acres of land administered by 
     California State Parks and identified on the Maps as `State 
     Parks to the U.S. Forest Service'.

       ``(ii) Federal land.--The Federal land referred to in 
     subparagraph (A) includes the approximately 1,995 acres of 
     Forest Service land identified on the Maps as `U.S. Forest 
     Service to Conservancy and State Parks'.
       ``(C) Conditions.--Any land conveyed under this paragraph 
     shall--
       ``(i) be for the purpose of consolidating Federal and State 
     ownerships and improving management efficiencies;
       ``(ii) not result in any significant changes in the uses of 
     the land; and
       ``(iii) be subject to the condition that the applicable 
     deed include such terms , restrictions, covenants, 
     conditions, and reservations as the Secretary determines 
     necessary to--

       ``(I) ensure compliance with this Act; and
       ``(II) ensure that the development rights associated with 
     the conveyed parcels shall not be recognized or available for 
     transfer under section 90.2 of the Code of Ordinances for the 
     Tahoe Regional Planning Agency.''.

                                 ______
                                 
      By Mr. McCONNELL (for himself and Mr. Paul):
  S. 1457. A bill to exempt the aging process of distilled spirits from 
the production period for purposes of capitalization of interest costs; 
to the Committee on Finance.
  Mr. McCONNELL. Mr. President, I ask unanimous consent that the text 
of the bill be printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 1457

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Aged Distilled Spirits 
     Competitiveness Act''.

     SEC. 2. PRODUCTION PERIOD OF DISTILLED SPIRITS.

       (a) In General.--Section 263A(f) of the Internal Revenue 
     Code of 1986 is amended--
       (1) by redesignating paragraph (4) as paragraph (5), and
       (2) by inserting after paragraph (3) the following new 
     paragraph:
       ``(4) Exemption for aging process of distilled spirits.--
     For purposes of this subsection, the production period shall 
     not include the aging period for distilled spirits (as 
     described in section 5002(a)(8)).''.
       (b) Effective Date.--The amendments made by this section 
     shall apply to the production of distilled spirits that 
     begins on or after the date of the enactment of this Act.
                                 ______
                                 
      By Mr. LEVIN (for himself, Mr. Grassley, Mrs. Feinstein, and Mr. 
        Harkin):
  S. 1465. A bill to ensure that persons who form corporations in the 
United States disclose the beneficial owners of those corporations, in 
order to prevent

[[Page 13022]]

the formation of corporations with hidden owners, stop the misuse of 
United States corporations by wrongdoers, and assist law enforcement in 
detecting, preventing, and punishing terrorism, money laundering, tax 
evasion, and other criminal and civil misconduct involving United 
States corporations, and for other purposes; to the Committee on the 
Judiciary.
  Mr. LEVIN. Mr. President, today, along with my colleagues, Senator 
Grassley, Senator Feinstein, and Senator Harkin, I am reintroducing the 
Incorporation Transparency and Law Enforcement Assistance Act, a bill 
designed to combat terrorism, money laundering, tax evasion, and other 
wrongdoing facilitated by U.S. corporations with hidden owners. This 
commonsense bill would end the practice of our States forming about 2 
million new corporations each year for unidentified persons, and 
instead require a list of the real owners to be submitted so that, if 
misconduct later occurred, law enforcement could access the owners list 
and have a trail to chase, instead of confronting what has all too 
often been a dead end.
  Our bill is supported by key law enforcement organizations, including 
the Federal Law Enforcement Officers Association, the Fraternal Order 
of Police, the National Association of Assistant United States 
Attorneys, and the Society of Former Special Agents of the Federal 
Bureau of Investigation, as well as by Manhattan District Attorney 
Cyrus Vance. It is also endorsed by a number of small business, public 
interest, and good government groups, including the Main Street 
Alliance, American Sustainable Business Council, National Money 
Transmitters Association, AFL-CIO, SEIU, Global Financial Integrity, 
Global Witness, U.S. Public Interest Research Group, Transparency 
International, Public Citizen, Project on Government Oversight, Jubilee 
USA Network, Tax Justice Network USA, Human Rights Watch, Friends of 
the Earth, Open Society Policy Center, Revenue Watch Institute, the 
FACT Coalition, and more.
  This is the fourth Congress in which this bill has been introduced to 
provide a solution to a problem that has gained only more urgency with 
time. In 2008, when the bill was first introduced, President Obama was 
a member of the U.S. Senate and an original cosponsor. In 2013, 
President Obama stood with other international leaders at a G8 summit 
in June to condemn corporations with hidden owners who commit crimes, 
tax evasion, and other wrongdoing. The G8 leaders made a joint 
commitment to combat that problem. President Obama immediately 
responded with a U.S. action plan that, among other measures, calls for 
enacting legislation to end the shameful practice in this country of 
forming U.S. corporations with unnamed owners and unleashing them on, 
not only our own communities, but the international community as well.
  A World Bank study found that the United States forms more 
corporations per year than all the rest of the countries in the world 
put together. Under current law, those U.S. corporations can be 
established anonymously, by hidden owners who don't reveal their 
identity. According to another recent study by Griffith University 
examining multiple jurisdictions, it is easier to obtain an anonymous 
shell company in the United States than almost anywhere else in the 
world. That study also found that ``only a tiny portion of U.S. 
providers of any kind met the international standard of requiring 
notarized identity documents.''
  Right now, in the United States, it takes more information to get a 
driver's license or to open a U.S. bank account than to form a U.S. 
corporation. Our bill would change that by requiring any State that 
accepts crime-fighting grants from the Department of Justice to add one 
new question to their existing incorporation forms asking applicants to 
identify the company's true owners.
  That is it. One new question on an existing form. It is not a 
complicated question, yet the answer could play a key role in helping 
law enforcement do their jobs. Our bill would not require States to 
verify the information, but penalties would apply to persons who submit 
false information. States, or licensed formation agents if a State has 
delegated the task to them, would supply the ownership information to 
law enforcement upon receipt of a subpoena or summons.
  The Problem. We have all seen the news reports about U.S. 
corporations involved in wrongdoing--from facilitating terrorism to 
money laundering, financial fraud, tax evasion, corruption, and more. 
Let me give you a few examples that indicate the scope of the problem.
  We now know that some terrorists use U.S. corporations to carry out 
their activities. Viktor Bout, an arms dealer who was found guilty in 
November 2011 of conspiring to kill U.S. nationals and selling weapons 
to a terrorist organization, used corporations around the world in his 
work, including a dozen formed in Texas, Delaware, and Florida. At the 
time of Mr. Bout's extradition to face justice here in America, 
Attorney General Eric Holder stated: ``Long considered one of the 
world's most prolific arms traffickers, Mr. Bout will now appear in 
federal court in Manhattan to answer to charges of conspiring to sell 
millions of dollars worth of weapons to a terrorist organization for 
use in trying to kill Americans.'' It is unacceptable that Mr. Bout was 
able to set up corporations in three of our States and use them in 
illicit activities without ever being asked for the names of the 
corporate owners.
  In another case, a New York company called the Assa Corporation owned 
a Manhattan skyscraper and, in 2007, wire transferred about $4.5 
million in rental payments to a bank in Iran. U.S. law enforcement 
tracking the funds had no idea who was behind that corporation, until 
another government disclosed that it was owned by the Alavi Foundation 
which had known ties to the Iranian military. In other words, a New 
York corporation was being used to ship millions of U.S. dollars to 
Iran, a notorious supporter of terrorism.
  U.S. corporations with hidden owners have also been involved in 
financial crimes. In 2011, a former Russian military officer, Victor 
Kaganov, pled guilty to operating an illegal money transmitter business 
from his home in Oregon, and using Oregon shell corporations to wire 
more than $150 million around the world on behalf of Russian clients. 
U.S. Attorney Dwight Holton of the District of Oregon used stark 
language when describing the case: ``When shell corporations are 
illegally manipulated in the shadows to hide the flow of tens of 
millions of dollars overseas, it threatens the integrity of our 
financial system.''
  Another financial fraud case involves Florida attorney Scott 
Rothstein who, in 2010, pled guilty to fraud and money laundering in 
connection with a $1.2 billion Ponzi investment scheme, in which he 
used 85 U.S. limited liability companies to conceal his participation 
and ownership stake in various business ventures. In still another case 
earlier this year, the Securities and Exchange Commission suspended 
trading in 61 shell corporations suspected of being misused to defraud 
investors.
  Shell corporations are also notorious for their role in health care 
fraud. One example involves an individual named Michel Huarte who 
formed 29 shell companies in several states including Florida, 
Louisiana, and North Carolina, used them to make fraudulent health care 
claims, and bilked Medicare out of more than $50 million. In 2010, he 
was sentenced to 22 years in prison. He is one in a long line of 
fraudsters who have hidden behind U.S. corporations to defraud Medicare 
and Medicaid.
  Tax evasion is another type of misconduct which all too often 
involves the use of U.S. corporations with hidden owners. One 
Subcommittee investigation showed, for example, how Kurt Greaves, a 
Michigan businessman, worked with Terry Neal, an offshore promoter, to 
form shell corporations in Nevada, Canada, and offshore secrecy 
jurisdictions, to hide more than $400,000 in untaxed business income. 
Both Mr. Greaves and Mr. Neal later pled guilty to federal tax evasion. 
The Subcommittee also showed how two brothers from Texas, Sam and 
Charles Wyly, created a network of 58 trusts

[[Page 13023]]

and shell corporations to dodge the payment of U.S. taxes, including 
using a set of Nevada corporations to move offshore over $190 million 
in stock options without paying taxes on that compensation.
  Still another area of abuse involves corrupt foreign officials using 
U.S. corporations to hide and spend their illicit funds. One example 
involves Teodoro Obiang, who is the son of the President of Equatorial 
Guinea, holds office in that country, and has purchased luxury homes, 
cars, and even a personal jet here in the United States. A Subcommittee 
investigation disclosed that, as part of his actions, Mr. Obiang used 
U.S. lawyers to form several California shell corporations with names 
like Beautiful Vision, Unlimited Horizon, and Sweet Pink to open bank 
accounts in the names of those corporations, move millions of dollars 
in suspect funds into the United States, and use those funds to support 
an affluent lifestyle. The Department of Justice has since filed suit 
to seize his U.S. property, alleging that Mr. Obiang acquired it 
through corruption and money laundering.
  One last example involves 800 U.S. corporations whose hidden owners 
have stumped U.S. law enforcement trying to investigate their suspect 
conduct. In October 2004, the Homeland Security Department's division 
of Immigration and Customs Enforcement or ICE identified a single Utah 
corporation that had engaged in $150 million in suspicious 
transactions. ICE found that the corporation had been formed in Utah 
and was owned by two Panamanian entities which, in turn, were owned by 
a group of Panamanian holding corporations, all located at the same 
Panama City office. By 2005, ICE had located 800 U.S. corporations in 
nearly all 50 states associated with the same shadowy group in Panama, 
but was unable to obtain the name of a single natural person who owned 
any one of the corporations. ICE had learned that the 800 corporations 
were associated with multiple U.S. investigations into tax fraud and 
other wrongdoing, but no one had been able to find the corporate 
owners. The trail went cold, and ICE closed the case. Yet it may be 
that many of those U.S. corporations are still engaged in wrongdoing.
  These examples of U.S. corporations with hidden owners facilitating 
terrorism, financial crime, health care fraud, tax evasion, corruption, 
and other misconduct provide ample evidence of the need for legislation 
to find out who is behind the mayhem. That's why law enforcement 
officials are among the bill's strongest supporters.
  The Federal Law Enforcement Officers Association or FLEOA, which 
represents more than 26,000 Federal law enforcement officers, has 
explained its strong support for the bill as follows:

       Suspected terrorists, drug trafficking organizations and 
     other criminal enterprises continue to exploit the anonymity 
     afforded to them through the current corporate filing process 
     in a few states. Hiding behind a registered agent, these 
     criminals are able to incorporate without disclosing who the 
     beneficial owners are for their company(s). This enables them 
     to establish corporate flow-through entities, otherwise known 
     as shell companies,' to facilitate money laundering and 
     narcoterrorist financing.
       Even through the due process of proper service of a court 
     order, law enforcement officers are unable to determine who 
     the beneficial owners are of these entities. This has to 
     stop. While we fully recognize and respect the privacy 
     concerns of law abiding citizens, we need to install a 
     baseline of checks and balances to deter the criminal 
     exploitation of our corporate filing process.

  The Fraternal Order of Police, which has 330,000 members across the 
country, offers a similar explanation for its support of the bill:

       For years corporations have been used as front 
     organizations by criminals conducting illegal activity such 
     as money laundering, fraud, and tax evasion. . . . This bill 
     is critical to our work because, all too often, 
     investigations are stymied when we encounter a company with 
     hidden ownership. . . . [T]he sharing of beneficial ownership 
     information with law enforcement will greatly assist our 
     investigations. When we are able to expose the link between 
     shell companies and drug trafficking, corruption, organized 
     crime and terrorist finance, the law enforcement community is 
     better able to keep America safe from these illegal 
     activities and keep the proceeds of these crimes out of the 
     U.S. financial system.

  The National Association of Assistant United States Attorneys, which 
represents more than 1,500 federal prosecutors, has urged Congress to 
take legislative action to strengthen inadequate state incorporation 
practices: ``[M]indful of the ease with which criminals establish 
`front organizations' to assist in money laundering, terrorist 
financing, tax evasion and other misconduct, it is shocking and 
unacceptable that many State laws permit the creation of corporations 
without asking for the identity of the corporation's beneficial owners. 
The legislation will guard against that and no longer permit criminals 
to exploit the lack of transparency in the registration of 
corporations.''
  Manhattan District Attorney Cyrus Vance Jr. has publicly urged 
Congress to enact this bill. He wrote: ``I have spoken with many 
colleagues in the law enforcement community, and every one of us 
supports the bill as a simple and common sense movement to help prevent 
white collar crime. . . . Because there is no national standard 
requiring disclosure of beneficial ownership, criminals can set up U.S. 
corporations anonymously and use them as fronts for all kinds of 
illicit activity without having to identify who actually controls and 
profits from the activity. In a simple stroke, the proposed bill would 
eliminate this needless barrier to the detection and prosecution of 
financial crimes.''
  Some members of the U.S. financial industry with obligations under 
U.S. anti-money laundering laws to know their customers, including when 
doing business with a shell corporation, support the legislation 
because it will help them know who is behind U.S. corporations seeking 
to open accounts with them. The National Money Transmitters 
Association, NMTA, for example, which represents state-licensed money 
transmitters, has written in support of the bill, explaining: ``The 
NMTA urges you to give us the KYC, know-your-customer, tools we need to 
do our job efficiently and make sure that our nation's standards are 
brought up to a level equal to that of other advanced countries.''
  We need legislation not only to stop the abuses being committed by 
U.S. corporations with hidden owners, but also to meet our 
international commitments. In 2006, the leading international anti-
money laundering body in the world, the Financial Action Task Force on 
Money Laundering--known as FATF--issued a report criticizing the United 
States for its failure to comply with a FATF standard requiring 
countries to obtain beneficial ownership information for the 
corporations formed under their laws. This standard is one of 40 FATF 
standards that this country has publicly committed itself to 
implementing as part of its efforts to promote strong anti-money 
laundering laws around the world.
  FATF gave the United States two years, until 2008, to make progress 
toward complying with the FATF standard on beneficial ownership 
information. But that deadline passed five years ago, with no real 
progress. Enacting the bill we are introducing today would help bring 
the United States into compliance with the FATF standard by requiring 
the States to obtain beneficial ownership information for the 
corporations formed under their laws. It would help ensure that the 
United States meets its international anti-money laundering 
commitments.
  Combating the misuse of corporations with hidden owners has 
increasingly become a global priority. In a letter to President Obama 
earlier this year, prominent prosecutors and corruption hunters from 
across the globe urged the United States to collect company beneficial 
ownership information to fight wrongdoing. According to the letter: 
``Grand corruption would not be possible without the help of the global 
financing system--in particular, banks that accept corrupt assets and 
secrecy rules that allow money launderers to disguise their activity. . 
. . We believe that part of the solution is for governments to require 
existing company registers to collect information on the ultimate 
owners of companies.''
  As I mentioned earlier, countries around the world have begun to take

[[Page 13024]]

action to tackle the problem. Just last month, during the G8 summit in 
Northern Ireland, leaders announced their commitment to ending the 
practice of establishing anonymous shell companies and declared: 
``Companies should know who really owns them and tax collectors and law 
enforcers should be able to obtain this information easily.'' To 
implement that principle, the G8 leaders pledged to publish national 
Action Plans outlining the concrete steps each country will take to 
ensure that law enforcement and tax authorities have ready access to 
information on who owns and controls the companies formed under their 
laws.
  In announcing the U.S. Action Plan, the White House expressed its 
commitment to ensuring that law enforcement and tax authorities have 
access to ownership information for companies formed within U.S. 
borders. The Plan explicitly calls for enactment of legislation that 
meets certain principles, all of which are met by the bill introduced 
today. Those principles are the following:
  ``Requirements for covered legal entities to disclose beneficial 
ownership to states or regulated corporate formation agents at the time 
of company formation.
  ``Requirements for verification of the identity of the beneficial 
owner.
  ``Options for covering legal entities depending on whether the 
applicant forms the legal entity directly or uses a regulated company 
formation agent.
  ``Requirements for law enforcement authorities, including tax 
authorities, to be able to access beneficial ownership information upon 
appropriate request through a central registry at the state level.
  ``An extension of anti-money laundering obligations to company 
formation agents, including an obligation to identify and verify 
beneficial ownership information.
  ``A mandate that entities provide updated information when changes of 
beneficial ownership occur within 60 days; and
  ``The imposition of civil and criminal penalties for knowingly 
providing false information.''
  The White House and the international community have made the 
collection of beneficial ownership information for corporations a 
global priority this year. It is time for Congress to step up to the 
plate and take the necessary action.
  The bill introduced today is the product of years of work by the 
Senate Permanent Subcommittee on Investigations, which I chair. Over 
twelve years ago, in 2000, the Government Accountability Office, at my 
request, conducted an investigation and released a report entitled, 
``Suspicious Banking Activities: Possible Money Laundering by U.S. 
Corporations Formed for Russian Entities.'' That report revealed that 
one person was able to set up more than 2,000 Delaware shell 
corporations and, without disclosing the identity of any of the 
beneficial owners, open U.S. bank accounts for those corporations, 
which then collectively moved about $1.4 billion through the accounts. 
It is one of the earliest government reports to give some sense of the 
law enforcement problems caused by U.S. corporations with hidden 
owners. The alarm it sounded years ago is still ringing.
  In April 2006, in response to a second Subcommittee request, GAO 
released a report entitled, ``Corporation Formations: Minimal Ownership 
Information Is Collected and Available,'' which reviewed the corporate 
formation laws in all 50 States. GAO disclosed that the vast majority 
of the States do not collect any information at all on the beneficial 
owners of the corporations and limited liability companies, or LLCs, 
formed under their laws. The report also found that several States had 
established automated procedures that allow a person to form a new 
corporation or LLC in the State within 24 hours of filing an online 
application without any prior review of that application by State 
personnel. In exchange for a substantial fee, at least two States will 
form a corporation or LLC within one hour of a request. After examining 
these State incorporation practices, the GAO report described the 
problems that the lack of beneficial ownership information caused for a 
range of law enforcement investigations.
  In November 2006, our Subcommittee held a hearing on the problem. At 
that hearing, representatives of the U.S. Department of Justice, the 
Internal Revenue Service, and the Department of Treasury's Financial 
Crimes Enforcement Network or FinCEN testified that the failure of 
States to collect adequate information on the beneficial owners of the 
legal entities they form had impeded federal efforts to investigate and 
prosecute criminal acts such as terrorism, money laundering, securities 
fraud, and tax evasion. At the hearing, the Justice Department 
testified: ``We had allegations of corrupt foreign officials using 
these [U.S.] shell accounts to launder money, but were unable--due to 
lack of identifying information in the corporate records--to fully 
investigate this area.'' The IRS testified: ``Within our own borders, 
the laws of some states regarding the formation of legal entities have 
significant transparency gaps which may even rival the secrecy afforded 
in the most attractive tax havens.'' As part of its testimony, FinCEN 
described identifying 768 incidents of suspicious international wire 
transfer activity involving U.S. shell corporations.
  The next year, in 2007, in a ``Dirty Dozen'' list of tax scams active 
that year, the IRS highlighted shell corporations with hidden owners as 
number four on the list. It wrote:

       4. Disguised Corporate Ownership: Domestic shell 
     corporations and other entities are being formed and operated 
     in certain states for the purpose of disguising the ownership 
     of the business or financial activity. Once formed, these 
     anonymous entities can be, and are being, used to facilitate 
     underreporting of income, non-filing of tax returns, listed 
     transactions, money laundering, financial crimes and possibly 
     terrorist financing. The IRS is working with state 
     authorities to identify these entities and to bring their 
     owners into compliance.

  In 2008, we first introduced our bipartisan legislation to stop the 
formation of U.S. corporations with hidden owners. It was a Levin-
Coleman-Obama bill, S. 2956, back then. When asked about the bill in 
2008, then DHS Secretary Michael Chertoff wrote: ``In countless 
investigations, where the criminal targets utilize shell corporations, 
the lack of law enforcement's ability to gain access to true beneficial 
ownership information slows, confuses or impedes the efforts by 
investigators to follow criminal proceeds.''
  In 2009, the Senate Homeland Security and Governmental Affairs 
Committee held two hearings which examined not only the problem, but 
also possible solutions, including our revised bill, S. 569. At the 
first hearing entitled, ``Examining State Business Incorporation 
Practices: A Discussion of the Incorporation Transparency and Law 
Enforcement Assistance Act,'' held in June 2009, DHS testified that 
``shell corporations established in the United States have been 
utilized to commit crimes against individuals around the world.'' The 
Manhattan District Attorney's office testified: ``For those of us in 
law enforcement, these issues with shell corporations are not some 
abstract idea. This is what we do and deal with every day. We see these 
shell corporations being used by criminal organizations, and the record 
is replete with examples of their use for money laundering, for their 
use in tax evasion, and for their use in securities fraud.''
  At the second hearing, ``Business Formation and Financial Crime: 
Finding a Legislative Solution,'' held in November 2009, the Justice 
Department again testified about criminals using U.S. shell 
corporations. It noted that ``each of these examples involves the 
relatively rare instance in which law enforcement was able to identify 
the perpetrator misusing U.S. shell corporations. Far too often, we are 
unable to do so.'' The Treasury Department testified that ``the ability 
of illicit actors to form corporations in the United States without 
disclosing their true identity presents a serious vulnerability and 
there is ample evidence that criminal organizations and others who 
threaten our national security exploit this vulnerability.''

[[Page 13025]]

  The 2009 hearings also presented evidence of dozens of Internet 
websites advertising corporate formation services that highlighted the 
ability of corporations to be formed in the United States without 
asking for the identity of the beneficial owners. Those websites 
explicitly pointed to anonymous ownership as a reason to incorporate 
within the United States, and often listed certain States alongside 
notorious offshore jurisdictions as preferred locations in which to 
form new corporations, essentially providing an open invitation for 
wrongdoers to form entities within the United States.
  One website, for example, set up by an international incorporation 
firm, advocated setting up corporations in Delaware by saying: 
``DELAWARE--An Offshore Tax Haven for Non US Residents.'' It cited as 
one of Delaware's advantages that: ``Owners' names are not disclosed to 
the state.'' Another website, from a U.K. firm called 
``formacorporation-offshore.com,'' listed the advantages to 
incorporating in Nevada. Those advantages included: ``Stockholders are 
not on Public Record allowing complete anonymity.''
  During the 2009 hearings, I presented evidence of how one Wyoming 
outfit was selling so-called shelf corporations--corporations formed 
and then left ``on the shelf'' for later sale to purchasers who could 
then pretend the corporations had been in operation for years. A June 
2011 Reuters news article wrote a detailed expose of how that same 
outfit, Wyoming Corporate Services, had formed thousands of U.S. 
corporations all across the country, all with hidden owners. The 
article quoted the website as follows: ``A corporation is a legal 
person created by state statute that can be used as a fall guy, a 
servant, a good friend or a decoy. A person you control . . . yet 
cannot be held accountable for its actions. Imagine the 
possibilities!''
  The article described a small house in Cheyenne, Wyoming, which 
Wyoming Corporate Services used to provide a U.S. address for more than 
2,000 corporations that it had helped to form. The article described 
``the walls of the main room'' as ``covered floor to ceiling with 
numbered mailboxes labeled as corporate suites.'' The article reported 
that among the corporations using the address was a shell corporation 
controlled by a former Ukranian prime minister who had been convicted 
of money laundering and extortion; a corporation indicted for helping 
online-poker operators evade a U.S. ban on Internet gambling; and two 
corporations barred from U.S. federal contracting for selling 
counterfeit truck parts to the Pentagon. The article observed that 
Wyoming Corporate Services continued to sell shelf corporations that 
existed solely on paper but could show a history of regulatory and tax 
filings, despite having had no real U.S. operations. That's the type of 
deceptive conduct going on right now, here in our own backyard, with 
respect to U.S. corporations with hidden owners.
  Despite the evidence of U.S. corporations being misused by organized 
crime, terrorists, tax evaders, and other wrongdoers, and despite years 
of law enforcement complaints, many of our States are reluctant to 
admit there is a problem in establishing U.S. corporations and LLCs 
with hidden owners. Too many of our States are eager to explain how 
quick and easy it is to set up corporations within their borders, 
without acknowledging that those same quick and easy procedures enable 
wrongdoers to utilize U.S. corporations in a variety of crimes and tax 
dodges both here and abroad.
  Beginning in 2006, the Subcommittee worked with the States to 
encourage them to recognize the law enforcement and national security 
problem they'd created and to come up with their own solution. After 
the Subcommittee's 2006 hearing on this issue, for example, the 
National Association of Secretaries of State or NASS convened a 2007 
task force to examine state incorporation practices. At the request of 
NASS and several States, I delayed introducing legislation while they 
worked on a proposal to require the collection of beneficial ownership 
information. My Subcommittee staff participated in multiple 
conferences, telephone calls, and meetings on the issue.
  In July 2007, the NASS task force issued a proposal. Rather than cure 
the problem, however, the proposal had multiple serious deficiencies, 
leading the Treasury Department to state in a letter that the NASS 
proposal ``falls short'' and ``does not fully address the problem of 
legal entities masking the identity of criminals.''
  Among other shortcomings, the NASS proposal would not require States 
to obtain the names of the natural individuals who would be the 
beneficial owners of a U.S. corporation or LLC. Instead, it would allow 
States to obtain a list of a corporation's ``owners of record'' who can 
be, and often are, offshore corporations or trusts with their own 
hidden owners. The NASS proposal also did not require the States to 
maintain the beneficial ownership information, or to supply it to law 
enforcement upon receipt of a subpoena or summons. Instead, law 
enforcement would have to get the information from the suspect 
corporation or one of its agents, thereby tipping off the corporation 
to the investigation. The proposal also failed to require the 
beneficial ownership information to be updated over time. These and 
other flaws in the proposal were identified by the Treasury Department, 
the Department of Justice, and others, but NASS continued on the same 
course.
  NASS enlisted the help of the National Conference of Commissioners on 
Uniform State Laws or NCCUSL, which produced a proposed model law for 
States that wanted to adopt the NASS approach. NCCUSL presented its 
proposal at the Homeland Security and Governmental Affairs Committee's 
June 2009 hearing, where it was subjected to significant criticism. The 
Manhattan District Attorney's office, for example, testified: ``I say 
without hesitation or reservation--that from a law enforcement 
perspective, the bill proposed by NCCUSL would be worse than no bill at 
all. And there are two very basic reasons for this. It eliminates the 
ability of law enforcement to get corporate information without 
alerting the target of the investigation that the investigation is 
ongoing. That is the primary reason. It also sets up a system that is 
time-consuming and complicated.''
  The Department of Justice testified: ``Senator, I would submit to you 
that in a criminal organization everyone knows who is in control and 
this will not be an issue of determining who is in control. What we are 
concerned about here from the law enforcement perspective are the 
criminals and the criminal organizations and so what we are asking is 
that when criminals use shell companies, they provide the name of the 
beneficial owner. That is the person who is in control, the criminal in 
control, as opposed to the NCCUSL proposal where they are suggesting 
that instead two nominees are provided--two nominees between law 
enforcement and the criminal in control.''
  Despite these criticisms, NCCUSL finalized its model law in July 
2009, issuing it under the title, ``Uniform Law Enforcement Access to 
Entity Information Act.'' At the November 2009 hearing, law enforcement 
again criticized the NCCUSL model for failing to provide the names of 
the true owners of the corporations being formed. The Justice 
Department testified: ``To allow companies to provide anything less 
than the beneficial owner information merely provides criminals with an 
opportunity to evade responsibility and put nominees between themselves 
and the true perpetrator.'' With regard to NCCUSL's proposal, Treasury 
testified: ``[T]here is not an obligation for that live person to not 
be a nominee. And what I think is important in the legislation is that 
we get at the true beneficial owner and not someone who may be a 
nominee.''
  In addition to its flaws, the NCCUSL model law has proven unpopular 
with the States for whom it was written. Despite the effort and fanfare 
attached to the uniform model, after four years of sitting on the 
books, not a single State has adopted it or given any indication of 
doing so.
  It is deeply disappointing that the States, despite the passage of 
many years, have been unable to devise an effective proposal to stop 
the formation

[[Page 13026]]

of corporations with hidden owners. One key difficulty is that the 
States are competing against each other to attract persons who want to 
set up U.S. corporations. That competition creates pressure for each 
individual State to favor procedures that allow quick and easy 
incorporations, with no questions asked. It's a classic case of 
competition causing a race to the bottom, making it difficult for any 
one State to do the right thing and ask for the identity of the persons 
behind the corporations being formed.
  That is why Federal legislation in this area is critical. Federal 
legislation is needed to level the playing field among the States, set 
minimum standards for obtaining beneficial ownership information, put 
an end to the practice of States forming millions of legal entities 
each year without knowing who is behind them, and bring the United 
States into compliance with its international commitments.
  The bill's provisions would require the States to ask incorporation 
applicants for a list of the beneficial owners of each corporation or 
LLC formed under their laws, to maintain this information for a period 
of years after a corporation is terminated, and to provide the 
information to law enforcement upon receipt of a subpoena or summons. 
The bill would also require corporations and LLCs to update their 
beneficial ownership information on a regular basis. The ownership 
information would be kept by the State or, if a State maintains a 
formation agent licensing system and delegates this task, by a State's 
licensed formation agents.
  The particular information that would have to be provided for each 
beneficial owner is the owner's name, address, and a unique identifying 
number from a State driver's license or a U.S. passport. The bill would 
not require States to verify this information, but penalties would 
apply to persons who submit false information.
  In the case of U.S. corporations formed by individuals who do not 
possess a driver's license or passport from the United States, the bill 
would permit them to submit their names, addresses, and identifying 
information from a non-U.S. passport to a formation agent residing 
within the State. They would have to include a copy of a passport 
photograph. The incorporation application would have to include a 
written certification that the formation agent had obtained the 
information and verified the identity of the non-U.S. corporate owners. 
The formation agent would have to retain the information in the State 
for a specified period of time and produce it upon receipt of a 
subpoena or summons from law enforcement.
  To ensure that its provisions are tightly targeted, the bill would 
exempt a wide range of corporations from the disclosure obligation. It 
would exempt, for example, virtually all highly regulated corporations, 
because we already know who owns them. That includes all publicly-
traded corporations, banks, broker-dealers, commodity brokers, 
registered investment funds, registered accounting firms, insurers, and 
utilities. The bill would also exempt corporations with a substantial 
U.S. presence, including at least 20 employees physically located in 
the United States, since those individuals could provide law 
enforcement with the leads needed to trace a corporation's true owners. 
In addition, the bill would exempt businesses set up by governments, 
churches, charities, and nonprofit corporations, since disclosure of 
their beneficial ownership information would not advance the public 
interest or assist law enforcement. These exemptions dramatically 
reduce the number of corporations who would actually have to file 
beneficial ownership information on state incorporation forms in order 
to ensure that the bill's disclosure obligations focus only on owners 
whose identities are currently hidden.
  The bill does not take a position on the issue of whether the States 
should make beneficial ownership information available to the public. 
Instead, the bill leaves it entirely up to the States to decide 
whether, under what circumstances, and to what extent to make 
beneficial ownership information available to the public. The bill 
explicitly permits the States to place restrictions on providing 
beneficial ownership information to persons other than government 
officials. The bill focuses instead on ensuring that law enforcement 
with a subpoena or summons is given ready access to the beneficial 
ownership information.
  Relative to the costs of compliance, the bill provides States with 
access to two separate funding sources, neither of which involves 
appropriated funds. For the first three years after the bill's 
enactment, the bill requires both the Justice and Treasury Departments 
to make funds available from their individual forfeiture programs to 
States incurring reasonable expenses to comply with the Act. These 
forfeiture funds do not contain taxpayer dollars; instead they contain 
the proceeds of forfeiture actions taken against persons involved in 
money laundering, drug trafficking, or other wrongdoing. The bill would 
direct a total of $40 million over 3 years to be provided to the States 
from the two funds to carry out the Act. These provisions would ensure 
that States have adequate funds for the modest compliance costs 
involved with adding a new question to their incorporation forms 
requesting the names of the covered corporations' beneficial owners.
  The compliance costs would be modest, because the bill does not 
require any State to change its laws, set up new forms, create new 
databases of information, or verify the information provided. To the 
contrary, the only steps that a State would need to take would be to 
add one question to its existing incorporation form asking for the 
corporation's beneficial owners, keep that incorporation application on 
file which all States do already, and make the ownership information 
available to law enforcement upon receipt of a subpoena or summons.
  It is common for bills establishing minimum Federal standards to seek 
to ensure State action by making some Federal funding dependent upon a 
State's meeting the specified standards. Our bill, however, states 
explicitly that nothing in its provisions authorizes the withholding of 
federal funds from a State for failing to modify its incorporation 
practices to meet the beneficial ownership information requirements of 
the act. Instead, the bill calls for a GAO report within 5 years of 
enactment to identify any States that had failed to strengthen their 
incorporation practices as required by the act. After getting this 
status report, a future Congress can decide what steps to take in the 
event there are any noncompliant States.
  The bill also contains a provision that would require corporations 
bidding on federal contracts to provide the same beneficial ownership 
information to the federal government as provided to the relevant 
State. The Subcommittee has become aware of instances in which the 
federal government has found itself doing business with U.S. 
corporations whose owners are hidden, including owners under 
investigation for suspect conduct. It is important that when the 
federal government contracts to do business with someone, it knows who 
it is dealing with.
  Finally, the bill would require the Treasury Department to issue a 
rule requiring U.S. formation agents to establish anti-money laundering 
programs to ensure they are not forming U.S. corporations or LLCs for 
wrongdoers. The bill requires the programs to be risk based so that 
formation agents can target their preventative efforts toward persons 
who pose a high risk of being involved with wrongdoing. GAO would also 
be asked to conduct a study of existing State formation procedures for 
partnerships, trusts, and charitable organizations to see if additional 
ownership disclosure requirements are warranted.
  We have worked with the Departments of Justice, Treasury, and 
Homeland Security to craft a bill that would address, in a fair and 
reasonable way, the significant law enforcement problems created by 
States allowing the formation of millions of U.S. corporations and LLCs 
with hidden owners. When those corporations commit crimes, they affect 
not only interstate commerce with U.S. victims, but also

[[Page 13027]]

our relationships with other countries whose citizens may become 
victims of U.S. corporate wrongdoing. What the bill comes down to is a 
simple requirement that States strengthen their incorporation 
applications to add a single question requesting identifying 
information for the true owners of the corporations they form. That is 
not too much to ask to protect this country and the international 
community from wrongdoers misusing U.S. corporations.
  For those who say that, if the United States tightens its 
incorporation rules, new corporations will be formed elsewhere, it is 
appropriate to ask exactly where they will go. A recent report found 
that virtually every other country is already tougher than the United 
States in terms of demanding and verifying beneficial ownership 
information. Most offshore tax havens, for example, already require 
this information to be collected, including the Bahamas, Cayman 
Islands, and the Channel Islands. Countries around the world already 
request beneficial ownership information, in part because of their 
commitment to FATF's international anti-money laundering standards. Our 
50 States should be meeting the same standards, but there is no 
indication that they will, unless required to do so.
  I wish Federal legislation weren't necessary. I wish the States could 
solve this law enforcement problem on their own, but ongoing 
competitive pressures make it unlikely that the States will do the 
right thing. It's been nearly seven years since our 2006 hearing on 
this issue and more than four years since the States came up with a 
model law on the subject, with no progress to speak of, despite 
repeated pleas from law enforcement.
  Federal legislation is necessary to reduce the vulnerability of the 
United States to wrongdoing by U.S. corporations with hidden owners, to 
protect interstate and international commerce from criminals misusing 
U.S. corporations, to strengthen the ability of law enforcement to 
investigate suspect U.S. corporations, to level the playing field among 
the States, and to bring the United States into compliance with its 
international anti-money laundering obligations.
  There is also an issue of consistency. For years, I have been 
fighting offshore corporate secrecy laws and practices that enable 
wrongdoers to secretly control offshore corporations involved in money 
laundering, tax evasion, and other misconduct. I have pointed out on 
more than one occasion that corporations were not created to hide 
ownership, but to protect owners from personal liability for corporate 
acts. Unfortunately, today, the corporate form has too often been 
corrupted into serving those who wish to conceal their identities. It 
is past time to stop this misuse of the corporate form. But if we want 
to stop inappropriate corporate secrecy offshore, we need to stop it 
here at home as well.
  For these reasons, I urge my colleagues to join us in supporting this 
legislation and putting an end to incorporation practices that promote 
corporate secrecy and render the United States and other countries 
vulnerable to abuse by U.S. corporations with hidden owners.
  Mr. President, I ask unanimous consent that a summary of the bill be 
printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:


 SUMMARY OF INCORPORATION TRANSPARENCY AND LAW ENFORCEMENT ASSISTANCE 
                                  ACT

       To protect the United States from U.S. corporations being 
     misused to support terrorism, money laundering, tax evasion, 
     and other misconduct, the Levin-Grassley-Feinstein-Harkin 
     Incorporation Transparency and Law Enforcement Assistance Act 
     would:
       Beneficial Ownership Information. Require the States 
     directly or through licensed formation agents to obtain the 
     names of beneficial owners of the corporations or limited 
     liability companies (LLCs) formed under State law, ensure 
     this information is updated, and provide the information to 
     law enforcement upon receipt of a subpoena or summons.
       Shelf Corporations. Require formation agents who sell 
     ``shelf corporations''--corporations formed for later sale to 
     third parties--to identify the beneficial owners who buy 
     them.
       Federal Contractors. Require corporations or LLCs bidding 
     on federal contracts to provide beneficial ownership 
     information to the federal government.
       Identifying Information. Require the provision of 
     beneficial owners' names, addresses, and a U.S. drivers 
     license or passport number, or information from a non-U.S. 
     passport.
       Penalties for False Information. Establish penalties for 
     persons who knowingly provide false information, or willfully 
     fail to provide required information, on beneficial 
     ownership.
       Exemptions. Exempt from the disclosure obligation regulated 
     corporations, including publicly traded companies, banks, 
     broker-dealers, insurers, and accounting firms; corporations 
     with a substantial U.S. presence; and corporations whose 
     beneficial ownership information would not benefit the public 
     interest or assist law enforcement.
       Funding. Provide $40 million over three years to States 
     from existing Justice and Treasury Department forfeiture 
     funds to pay for the costs of complying with the Act.
       State Compliance Report. Specify that funds may not be 
     withheld from any State for failure to comply with the Act, 
     but also require a GAO report in five years identifying any 
     States not in compliance so a future Congress can determine 
     if additional steps are needed.
       Transition Period. Give the States two years to begin 
     requiring existing corporations and LLCs to provide 
     beneficial ownership information.
       Anti-Money Laundering Safeguards. Require paid formation 
     agents to establish anti-money laundering programs to guard 
     against supplying U.S. corporations or LLCs to wrongdoers. 
     Attorneys using paid formation agents would be exempt from 
     this requirement.
       GAO Study. Require GAO to complete a study of existing 
     beneficial ownership information requirements for 
     partnerships, charities, and trusts.
                                 ______
                                 
      By Mr. KAINE (for himself and Mr. Warner):
  S. 1470. A bill to amend the Federal Water Pollution Control Act with 
respect to the guidelines for specification of certain disposal sites 
for dredged or fill material; to the Committee on Environment and 
Public Works.
  Mr. KAINE. Mr. President, today, my colleague Senator Mark Warner and 
I are introducing the Commonsense Permitting for Job Creation Act of 
2013, a bipartisan, bicameral piece of legislation to address an aspect 
of water permitting law that has touched several economic development 
projects.
  In my home State of Virginia, there is a county that has been working 
on securing a permit for the proposed site of a business center, where 
one or multiple firms could establish job-creating manufacturing 
plants. This area--Henry County, on the North Carolina border, has seen 
profound economic challenges in recent years. The county's 5-year 
average unemployment rate is 11 percent. In the county's largest city, 
Martinsville, the 5-year average unemployment rate is over 17 percent. 
This part of Virginia would benefit greatly from the jobs this site 
could bring.
  Henry County has worked with the U.S. Army Corps of Engineers on site 
preparation. However, the Corps has been reluctant to issue the permit 
because no company has yet committed to the site and prepared detailed 
blueprints. The problem is that a company will not relocate to the site 
without an approved permit, but a permit cannot be approved without a 
company willing to relocate.
  Henry County, the Martinsville-Henry Co. Economic Development Corp., 
and the Commonwealth of Virginia have together devoted more than $16 
million to this project. They have worked in good faith, at great cost 
in money and personnel hours, to promote economic development in line 
with environmental protection and all requirements of the law. Yet due 
to this regulatory ambiguity, this process is unable to move forward.
  Our legislation clarifies that ambiguity. It specifies that the lack 
of a committed end-user shall not be a reason to deny a Corps permit 
that meets all other legal requirements. I believe this bill will allow 
the site in Henry County, and similar sites elsewhere, to move forward, 
while maintaining all environmental protections.
  Senator Warner and I have introduced this legislation in partnership 
with our friends and Virginia colleagues in the House, U.S. 
Representatives Robert Hurt and Morgan Griffith. We believe this will 
expedite the approval of important economic development projects, and 
we are proud to

[[Page 13028]]

be able to work across the aisle and with state and local officials on 
this commonsense, bipartisan solution.
                                 ______
                                 
      By Mr. REED (for himself and Mr. Blumenthal):
  S. 1476. A bill to amend the Internal Revenue Code of 1986 to expand 
the denial of deduction for certain excessive employee remuneration, 
and for other purposes; to the Committee on Finance.
  Mr. REED. Mr. President, today I am introducing, along with Senator 
Blumenthal, the Stop Subsidizing Multimillion Dollar Corporate Bonuses 
Act. This bill closes a loophole that allows publicly traded 
corporations to deduct an executive's pay over $1 million from their 
tax bill.
  Under current tax law, when a public corporation calculates its 
taxable income, generally it is permitted to deduct the cost of 
compensation from its revenues, with limits up to $1 million for some 
of the firm's most senior executives. However, a loophole has allowed 
many public corporations to avoid such limits and freely deduct 
excessive executive compensation. For example, because of this 
loophole, if a CEO receives $15 million in compensation in a given 
year, that amount can cause the corporation's taxable income to decline 
by $15 million. With the current corporate tax rate at 35 percent, the 
corporation in this case would pay less tax to the U.S. Treasury, up to 
35 percent of $15 million, leaving the corporation's shareholders to 
bear only $9.75 million of the $15 million cost of executive pay, while 
U.S. taxpayers foot the remaining $5.25 million.
  The Stop Subsidizing Multimillion Dollar Corporate Bonuses Act would 
allow a public corporation to deduct compensation up to only $1 
million. Using the same example, this would mean that corporate 
shareholders would bear $14.65 million of the $15 million in 
compensation.
  Over a ten-year window, the Joint Committee on Taxation has estimated 
this legislation would close a loophole that costs U.S. taxpayers over 
$50 billion by making some simple changes to existing law.
  First, our legislation extends section 162(m) of the tax code to all 
employees of publicly traded corporations so that all compensation is 
subject to a deductibility cap of $1 million. Publicly traded 
corporations would still be permitted to pay their executives as much 
as they want, but compensation above and beyond $1 million would no 
longer be bankrolled, in part, through our tax code.
  Second, our bill removes the exemption for performance-based 
compensation, which currently permits compensation deductions above and 
beyond $1 million when executives have met performance benchmarks set 
by the corporation's Board of Directors. As a result, publicly traded 
corporations would still be able to incentivize their executives, but 
all such incentives would be subject to a corporate deductibility cap 
of $1 million.
  Finally, our legislation makes a technical correction to ensure that 
all publicly traded corporations that are required to provide quarterly 
and annual reports to their investors under Securities and Exchange 
Commission rules and regulations are subject to section 162(m). 
Currently, this section of the tax code only covers some publicly 
traded corporations who are required to provide these periodic reports 
to their shareholders. Discouraging unrestrained compensation packages 
shouldn't hinge on whether a publicly traded corporation falls into one 
SEC reporting requirement or another, and my bill closes this technical 
loophole.
  With this legislation, we aim to put an end to some of the 
extravagant tax breaks that exclusively benefit public corporations. 
This is simply a matter of fairness at a time of fiscal belt 
tightening, when so many of our constituents have already sacrificed.
  I want to thank Senator Blumenthal and his staff for working with me 
on this issue, and I urge our colleagues to join us by cosponsoring 
this legislation.

                          ____________________